| March 1, 2005
Social Security
The Social Security program
helps ensure a minimum level of security for all workers,
their families, and persons with disabilities. Social
Security is most often thought of as a retirement
program, but about one-third of its beneficiaries
are not retirees. Social Security provides three different
kinds of benefits for workers and their families:
lifetime retirement benefits for retirees who have
worked at least ten years, their spouses, and their
children; disability insurance for workers, their
spouses, and their children; and survivors’ insurance
for the families of deceased workers.
Social Security takes
in money from payroll taxes paid by all workers and
their employers on all or a portion of their income,
currently up to $90,000. Historically, the money collected
from payroll taxes would be paid out in benefits to
retired or disabled workers or their surviving spouses
and children. In recent years, this income has exceeded
the guaranteed benefits resulting in a surplus. This
surplus was the result of the expanded workforce made
up of the large post-war baby boom generation. In
the coming years, these numbers may reverse themselves
as the baby boomers reach retirement age, resulting
in increasing numbers of beneficiaries and decreasing
numbers or workers contributing to the system. This
imbalance and fear of a shortfall are what continues
to drive the current debate about if and how to reform
Social Security.
At the end of December
2003, Social Security provided monthly benefits to
47 million beneficiaries (or one in every 6 Americans).
Social Security paid a total of $471 billion to retired
workers, disabled workers, and to the surviving family
members of deceased workers in 2001. In 2002, Social
Security beneficiaries included about 3 million children
under the age of 18.
USCCB POSITION
In May 1999, the Administrative
Board of the U.S. Catholic Conference released: A
Commitment to All Generations: Social Security and
the Common Good. In this statement, the bishops recognized
that the Social Security program is the largest and
one of the most successful social programs in the
United States because it offers an effective, dignified
way for Americans to honor their obligations to the
elderly, persons with disabilities, and their dependents.
The statement identifies
five key criteria, which USCCB will use to evaluate
reform proposals:
-
The disability and survivors’
portions of the Social Security program should
remain linked to the retirement portion to ensure
continuity of commitment to workers and their
families in cases of disability and death.
-
Changes in Social Security should
not put at risk those individuals and families
whose resources are already very limited.
-
ny changes made in the tax structure
should be weighted in favor of the poor. Those
with lower incomes should bear less of the total
Social Security tax burden than those who are
more affluent.
-
Benefit inadequacies with respect
to the benefits received by some women should
be remedied.
-
Principles of equity and concern
for the common good support bringing employees
from all sectors of the economy into the Social
Security program.
ACTION
The President has made reforming the Social Security system a high priority. There is much discussion and debate over the merits of the system and its short and long term viability. Among the proposals being discussed are changes to the payroll tax structure, retirement age, or the rate of benefits. The provision in the President’s proposal that is currently receiving the most attention is the establishment of private accounts by which younger workers would have the option of investing part of their payroll tax into the stock market in the hope of a higher return at retirement.
As of this writing, most of the proposals, including the President’s have not been put into legislative language. USCCB staff will be studying these proposals as they are fleshed out and applying the criteria in A Commitment to All Generations to legislation. In the broader debate, we will focus on how the proposed changes touch poor families and individuals and people with disabilities. Our particular priority will be continuing the guarantee of Social Security, especially for those who rely on it for basic income support.
|
