Published in Woonsocket Call on August 23, 2015
With the stroke of his pen, over 80 years ago, on August 14, 1935, President Franklin D. Roosevelt signed the Social Security Act into law. Over the last eight decades, this domestic program has become one of the most popular federal programs, paying $848 billion to 59 million beneficiaries at the end of calendar year 2014. During that year, an estimated 166 million people had earnings covered by Social Security and paid taxes.
Celebrating the 80th birthday of Social Security over two weeks ago, AARP released the results of its anniversary survey. The August 2015 survey followed earlier surveys conducted during previous milestone anniversaries in 1995 (60th), 2005 (70th) and 2010 (75th). The latest 29 page report found that Americans of all ages continue to have strong feelings of support for Social Security, and this latest survey found several key themes.
According to the national survey of adults detailed in “Social Security 80th Anniversary Survey Report: Public Opinion Trends,” Social Security remains a core part of retirement security, it also remains popular across the generations and political ideologies.
“As we celebrate Social Security on its 80th anniversary, our survey found that it remains as important as ever to American families,” said AARP CEO Jo Ann Jenkins. “We also found that although most want to continue living independently as we age, obstacles to saving often continue to occur in our lives. However, Social Security continues to help generation after generation to diminish these obstacles.”
“When it comes to how important Social Security is to Rhode Islanders, the numbers speak for themselves,” said AARP Rhode Island State Director Kathleen Connell. “210,975 is the number of Social Security beneficiaries in the state; 23.7% say that Social Security provides 90% or more of their total income. And about half say that Social Security represents 50% or more of their income. Without Social Security, many retirees would be living below the poverty line.
“It is plain to see that protecting this key earned benefit is critical. A recent AARP survey found 68% of respondents express at least some concern that they won’t have enough savings to last their lifetime. Imagine if they are given reason to worry more about the viability of Social Security. People who are working toward retirement need to make themselves heard and – as we approach the 2016 elections – hold politicians to their promises to protect Social Security.”
Social Security Key to Surviving Old Age
Older American’s look to rely on their Social Security checks to pay bills, say the researchers. Four in five adults (80%) rely or plan to rely on Social Security benefits in a substantial way. Survey respondents (33%) say that Social Security is the source of income that they rely on or plan to rely on most during their retirement years.
The study finding’s reveal that Social Security has broad support, even across political ideologies and America’s generations, too. Sixty six percent believe that this domestic program is one of the most important government programs when compared to others. This view has remained consistent over time in similar AARP anniversary surveys taken in 1995, 2005, and 2010. According to the study, the vast majority of Americans (82%) also believe it’s important to contribute to Social Security for the “common good.”
Like aging baby boomer and seniors, even younger Americans value this program. Specifically, nine in ten adults under 30 (90%) believe Social Security is an important government program, and nearly nine in ten (85%) want to know it will be there for them when they retire.
The survey respondents also want to live independently in their communities at home. The findings indicate that four out of five adults (83%) consider it extremely important to have the ability to stay at home as long as they want; although 64% believe they won’t be able to do so as they age and become frail. Additionally, while 68% feel it extremely important to have family around, 80% want to be able to financially take care of themselves so their children and other relatives won’t have to support them financially.
While recognizing the importance of financial planning, survey respondents say they face a multitude of challenges that keep them from effectively putting away money for their retirement. Specifically, 69% note that they must focus their income on current financial needs, while 47% believe they do not have enough money left over to put into their retirement savings after paying their monthly bills. Survey respondents (39%) says health issues and family problems keep them from saving for retirement.
SS Trustee Report Gives Nation a Warning
The six member Social Security Board of Trustees issued its 2015 report, on July 22, giving the nation a snapshot of the fiscal health of the nation’s retirement and disability program.
Within the 257 page report, the Trustees gave a dire warning to Congress. “Taken in combination, Social Security’s retirement and disability programs have dedicated resources sufficient to cover benefits for nearly two decades, until 2034. However, the projected depletion date for the separate Social Security’s Disability Insurance (DI) Trust Fund is only a little more than one year away, in late 2016,” says the widely anticipated federal report. “After the DI trust fund exhaustion, annual revenues from the program’s dedicated payroll and taxation of Social Security benefits will be sufficient to fund about three-quarters of scheduled benefits through 2089.”
According to the Social Security Administration, there were about 10.4 million Americans who received benefits from the DI Trust Fund in 2014, including roughly 42,429 in the Ocean State. In order to qualify, these beneficiaries are required to have worked in a job covered by Social Security, and must have been unable to work for a year or more due to a disability. If Congress fails to act to direct more funding into the DI trust fund, disabled workers throughout the nation and in Rhode Island will be hit hard financially right in their wallets.
AARP CEO Jo Ann Jenkins offered her observation about the released Social Security Trustees report. “While the Trustees once again report that the combined Old Age, Survivor and Disability Insurance Trust can pay full retirement, survivor and disability benefits for approximately two more decades, we know that if no action is taken, benefits will be cut by nearly 25% in 2034. As the campaign season gets underway, we will be urging all Presidential candidates to share their plans for the long term solvency and adequacy of Social Security.”
Democrats are calling for an easy fix to shoring up the DI Trust Fund, specifically shifting a small percentage of the Social Security payroll tax from the retirement fund to the disability trust fund. This has occurred 11 times in the past with bipartisan support. But, with the 2016 presidential elections now catching the attention of politicos, GOP Senators have threatened to block any transfer of funds, charging that following this strategy is just a way to push the political “hot potato” issue down the road. Political observers say that this year’s Republican opposition to quickly fixing the DI Trust Fund is a way to force Democrats to the negotiation table to get concessions on higher Social Security payroll taxes or to cut program benefits.
Now, it’s time for Congress to pull together to fix the ailing Social Security program to ensure its future solvency and to adequate fund the DI Trust Fund. Lawmakers from both sides of the aisle must stop their political bickering and craft a compromise to keep Social Security’s retirement and disability trust funds well-funded and up and running for years to come. For the sake of older Americans who now rely on their meager Social Security benefits to survive, our elected federal elected officials must begin to act like Statesmen not simple-minded politicians. Hopefully, the voters will push for this change in thinking when they go into the polls in 2016.