President Bush has named a commission to reform Social Security. The commission will devise a plan allowing younger workers to voluntarily invest a portion of their Social Security taxes into private personal investment accounts. Creating private accounts; however, would not by itself solve Social Security`s problems.

Money would be taken out of payroll taxes, an approach known as `carve-out,` to fund private accounts. This means less money to pay current benefits. Even at the current level of funding, Social Security will run short of revenues by 2016. To prevent shortfalls, Commission co-chairman Daniel Patrick Moynihan has said they will probably have to recommend additional steps, such as reducing Cost-of-Living-Adjustments (COLAs). Other options may include cutting benefits or raising the retirement age. We are gravely concerned about this new threat to benefits.

Many TSCL members, our `Notch Babies,` were hurt by the cost of saving Social Security from going broke in 1977. Now they may be hurt again. Millions more Social Security retirees may also share the pain. TSCL believes that the Commission must acknowledge and rectify that the previous attempt to save the system inadvertently cost an estimated 9 million Americans about $100 a month each in benefits today.

In order for the President to achieve support for his plan, he needs to convince Americans that Social Security can and will keep its promises. TSCL believes Notch Reform legislation must be an important part of this effort. By correcting the existing disparity in benefits received by retirees born from 1917 through 1926, lawmakers will prove they are willing to keep those promises.

TSCL believes that H.R. 97 `The Notch Fairness Act,` introduced by Ralph Hall, would offer one of the best legislative solutions for doing this. Those born from 1917 through 1926 could choose either a Lump-Sum of $5,000 payable in four annual installments, or a higher monthly benefit for the rest of their lives.

TSCL members can play a pivotal role in determining whether the Social Security Reform Commission and Congress will address the Notch benefit disparity. A key challenge lies in the make-up of the Commission. At least three of the 14-member panel, including the chairman, former Senator Daniel P. Moynihan (D-NY), are on record as being opposed to Notch Reform. It will be vitally important to create pressure from constituents to put Notch Reform into any plan to reform Social Security.

Please write to your Senators and your Representative to stress how important correcting the Notch disparity is, not only to you but also to gain the confidence of future generations for Social Security reform. Ask them to cosponsor `The Notch Fairness Act of 2001.`

If you would like to write your Senator and Representative urging their support for Notch Reform, click the link below and, once there, select the $5,000 Notch Settlement Petition: http://congress.nw.dc.us/tscl/elecmail.html

June 2001