Don’t Cut Social Security—Double It

From The Atlantic:

social-securityAs the nation tiptoes closer to the fiscal cliff, a frightening number of leaders on both sides of the political aisle seem ready to push poor, beleaguered Social Security over the edge. Not only would that be a huge mistake for the nation’s future, but these leaders show a dreadful misunderstanding of the new challenges faced by the U.S. retirement system. Particularly in the aftermath of the largest economic collapse since the Great Depression, none of the proposals on the table are grappling with some stark economic realities. How we settle this New Deal legacy will decide fundamental questions about what kind of society America will be for generations to come.

Here’s the dilemma that the United States faces. Since World War II, individual retirement has been based on a “three-legged stool,” with the three legs being Social Security, pensions, and personal savings (the latter primarily centered around home ownership). But two out of three of these legs have been chopped back to blunted pegs, leaving the retirement stool as an unstable, one-legged oddity.

Pensions have always been the least broadly distributed asset, with only a third of elderly Americans (those 65 and over) earning pension income, a percentage which has been declining dramatically in recent years. A bit over a majority of these older Americans have income from personal savings, most of that residing in the value of their homes. But 86 percent receive Social Security payments.

Read the rest from The Atlantic

Selling Social Security to young people: Today vs. the 1960s

From Washington Policy Watch:

Online news magazine Slate recently posted scans of comic books published by the Social Security Administration in the 1950s and 1960s designed to inform young people about the importance of Social Security – a common strategy to reach youth at that time. Slate writes:

Why should young people care about Social Security? Some of these comics sold the program as a way that the government could help free young people from familial obligation. The crew-cut young men and well-dressed girls wanted to help parents in dire straits, but they shouldn’t have to. Social Security would make sure Tom wouldn’t have to skip engineering school to take over the family farm, and Janet wouldn’t have to postpone her wedding to earn money for her family. (Yes, Janet’s “dream” was marriage, even in a comic published in 1965; the 1950s died hard.)

Here’s one of the comics Slate posted:

For a more updated take on Social Security, check out the music video Just Scrap the Cap, also aimed at educating young adults about the importance of Social Security.

Mobilize to oppose lame-duck grand bargain

Via The Stand:

(Nov. 2) — AFL-CIO President Richard Trumka recently warned of a debt-reduction deal called the “grand bargain” that’s being negotiated behind closed doors in Washington, D.C., and could be voted upon during the lame-duck session immediately following the election. He said this grand bargain “boils down to lower tax rates for rich people — paid for by benefit cuts for Social Security, Medicare and Medicaid.”

The Washington State Labor Council, alongside its affiliated unions and community partners, are joining the AFL-CIO in mobilizing now to urge members of Congress to oppose such a “bargain.” Thursday, Nov. 8 will be a national day of action on the issue and events are planned in Seattle and Spokane that day. In addition, a telephone town hall meeting with Sens. Patty Murray and Maria Cantwell is being planned for Monday, Nov. 12.

On Nov. 8, union members and other supporters will be urged to call their Congressional Representatives and Senators and leave messages urging against safety net benefit cuts and more tax breaks for the richest 2% of Americans. (Please download, post, and distribute this flier.) Although the toll-free number works today, you might want to wait until after the election to call. Residents in Washington’s 1st Congressional District, for example, will have to wait until after the election before the D.C. office of their new lame-duck Representative is even staffed.

Here are the details on mobilization events:

SPOKANE RALLY — On Thursday, Nov. 8 from 7:45 to 8:45 a.m. (program at 8 a.m.), union members and other supporters of Social Security, Medicare and Medicaid will gather at Riverside and Division at the entrance to the new University District in Spokane. Labor speakers will include Spokane Regional Labor Council President Timm Ormsby as emcee and Mike Foley of UA Local 44 representing construction workers. Following the rally a delegation will be going to the office of Rep. Cathy McMorris Rodgers (R-5th) to express working families’ positions on Social Security, Medicare and Medicaid, and on extending tax cuts for the richest 2% of Americans.

For more information, visit the event Facebook page or contact Mariah McKay from Washington CAN via email or by calling 509-939-0015.

W.S.L.C. LUNCHEON IN SEATTLE — On Thursday, Nov. 8 at noon, the Washington State Labor Council will host its annual post-election luncheon at Seattle’s Catholic Seafarers Center, 2330 1st Ave.  But this year, in addition to the usual raffle benefiting the Center and celebration of the beginning of the holiday season, U.S. Rep. Adam Smith (D-9th) will be on hand to hear from a brief panel of speakers discussing the so-called grand bargain. Possible-U.S. Reps. Suzan DelBene and Denny Heck also plan to attend, pending election results and the possible need to travel to Washington, D.C.

The luncheon costs $15 per person. Please RSVP to Braden Van Dragt at the Catholic Seafarers Center at 206-441-4773.

