Social Security
Daniel McFadden2000 Nobel Laureate in Economics, E. Morris Cox Professor of Economics, director of the Economics Laboratory and a professor of the Graduate School
Expertise:
Economics and choice theory,
health and welfare economics, economic growth and development,
consumption and savings by the elderly.
Contact:
Office phone: (510) 643-8428
E-mail: mcfadden@econ.berkeley.edu
Additional contacts:
Kathleen Maclay, Media Relations: (510) 643-5651, kmaclay@berkeley.edu
Roxanne Makasdjian, broadcast: (510) 642-6051, roxannem@berkeley.edu
Background:
McFadden is director of UC Berkeley’s Econometrics Laboratory, and his current research focuses on the economic status of the elderly and the adequacy of their housing arrangements, financial planning and the delivery and cost of health services.
His research has had profound effects on public policy issues including alternative modes of transportation, electricity usage, attitudes about clean air initiatives and regulation.
In addition to winning the Nobel Prize, he was awarded the prestigious Nemmers Prize in Economics from Northwestern University in 2000.
McFadden is frequently interviewed in the media and recently participated in a National Public Radio panel discussion about Social Security.
Comments on Social Security:
The Social Security system could be put on sound fiscal footing, McFadden says, through modest increases to the payroll tax rate, tilting benefit payout formulas to encourage later retirement, indexing benefits to life expectancy and/or taxing total income, including Social Security benefits – as outlined in "Saving Social Security: A Balanced Approach," by Peter Diamond and Peter Orszag (Brookings, 2004).
Financing a transition of Social Security now will require substantial new taxes or heavy government spending, McFadden says, and that is something the United States is ill-prepared to do because of budget deficits and "off-book" war financing.
McFadden is concerned about how to prevent a privatized system from being plundered by excessive management fees, and how to protect individual investors from investments that are too risky. He questions whether Congress can stand up to industry lobbyists and political constituencies in order to design a successful, privatized Social Security system.
