As millions of Americans prepare this year for one of the biggest milestones in their lives – retirement – the program that they have come to most depend on in retirement its celebrating its own milestone. The Social Security program turns 80-years-old on August 14.
Ironically, the program that seniors next most depend on in retirement – Medicare – celebrates a major milestone of its own this year, and will turn 50 on July 30.
Signed into law by President Franklin D. Roosevelt as part of the New Deal, the Social Security program has assisted hundreds of millions of American seniors during that time. And the reasons for its passage may sound familiar to modern day workers.
“The Act was an attempt to limit what were seen as dangers in the modern American life, including old age, poverty, unemployment, and the burdens of widows and fatherless children,” notes Wikepedia. “By signing this Act on August 14, 1935, President Roosevelt became the first president to advocate federal assistance for the elderly.”
What Your Peers Are Reading
Most people today agree on the critical role that Social Security plays in helping Americans survive financially once they retire. But not everyone agrees on just how large that assistance should be. Some members of Congress advocate cuts to the program. Even left along at its present rate, estimates are that the program will run out of funds in 2033.
While some recent attempts to change the current Social Security tax system have failed, Congress will eventually have to act before the 2033 date if benefits are to continue beyond then without being reduced. Benefits will continue beyond 2033 but the program will only be able to pay bout 77 percent of the scheduled benefits.
Alliance for Retired Americans
One organization at the forefront of efforts to expand Social Security is the Alliance for Retired Americans. Formed in 2001 by the Executive Council of the AFL-CIO, it is the labor movement’s organization for retired workers. But Executive Director Rich Fiesta said the Alliance is not just for labor retirees.
“We welcome anybody else who wants to come and join us,” Fiesta said. “We have chapters in 35 states. We are chartering more as we go along. We are about 4.3 million members nationally with about 1,000 local chapters and 35 state chapters. We focus on retirement – Social Security, Medicare, disability, pension, and retirement security are our core issues.”
While the Alliance has a few causes on its agenda, “Social Security expansion is the most important one,” Fiesta said. Others include: “protecting Medicare from privatization or cost shifting to beneficiaries. Plus the whole larger issue of retirement security – having enough resources during your working life that you can have a secure retirement. Then, there are both private sector and public sector pensions; savings; the phenome of growing wage inequality and its effects on retirement.”
In addition to being Social Security’s 80th birthday, 2015 is also presidential election campaign season. And the presidential candidates are all targets for the Social Security expansion campaign.
That is one reason why the Alliance was delighted with the recent late-night Senate votes on Social Security, especially the effort by Massachusetts Senator Elizabeth Warren to see Social Security expansion pass. While the measure failed, it did draw near-unanimous support by Senate Democrats (and near unanimous opposition by Republicans). But the Vote-athon measure forced every member of the Senate to go on the record how they stood on the issue.
“We were very heartened on the Vote-athon on Sen. Warren’s amendment to expand Social Security had nearly unanimous support from the Democrat caucus,” Fiesta said. “It was unfortunate that the Republicans didn’t see it the same way. But we are heartened that Social Security expansion is now part of mainstream discourse on retirement.”
The Alliance will press the presidential candidates to take a position on Social Security expansion. Fiesta says numerous public polls show widespread support for expanding the program, and numerous studies also reflect a growing retirement preparedness crisis.
“Americans are even less prepared for retirement than they were four or five years ago, which is a bad trend,” Fiesta said. “The [National Institute on Retirement Security] just came out with a retirement savings report and it shows that the average working household has virtually no retirement savings. The median account for working age households is $2,500 and for near retirement households it’s only about $14,500.”