January 19, 2013
Two weeks ago the NYT ran a lengthy column by two social scientists, Gary King and Samir Soneji, under the headline “Social Security: It’s Worse Than You Think.” The column warned that the Social Security shortfall will actually be larger than currently projected because life expectancies are increasing more rapidly than the trustees had assumed. I had criticized the piece at the time because, among other things, it took no account of how its claim on improving health might affect other aspects of the program, such as the possibility that it would reduce disability rates, allow people to work later in their lives (many people retire due to health conditions), and reduce health care costs which could lower the amount of money paid to workers in employer provided health insurance which escapes the Social Security tax.
It turns out that King and Soneji’s case on life expectancy is far less compelling than they claim in their column. The actuaries at the Social Security Administration put out a response this week. They pointed out that the King and Soneji methodology is not anything new to them and note several inaccuracies in their column and the paper on which it is based. So it looks like we may not have to worry after all, we are going to die young.
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