From the category archives: Retirement
Tucked into the massive spending bill Congress passed this weekend was legislation that reversed 40 years of federal law protecting retirees’ pensions. The change will allow benefit cuts for more than 1.5 million workers, many of them part of a shrinking middle-class workforce in businesses such as construction and trucking. There wasn’t a single Congressional hearing on the plan before it was slipped into the spending bill, outraging senior’s advocates...including NCPSSM.
“Allowing plans to break the fundamental ERISA promise - that pensions paid to retirees and their surviving spouses will not be reduced - represents an extreme response to a problem that can be addressed through other means by strengthening the funding of the Pension Benefit Guaranty Corporation.
Additionally, the National Committee is deeply concerned that this provision could set a dangerous precedent for other defined benefit programs, such as single employer plans, public sector plans and Social Security. We believe a change this fundamental to the retirement security of Americans should be subject to a Congressional hearing and should be considered by the appropriate committees, with legislative language reviewed by Congress and the public, particularly those who will be affected by these reductions.” Letter to Congress - Max Richtman, NCPSSM President/CEO
Senate Finance Committee Chairman, Sen. Ron Wyden (D-OR), shares our concerns as he described to the Wall Street Journal:
“Some Democrats in particular were uneasy with the solution, saying it is being rushed through Congress and could create a dangerous precedent encouraging other retiree benefit cuts.
‘This is unprecedented and I worry about the impact on retirees and the slippery slope we’re about to head down,’ said Sen. Ron Wyden (D., Ore.), the Finance Committee chairman, in a statement. ‘I am working hard to protect retirees’ pensions, and jamming this bill through Congress virtually sight unseen is no way to solve this issue.’ “
In fact, some House Republicans see this pension cut strategy as an example of how Congress should handle Social Security in the new GOP controlled Congress. Make no mistake about it, Congress needed to come up with a long-term solution to the multi-employer pension shortfall; however, there was no urgency plus there were other options beyond a cuts-only solution hitting current retirees with no way to prepare for a cut in their income.
“Wall Street banks, automakers and insurance giants got bailouts during the economic meltdown that started in 2008. But when it comes to the pensions of retired truck drivers, construction workers and mine workers, it seems that enough is enough.” Time.com
‘It bothers me no end that we have Congress and legislators that think that the proper way to correct problems that banks and corporations made is to take it out on the workers,’ said Dave Cook, president of Local 655 of the United Food and Commercial Workers.” St. Louis Post Dispatch
The Pension Rights Center has a calculator
on its website that lets retirees under age 75 see how much their pensions might be reduced under the bill.
NCPSSM Board Chair, Catherine Dodd, testified before the Senate Finance Committee today on the retirement challenges facing America's women and the National Committee's Eleanor's Hope initiative to improve Social Security benefits:
“22 million older women receive Social Security benefits yet the inequalities they face threaten their retirement security. Persistent gender wage discrimination, work gaps taken to care for loved ones, the lack of pensions and generally longer lives mean women receive a significantly lower Social Security benefit than men. While the Social Security system is gender-neutral, life is not and America’s senior women pay the price for that inequality for as long as they live. We urge Congress to level the playing field for millions of our nation’s older women.” Catherine Dodd, PhD, RN and NCPSSM Board Chair
Members of the Senate Finance Committee heard testimony from witnesses today in a hearing entitled, “Social Security: Is a Key Foundation of Economic Security Working for Women?” National Committee to Preserve Social Security and Medicare Board Chair, Catherine Dodd, urged the Senate to address the inequities that reduce the average monthly Social Security benefit for women. In 2012 the average woman retiree received $1,103 a month while a retired man received a $1,414 monthly benefit. The National Committee believes women deserve an adequate retirement income whether a work life is spent in the home in the paid workforce or a combination of the two. Toward that end, our new initiative, Eleanor’s Hope -- named in honor of first lady and activist Eleanor Roosevelt -- is mobilizing women of all ages to advocate for income equality, retirement security and health protection for women.
Some of the National Committee’s proposals for improving benefits in Social Security presented to the Senate Finance Committee today include:
· Providing Social Security credits for caregivers
· Improving Social Security survivor benefits
· Equalizing Social Security’s rules for disabled widows
· Strengthening the Social Security Cost of Living Allowance
· Boosting the basic Social Security benefit of all current and future beneficiaries
You can see Catherine Dodd’s full Senate testimony here.
