Retirement's Unraveling Safety Net

Initially, Paugh paid $19 a month -- including water and electricity -- for the house where he still lives at 108 Glider Dr. in Aero Acres, a subdivision built on a former strawberry field. Martin named every street for an airplane part (Left Wing and Right Wing drives had no larger connotation), and everyone lived in an identical 24-by-48-foot bungalow with a hallway, two bedrooms, a bathroom and a spacious living room.

Paugh went off to war in 1943, returning with a Purple Heart for shrapnel wounds in the Battle of Okinawa. He remained faithful to Martin, spurning other offers, including one from the Baltimore Orioles in the 1950s. A lanky lefty, Paugh was a star pitcher for the Martin Bombers, the company's standout industrial league team, but professional baseball had nothing on a factory job in his day. "No security," he explained.

Pitching for the Bombers was its own form of security. Martin was famously fanatical about baseball -- he built a verdant field on Eastern Avenue and Wilson Point Road, watching Bombers practices from the wing of a strategically parked airplane. When layoffs began after the Korean War, the Bombers' entire roster was exempt.

In return for this security, Paugh traded away some flexibility. In his days as a "CCC Boy," as he still calls himself, he got $5 of his $30-a-month salary, and the CCC sent the rest home for his parents and 12 siblings.

And he would have received only a small fraction of his $920 monthly pension had he not spent his entire career, 41 years, with one employer -- an arrangement dubbed the "invisible handshake." The pension is 40 percent of his retirement income; Social Security pays him $1,373.

Nor would Paugh have retired with lifetime health insurance, under which he pays only $2 for prescription drugs. Because of rising health care costs, retirement experts say, employers now pay as much or more for retiree health insurance -- which supplements Medicare -- as for pensions.

Another important feature of Junior Paugh's retirement security is his thrift, which was bred into him. "We saved and saved and saved," he said of himself and his wife, who died 10 years ago. Paugh is what his family calls "tight," and proud of it. He does not turn on lights until the afternoon sun all but disappears. "Hey, I'm paying for that," he cracked one day when son Doug stopped by after work and flipped on the living room light. He'd rather sweat than use air conditioning, turning it on only when his children and grandchildren visit. ("It was 110 degrees in the South Pacific and we still won the war," he said.)

In Paugh's day, only the wealthy invested in the stock market; Paugh put his trust in Uncle Sam through the "bond a week" savings plan. He also opened an individual retirement account in the early 1980s, with bank interest rates at 15 percent. Last year, the rate fell below 1 percent. His disappointment with IRAs makes him dubious of young people's faith in the stock market -- what goes up, he warns, can come down.

At a recent monthly meeting of the Retirees Association of Martin Marietta, Paugh sat with seven former co-workers whose life experiences were almost identical to his: All 80 or older, all sitting pretty on three-legged retirement stools, and all worried about how their children and grandchildren will get by in old age.

"They spend their money before they make it," Ed Dorsey, 82, said of his children. "I say, 'What do you have for retirement?' They say it's a long way away. But they're all in their fifties!"

All said they regard Social Security as indispensable, and all said they know it cannot sustain their descendants in its current form.

"We're the generation that beat the system," said Elmer Sanders, 83. "Social Security didn't count on us living this long. I tell my wife if I have a stroke, and they put me on life supports, just don't unplug me. If I'm still breathing, the checks keep coming."