The Sense of the Senate in Support of Social Security is a non-binding resolution that would have expressed the Senate’s determination to address the solvency of the Social Security system while rejecting any plan that would require deep benefit cuts or a massive increase in debt.
The Middle-Class Position:
The Middle Class Supports. Social Security has long been a mainstay of the American middle class. At a time when many middle-class jobs are forcing employees to assume more individual risk in their retirement with a shift away from traditional pensions and toward 401(k) style-plans, Social Security continues to provide a modicum of genuine retirement security, guaranteeing fixed benefits whatever the state of the stock market. This security was endangered when, in the name of bolstering Social Security’s solvency, President Bush proposed a privatization plan that over time would have required benefit cuts of 28 percent and increased the federal debt by $17.7 trillion. The president’s plan to privatize Social Security was among the most controversial and intensely debated issues of 2005, but by year’s end, this resolution was the only Social Security proposal to actually come to a vote in either chamber of Congress. While the resolution was non-binding, it was widely regarded as an indicator of the Senate’s level of support for President Bush’s debt-boosting, benefit-slashing plan.
From the Experts:
“Social Security is the only guaranteed, inflation-proof, lifelong benefit that millions of workers – present and future – can count on. And we should not be talking about replacing this rock solid core of income security with a risky gamble… The trillions of dollars it would cost to create a private account system may well lead to higher interest rates that will raise interest payments on all of the federal debt. That would squeeze the federal budget even tighter. It could lead to higher taxes on everyone and cuts in the funding for essential federal programs besides Social Security, such as Medicare and Medicaid. This would be bad for the economy, bad for family budgets, and bad for future generations.” -Douglas Holbrook, Vice President - Secretary/Treasurer, AARP Board of Directors (January 28, 2005)
“There is no reason to cut Social Security benefits... What is needed are some relatively small changes that are desirable in any event and that would improve the fairness and efficiency of Social Security, while at the same time improving the program’s financing. Diverting Social Security funds into private accounts as proposed by the president only makes basic retirement benefits uncertain and the program more difficult to finance.” –Robert M. Ball, former Commissioner of Social Security (June 2005)
“Increased borrowing is not necessary to restore Social Security solvency. Instead, the increased borrowing would be needed to finance the creation of the private accounts, which by themselves would not do anything to restore solvency, and under some circumstances would worsen solvency. Some plans with private accounts, like the President’s, would shrink the solvency gap by reducing Social Security benefits… Even when these benefit reductions are taken into account, however, all of the proposed plans that include private accounts would substantially increase the federal debt and the interest payments on the debt.” - James Horney and Richard Kogan, Senior Fellows, Center for Budget and Policy Priorities
Beyond this Bill:
While Social Security was never in crisis, the shortfall in funding projected to occur in 2042 should be addressed. Plans to privatize Social Security would undermine, rather than shore up, the program’s finances and should be abandoned. Instead, Congress could consider proposals such as increasing or eliminating the $90,000 cap on income subject to Social Security taxes, diversifying Social Security’s investments beyond U.S. Treasury bonds, and covering new state and local employees under Social Security to increase the pool of people paying into the system.
Proportion of current retirees who get half or more of their current income from Social Security: 2 out of 3
Weeks after his second inauguration that President Bush began touring the country to promote the privatization of Social Security: 2
Number of days after the cross-country tour began that the president finally unveiled the specifics of the plan: 84
Percentage by which President Bush’s Social Security plan would have reduced guaranteed benefits to the average worker now in their twenties: 16
Percentage of young workers not participating in any retirement plan at work: 80
Percentage of Americans who approved of the way President Bush was handling Social Security in June 2005 after they had learned more about his plan: 25
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