The Washington Post recently ran a lengthy article explaining the difficulties Americans face in providing for a secure retirement, as traditional pension plans become less common and 401(k) savings accounts prove to be frighteningly inadequate.
But AFL-CIO President Richard Trumka points out that this whole discussion about retirement security fails to mention an obvious solution staring at us right in the face. It’s called Social Security.
Social Security is a phenomenally successful program that represents the very best in American values and has virtually no waste, no corruption and almost no overhead. The biggest problem with Social Security is that its benefits are too low.
The average annual Social Security payout for men is just $15,876—barely above the minimum wage. For women, the average is only $12,276—barely above the poverty line. By contrast, retirement programs in most other industrialized nations replace a higher share of pre-retirement income.
The AFL-CIO Executive Council adopted a policy statement last month calling for an across-the-board increase in Social Security benefits and an increase in Social Security COLAs to take into account the health care costs faced by seniors.
The truth is that our retirement system is falling apart at the seams. Millions of Americans are afraid to retire because they know they can’t maintain their standard of living in retirement, and more and more seniors have to keep working well past the age when they should be retiring.
It is time to modernize Social Security benefits to reflect fundamental changes in our economy, such as the decline of traditional pensions, the loss of home equity experienced by millions of Americans in the Great Recession and the growth of health care costs.
Recently, Sen. Tom Harkin (D-Iowa) introduced the Rebuild America Act, which includes a proposal to increase Social Security benefits across the board and to make Social Security COLAs more accurately reflect health care costs, while extending the solvency of the Social Security trust fund for another 16 years, until 2052.
Yet most of the discussion about Social Security in Washington, D.C., is about cutting benefits. The Republican budget recently offered by Rep. Paul Ryan (Wis.) endorses benefit cuts such as increasing the retirement age.
There is a huge disconnect between elite opinion and popular opinion when it comes to Social Security benefits. The overwhelming majority of working Americans of every political persuasion in every part of the country “get” the absolutely critical importance of adequate Social Security benefits, but our elites just don’t seem to get it.
Trumka says: “America’s unions invite others to join us in calling for an across-the-board increase in Social Security benefits.”
Social Security is the solution, not the problem.