TELEPHONE TOWN HALL MEETING — On Nov. 12, Sens. Patty Murray (D-WA) and Maria Cantwell (D-WA) will participate in a telephone town hall meeting on the subject of debt-reduction negotiations and proposals. The time and call-in number/code will be announced soon. Stay tuned…

WA citizens pushing back against Social Security attacks

The 2012 Social Security Trustees’ report confirms Social Security is well-financed, with a reserve of $2.7 trillion. But you wouldn’t know it from the chorus of “bad news” headlines, so here are the facts:

  • Without any Congressional action at all, full benefits can be paid until 2033, at which point Social Security would still be able to cover about 75% of benefits.
  • Because of how Social Security calculates benefits, that “75%” of benefits in 2033 will still be, on average, higher (in inflation-adjusted dollars), than full benefits today.

Other nonpartisan sources have also noted Social Security is on a sound financial footing. The Congressional Budget Office projects costs will remain relatively flat over the next 75-years, increasing by about 1% before leveling off.

Unfortunately, these truths aren’t exactly headline material – and several prominent media outlets have been critiqued for it by the Columbia Journalism Review for lax reporting on Social Security:

 “Whatever the reason—ideology, poor understanding of how the program works, gullibility, or plain old reportorial laziness—news outlets have given the public a skewed picture of the financial health of this hugely important program.”

Social Security Works – Washington is pushing back by correcting misinformation about Social Security in the media, and advocating for a simple proposal that will improve Social Security’s long-term fiscal outlook and improve benefits: Scrap the Cap.

Under Scrap the Cap, Congress would lift the cap on income subject to Social Security taxes, currently $110,100. This simple fix would allow a modest benefit increase today, ensure benefits are fully funded in the long-run, and maintain Social Security’s historic benefit-contribution link.

“Social Security is well-financed – scrapping the cap will remove any doubt about its long-term financial stability,” said Robby Stern, Chair of the Social Security Works WA coalition and President of Puget Sound Alliance for Retired Americans.

Under Scrap the Cap, Social Security can restore benefits to college students who have suffered the death of a parent, provide family care credits to people who leave the workforce to take care of children or family members, and increase benefits for the lowest-income earners.

The simple Social Security fix no one wants to talk about

One change could eliminate the long-term shortfall, promote tax equity and allow a modest benefit increase now

The 2012 Social Security Trustees’ Report shows the nation’s most important and popular social insurance system is on sound financial footing for at least another generation. With $2.7 trillion in its trust fund, Social Security can pay full benefits through 2033.

After 2033, the program can still pay 75% of benefits, even with no action by Congress. And because of how Social Security calculates benefits, that “75%” of benefits in 2033 will still be, on average, higher in inflation-adjusted dollars than full benefits are today.

But America can do better than that. Under the “Scrap the Cap” plan, Social Security can pay 100% of benefits after 2033, and even modestly expand benefits today, if Congress makes one simple change: eliminate Social Security’s cap on taxable income (now set at $110,100) so high income earners pay the same tax rate as middle class workers.

Eliminating Social Security’s cap on taxable income (now set at $110,100) means
high income earners would pay the same tax rate as middle class workers

The additional funding could boost benefits for low-income earners, add credits for individuals (often women) who take time from work to raise their family, and restore benefits for college students that were cut in the 1980’s.

“These improvements immediately boost the American economy, build economic security for women, and safeguard educational opportunities for young people who have suffered the loss of a parent,” according to Marilyn Watkins, policy director for the Economic Opportunity Institute.

Social Security benefits are more critical to American economic security than ever. According to estimates, nearly one-half of Americans will be unable to maintain their standard of living in old age. About 1 in 4 Washington households – more than 1 million Washingtonians, including 73,000 children – received old age, survivor, or disability benefits from Social Security in December 2010.

[Cross-posted from Washington Policy Watch]

Video: An easy fix for Social Security – Scrap the Cap!

An educational event at Highline Community College on April 12th highlighted some of the common misconceptions about Social Security – and showed how easy it would be to strengthen the program and improve benefits.

The event was taped and edited together by the Washington State Labor Council’s Kathy Cummings. Please enjoy this brief video featuring highlights from the event!

Scrap the Cap to improve Social Security’s benefits

Social Security provides benefits to more than 50 million Americans – benefits that are critical for retirees, widows/widowers, and families of disabled and deceased workers.

That’s why some members of Congress, including Sen. Bernie Sanders, have supported legislation to “Scrap the Cap” on Social Security. This simple tweak would ensure millionaires will pay the same tax rate as middle class families, and eliminate any concerns about Social Security’s long-term financing.

But this tweak would do more than bring Social Security into balance; it would also allow Social Security benefits to be increased and expanded.

Below is a list of suggested improvements to strengthen Social Security benefits and ensure financial security for millions of Americans.

  1. Increasing benefits for the lowest income earners.
  2. Increasing benefits for surviving spouses. This will help low and moderate-income widows and widowers.
  3. Providing family care credits for individuals (mostly women) who leave the work force to take care of family members. Alternatively, we could reduce the calculation of benefits from the highest 35 years of work to the highest 30 years in the workforce.
  4. Restore Social Security benefits to young people attending college up to age 22 who suffer the death of a parent or have parents on Social Security. This benefit existed prior to the “reforms” in the 1980s.

Social Security can easily be protected for future generations – and benefits can be strengthened now and into the future – with one small tweak, just scrapping the cap. This simple solution will ensure all Americans are able to provide for themselves in retirement, and preserve the promise of Social Security for our parents, ourselves and out children.