Reinforcing Retirement: Analyzing Psychological Ownership and Support for Social Security Reform Options

Abstract

Social Security, the cornerstone of retirement for millions of Americans, is facing an impending solvency crisis. Under current estimates, Social Security’s trust fund will be depleted by 2032, leading to an immediate 23% reduction to benefit payments. While policymakers must pass legislation to avoid this scenario, their decision is constrained by both policy and political factors, especially public opinion. In order to craft a durable policy solution, legislators need to know the public’s attitudes toward reform options and, ideally, the factors that influence those attitudes. This thesis uses an original, nationally representative survey to examine Americans' relative support or opposition to various Social Security policy fixes. In addition to describing the various demographic and political correlates of support, this thesis focuses particularly on how aspects of psychological ownership help to explain the variations in support for the policy options. This thesis examines the policy context of Social Security, including the factors contributing to Social Security’s funding problem, policy options to prevent insolvency, and existing public opinion on the issue. Next, it reviews the existing literature on psychological ownership and the application of this concept to Social Security. Then, it reports the survey results, finding broad opposition to policy options that reduce benefits, broad support for options that raise revenues, and a large degree of consensus across demographic groups for both raising or eliminating the payroll tax cap. Regression analyses find that psychological ownership has a statistically significant relationship with support for a few policies, but the size of this relationship is too small to be substantially significant. This thesis concludes with relevant policy recommendations to prevent Social Security’s solvency.