Congress needs to be constantly reminded: Quit messing with Social Security.
There are currently three dangerous signals that “reform” — read that, cuts — intends to chip away at this valued entitlement:
- Multi-employer pension funds were cut under the recent spending bill passed by both chambers;
- The House blocked transferring funds from Social Security to its Disability section (though done 11 times previously);
- and members from both parties are proposing to pass a cost-of-living-adjustment that would reduce payments by $1,000 annually for seniors.
Floridians will be especially hard-hit. Three million Florida residents are over 65. One in five Florida residents receives Social Security benefits.
Fifty-four percent of Americans support “reforming” Social Security, according to a January NBC News poll. It’s a case of the pollsters following the political nomenclature. Call it “reform” and people will vote for it. Other polls call it what it is — cuts — and vast majorities (a 2013 Pulse Opinion Research poll said about 70 percent) oppose Social Security and Medicare cuts to reduce U.S. debts and deficits.
Yet Rep. Paul Ryan, R-Wis., chairman of the powerful House Ways and Means Committee, keeps the fear assault going. In the 2015 budget resolution he wrote, Ryan purports, “The trust fund is not a real savings account.” He adds, “Any value in the balances in the Social Security Trust Fund is derived from dubious government accounting.”
Funny, retirees aren’t told that as they contribute. The fact is, there is a $1.7 trillion surplus in the Social Security Trust Fund — based on inflow from retirees and outflow of payments.
Another Republican leader, Florida Sen. Marco Rubio, adds to the angst. He said in little noticed comments to the National Press Club last year: “Social Security is wobbling …. The Social Security trust fund is drying up. … These factors have created a real and looming crisis.”
Yet the Social Security Trust Fund, according to its own website, is solvent through 2033 from the stockpile of payments into it. And even after that, it is 75 percent to 80 percent solvent. Even after 2033, the equivalent of a third of past annual Iraq War costs would make up the difference. It’s an easy congressional fix, without cuts. The fears are hype.
Possible 2016 Democratic presidential candidate Hillary Clinton takes a different approach. She has asked how members of Congress could “find money for 100 more years in Iraq and tax cuts for the wealthiest, but not for Social Security.” She added that passage of Republican budgets would have “turned Social Security’s guarantee into a stock market gamble for millions of Americans.” Social Security provides 57 million seniors more than half of their income, and has reduced the number of seniors in poverty by a 50 percent.
The spending bill passed in December cuts multi-employer pension funds and puts about a million workers at risk. These pensions were federally protected. Now, according to the Pension Rights Center, a worker who receives $25,000 a year could see a cut of $13,000 — over half.
Changing Social Security to use a so-called “chained” Consumer Price Index (CPI) will cost seniors $1,000 per year by substituting the cheapest brands as the calculation — but that’s what fixed-income seniors already buy, so it’s just taking away their money. While the title sounds like a minor tweak, Massachusetts Sen. Elizabeth Warren said in 2013 that switching to “chained CPI falls short of the actual increases in costs that seniors face. It’s just a fancy way of saying cut benefits.”
Social Security’s invested cash surplus has been borrowed by the government to finance the deficit, pay for tax breaks for the rich and fund other programs. Former Vice President Al Gore was right years ago: a “lockbox” is needed to separate Social Security funds from the Treasury to protect seniors’ money.