How Progressive Is Social Security and Why?

Brief

How Progressive Is Social Security and Why?

Social Security was designed to redistribute income from those with higher lifetime earnings to those with lower lifetime earnings. The reason is obvious: the system was created to ensure an adequate retirement income for the elderly. Less obvious is how Social Security's many provisions interact to achieve redistribution. This Straight Talk summarizes the most comprehensive study of those interactions to date, concluding that less-educated, lower-income, and nonwhite groups benefit little or not at all from redistribution in the old age and survivors insurance (OASI) part of Social Security. However, there is substantial redistribution to women, who historically have had lower lifetime earnings than men.

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