We’ve long emphasized that Social Security benefits are modest, averaging less than $1,300 a month (about $15,000 a year) for retirees and elderly widows. They’re also low in relation to earnings, replacing just 41 percent of the median retiree’s earnings, according to the Organisation for Economic Co-operation and Development’s (OECD) latest biennial update. That puts us in 31st place among the 34 OECD member countries. (See graph.)
That’s nothing new. Although the rankings shift a bit from year to year, the United States has consistently appeared near the bottom by this measure.
Recent austerity measures in other countries still leave their benefits well above U.S. levels, in most cases. Greece and Iceland, for example — which topped the rankings in 2011 and 2009 — have slipped several notches but remain far more generous than the United States.
Social Security already has a number of money-saving features that European nations are emulating, such as an early-retirement age that’s higher than many other countries’ (62), lower benefits for people who take early retirement, a high and rising age for full benefits (66, soon to be 67), and a bonus for people who delay retirement.
U.S. seniors are also much more likely to work than their peers in most other developed countries, as we’ve noted.
The moral? Our seniors already work harder and get lower benefits than their counterparts in most other rich countries. So imposing big benefit cuts on ordinary seniors would be the wrong way to restore solvency to this popular and essential program.