# Keep Security in Social Security 

## By U.S. Senator Tim Johnson

Tuesday, January 11, 2005

Nearly one out of every five South Dakotans depends on Social Security
to make ends meet in their golden years. These are our mothers and
fathers, our aunts and uncles, our neighbors and dear friends.
Forty-seven million Americans count on this program, and for two-thirds
of seniors, it is their primary source of income.

The central component of the program has always been that seniors would
know exactly how much money they could expect every month. There would
be no guessing game or fear of market crashes. Social Security was to
remain a secure, guaranteed benefit.

So, of course, recent plans discussed by the White House to reform and
privatize the program have caused concern because of the severe cuts
expected to the benefits our seniors have been promised.

While the Social Security Trust Fund has a very long-term problem, it is
not an immediate risk. According to the Congressional Budget Office, the
Trust Fund remains solvent for nearly half a century until 2052 and even
after that, all recipients would continue to receive roughly 80% of
today\'s Social Security buying power. This means we must work together
on the best plan possible for future beneficiaries and not rubber-stamp
the first plan floated.

From the limited information we\'ve seen from the Administration, the
Bush proposal privatizes a portion of Social Security by diverting
payroll taxes to individual private accounts.

In addition, during an economic forum held by the President in December,
the Administration sent signals that they will likely propose changing
the formula that sets benefits to a troubling scheme that will reduce
benefit levels by nearly a third in the coming years.

The scheme adjusts benefit levels based on consumer price indexing
rather than wage indexing. This would leave beneficiaries with a smaller
annual cost of living adjustment, or COLA, at a time when Medicare
premiums are skyrocketing at nearly 17% per year.

These changes and the resulting benefit cuts would apply to everyone,
even people who chose not to set up a private account. Such a plan
essentially results in a steep \"retirement tax\" on all seniors. Such a
plan is not \"reform\" and it will not \"strengthen\" Social Security.

Further, the privatization component of the plan doesn\'t fix the basic
solvency problem for the Social Security Trust Fund. Rather, private
accounts would throw the Trust Fund up to \$2 trillion deeper in the
red. Future generations would be tied down with this debt \-- a debt we
would likely be forced to borrow from countries like China and Japan.

We must find a fiscally responsible solution to this problem without
slashing the program and driving up the deficit.

If privatization were in place as Enron was collapsing and the market
stumbled just a few years ago, seniors would have faced an unsteady
future. While private accounts may be a concept we can examine as an
additional component of Social Security, much like an IRA or pension
plan, it should not carve away from the guaranteed benefit our seniors
have come to rely on.

Congress has yet to see the details of the President\'s proposal, and
until that point comes, it is difficult to determine exactly how we
should proceed.

While we may need to examine several options to protect the Trust Fund,
the first must be to bring our federal deficit back under control. South
Dakota common sense tells us that when you find yourself in the hole,
you need to stop digging.

I look forward to working with President Bush to strengthen and improve
Social Security and boost private savings for families. Change must be
approached on a bipartisan basis, through consensus so the program
continues to exist for current and future beneficiaries.

I believe that we must honor our promise to those who have worked hard
and earned the right to a secure retirement that is safe and protected
in their late years.