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Congressional Corner - The Guaranteed Benefits Of Social Security And Medicare Serve As A Bedrock Of A Secure Future
By Representative Tim Holden (PA) As we celebrate the 71st Anniversary of Social Security, some of my colleagues in Congress are pushing once again to privatize the program citing a "crisis" illustrated in the recent Social Security and Medicare trustees report. In fact, the report shows Social Security will be able to pay full benefits until at least 2040 and modest changes would shore up the program well beyond that. Medicare’s solvency is much less predictable due to spiraling health costs and the added burden of the Medicare Part D prescription drug benefit. I understand the concern Americans have for their long-term security. As a Member of Congress, I stand ready to take the steps necessary to ensure that Social Security and Medicare are there for future generations. However, I disagree that these steps must include the introduction of private accounts into the system. According to the 2006 Social Security and Medicare Trustees Report, people are living longer, the first baby boomers are nearing retirement, and the birth rate is low. The result is that the worker-to-beneficiary ratio has fallen from 16.5 to 1 in 1950 to 3.3 to 1, today. Within 40 years it will be 2 to 1. At this ratio there will not be enough workers to pay scheduled benefits at current tax rates. Privatization, however, would force benefit cuts, increase risk, and remove the guarantee that these benefits will be there for all Americans. Younger and healthier Americans would pull out of the system, leaving even less in the Treasury for seniors who spent a lifetime paying for the retirement security of others. Additionally, the transition costs of moving to private accounts for Social Security alone would be more than $1 trillion over the next ten years. Even those with many working years ahead of them to build a private account face a risky gamble dependent on the fluctuations of the stock market. The guaranteed benefits of Social Security and Medicare serve as the bedrock of a secure future, unshaken by the ups and downs of the economy or the timing of one's retirement. I am working with my colleagues in Congress for a bipartisan and thoughtful solution to ensure the solvency of these great programs, including advancing legislation to reduce the cost of the Medicare Part D program by requiring Medicare to negotiate lower prices, permit the re-importation of drugs from abroad and create a drug plan provided directly by Medicare, not through a costly private insurance company. Privatization is not the answer and I pledge to do everything I can to prevent the dismantling of Social Security, and Medicare as we know it. November 2006 | ||||||||
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