Letters to
the Editor
flight of the Wright brothers, driving
knowledge of aerodynamics.
The role of scientists in advising both
governmental and nongovernmental
bodies, which involves essentially the
entire community of established scien-
tistas, may be seen as another disinter-
ested service to society. The American
public simply has no idea of the vast ad-
visory network that provides continu-
ous input to the executive and legislative
branches of government and their many
subdivisions, as well as to nongovern-
mental organizations and the private
sector. The National Institutes of Health
(nih) alone has some 270 ‘study sec-
tions’ (panels of scientists), which ad-
vise on applications for research grants,
each meeting two or three times a year
for several days at a time. ‘Congressional
Fellows,’ supported by various scienti½c
societies, provide another channel of sci-
enti½c input to legislators (and now to
most agencies of the executive branch).
Más que 1,600 Science and Technolo-
gy Fellows of the American Association
for the Advancement of Science have
trabajó, since the program was started
en 1973, as ‘special legislative assistants,'
in legislative and policy areas requiring
scienti½c and technical input, sobre el
staff of members of Congress or con-
gressional committees. The program has
been highly commended by senators and
representatives from both Democratic
and Republican sides of the aisle.
One of the most important rewards of
science is the satisfaction of getting an-
swers to dif½cult and potentially impor-
tant problems. The contemporary public
does not understand this and thinks of
high-pro½le awards, such as the Nobel
Prize, mainly in terms of the large sum
of money that changes hands. Yet a re-
cent study, published in Science, presentado
that two-thirds of science and engineer-
ing researchers at universities, ranging
140
Dædalus Spring 2006
from Harvard to Texas A&METRO, evinced lit-
tle interest in patenting their discoveries
(over the period 1983–1999), a pesar de
they might have made a good deal of
money by doing so.
Let me close by noting that research,
En realidad, has an artistic side. Nature is
complex, but the scientist ½nds a piece
of Nature’s jigsaw puzzle–and it has its
own beauty. If he keeps working on the
same problem, he may ½nd additional
pieces, which ½t together to create a
beautiful whole.
Byron H. Waksman, M.D.
Byron H. Waksman, a Fellow of the American
Academy since 1979, is professor emeritus of mi-
crobiology and biology at Yale University and vis-
iting scientist in neurology at Harvard University.
On Social Security & the aging
de América
Febrero 27, 2006
To the Editor:
In “Measuring Social Security’s ½nan-
cial outlook within an aging society”
(Dédalo, Invierno 2006), Jagadeesh Gok-
hale and Kent Smetters set forth a con-
cise and clear account of the standard
½nancial framework for understanding
Social Security’s ½nancial problems that
is generally subscribed to by academic
experts and the Social Security Admin-
istration’s actuaries. Gokhale and Smet-
ters criticize this formulation and offer
a re½nement from which to better as-
sess reform proposals. I contend that the
standard formulation, as well as their re-
½ned version of it, is deeply flawed from
the perspective of social justice. Básico-
ly, this formulation has led to all of the
reform proposals requiring that a large
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fraction of the population forgo, in ½-
nancing their pensions, the very sub-
stantial bene½ts provided by return on
investment on their payroll taxes.
Congreso, in managing Social Securi-
ty, set pension levels for people retiring
in the early years of the program much
higher than their payroll tax payments
would justify. This has evolved into the
present situation in which people retir-
ing during the last few years receive pen-
sions of reasonable size relative to the
money they paid in–in payroll taxes,
and the return on investment of these
payments. Desafortunadamente, the portion
of these pensions that would normally
come from return on investment is com-
ing from the payroll taxes paid by youn-
ger workers. Como resultado, the Social Secu-
rity trust fund, the investment vehicle
for Social Security, is at about $1.7 tril- lion when it should be around $13 tril-
lion to cover future pensions. A pesar de
the details are complex, my contention
is captured in the following two ways of
responding to this state of affairs.
Gokhale and Smetters respond with:
Desafortunadamente, the windfalls awarded to
prior generation of retirees do not come
for free: future generations must pay for
them by receiving lower rates of return
on their payroll taxes compared to the
rates they could have earned if they had
invested their contributions in govern-
ment bonds instead. In fact all future gen-
erations are worse off.
In present reform proposals, “lower
rate of return” turns out to mean neg-
ative rate of return. I have been prepar-
ing a paper entitled “A Strategy for Re-
forming Social Security’s Pension Pro-
gram.” Quoting from this paper:
Step 2: Completely solve the problem for
workers retiring after 2045. The Social
Security Administration should set up a
On Social
Security &
the aging
de América
second Old Age Survivor and Dependents
Insurance (oasdi) program for these
workers keeping present bene½ts levels.
Their payroll taxes are invested in Trea-
sury bonds and their payroll tax rates are
reduced (probably about 25 por ciento) to a
rate making the system ½nancially sound,
eso es, so that at all times the Trust Fund
balance equals a reasonable estimate of
future liabilities. Failure to immediately
put this into effect is obviously inexcus-
capaz. There is no reason these workers should
be called upon to make a greater contribution
to the federal shortfall due to their reduced pay-
roll taxes than the general taxpayer. The addi-
tional money needed to fund bene½ts for
earlier retirees should come from income
and corporate pro½t taxes rather than
from payroll taxes.
Investment in Treasury bonds and cor-
porate stocks and bonds in retirement
programs such as Social Security are all
about the same–none is free lunch. El
community at large pays the return on in-
vestment. The bottom line in any Social
Security reform is how are bene½ts modi-
½ed and what fraction of pensions comes
from payroll taxes and what comes from
the community at large via return on in-
vestment. Once it is agreed that workers
should get a fair shake for their payroll
taxes, reform is easy.
Edgar H. Marrón, Jr.
Edgar H. Marrón, Jr., a Fellow of the American
Academy since 1974, is professor emeritus of
mathematics at Brandeis University.
Febrero 28, 2006
Jagadeesh Gokhale and Kent Smetters
respond:
We appreciate Edgar H. Marrón, Jr.’s
thoughtful response to our paper. Nosotros
Dædalus Spring 2006
141
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Letters to
the Editor
agree that a fully funded Social Security
sistema, where each generation pays for
its own bene½ts, would have more than
$12 trillion in assets. After initially es-
tablishing Social Security as a funded
sistema, sin embargo, Congress chose to
transform it into a mostly pay-as-you-
go system. Como resultado, younger workers
pay for the bene½ts of older retirees in-
stead of saving for themselves. Eso
transformation produced windfalls for
previous generations that cannot be re-
covered since most are no longer alive.
Although we don’t deal with social
justice in our paper, we agree with Mr.
Brown that future generations should
not be asked to shoulder the entire bur-
den of closing Social Security’s total ½-
nancial shortfall–current generations
should contribute as well. But it is in-
escapable that current and future gener-
ations must collectively share the load.
The appropriate distribution of this cost
sharing across generations is a moral
choice that our alternative (o, en efecto,
cualquier) accounting framework cannot de-
cide. But our framework does indicate
the full value of the ½nancial shortfalls
that must be addressed, and it could
be used to show how particular policy
choices would differentially impact cur-
rent and future generations.
142
Dædalus Spring 2006
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