SSP No. 33 February 24, 2004

Social Security

Social Security Choices for the 21st-Century Woman

by Leanne Abdnor

Leanne Abdnor, former vice president for external affairs at the Cato Institute, is president of For Our Grandchildren, a grassroots advocacy organization that supports Social Security reform. She was a member of the President's Commission to Strengthen Social Security.


Executive Summary

Since 1935 millions of elderly Americans have relied on Social Security for their retirement income. However, the program is now both structurally and financially unable to meet the needs of today's workers, especially women.

Although there has been much public attention paid to Social Security's looming financial crisis, even more important to women may be the clash between the current benefit structure and the socioeconomic changes that have occurred since 1935, such as the great increase in the number of women in the workforce, women marrying later or not at all, and the doubling of the divorce rate. By failing to keep pace with the changing nature of American families, Social Security's outdated benefit structure results in single women and dual-earner couples subsidizing the benefits of wealthier single- earner couples, which creates a sharply regressive element to the current benefit structure.

Social Security reform not only must restore the system to solvency, it should also address the program's other inequities that disadvantage women. The best way to do this would be to allow younger workers, including younger women, to privately invest at least a portion of their Social Security taxes through individual accounts. Not only would individual accounts help to solve Social Security's financial problems by taking advantage of the higher returns available to private capital investment, they would give women greater ownership and control of their retirement income and create a benefit structure far more in tune with the needs of the modern family.

Everyone who truly favors giving women more choices and control over their own lives should champion such a reform.

Full Text of SSP No. 33 (PDF, 16 pgs, 148 Kb)

2004 The Cato Institute
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