SOCIAL SECURITY REFORM -- (House of Representatives - February 09, 2005)
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Mr. GOHMERT. Mr. Speaker, what a pleasure and privilege it is to share this time with Chairman Shaw, and the enlightening presentation he made previously.
I came across some information that had been talked about in a local newspaper, The Examiner, a new paper, and did some digging. And it is indeed my pleasure in a bipartisan spirit to call attention to statements made or endorsed by certain Senators, including some prominent Democratic Senators who, in 2001, found that Social Security simply was not as efficient as a system that allowed workers to invest their own retirement funds in a personalized retirement account.
Privatization is not a good idea; we are not for that. However, allowing young workers to personalize their retirement by taking a part of their retirement funds and placing them in a personal Social Security savings account that the individual actually owns is a good idea. And we are open to discussion on that. I am proud to be a part of looking at that. Such accounts currently are in place for State and local retirees, and they are performing at least 200 to 300 percent higher than Social Security.
What a great thing, to provide individuals with a decent retirement while preserving Social Security for those that are on it and for those that are over 55 years of age. Such an account could actually be owned by the worker and not by the government. The State and local governments manage the accounts and see that they are safely invested, all a vast benefit for their employees. I was under such a system in Texas as a judge and chief justice. Our retirement account was through the Texas Employee Retirement System.
There are those who say, Mr. Speaker, There is no crisis. You have heard it; we have all heard it. But that is akin to somebody falling off a very tall building and all the way down at each window he is heard to say, "I am doing all right so far." Eventually there is going to be a time of reckoning, and that is exactly what we are looking at with Social Security. We want to avoid that now, while it can still be avoided.
Most agree that in 2018 there will be more money going out of Social Security than there is coming in. Some say that is still no big deal, because Social Security has so much money in the lockbox.
Well, since 1935, when Social Security was created and FDR's Congress immediately began spending that Social Security money, what they put in the lockbox was Federal bonds, which is basically a government IOU.
Mr. Speaker, I heard the gentleman from Florida (Chairman SHAW) talking about that a moment ago. When the outgo gets higher than the income, then what they are going to rely on is not cash in the lockbox, it is IOUs that have been getting stuck in there ever since 1935. That is serious. It creates a major problem looking at us right now, here in the face, and we need to deal with it.
Some say that even though the proposal will not affect seniors, will not affect those the way it is proposed, it would not even affect those over 55 at all, but it would just allow some young people to put some of their own money in their own retirement account, that that would dry up capital and hurt the economy.
But, Mr. Speaker, that argument flies in the face of the facts. If young people start investing some of their money in a personalized Social Security savings account, and that is not happening right now, then what it does is it creates capital to help the economy. There will be savings that are there as capital that will help the economy and drive it, as the President's tax cut has been doing the last couple of years.
Young people overall are not saving right now. But if they begin now, by their very act of saving, they will create capital and help the economy.
There are some very important principles. First of all, Social Security is in trouble. Second, every day we delay, the naysayers are denying young people the compound interest on a conservative investment that they could be making if the opposing Democrats would get out of the way, would come together with us, let us reason together, come up with a good plan, save Social Security and yet plan for future generations.
Do you think that conservative investment could do much better? Well, there are a bunch of folks that did. In 2001, they signed a letter to that effect, sent out a press release to that effect.
Some real live examples we checked on, got input from these systems. Galveston, Texas, has its own retirement system. If you work until age 65 with an average income of approximately $35,000, then you will receive over $2,600 per month. If you did the same thing under the Texas Employee's Retirement System that I was under as a judge, you would be getting nearly $2,700 a month. Using that same scenario, but under Social Security, you receive less than $1,300 per month. Mr. Speaker, it is not hard for folks to figure out what would be a good system to plan for the future.
There is apparently a letter, a press release regarding that letter that was signed by a host of Senators regarding Social Security back in 2001. At that time, there were some people that wanted to make those workers that had State and local retirement systems pay into Social Security. These Senators signed this letter in December of 2001, and they were adamant that such personalized accounts outside of Social Security were a far better deal for those workers.
Senators, and you may recognize some of the names, Mr. Speaker, like JOHN KERRY, HARRY REID, EDWARD KENNEDY, CHRIS DODD, JOE LIEBERMAN, they indicated, according to the copy of the release we obtained, "Millions of our constituents will receive higher retirement benefits from their current public pensions than they would under Social Security." Those Senators call those retirement funds outside Social Security "well-managed" and "well-funded."
Additional evidence that such personalized accounts are a good idea is that AARP has its own mutual fund and encourages its members to join the fund, even though its investments are outside Social Security. Apparently they do not consider such a fund to be too risky. It would certainly seem that either such a fund is a good thing to invest in, as AARP is telling some of its members, or AARP is misleading its members and encouraging them to invest in something outside Social Security. If it is a good thing for AARP members, how much better would such a personalized retirement fund be for young people with plenty of time to build a future?
For years I have gotten e-mails saying Congress must be forced to live on Social Security, and we needed to do that. Well, I got elected and guess what I found out when I got here? We are on Social Security. We pay into Social Security. We are going to be part of the Social Security system when we retire.
So we are in it. The only addition is, we are allowed to invest some of our income in retirement accounts, and some of us believe that others besides Congressmen and certain State and local employees ought to have that same right. That is what we are talking about.
I campaigned that we should fix Social Security, but do so without reducing benefits or adding taxes. Mr. Speaker, I cannot tell you how pleased I was to come to Washington and find that the President and so many others, Republicans here, all agree.
I also personally believe we really ought to eliminate that terribly abusive tax that was added on to Social Security benefits that President Clinton and the Democrat-controlled Congress piled on to the poor Social Security receivers back in 1993. In fact, the Republicans, and even some Democrats back then, were so opposed to taxing that income on Social Security that the Vice President of the United States at that time, Al Gore, had to come to Capitol Hill, cast the tie-breaking vote, just to hammer our good seniors with that brutal tax.
There have been so many inequities in Social Security. One woman reported that though she and her husband both worked their entire lives, that when her husband died, she was getting exactly the same thing that another woman was getting who had never worked or put into Social Security in her whole life. It is easy to understand her frustration at paying into Social Security her whole life, for no benefit whatsoever to her. If she and her husband had been allowed to own their own personalized Social Security savings account, she would have received the benefit of both her and her husband's hard work and investment.
We can do this. We can save Social Security for those that are on it and for those that are paying into it, those over 55, as the President is talking about, and for future generations and, at the same time, create these great personalized Social Security savings accounts for young people so they cannot only survive during their senior years; they can thrive. It would be good for everyone except those wanting the government to keep people enslaved to the Big Brother in Washington.
I applaud those Senators, including Senator Kerry, Senator Kennedy, and Senator Reid, among others, that signed it for their courage and their vision as it was back in December of 2001, when they knew and believed in a retirement system like the President is proposing, that that would be the best thing for folks to invest in.
Now, if their view has apparently flip-flopped since 2001, then, hopefully, we will not have to wait until the year 2020 before their vision returns to being 20/20.
Mr. Speaker, I appreciate so much the efforts of the gentleman from Florida (Mr. Shaw) on behalf of all of us, for senior citizens, to save Social Security, not just for everybody on it now, but for future generations.
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