While the well-financed Wall Street-backed campaign
to convince Americans that Social Security is in crisis (even though the facts
prove just the opposite) has sputtered over time, that hasn’t stopped some in Congress from inflicting a death-by-a-billion-cuts budget strategy on the Social Security Administration's administrative finances. SSA has received less than its budget request
in 14 of the last 16 years. In FY 2011-2013 alone, SSA received nearly $3 billion
less than it requested from Congress to do its job. A job that is increasingly challenging as the agency serves near record number of visitors as the nation’s baby boomers retire. Not surprisingly these short-sighted “serve more with less” budgets mean beneficiaries
are paying the price:
“Each day, almost 163,000 people visit field offices and more than 348,000 people try to reach an SSA agent for assistance. In FY 2014 about 13% of SSA’s visitors waited over an hour for service. Despite agency online service initiatives and the reductions of public service ours, field offices in FY 2014 served 40.7 million visitors. Field office visitors waited 50% longer in FY 2014 than in FY 2012. In FY 2014, nearly 5.5 million SSA visitors waited over an hour to be served and over 2 million visitors left without service. SSA’s 800 number network had a marked deterioration in FY 2014 in answering calls to agents, demonstrated by an answer rate of about 54%. The field office answer rate was about 67%, which also represents a substantial degradation in performance over the past few years.” -- Letter to Office of Management and Budget, signed by 35 Social Security advocacy organizations, November 2014
64 SSA field offices and 533 temporary mobile offices have closed, which is the largest five-year decline in the agency’s 79 year history. In testimony submitted to the Senate Aging Committee earlier this year, NCPSSM President/CEO Max Richtman urged the SSA to reject suggestions that online and self-service options should replace in-person services currently provided in field offices:
“...the National Committee believes any individual who has paid Social Security taxes has the right to face-to-face service within a reasonable distance of their home. The National Committee also is concerned that seniors and low-income individuals who are accustomed to conducting business on a face-to-face basis will suffer undue hardship when faced with the need for a benefit verification letter or SSN printout. Many in this population lack access to and are not familiar with computers and printers. I am also concerned that shifting this administrative burden to SSA call centers will only increase the current average wait time of 26 minutes.”
Social Security advocates, including NCPSSM's Max Richtman, SSA Acting Commissioner Carolyn Colvin and Chairwoman of the Senate Appropriations Committee, Senator Barbara Mikulski (D-MD) were among the attendees of a Capitol Hill conference on the challenges facing the Social Security Administration. All agreed on the need to fund SSA far beyond what Congress has approved in recent years. Results of a new national poll were also released showing the majority of Americans want to keep Social Security field offices open to serve the millions of Americans who need the one-on-one attention they provide.
It’s time to end the “starve the beast” politics promoted for decades by those opposed to programs like Social Security. Annual defunding of SSA fulfills a political goal at the expense of millions of American seniors, the disabled, survivors and their families who depend on Social Security.
This article was originally posted on Huffington Post
Max Richtman, President and CEO, National Committee to Preserve Social Security and Medicare
The 114th Congress will see many new faces after the 2014 midterms; however, the face of our nation's middle class remains largely unchanged - they're poorer, more diverse, getting older and facing a retirement crisis which threatens millions. How will this new Congress address this old reality? Not one of the newly-elected Members of Congress campaigned on promises to cut benefits to Social Security and Medicare, yet it's already clear the new GOP majority considers lowering corporate tax rates and cutting benefits to middle-class seniors a priority. Same as it ever was.
The disconnect between many in Congress and average Americans on Social Security and Medicare is certainly nothing new. In poll after poll, the American people clearly do not support cutting middle-class benefits in these programs to balance the budget or bankroll tax cuts for the wealthy or large corporations already dodging billions in taxes each year. Contrary to the current political mythology that the American people aren't willing to be "grownups" and make the "tough choices" for our nation, the fact is, they simply don't support the benefit-cutting strategy preferred by many Washington politicians. Not only do they oppose cutting benefits, most Americans support boosting benefits.
A new report by the National Academy of Social Insurance, "Americans Make Hard Choices on Social Security" shows that Americans' support for Social Security is unparalleled and they are willing to pay more in taxes to stabilize the system's finances and improve benefits. NASI reported:
Seven out of 10 participants prefer a package that would eliminate Social Security's long-term financing gap without cutting benefits. The preferred package would:
• Gradually, over 10 years, eliminate the cap on earnings taxed for Social Security. With this change, the 6 percent of workers who earn more than the cap would pay into Social Security all year, as other workers do. In return, they would get somewhat higher benefits.
• Gradually, over 20 years, raise the Social Security tax rate that workers and employers each pay from 6.2 percent of earnings to 7.2 percent. A worker earning $50,000 a year would pay about 50 cents a week more each year, matched by the employer.
