From The Chicago Sun-Times, 3/26/05:
http://www.suntimes.com/output/martire/cst-edt-mart26.html
Bush's plan would impoverish seniors
March 26, 2005
BY RALPH MARTIRE
President Bush is on a crusade to save Social Security from
insolvency.
Now there's a good cause.
Social Security is one of the most successful programs ever.
Created as a response to the Great Depression, Social Security is
supposed to provide sufficient income to ensure elderly and disabled
Americans don't live in poverty.
And it works.
Not only does it work, but the data demonstrate that Social Security
remains essential.
According to the Center on Budget and Policy Priorities, nearly half
of our nation's elderly have private incomes below the poverty level.
After Social Security, which lifts almost 13 million elderly citizens
above poverty, only 8.7 percent of seniors remain poor.
Illinois benefits in similar proportions.
Without Social Security, 47.6 percent of our state's elderly would
live in poverty.
That drops to 7.2 percent with Social Security.
Disabled individuals also benefit.
Jerry Stermer of Voices for Illinois Children emphasizes that without
Social Security, many working-age Americans -- and children -- would
fall into poverty because of disability.
Last week's Social Security trustees' report shed light on the
system's financial condition.
It concluded that if no changes are made, beginning in 2041 -- one
year sooner than projected last year -- Social Security will be able
to pay only 74 percent of current benefit levels.
The trustees noted this slight deterioration occurred because workers
earned less than expected, so Social Security received less payroll
taxes than expected.
To address the system's insolvency, the Bush administration has
offered a proposal short on details that is based on diverting money
from Social Security to private accounts and cutting benefits.
The president's hope is that the private accounts will outperform the
guaranteed benefits under current law.
While undoubtedly some will, studies demonstrate that most won't.
See, there's risk involved, and even savvy investors make huge errors.
To highlight just one of the many risks, consider market timing.
If you're a middle-income worker who retires in a year when there's a
bear market, your retirement benefit will be reduced to, well, bull.
The proposed private accounts also wouldn't make the current system
solvent.
Quite the contrary, they would necessitate that the feds borrow an
additional $2 trillion -- money that instead could be used to
eliminate half the projected Social Security shortfall over the next
75 years.
Even worse, according to the Employee Benefits Research Institute, the
costs of administering these new accounts will be significantly
greater than under the current system.
In effect, the president's proposal would worsen the nation's debt,
cost significantly more than current policy, and result in less
guaranteed benefits and more seniors in poverty.
The administration claims benefit cuts are the only way to make the
system solvent.
Max Sawicky, an economist with the Economic Policy Institute, doesn't
agree.
Sawicky notes that increasing the payroll tax by just 1.92 percent
would eliminate the projected actuarial deficit for Social Security, a
fact the trustees' report confirms, as would allowing Bush's tax cuts
to expire in 2010.
But the president refuses to consider revenue changes.
That's particularly troubling when the Social Security trustees
identified declining revenue from underperforming wages as a problem.
It's the ultimate kick-a-guy-when-he's-down approach.
You earn less than expected while working, and get your Social
Security benefits slashed when you retire.
If that's how the feds solve problems, I hope they stay away from
another factor causing Social Security cost increases: longevity.
America enacted Social Security in the aftermath of the Great
Depression.
Back then, it was clear the private sector doesn't always benefit all
or even most working Americans.
Even in the wealthiest nation in the world, poverty is a problem.
The public sector can mitigate some inequities caused by the private
sector.
No program does that better than Social Security.
Yes, it involves shared costs, but consider the benefits.
Millions of elderly and disabled Americans don't live in poverty
because Social Security exists.
That's worth preserving.
____________________________________________________
As Georgie Bush has demonstrated, the lives of millions of elderly and
disabled Americans are of no concern to him.
Harry
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