U.S. Pension Reform: Lessons From Other Countries

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U.S. Pension Reform: Lessons From Other Countries
By Martin N. Baily and Jacob Funk Kirkegaard
Peterson Institute for International Economics, 2009
384 pp. $26.95
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The debate over medical care in the United States has crowded out the debate over Social Security, but the future fiscal viability of the latter has yet to be solved. With increasing longevity everywhere, often accompanied by low birthrates, the viability of public pension systems is a serious concern in all rich countries. This book compares the U.S. system to others (it fares rather well) and explores whether reforms in other countries are applicable to the United States. The authors conclude, partly on the basis of international experience, that the U.S. system can be made fiscally viable by gradually increasing the age of eligibility for retirement (including early retirement), by increasing payments into Social Security by the wealthy, and, as necessary, by increasing taxes. They also support a voluntary, government-sponsored, and privately managed retirement-savings program for low- and middle-income families -- as an addition to, not a substitute for, Social Security.