According to a study by "Advisor" editor Mary Johnson, a person who retired at age 65 with average benefits in 1984 would receive about $9,558 this year in benefits. That's only $698 more than the poverty guideline (in 48 states) and below the poverty level in Hawaii and Alaska.

Notch Babies receive lower benefits than other seniors with similar work and earnings records because of changes made to Social Security in 1977 when the Social Security Trust Fund was running out of money to pay benefits. The federal budget was in deficit and there were no general federal revenues to transfer. Although the cut in benefits played a significant role in saving Social Security, the change was abrupt. Instead of getting phased in, a transition benefit formula did not work as expected. Nearly all retirees were affected almost immediately. There was no time to make alternate plans.

Opponents of Notch Reform point to the potential cost, but, although the federal budget is once again in deficit, Congress bestows billions in new spending on special interests. Recently, nearly $4.3 billion in subsidies and buy-outs for peanut farmers was proposed.

According to "The New York Times," the biggest beneficiary of this government largesse would not be poor, small farmers, but John Hancock Financial Services, Inc. That financial giant owns licenses controlling 3.8 million pounds of peanuts, but doesn't grow a single one. Astoundingly, some Members of Congress have threatened to cut money for programs such as food stamps upon which low-income seniors like Notch Babies depend, in order to pay for the subsidies.

These are terribly twisted priorities. TSCL members are urged to become active now in the election process. Members of Congress must be held accountable. Contact your Members of Congress and ask them to cut the peanuts and co-sponsor Notch Reform for the millions who legitimately need the help. Co-sponsors of Notch Reform are listed on TSCL's web site at http://www.tscl.org/NotchReformLegislation.asp. Starting in July through October we will publish the names of Notch Reform co-sponsors in this newsletter.

Appendix: 2002 HHS Poverty Guidelines

Source: "Federal Register," Vol.67, No.31, February 14, 2002, pp.6931-6933.

For more information, read "Notch Babies May Be At Higher Than Average Risk For Living In Poverty" at http://www.tscl.org/NewContent/100924.asp.

April 2002