Issue Position: Senior Citizens - Social Security
Social Security is one of our nation's most important programs.
Since its inception in 1935, Social Security has made a tremendous difference in the life of hundreds of millions of people, dramatically reducing poverty among seniors, assisting the disabled, and assuring children who are orphaned of a more secure future. Today some 47 million Americans receive Social Security benefits. It is the primary source of income for approximately two-thirds of its recipients, and the only source of income for about one-fifth of its recipients.
Many things have changed over the years since Social Security was created in 1935. We have made modifications along the way to keep it secure and solvent. We always have looked, and always should look, at long-term strategies to protect the solvency of the Social Security Trust Fund to ensure it will be strong when our children and grandchildren are ready to retire.
Because of actions taken by Congress over 20 years ago, the Social Security Trust Fund will pay full benefits until the 2040s. In fact, according to the Social Security Administration, the Trust Fund will continue to have annual surpluses - more money coming in than going out - through 2018. After that, the large balance built up in the Trust Fund to pay future benefits will kick in, and the Social Security Administration projects that the Trust Fund without any change will pay full benefits at least through 2042.
The Congressional Budget Office, a nonpartisan organization that analyzes budget matters for Congress, estimates the Social Security Trust Fund will be solvent even longer, until 2052. And even if no adjustments were made, about 80 percent of the benefits could still be paid after 2052. In fact, many experts believe Social Security is on more sound footing today than it has been for most of its 70-year history.
President Bush and others have said that there is a "crisis" in the Social Security system. They have called for partial privatization of Social Security by permitting individuals to put a part of their Social Security taxes in private accounts and invest those funds in the stock market, thus diverting funds from the Social Security Trust Fund.
While Senator Levin believes we need to make some adjustments to protect Social Security for the long term, he does not believe that Social Security is facing an imminent crisis. Senator Levin believes that the President's privatization plan would not only do nothing to address the long-term challenge facing Social Security after 40 years, but it would actually create serious problems.
The President's privatization plan would reduce revenues to Social Security by about $2 trillion. Our economy would be in an ever-deeper deficit ditch because, to cover that loss, the federal government would have to borrow the money to be repaid with interest.
Borrowing on the scale the Bush plan requires would undermine the fiscal strength of the nation, threaten to diminish America's control over our own economic security, and saddle those same young workers the President seeks to entice in a privatization scheme with more national debt.
Moreover, privatizing Social Security would introduce risk and uncertainty into the system: there will be winners and losers. Social Security would no longer be a guarantee for all Americans, but a stock market gamble where the lucky come out winners, but where there would also be losers. For the first time in 70 years, we would fail to keep our pact with the American people of security for all.
Senator Levin wants to keep Social Security solvent for the foreseeable future, not just 40 years. When Social Security faced a real and imminent crisis in the early 1980s, Democrats and Republicans worked together to craft a bipartisan solution that stabilized the future of Social Security and that Congress passed overwhelmingly. Senator Levin believes we can and must do so again.
But before we consider any modifications to the system, we must decide as a nation whether we want to preserve the system or begin to dismantle it, as President Bush proposes. Senator Levin believes we must first resolve that issue.
At the inception of Social Security, the American people were promised an insurance program that guaranteed support for all workers in the face of retirement and disability. We have kept that promise for 70 years. Senator Levin believes it is a promise worth keeping.