Camp: Social Security Proposal a Solid Start'
Congressman urges Democrats to start working with Republican on final solution
As a senior member of the Ways and Means Committee, which has jurisdiction over Social Security, U.S. Rep. Dave Camp today praised Social Security Subcommittee members for their proposal to protect current and future Social Security benefits.
The bill works to achieve three goals: 1) the Social Security surplus should only be used for Social Security, 2) the surplus should not be used to fund other government programs; and 3) the surplus should not be used to mask the true size of the national debt. Ultimately, the proposal walls off Social Security surplus money from other government spending through the creation of GROW (Growing Real Ownership for Workers) Accounts.
"I have personally spoken with and corresponded with thousands of mid- and northern-Michigan residents on how best to improve the Social Security system, and everywhere I go there was one overriding theme: the Social Security surplus should stay in Social Security," said Camp. "This proposal ensures the Trust Fund money stays in Social Security and does not fund other government programs. It is a good first step to solving the larger problems within the Social Security system. I am also encouraged to see my colleagues move in a direction that would give taxpayers ownership over their own retirement account and be inheritable by younger generations. We still have a long way to go, and several tough choices to make in the months and years ahead, but this proposal is a solid starting point."
According to the Social Security Trustees, Social Security will run a surplus until 2017. Currently Social Security taxes pay for retiree benefits, as well as benefits for widows, orphans and the disabled. Any funds left over, known as the Social Security surplus, are used for other government spending.
This measure would change that by directing money from the surplus to fund newly created GROW Accounts. People under the age of 55 will have GROW accounts, or can choose to opt out. The accounts will initially be invested in marketable Treasury bonds. This allows a safe and prudent transition period for the development of personal accounts to protect the Social Security surplus.
Under the proposal an independent Board, similar to the one which manages the retirement plan for Federal workers, will manage and administer GROW Accounts. In January 2009, the board will submit a plan to Congress that would allow for workers to choose other prudent investment options or stay in low-risk marketable treasury bonds. When a person retires, the account balance will be used to help pay Social Security benefits.