1. Whether the retirement age has or hasn't kept up with life expectancy is of zero relevance. Social Security was started in the middle of the Great Depression, in an economy that was but a generation removed from the Industrial Revolution. Of course that society couldn't afford to support retirees. We are now much richer.
2. As economists like to say, consumption is about choices. Because we are a rich country, we have the ability to finance a lot of consumption. One form of consumption is leisure time. Silly people like Zen think that the economy is solely about the accumulation of material wealth. It is not. A free society can choose non-work if it wants. People in European countries have more vacation time, generally speaking, than Americans -- and their governments allow it (this is why, by the way, cross-country GDP comparisons are faulty without adjustments). In Mexico, the workday is interrupted by a siesta, or at least it was 20 years ago when I did a lot of work with Mexico.
So the US can choose non-work in retirement, if it wants. We absolutely can afford it and it's not even close. Of course, doing so would require us to, you know, make sure the rich pay their taxes. You know, not electing corruptocrats like Trump who are trying to shut down tax collections on the very rich to the maximum extent possible.
There is no reason as a society we should have to raise the retirement age. We just have to make choices. Zen, how do you choose? Properly fund the IRS and collect the hundreds of billions of taxes that aren't paid? Or let the rich get away with tax evasion and make ordinary Americans work longer and harder. That is a choice in front of you. How do you choose?
3. Social Security has never been a take-what-you-pay system. Every generation has taken far more than what it paid. That's fine!! Again, that's what a rich country should do! Or can do, if it wants to. Artificial constraints like "we can't use general revenues to fund SS shortfalls," make no sense and serve only to distract people on the bottom line. I guess it also gives cover to the lie that lower-income Americans don't pay any "federal income tax" because SS is classified as something different, even though it is a federal tax on income and functionally indistinct from any other income taxes.
4. Social Security doesn't really cost anything. Generally, it finances expenses that would be paid by retirees' children if SS didn't exist. So it's more of a bookkeeping issue than most people think. It's simply a question of which bucket of capital to use to finance those expenses. This makes SS different than Medicare, which absolutely does induce the consumption of real resources because it pays for medical care.
I don't want to exaggerate this point. SS probably induces *some* consumption. There are old people, perhaps, who are able to throw a party for their grandkids' graduations who wouldn't be able to but for that income. That's a real economic cost. There are SS recipients who might trade in an old car for a new one a little more quickly than without SS. That's a real economic cost. For the most part, though, SS does not finance lavish consumption. Generally speaking, it simply reduces the financial liabilities of children for their parents, which seems like a good use of money.
