In the News

By David Shuster

 

There were fresh indications today that Democrats in Congress have rediscovered their spine in the fight to protect Social Security. The development is a gift to all of us on this -- the 77th birthday of the program.

 

In a press call Tuesday, Representative Gwen Moore (D-WI) became the latest lawmaker to publicly defend Social Security in the 2012 election season, noting the cuts proposed by Republicans would harm most Americans, particularly people of color and women.

 

"Social Security has helped vulnerable groups -- women, people of color -- stay out of poverty," Moore said on the call organized by Social Security Works and the Wisconsin Alliance for Retired Americans. "As people of color become a majority of the population, and women remain economically vulnerable later in life, Social Security will become more important to the country too."

 

Because older people of color tend to have lower career earnings, Social Security is often more crucial to them than it is for older white people. According to the Social Security Administration, 49.4 percent of senior African American households, 55.1 percent of senior Latino households, and 41.7 percent of senior Asian households relied on Social Security for 90 percent of their income or more in 2010.

 

Representative Moore singled out the chained Consumer Price Index (CPI), a reduction in Social Security's annual COLA (cost-of-living adjustment) in many popular budget proposals, including the Simpson-Bowles plan, as a threat to current and future Social Security beneficiaries.

 

The Consumer Price Index is an indicator of inflation that the Social Security Administration uses to determine the annual cost-of-living adjustment (COLA) increase for Social Security beneficiaries. Some hawkish reform advocates have proposed changing the COLA formula to a chained Consumer Price Index, which grows more slowly, since it accounts for consumers' decisions to substitute cheaper products for more expensive ones.

 

Social Security advocates such as Rep. Moore, however, smartly argue that the chained CPI does not account for the unique expenses incurred by seniors. "The chained CPI comes from a basket of goods that does not reflect seniors' lives," Moore said. "Seniors have greater health care costs, and groceries for seniors may be more expensive because they need them to be delivered. These are not included in the chained CPI. We need to ask ourselves, to what extent does the COLA reflect the reality of seniors?"

 

The reality of Social Security overall is that it's in far better shape than most Republicans and some Democrats seem to understand. According to the Social Security Actuary -- if no changes are made to the program -- it will continue meeting all of its obligations until 2033. And even at that point, Social Security would be able to cover 75 percent of all benefits.

 

Yet Republicans, led by vice presidential candidate Paul Ryan, have proposed dramatic changes to Social Security including the fool's errand and god send to the financial industry known as "privatization." Ryan's proposed "Path to Prosperity" budget resolutions for FY2012 and FY2013 would also create an extraordinary legislative process so Congress could ram through the so called "fixes."

 

Here's an idea: Let's follow regular order for the legislative debate over any proposed changes for Social Security. Let's make time for an honest and comprehensive discussion, even on the proposals that progressives are floating. Democratic Congresswoman Jan Schakowsky (D-IL) has suggested fixing Security by raising the $110,000 cap on income subject to Social Security taxes.

 

It sounds good to me. Millionaires and billionaires shouldn't pay a lower rate into the Social Security trust fund than everybody else. Still, let's have a full-fledged debate on that proposal as well as all the rest.

 

In the meantime, let's remember that this isn't just an actuarial or accounting discussion. Social Security, while helping most Americans, has had a particularly huge impact on women and people of color. And it's a program that we should be working to strengthen, not weaken.

 

Thanks to Congressman Moore today for the reminder.

 

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