The pension debate have to be fact-based. At the moment it shouldn’t be like that.

My friend and occasional sparring partner Teresa Ghilarducci Tweeted published their most up-to-date op-ed with the subtitle: “Andrew Biggs is wrong about America’s retirement crisis.” I assume so long as they spell your name right.

If only it were, for Teresa’s sake and for the sake of the senator her comment defends, Bernie Sanders of Vermont. Because it was an article during which I published The hill He criticized Sanders’ claims that America is facing a “retirement crisis,” which sparked this mini-brouhaha. But I’m pleased that this debate is going down. The more we talk, the more we are going to understand.

In this text, I’ll address a claim that Senator Sanders at all times seems to have on his mind: “Nearly half of Americans ages 55 and older have no retirement savings.” report published by Sanders’ staff states. Teresa’s article quotes Sanders as if repeating it twice makes something right.

Now the veracity of Sanders’ fact doesn’t tell us whether we now have a retirement crisis or not. But the undeniable fact that Sanders’ claim shouldn’t be true, and even remotely true, tells us in regards to the quality of the discussion in regards to the US pension system.

Sanders claims his startling factoid comes from a 2019 Government Accountability Office (GAO) study.

A fast take a look at the GAO report reveals a more comforting story: That report defines “retirement savings” only as balances in 401(k) or IRA accounts. If an individual is eligible for a conventional “defined benefit” (DB) pension, which each Sanders and Ghilarducci consider is a greater strategy to prepare for retirement, it shouldn’t be counted as “savings.” I do know, it’s strange.

But because the GAO recognizes, if you happen to Do If you count pensions as retirement savings, it isn’t nearly half of Americans over 55 who haven’t any savings. It’s only 29%. But that is not all.

Some people save for retirement outside of a retirement account or pension. Think of small business owners or farmers. The Federal Reserve’s Survey of Household Economics and Decision Making (SHED) asks specifically about these less traditional retirement savings.

The Fed asks Americans, “Do you currently have each of the following types of retirement savings?” In addition to retirement accounts and pensions, the SHED asks about “savings outside of a retirement account,” “a business or property that will provide income in retirement,” or ” other retirement savings”.

According to the Fed itselfIn 2022, 88 percent of households aged 60 and over had retirement savings. The reason I describe this in such detail is to indicate how silly Sanders’ claim is and the way strange it’s that individuals would hassle to defend it.

Teresa, for her part, puts forward a straw man: “Biggs insists there is no retirement crisis because, according to his numbers,” excess of Bernie’s claims, 55% of individuals nearing retirement have some type of retirement savings. It is misleading, she says, to cite a straightforward yes/absolute confidence to refute the so-called pension crisis. OK.

But I never said that. Just because Sanders cites false evidence does not imply his conclusion is incorrect. Although it doesn’t help. I actually have found that individuals are inclined to support their arguments with actual somewhat than made-up facts.

The real Reasons I insist there isn’t any retirement crisis that Sanders and Ghilarducci aren’t coping with:

· Retirement provision is dramatically higher than up to now, not only on average, but inside any age, any income, any education, and any racial or ethnic group.

· Access to retirement plans is at a record high: According to the Bureau of Labor Statistics, 70% of personal sector employees had access to a workplace retirement plan in 2023. increased by 57% in 2003

· Pension contributions have skyrocketed because the heyday of traditional pensions. rising from 5.8% of employees’ compensation in 1975 to 9.2% in 2021, in response to the Department of Labor. That’s a relative increase of 58% in what Americans save for retirement.

· The labor force participation rate of 55 to 64 12 months olds is Record highs, in response to the BLS. People say Americans cannot work any longer. Guess what: you already did.

· Today’s Americans are claim According to the Social Security Administration, Social Security got here into effect 1.5 years later than 1990.

· Average Social Security advantages for latest retirees 39% higher in 2022 than in 2000, even after inflation.

· According to the Census Bureau, retirement incomes aren’t just at record highs on average but across the income distribution.

· Old-age poverty, measured using probably the most accurate data available, has declined 9.7 percent in 1990 to simply 6.4% in 2018a discount in the chance of being poor in old age by greater than a 3rd.

· Congressional Budget Office data show that seniors represent a disproportionately high-income group; They are greater than twice as prone to be in the highest fifth of the income distribution as those in the underside fifth.

· The Social Security Administration Projects that future retirees may have “replacement rates” – retirement income expressed as a percentage of their pre-retirement income – which can be very just like those of past and present seniors.

· Senior residents Tell us They’re doing well: In the Fed’s SHED survey in 2022, only 4% of seniors said they “find it difficult to make ends meet”; According to Vanguard, only 4% describe their financial situation as a “retirement crisis.” 77% tell Gallup they find the money for not only to survive, but to “live comfortably.” Are all these people lying?

Teresa seems confused that I do not believe within the pension crisis. But given these facts – and contrary to lots of Senator Sanders’ statements, they are literally verifiable facts – why should I do this?

But all of this doesn’t suggest that you’ve gotten to agree with me. There are many individuals I like and respect who’re more pessimistic than I’m about Americans’ retirement preparedness. This is totally right. And even I do not think the system is ideal. I might do so much to enhance it.

But step one to resolving this debate and improving the U.S. retirement system is for people to stop saying things that are not true.

Click here for Part II, where I discuss how believers within the pension crisis draw those beliefs from bad data. And why they need to know higher.