President's Social Security Plan Will Hurt Arizona Families

President's Social Security Plan Will Hurt Arizona Families

Tucson, AZ - In a congressional report requested by Rep. Raúl M. Grijalva, President Bush's Social Security proposal would reduce benefits for all wage earners in Rep. Grijalva's district who are 55 or younger and who make more than $20,000 annually.

There are 150,000 of these affected wage earners in the district.

President Bush has endorsed significant cuts in benefits as part of his Social Security proposal. Under the President's plan, future benefit payments for most wage earners would drop because they would cease to be fully indexed to the wage rate. According to the AARP, the President's plan "amounts to a middle class benefit cut" that "breaks Social Security's promise that the benefit you receive will reflect what you paid into the system."

The nonpartisan Congressional Budget Office (CBO) found that Social Security can pay full benefits until 2052. Beyond 2052, the Social Security program will have exhausted its reserve funds, and the program will be able to pay only what it collects in taxes.

In the report prepared by the House Committee on Government Reform Minority staff, it was found that:

* The President's plan would result in significant benefit cuts for individual wage earners in Rep. Grijalva's district. For wage earners between the ages of 35 and 55, the average benefit cut would be $1,080 per year. For younger wage earners, the average benefit cut would be $2,580 per year. Over 25,000 wage earners in the district would face benefit cuts of over 20%.
* The President's plan would cut total benefits by over $9 billion for current wage earners in Rep. Grijalva's district. Over their lifetimes, wage earners in the district who are currently contributing to Social Security would lose $9.4 billion in benefits under the President's plan. More than 68% of this cut will come from middle-class workers who earn between $30,000 and $90,000 annually.
* The President's plan could also cut benefits for widows and surviving children in Rep. Grijalva's district. The President has not provided details of how survivor benefits would be affected under his Social Security proposal, but the number of survivors who could be affected is large. Currently, over 17,700 surviving spouses and children in Rep. Grijalva's district receive these benefits.

"Workers are the foundation of our country, specifically retirees who have devoted their life to our core principles and values", said Rep. Grijalva. "Most of us have family members that depend on it. It is only right that we ensure they have a dignified retirement, and that current workers know their work will ensue the same result."

http://www.house.gov/grijalva/press/press_releases/pr_070805.html