BlackRock CEO says Social Security's retirement age 'a bit crazy' as crisis looms

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Sen. Bill Cassidy, R-La., discusses the Republicans plan to save social security and reacts to Bernie Sanderss 32-hour workweek idea on Varney & Co.

BlackRock CEO Larry Fink sent his annual letter to investors on Tuesday in which he cited the «immense strain» on Social Security amid the aging of the U.S. population and the need to reform the retirement system given its looming insolvency.

Fink explained the economics behind Social Security, which collects taxes from people who are working to pay those in retirement who are receiving benefits: «During your working years, the government takes a portion of your income, then after you retire, it sends you a check every month. The idea actually originates from pre-World War I Germany, and these 'old-age insurance' programs gradually became more popular over the 20th Century largely because the demographics made sense.»

«Think about someone who was 65 years old in 1952, the year I was born. If he hadn't retired already, that person was probably getting ready to stop working. But now think about that person's former colleagues, all the people around his age who he'd entered the workforce with back in the 1910s. The data shows that in 1952, most of those people were not preparing for retirement because they'd already passed away,» Fink wrote.

SOCIAL SECURITY TRUST FUND ON PATH TO INSOLVENCY

BlackRock CEO Larry Fink said Social Security's retirement age looks «a bit crazy» as the program faces insolvency and benefit cuts a decade from now. (Victor J. Blue/Bloomberg via Getty Images / Getty Images)

Data from the Social Security Administration (SSA) shows that the ratio of covered workers paying taxes to the number of beneficiaries was 8.6 workers to beneficiaries as of 1955.