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February 28, 2024 at 02:47 PM
What You Need to Know
- The influential economist, who has proposed replacing the 401(k) system, argued at a conference that the U.S. needs a Gray New Deal.
- The idea that working a few years longer can boost retirement security is largely a myth, she says.
- Poverty is higher in the U.S. and there is more stigma around leaving work than in other G7 countries, she says.
Teresa Ghilarducci, the influential economics professor at the New School for Social Research, painted a grim picture Tuesday of the current state of retirement in the United States.
“Retirement, American style, is about work,” she said, and “a great deal of poverty.”
Speaking in Washington at a policy conference for the National Institute on Retirement Security, a pro-pension research and advocacy group, Ghilarducci laid out what she called untruths about retirement, many of which are chronicled in her new book, “Work, Retire, Repeat: The Uncertainty of Retirement in the New Economy.”
Unlike other G7 countries, retirement in America is about work, Ghilarducci said.
“There are even people who say they are retired but they show up in the data sets as actually working 15 to 20 hours per week,” she relayed. “In America, if you say you’re retired, you kind of have to pivot and apologize — ‘It doesn’t mean I’m not doing anything.’”
Or, “if you’re planning your retirement, you have to actually demur and talk about how you are needed elsewhere — maybe you’ll do volunteer work,” Ghilarducci said. “You have to create a vision of yourself as a productive member of society because retirement in America is a very complex state.”
In other places, however, “it’s not — it’s dignified, secure, it’s not a shameful activity,” Ghilarducci maintained.
Further, retirement is also “not affordable” in the United States.
“Earnings of those 65 and older is quite high among Americans,” which is “just not a reality in other countries,” Ghilarducci said.
Busting Myths
There is a “working longer attitude” in America, Ghilarducci stated.
The notion is that “the cheap fix to our pension financing problem is just a few more years of work from everybody who is, after all, living longer, and for everybody whose jobs are getting easier because of the wonderful technology — of the computer and decline of physical labor,” Ghilarducci said.
