Defending Social Security

 

  Social Security is the most successful social program in American history.  More than half of our elderly population lived in poverty before 1940, when Ida May Fuller of Ludlow, Vt., received the first Social Security check. Because of Social Security, the poverty figure today is less than 10 percent.  Social Security also provides dignified support for millions of widows, orphans and people with disabilities.  One in four veterans receives Social Security benefits in addition to help they receive from the VA.   Since Social Security was established 75 years ago, every nickel owed to every eligible American has been paid in good times and bad. While corporations destroyed the retirement dreams of older workers by eliminating defined-benefit pension plans, Social Security was there paying full benefits.  When Wall Street greed and recklessness caused millions of working people to lose billions in retirement savings, Social Security was there paying out full benefits.  Despite its success, Social Security now faces unprecedented attacks from Wall Street, the Republican Party and a few Democrats.  If the American people are not prepared to fight back, the dismantling of Social Security could begin in the very near future. Rep. Paul Ryan, the new chairman of the House Budget Committee, has been open about his desire to partially privatize Social Security, lower cost-of-living adjustments (COLAs), and drastically cut benefits.  A majority of his fellow Republicans agree.  There are threats on other fronts. A deficit reduction commission established by President Obama called for increasing the retirement age to 69, reducing COLAs for today’s retirees and cutting benefits for future retirees making as little as $42,000 a year.  Just about every day, in one form or another, we hear from our conservative friends that Social Security is in “crisis,” that Social Security is going “bankrupt” and that the Social Security Trust Fund contains nothing more than a pile of worthless IOUs.  As a result of this barrage of misinformation, many young Americans have been convinced that when they reach retirement age, Social Security will not be there for them. So what are the facts? Why have there been such concerted attacks against Social Security?    According to the latest report of the Social Security Administration, Social Security will be able to pay 100 percent of promised benefits for the next 26 years. After 2037, Social Security will still be able to pay about 78 percent of promised benefits. The non-partisan Congressional Budget Office (CBO) says Social Security will be able to pay full benefits to every eligible recipient until 2039, and beyond then cover 80 percent of promised benefits.     While Social Security is strong for a quarter century, Congress should stabilize it for the longer term.  That is why I agree with President Obama, who has called for raising the cap on taxable income.  Today, that cap is at $106,800.  By removing the cap on incomes of $250,000 and more, we can make Social Security fully solvent for generations to come. Even with no change, the fact is that Social Security has a $2.6 trillion surplus that is projected to grow to more than $4 trillion in 2023. Is this surplus, as some have suggested, just worthless IOUs?   Absolutely not!  Social Security invests, as it should, the surplus money it accumulates into U.S. Treasury bonds, the safest interest-bearing securities in the world.  These are the same bonds that wealthy investors, China and other foreign countries have purchased. The bonds are backed by the full faith and credit of the U.S. government which, in our long history, has never once defaulted on its debt obligations.  In other words, Social Security bonds are as safe as any other U.S. debt obligation.  Further, despite the manufactured hysteria about a “Social Security crisis,” Social Security has not contributed one penny to the very serious deficit situation we face.   Social Security is fully funded by the payroll tax that workers and their employers contribute into the system, not theU.S. Treasury.  Our deficit has, in recent years, been largely caused by the cost of two wars, tax breaks for the rich, a Medicare prescription drug program written by the insurance and pharmaceutical industries and the Wall Street bailout – all unpaid for. Social Security has played no role in our deficits. Why has there been such a concerted effort to privatize Social Security, raise the retirement age or cut benefits?  There are two reasons.  First, Wall Street stands to make hundreds of billions in profits if workers are forced to go to private Wall Street firms for their retirement accounts.  Second, as the Republican Party has moved far to the right and become much more anti-government, there are more and more Republicans who simply do not believe government has a responsibility to provide retirement benefits to the elderly, or help for those with disabilities.  Needless to say, I strongly disagree with both of those propositions.  That is why I have recently formed the Defending Social Security Caucus in the Senate.  In my view, maintaining and strengthening Social Security is absolutely essential for the wellbeing of tens of millions of Americans. We cannot allow it to be destroyed or dismembered.  Bernie Sanders is the junior U.S. Senator from Vermont. He served as the mayor of Burlington 1981-1989.