support, and it was unanimously rejected by the Re-
publican-controlled Senate.
After this defeat, Reagan sought political cover,
delegating the problem to a bipartisan commission
that was to propose changes that the president could
reject if he deemed them too controversial. Headed
by economist Alan Greenspan, who would later be-
come chairman of the Federal Reserve, the Social
Security Commission faced the problem of increas-
ing benefits paid out to retirees and decreasing
revenues from workers’ taxes. Composed of labor,
business, and political leaders, the commission con-
sidered many solutions, all with potentially disas-
trous consequences for any politician who proposed
them.
After several months of debate and hearings, the
commission offered a plan and several suggestions
for stabilizing Social Security. The first was to raise
revenue by increasing the Social Security taxes paid
by workers and businesses. The commission also
proposed adding federal and state employees to the
Social Security system, which would raise the num-
ber of workers paying into the system but also the
number of potential retirees who could draw bene-
fits in the future. A more controversial possibility,
raising the retirement age to sixty-seven, was offered
as a suggestion rather than a proposal, as members
of the commission could not agree to it.
The commission’s work, though, would be wasted
if Congress did not pass their recommendations.
Inclusion of political leaders, including the self-
proclaimed defender of Social Security, Florida rep-
resentative Claude Pepper, eased the political pro-
cess. Social Security reform bills following some of
the commission’s proposals and suggestions began
to be introduced in Congress. The first bill sought to
raise Social Security taxes: It passed easily, as House
members realized the boon to the federal purse cre-
ated by a tax increase.
The second major proposal came from the com-
mission’s suggestion to raise the retirement age. The
bill, offered by Texas congressman J. J. Pickle, pro-
posed gradually raising the retirement age to sixty-
seven. Starting in the year 2000 with gradual in-
creases until the year 2020, retirees would have to
work longer before receiving full retirement bene-
fits. Moving the retirement age from sixty-five to
sixty-seven in this fashion proved politically palat-
able, as it would affect only future workers, includ-
ing many who were not yet of voting age, while not
affecting those currently approaching or already
having reached retirement. Constituents between
the ages of sixty and sixty-seven might otherwise
have fought aggressively against the change. Pickle’s
proposal passed narrowly.
The rise in the retirement age had little immedi-
ate impact on the solvency of Social Security, but it
was intended to stabilize the system in the future, as
more money poured into the system while the num-
ber of retirees was reduced. The full reform bill eas-
ily passed the Senate and was signed by the president
on April 20, 1983. The involvement of Republicans
and Democrats, labor and business, had allowed the
reforms to be passed with a minimum of partisan
rancor.
Impact The Social Security Commission and the
legislation it spawned solved the immediate prob-
lem of the program heading toward bankruptcy, but
it did not solve the longer-term problems of the pro-
gram, including an aging population, longer life ex-
pectancy for retirees, and the baby-boom genera-
tion, whose size would entail significant drains upon
the program’s coffers when baby boomers began to
retire in 2013. The decision to raise both taxes and
the retirement age may have only pushed the harder
decisions into the future, though Congress and the
president demonstrated that changes in Social Secu-
rity could be achieved using a bipartisan approach.
Further Reading
Beland, Daniel.Social Security. Lawrence: University
of Kansas Press, 2005. Fast-paced book that de-
scribes how Social Security evolved from a limited
old-age program to a larger social welfare pro-
gram, as well as summarizing attempts to reform it.
Berkowitz, Edward.Robert Ball and the Politics of Social
Security. Madison: University of Wisconsin Press,- Describes the life and efforts of the head of
the Social Security Administration during the
1960’s and early 1970’s.
Koitz, David.Seeking Middle Ground on Social Security
Reform. Stanford, Calif.: Hoover Press, 2001. Ana-
lyzes the various approaches to changing the So-
cial Security system in order to solve the financial
and other problems with the system.
Douglas Clouatre
See also Business and the economy in the United
States; Conservatism in U.S. politics; Congress, U.S.;
Demographics of the United States; Elections in890 Social Security reform The Eighties in America