• Increase Social Security's cost-of-living adjustment to reflect the inflation experienced by seniors.
• Raise Social Security's minimum benefit so that a worker who pays into Social Security for 30 years or more can retire at 62 or later and have benefits above the federal poverty line.
Exit polling after the midterm election, even in Republican-leaning states, mirrored the findings in the NASI report. Public Policy Polling found 86 percent opposition to allowing any cuts to Social Security and Medicare with 79 percent opposition among Republicans. Voters say they are also less likely to vote for a candidate who supports making cuts to Social Security and Medicare by 70 points. Of course, this isn't really a surprise to political candidates. It's why you will rarely hear politicians telling voters they plan to cut Social Security and Medicare benefits for the millions of middle-class families who depend on them. Instead, candidates have successfully deployed a dodge-and-deflect strategy built on Orwellian language in which they say they'll "preserve" these programs when they actually mean privatize, "strengthen" when they mean slash, or "give you choices" when they mean you're on your own. While that strategy has certainly worked on the campaign trail, what remains to be seen is if the new Republican majority can successfully govern using the same approach.
Congress' new leadership may want to give former President George Bush a call. Not so many years ago, he believed his "voter mandate" cleared the way to privatize Social Security - cutting benefits and putting workers' guaranteed benefits at risk on Wall Street. That didn't turn out so well for the President simply because the American people understood then, as they do today, the abiding value of America's retirement and health security programs. Outside Washington, Social Security and Medicare aren't regarded as political or partisan because they are synonymous with economic survival for millions of workers, retirees, people with disabilities and their families.
The difference between campaigning and governing is vast -- something the members of the 114th Congress will discover first hand if cuts to Social Security and Medicare remain on their legislative agenda.
Follow Max Richtman on Twitter: www.twitter.com/maxrichtman
It’s that time of the year (just days before Election Day) when every Congressional candidate extolls the virtue of Social Security. Too many of these candidates will then return to Congress (with your vote) singing a different tune lamenting that America simply “can’t afford entitlements” like Social Security and Medicare. Only after Election Day will you discover that “save” actually means “slash” and “protect” means “privatize.” They’ll claim your benefits must be cut or programs privatized to “save” the programs for future generations. The problem is...that’s simply not true and the American people of all political parties, ages and incomes don’t believe that cutting benefits is the best way to strengthen Social Security.
This Social Security disconnect is illustrated in a big way in a new report released today by the National Academy of Social Insurance. “Americans Make Hard Choices on Social Security” shows that Americans’ support for Social Security is unparalleled and they are willing to pay more in taxes to stabilize the system’s finances and improve benefits. We highly recommend you read the entire study (it’s important!) but here are some key highlights:
To gauge Americans’ policy preferences, the survey used trade-off analysis — a technique that is widely used in market research to learn which product features consumers want and are willing to pay for. The trade-off exercise allowed survey participants to choose among different packages of Social Security changes. As lawmakers would do, they weighed how each policy change would affect workers, retirees, and the program’s future financing gap, and then chose among different packages of reforms.
Seven out of 10 participants prefer a package that would eliminate Social Security’s long-term financing gap without cutting benefits. The preferred package would:
- Gradually, over 10 years, eliminate the cap on earnings taxed for Social Security. With this change, the 6% of workers who earn more than the cap would pay into Social Security all year, as other workers do. In return, they would get somewhat higher benefits.
- Gradually, over 20 years, raise the Social Security tax rate that workers and employers each pay from 6.2% of earnings to 7.2%. A worker earning $50,000 a year would pay about 50 cents a week more each year, matched by the employer.
- Increase Social Security’s cost-of-living adjustment to reflect the inflation experienced by seniors.
- Raise Social Security’s minimum benefit so that a worker who pays into Social Security for 30 years or more can retire at 62 or later and have benefits above the federal poverty line.
Again, not only do Americans value Social Security they are willing to pay to sustain and improve it. This package was preferred by large majorities across political parties and income levels. 68% of Republicans, 74% of Democrats, and 73% of independents favored this no-cuts plan, as do 71% of study participants with incomes above $75,000 and 68% of those with incomes under $35,000.
We suggest that if you see a political candidate on the campaign trail between now and Election Day ask him/her about this plan and its support by the vast majority of all Americans. Will they support fixing Social Security’s long-term solvency while also improving benefits without cutting the program?
It can be done, if only there was the political will to do it.
Indicates required fields
Have a Social Security or Medicare question?