Documents and Legislation
The President's Plan to Strengthen Social Security
The President is Committed to Saving Social Security.
- Social Security provides important support for millions of workers and their families. That is why President Bush is committed to fixing Social Security and signing legislation this year
- Social Security is sound for today's retirees, but the system must be fixed to keep the promise of Social Security for our children and grandchildren.
Because of the President's Leadership the American People Now Recognize These Problems.
- The President Has Led in Confronting The Problems Of Social Security. Beginning with his State of the Union address, the President has placed the problems of Social Security at the top of the nation's agenda.
- Members of Both Parties Now Recognize The Problems Facing Social Security.
Social Security Faces Real Problems That Must Be Addressed Today.
- There Are More People Collecting Benefits. Life expectancy this week rose to a record high of 78 years, and as the Baby Boom generation begins retiring in 2008, there will be dramatically more retirees who will be living longer.
- Benefits Are Growing Faster Than Inflation. Today's 20-year-olds are promised benefits 40 percent higher than seniors retiring today.
- Fewer People Are Supporting the System. In 1950, there were 16 workers for every retiree. Today, there are 3.3 workers for every beneficiary. By the time today's 20-year-olds retire, that number will drop to 2 workers for every beneficiary.
- These Problems Signal a Looming Crisis. In 2008, the first Baby Boomers will begin to retire. In 2018, the system will begin paying out more than the system takes in. This will mean drastically higher taxes, massive new borrowing or sudden and severe cuts in Social Security benefits. Doing nothing today will cost an estimated $10.4 Trillion. Every year we delay acting costs an additional $600 billion.
The President Has Laid Out Basic Principles That Must Guide Reform.
- No Changes for Those Born Before 1950. Those who are at or nearing retirement will have no changes to their Social Security benefits.
- We Must Fix Social Security Permanently. The President wants to fix Social Security once and for all for our children and grandchildren. In 1983, Congress thought they had "fixed" the system for 75 years, and now -- just 22 years later -- the system is facing shortfalls comparable to what they faced then. If we don't fix the system permanently now, we will face the same cash shortfalls and hard choices some 20 years from now. Any fix short of a permanent fix means handing the problem off to future generations
- No Increase in Payroll Taxes. Increasing the payroll tax rate would burden workers and harm our economic strength.
Voluntary Personal Retirement Accounts Are An Important Part Of Comprehensive Reform.
- Voluntary Personal Retirement Accounts Give Younger Workers a Chance to Earn a Better Return on Their Money. If a young person earns an average of $35,000 a year during their career and contributes the maximum amount to their personal account each year, they could expect to have about a quarter million dollars saved by the time they retire.
- Personal Accounts Could Only Be Safely Invested. The accounts could only be invested in a limited number of secure bond and stock index funds, including a life-cycle fund designed to protect workers from sudden market changes on the eve of their retirement.
- Personal Accounts Could Not Be Emptied at Once. The system would ensure the accounts are paid out over time, just like any sensible retirement plan.
- Personal Accounts Could Be Passed On To Children. Personal accounts will give workers an opportunity to build a nest egg and pass the wealth they have built up to their children.
- Personal Accounts Will Belong To The Individual And Can Never Be Taken Away By The Government.
Documents and Legislation »
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