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Retirement Planning > Social Security

Social Security Expansion Advocates Target Presidential Candidates

By David Weldon

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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.”

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.”

“We are entering an era where we will have more and more people retiring – but less financially prepared for retirement than the generation before them, even 15 to 20 years ago. That is a huge concern to us at the Alliance. Social Security expansion would plan a role in helping to lesson problems as people prepare for retirement,” Fiesta said.

Social Security Works

Also supporting expansion of the Social Security program is Social Security Works, a coalition of national organizations, unions and social action groups. Co-directors Nancy Altman and Eric Kingson have spent years working on retirement and Social Security issues in the federal government, academia and the public sector.

The two have also just co-written a book on the topic, “Social Security Works – Why Social Security Isn’t Going Broke and How Expanding It Will Help Us All.” They shared the messages from the book, and their thoughts on the current political climate around Social Security expansion with Retirement Wire.

“All of us feel that the nation faces a very serious retirement income crisis and at some point we wanted to turn the discussion away from, ‘Don’t just cut Social Security, to ‘Let’s talk about the realistic solution that Social Security is for a significant number of Americans,” Kingson said of the coalition, and of the pair’s purpose in writing the book.

“The thesis of the book is that are a number of challenges facing the country and Social Security is the solution to all of them,” Altman said.

Like the Alliance’s Rich Fiesta, both Altman and Kingson agree there is a legitimate retirement crisis in this country.

“The vast majority of today’s seniors are one economic shock away from poverty if they’re not already in poverty,” Altman said. “Thanks to Social Security they are doing ok, but the projections are that tomorrow’s seniors are going to be worse off.”

“We’ve had decades of spending wages; we’ve had a complete decline in traditional defined benefit plans; we have the recent recession with the loss of home equity,” Altman said. “Today you’ve got two-thirds of seniors that rely on Social Security for half their income and a third of senior household beneficiaries rely on Social Security for virtually all of their income.”

 That leaves one clear choice in the view of Altman: “What makes sense, what’s going to work, what has support, and what is the most efficient way to go is to expand Social Security.”

There simply is no other viable choice according to Kingson.

“There are estimates that come out of the Boston College Center [for Retirement Studies] that say 53 percent of Americans today will be unable to maintain their standard of living, and that is assuming they will stay working until age 66,” Kingson said. “When they added in the health and long-term care it was 64 percent. So you’re looking at two-thirds of senior households not being able to maintain their standard of living.”

With that in mind, the coalition has its sights set on the same targets this year as the Alliance—Congress and the presidential candidates.

“The policy goal is to have the idea of increasing benefits accepted by more Democrats and Republicans. And we would like to see the presidential candidates—whoever they turn out to be— take a position on the need to expand benefits,” Kingson said.

“We also talk about, not just the need to expand benefits to the old, but also there are things that can be done to assist families taking care of family members,” Kingson said. For example, “There is no reason for this country not to have a paid family leave sick pay under the Social Security system. It’s not expensive – it’s 12 weeks of paid leave. Also: providing for students of deceased workers or disabled workers to receive benefits through their college years, or at least to age 21. These are things that are reasonable and should be brought back into the policy discussion.”

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