Protecting Social Security and Medicare

August 14th marked the 75th anniversary of Social Security and now is an appropriate time to celebrate the program that has helped so many Americans. It is also a time to assess the long-term viability of a program that in recent years has been under attack, and to reaffirm my pledge to protect it.

All Americans should seek a comfortable retirement including IRA’s, 401(k)’s and similar accounts. However, any sound retirement plan starts with an inflation-adjusted lifetime annuity – a monthly check for life that you cannot lose, and you cannot outlive. This is what Social Security provides – and it thus guarantees a base level of income, even if all else fails. We should not replace a guarantee with a gamble.

Unfortunately, the top Republican on the House Budget Committee recently proposed the partial privatization of Social Security. The plan would cut future Social Security benefits and divert these savings to help fund new private accounts. Because the plan would divert massive sums from Social Security’s Trust Fund, it would leave the program with a deep financial hole. And unless the stock market did particularly well, benefits would be cut.

We need to act to save Social Security, but there is no “crisis.” Even under the most dire predictions, with no changes Social Security will be able to pay full benefits until 2037. We need bipartisan solutions to extend the program’s solvency for the long term. But plans that will put beneficiaries at risk if private accounts – accounts that are based on the stock market – lose their value are not going to solve Social Security’s long-term solvency problems.

The leading Republican in the House of Representatives also recently proposed reducing or eliminating Social Security benefits for those Americans with “substantial non-Social Security income.” Advocates of means-testing Social Security pretend that they are only talking about taking benefits from a few very rich people. But significant savings are not available to the Social Security program, except by taking away benefits from millions of middle-class retirees. Due to the proposal, middle class families do not know whether some future act of Congress will penalize them for saving for retirement.

Congress should reject this attempt to turn Social Security into a welfare program only for destitute seniors. To tell Americans that because they save for retirement, they will lose their Social Security benefits, is both unfair and self-defeating. To improve our economy, we need to encourage savings.

Again, I strongly oppose plans to privatize Social Security and efforts to cut Social Security benefits to working families just because they have saved for their retirement and they are therefore not totally dependent on Social Security. Social Security is a fundamental contract with the American people, and it must not be broken by basing benefits on one’s personal savings or assets.

Congressman Brad Sherman represents roughly half of the San Fernando Valley.