Issue Position: Retirement Security
Keeping Our Promises to This Generation and the Next
Today's seniors have worked to keep their promises to America, and America must keep its promises to them. Our Social Security system is an important promise to seniors, but unfortunately, it is on the verge of collapse. We must act now to avoid a catastrophe in the future.
Due to our aging society and increased life expectancy, our current Social Security system is facing a funding crisis that will require large tax increases, huge benefit cuts, massive government borrowing, or a combination of all three. With the impending retirement of "baby-boomers," we must act now if we are to ensure that this vital program will be solvent for future retirees.
Many people believe that the current Social Security Trust Fund is a real pension fund where individual contributions are saved and invested for their retirement. This is not true. Social Security was not established to be a fully funded pension program, and therefore contains no real assets. The system operates essentially on a "pay-as-you-go" basis where today's workers pay taxes to support today's retired beneficiaries knowing that the generation that follows them will do the same. This worked well when there were 40 workers for every retiree, but today there are less than 4 workers for every retiree.
Some politicians would like to pretend there is no problem, and instead talk about a "Social Security surplus", but the truth is, these funds are given to the Treasury Department and spent on other government programs. But when the government "borrows" from itself, it has not purchased anything of real value, instead, just adding to a filing cabinet full of IOU's.
American retirees and taxpayers deserve better than this accounting shell game. That is why, as a first step toward protecting Social Security, we must "Stop the Raid," and ensure that Social Security tax dollars are only used to pay workers' hard-earned retirement benefits and not for other government programs. I was proud to join Senator Mike Crapo, (R-Idaho) to offer a "Stop the Raid" amendment to the Fiscal Year 2007 Budget Resolution. Sadly, fifty-three senators chose to turn their backs on America's seniors, but I am thankful that forty-six senators had the courage to vote to stop using the surplus as a secret slush fund.
We must also address the fact that we are not currently providing workers with real ownership of the money they pay into the system, and wealth is never allowed to be accumulated and passed on to children or grandchildren. The answer to this: Personal Social Security Savings accounts. These accounts would give younger workers the opportunity to build wealth and control their futures, so that when they retire they will not have to live month-to-month relying on the government for a check. Personal Social Security Savings accounts will make every American and saver and investor.
Each passing year that we refuse to address these problems makes the solution more and more expensive. We must recognize the tremendous opportunity we have to modernize essential government programs like Medicare and Social Security and truly protect benefits to current and future retirees.
We cannot hand the next generation a broken promise that forces them to accept higher taxes, crushing benefit cuts, and crippling debt. From the Greatest Generation to Generation Y, Americans must know that their government will keep the promises it has made.