Social Security | Introduction
Social Security has been a great success for seven decades. The 2008 Trustees’ Report confirms that the program can easily continue to provide economic security to all Americans through the 21st century. The report projects the program’s finances through 2085. As a whole, it shows that Social Security is fundamentally healthy, but the introduction produced by political appointees warns of looming financial problems.
The report projects that when those just entering the work force, reach retirement age, both workers and retirees will have considerably more buying power than they do today. In 2050, Social Security taxes at the current level will finance benefits for the typical retiree worth more than $20,000 in 2008 dollars. Today’s average annual benefit is $12,800.
Unfortunately, a reader has to wade through hundreds of pages and apply enough arithmetic to pass a seventh-grade math test to arrive at that reassuring conclusion. Even more unfortunate, the years of propaganda by Social Security’s opponents have convinced many Americans that the system is in trouble.
Social Security guarantees that all workers and their family members can live in dignity when they can no longer work because of old age, disability, or death. Before Social Security, most seniors faced the prospect of dire poverty in their final years. Moving in with their children was the only safety net. Today 90% of seniors are free from poverty, and most are able to live independently.
While most often thought of as a retirement program, Social Security is organized as a social insurance program. It provides economic security to everyone who works, whether as a physician or nursing home attendant, CEO or janitor, college professor or day care teacher. Social Security protects the unlucky as well as the fortunate, but it never makes anyone rich.
One-third of Social Security recipients are disabled workers and their family members or survivors of deceased workers. In fact, more children live in households supported by Social Security (5 million) than Temporary Assistance to Needy Families, or welfare (4 million).
Benefits are progressive, providing higher incomes to those who need it the most. Those who make less while working get less in monthly benefits, but the lowest earning workers receive a benefit equal to about 50% of their average pay, while the highest earners receive about 25%. Recipients with dependent children or spouses receive additional benefits. Benefits are adjusted annually for inflation regardless of the ups and downs of the economy and are guaranteed for life for retirees and their surviving spouses no matter how long they live.
Privatizing Social Security as President Bush has proposed will slash guaranteed benefits for everyone, remove the foundation of economic security from seniors and families who have experienced tragedy, and cost American taxpayers trillions of dollars.
Rather than dismantling a successful program, we should focus our efforts on strengthening the American economy and increasing the productivity of the future workforce. Investing now in the education of our children and young adults will pay double dividends by providing opportunity for a prosperous future to younger generations and by securing Social Security’s long-term finances.