Think again

Stay calm, don't let Bush scare you into abandoning Social Security

By TIM NESBITT

President, Oregon AFL-CIO

When President Bush sounded the alarm about the future of Social Security on the day after his re-election, most Americans said, “Huh?” Then, when Administration officials talked about borrowing $2 trillion to save the program, many of those same people thought, “Gee, Social Security must be in really bad shape.”

There’s a method to the madness in these messages. Once we accept the proposition that Social Security is on the rocks, Bush will have us where he wants us — on the deck of a ship we believe is sinking while he’s in charge of the lifeboats.

So the best advice I have for those who care about Social Security is this: Everybody, stay calm. The worst thing we can do now is to panic and begin fighting over how to abandon ship. Next, let’s take stock of our situation. Here’s a simple three-point checklist we can use to make sure we’re not being misled or bamboozled into doing something that we’ll regret when we’re too old to work for a living and our children are working two jobs to support their families.

Point one: We should look carefully at Social Security’s financing from stem to stern.

It turns out that experts hired by Social Security’s trustees and the bipartisan Congressional Budget Office have done just that. When they added up all the money we have paid into the system to prepare for the surge of retiring baby boomers, they found that there will be enough money to pay all benefits promised until at least 2042, if not 2052. This ship is not leaking, yet. Even 40 years from now, when the leaks are expected, the worst case scenario is that the system will have to scale back its benefits to 73 cents on the dollar. So there’s no reason to rush for the lifeboats.

Point two: We should do whatever it takes to keep Social Security afloat for generations to come.

We expect our government to keep its promises. And, we’ve learned over the years that when something is important enough, the politicians will find a way to get it done. Remember when Congress voted to bail out those mismanaged savings and loan banks in 1989? They did so because our government had promised the money would be safe in those institutions.

We should apply the same principle to Social Security, because (a) this is the most important promise that our government has ever made to its citizens, and (b) those of us working today have been making payments from every paycheck we have ever earned to keep the promise to ourselves and to those workers who come after us. In fact, since 1983, we’ve been paying extra to make sure that promise is kept. We shouldn’t let our elected officials break that promise now.

Point three: Whatever changes we propose for Social Security should make the economic future of America’s workers stronger and more secure, not weaker and less certain.

This might seem like a no-brainer, but Bush’s proposal fails this test. That’s because he wants to divert revenues now dedicated to paying Social Security benefits into private accounts. This change will create an additional shortfall of $2 trillion to pay retirement benefits that were otherwise fully funded over the next several decades.Bush’s proposal punches new holes in the ship and forces us to start bailing sooner.

Two trillion dollars is the equivalent of $6,800 for every man, woman and child on the Good Ship USA. Bush says he’ll borrow that amount of money to ensure that everyone now retired or close to retirement is protected under his plan. But even if he’s successful in getting lenders to pay for our lifeboats, who’s going to pay off those loans?

In the end, Bush’s proposal creates more problems than it solves for our Social Security program and shifts the costs of those problems to future generations. There won’t be room in those lifeboats for anyone born after 1960 or so, even though they’re the ones who will have to pay for them. And, according to the Congressional Budget Office, the generation of Americans who are just now entering the workforce will continue to pay what we’ve been paying for Social Security while their benefits will shrink to half of what the system now provides.
Message to Captain Bush: Don’t try to scare us. And, most of all, don’t try to cheat us. We’re the paying passengers on this ship and we expect you to chart a safe course for us and our children. If you try to do otherwise, you’ll have a mutiny on your hands. Tim Nesbitt is president of the Oregon AFL-CIO..

For more information, check out the Oregon AFL-CIO online at oraflcio.unions-america.com