Senator Marco Rubio’s proposal to fund paid family leave by cutting participants’ future Social Security benefits is nothing less than a Trojan Horse to undermine Social Security – and lays the groundwork for further damage to the program. Social Security is not a piggy bank or ATM to be used for other programs, no matter how commendable.
“Our Social Security system is a foundation of economic security for workers and their families in the event of a worker’s retirement, disability or death. While we believe that expanding access to paid parental leave is important for all workers, we oppose legislation that would finance it by cutting future Social Security benefits.” – Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare.
Senator Rubio’s proposal would weaken Social Security’s long-term financial health. Caregivers taking their retirement benefits in advance as paid family leave may never be able to reimburse Social Security due to premature death or disability. Former Congressional Budget Office Director Douglas Holtz-Eakin estimates that Senator Rubio’s program would cost Social Security $10.5 billion in the first year and $227 billion over ten years.
Social Security already helps millions of younger working-age families (approximately 16 million beneficiaries) through disability, dependents’ and survivors’ benefits. The truth is that this family leave proposal from Senator Rubio, an outspoken advocate of “entitlement reform” (code for cutting earned benefits), is – at its core – a benefit cut for future retirees and their families.
Workers who take time off to care for children and other family members should not have to sacrifice their hard-earned Social Security benefits later in life. Senator Rubio’s proposal is especially harmful to women, who make up the majority of family caregivers in the United States today. Women can ill afford to take a financial hit during retirement when their average Social Security benefits are already lower than men’s.
As Michael Hiltzik reported in the Los Angeles Times, an Urban Institute study found that trading paid leave for future retirement benefits is a raw deal for families:
“Authors Melissa Favreault and Richard Johnson calculate that parents who take leave would have to delay collecting Social Security for twice the period for which they took leave — to repay 12 weeks of leave, they would have to delay their retirement benefits by 20 to 25 weeks. But delaying Social Security translates into a real financial loss; the authors reckon that parents who took a single 12-week leave would lose about 3% of their future retirement benefits, and those who took four leaves would lose 10%.” – Michael Hiltzik, Los Angeles Times
Author Richard Johnson told Hiltzik, “If we let people borrow against Social Security, that adds to the precariousness of the retirement system.” Johnson warned that the proposed change to Social Security could lead to Americans viewing the program as a savings account rather than income insurance, opening the door to GOP attempts to privatize it.
In a July 10th letter to the Senate Finance Social Security subcommittee, National Committee president Max Richtman implored Senators to reject Rubio’s proposal:
“Since the inception of the program, Americans have regarded their contributions to Social Security as sacrosanct and available only for Social Security. The National Committee believes it should stay that way, and therefore urges you to oppose any legislation that relies on Social Security as a means for financing a program of paid family leave.” – Max Richtman’s letter to the Senate Social Security subcommittee
Read the full letter to the Senate committee here.