Principally because of increasing life expectancy and the fact that the baby boom generation is reaching retirement age and is followed by a much smaller generation, the American social security system is facing a long-term funding deficit. The Board of Trustees of the Federal Old-Age and Survivors and Disability Trust Funds predicts that unless corrective action is taken, social security benefits will exceed dedicated tax revenues by the year 2016, and the social security system will become insolvent, that is, unable to pay benefits in full, by the year 2038.
The United States is not alone in facing these circumstances. Industrialized countries throughout the world are facing similar challenges and reforming their retirement systems in response to them. The experiences of these foreign countries can provide important guidance for the United States as it considers reform of its social security system. Indeed, the House Ways and Means Committee recently devoted a hearing to “social security reform lessons learned in other countries.” Following that lead, this Article examines recent reforms of the French retirement system to see what lessons can be applied to reform of the American social security system.
The Article begins by giving a broad overview of the French retirement system. It then describes the more significant reforms of the system instituted over the last decade. Finally, it discusses the lessons these reforms offer for reform of the American social security system.