Finally, A Reform Proposal for Social Security
Knight-Ridder/Tribune Media Services, April 6, 2000
Although it didn't get a fraction of the attention that his proposal for Elian received, Vice President Gore has recommended two changes to Social Security that would help make the system more fair for women. If this is a new strategy to rescue those elusive 25 electoral votes in Florida, it is a welcome change.
Gore's first proposal would add $16,500 per year to the earnings record of parents with children under five years of age.
Women spend more time out of the labor force than men do, caring for children. As a result, their benefits at retirement are substantially reduced: the average benefit for women $660, while men's average benefit is about $880. Much of this difference is due to lower pay (women on average earn 73 percent of what men earn, and this percentage was even lower for the time when current retirees were working). But a large part of the difference results from the time that women spend out of the labor force.
"Giving women credits for caring for children is important for all women who will draw benefits in the future from their own work," said Heidi Hartman, director of the Institute for Women's Policy Research. "It would be the first time that the Social Security system would recognize the value of care-giving, something the women's movement has demanded for a long time."
Men would also be eligible for the credit to their earnings record.
The plan also raises some interesting issues about wage fairness: most child care workers do not earn $16,500 a year. Gore's plan should make people think about why our society places such a low value on this important labor in the private sector as well.
Gore's other proposal would benefit elderly widows by increasing their survivors' benefit. Under current law, many women lose anywhere from one-third to one-half of the couple's combined benefits upon the death of a spouse. This proposed change would guarantee 75 percent of the couple's combined benefits.
These proposals are a breath of fresh air in a national debate that has reeked with dishonesty on all sides. Virtually every "reform" plan that has gotten attention so far has contained either privatization that would undermine the security of the system, benefit cuts that would push millions of elderly below the poverty line, or both.
We still have a long way to go before we can have an honest discussion about Social Security. Gore continues to pretend that Social Security is somehow affected by what the program's annual surplus is spent on-- for example, tax cuts versus paying down the national debt. It isn't, and anyone familiar with the basic accounting knows this. The Social Security Trust Fund still holds the bonds for the surplus funds that it loans to the government. If you don't believe the program will collect on its debt, you may as well throw away the $20 bill in your pocket, because it is backed by the same commitment from the US Treasury.
Not to be outdone, candidate George W. Bush responded that "there needs to be Social Security reform to make sure there's a Social Security system at all. This is a system that I believe needs to be fixed"--proving once again that he can say dumb things without mentioning Greecians or Kosovians. Bush has proposed to partially privatize Social Security with individual accounts, a dangerous and expensive scheme that could well cost him the election if it gets enough attention.
For the record, Social Security is financially rock-solid, as was demonstrated once again in the latest Trustees' report, released on March 30. According to their projections, for the next 37 years it can pay all promised benefits, without any changes at all. For those who think it is worthwhile to worry about the science-fiction future-- the Trustees make projections for 75 years-- the additional funds required to balance the program for the entire 75-year period are well under one percent of our national income. So future generations earning 50, 60, and 70 percent more than we do today may possibly have to pay that little bit more of their income to support the elderly.
If these facts were known to the public, no one would be talking about Social Security, and it certainly wouldn't be an election issue. And eventually the truth will have to leak out. But in the meantime, if any politician wants to propose a real reform that will help make the program more fair for women, we should seize the opportunity and try to make it a reality.