Johnson: Keep Security in Social Security
Johnson: Keep Security in Social Security
Holds Meetings to Discuss Proposed Changes to the Guaranteed Benefit Plan
U.S. Senator Tim Johnson (D-SD) will host six meetings across South Dakota this week to discuss Social Security, how best to protect the guaranteed benefit, and how to make sure Social Security continues to be the cornerstone of retirement planning for future generations. Johnson will be joined by Sarah Jennings, Executive Director of the South Dakota AARP, and Max Richtman, Executive Vice President of the National Committee to Preserve Social Security and Medicare.
"It is important to hear from South Dakotans, gain insight from them and be able to represent their values as Social Security is debated here in Washington," Johnson said. "Social Security is the cornerstone of retirement, and the single most effective anti-poverty program there is. We don't need to dismantle the program in order to fix it."
The Administration's plan to privatize Social Security does not address the current solvency issues, and will cost $2 trillion in just the first 10 years and $5 trillion in the first 20 years simply to set up the plan. This new debt creates massive borrowing from foreign countries, which may destabilize financial markets, increase interest rates, slow economic growth and likely force large tax increases.
Further, by diverting payroll taxes from the program, privatization will cause substantial benefit cuts. Younger people will suffer deeper benefit cuts, while inheriting massive new debt required by the Administration's plan. Later generations would suffer cuts of 45 percent or more, even after including projected proceeds from privatized accounts.
The AARP recently said that to fix the Social Security system, benefit cuts and raising taxes are not the place to start. According to their website, they say, "We need real solvency options that are tested, debated and then agreed upon. Private accounts that are created out of Social Security will weaken, not strengthen the guaranteed benefit people have earned and will get in their later years. There are real solvency options that should be explored that will make a substantial difference."
While protecting the guaranteed benefit Social Security provides, Johnson wants to work with his colleagues to address the long term solvency of this program. South Dakotans deserve to know to the dime what they will get out of the program in their retirement years. Principles that reform must abide by include:
· Do no harm- We should not cut Social Security's funding by diverting trillions of dollars out of the Trust Fund as has been proposed.
· Honor our obligations- We should do all we can to pay back the Social Security Trust Fund for all the money used for other purposes. Doing so will keep the program solvent for nearly 50 years.
· Restore fiscal discipline- Our record deficits must be addressed. We can start by not promoting tax cuts for the wealthy that we cannot afford- especially during time of war.
· Address today's crises- The costs of health care, especially in Medicare and Medicaid, are swallowing up the federal budget. We need solutions that create a more efficient health care system (lowering drug prices, increasing use of information technology, reducing administrative burdens, etc).
Social Security is the primary source of income for two-thirds of seniors, and the only source of income for one-fifth of seniors. Forty-seven million Americans receive Social Security benefits and 1 in 5 South Dakotans receive such benefits. The average retiree benefit is about $930 per month or less than $11,200 per year. For women retirees, the average benefit is about $805 per month, or less than $9700 annually. Social Security reduces the poverty rate among seniors from about 50 percent to about 10 percent. Beyond its retirement benefits, Social Security provides critical support for the disabled and for the surviving family members of deceased workers.
Johnson will hold six town hall meetings across South Dakota between March 29thApril 1st. Johnson will hold meetings in Aberdeen, Mitchell, Rapid City, Sioux Falls, Watertown, and Yankton.
To learn more about Social Security or sign Senator Johnson's citizen petition to oppose the privatization of the program, visit http://johnson.senate.gov.
http://johnson.senate.gov/~johnson/releases/200503/2005329B31.html