By Charlie Williams
The latest Social Security Trust Fund Trustees report assures us that the trust fund is healthy, growing, strong and secure. The trustees report showed the fund stands at a healthy $2.7 trillion.
The trust fund is in excellent shape especially when considering the hit our economy suffered through starting in 2007 and continuing through 2008. According to the latest trustees report, there is enough money in the fund without changes in financing to meet all obligations to current and future retirees over the next two decades (through 2033). The report assures us that without any new funding the trust will have sufficient funds to pay about 75 percent of benefits for the following 51 years. That’s comforting assurance for both current and future retirees.
Now lets compare privatization of the trust fund for current and future workers versus the current system. First and foremost, Social Security trust funds are guaranteed just as is our currency which we rely on day after day. Privatization on the other hand brings about serious risk to retirees. In the privatization stock market world the rule is, as the stock market goes so goes a worker’s chance for a healthy, reliable, retirement income. We need no further proof than the record of millions losing their life savings in the most recent devastating recession to be leery of privatization as to risk it would bring about.
The economic challenges we just went through during the past recession should be viewed as the most serious test ever of the strength of the Social Security Trust Fund. Judging from the last trustees report it is quite obvious the fund met every challenge thrown at it and remains strong and resistant to any and all funding threats. That certainly cannot be true had the fund been turned over to privatization investment firms during those years nor anytime in the future.
It’s always good to remember Social Security benefits are backed up with the full force and credit of the U.S. government just like our U.S. currency which we rely on day after day, year after year. Stocks on the other hand are subject to the ups and downs of the market place. When big banks fail, and the stock market falls, our investments are in jeopardy. Investor market savings were devastated during the recession years. Millions of jobs were lost, investment nest eggs wiped out, homes by the millions lost to foreclosure and lives devastated, but Social Security remained strong and secure, not one Social Security recipient had their monthly benefits cut as a result of the recession and monthly benefits arrived on time as promised.
In the April 27 Alliance for Retired Americans, Friday Alert, Executive Director Ed Coyle, warned retirees to be wary of politicians who would use media reports as political cover for radical changes that would put seniors at risk while enriching Wall Street and big health insurance companies. Good advice, and may I add that goes double for future retirees. Congress should remove the tax cap on Social Security altogether which would ensure the trust fund soundness well beyond this century.
This year’s trustees report also noted the Medicare Trust Fund can pay full benefits through 2024 and cover most benefits through 2085. Not bad when considering all the horror stories put out by opponents of these programs which protect not only seniors but the disabled, widows and widowed children too.
So take heart seniors and the many millions yet to reach retirement age. Social Security and Medicare are in good shape for all current retirees and promised benefits will be there for those still paying into the trust fund when they retire as well.
Charlie Williams, is Field Mobilization Committee Chairman for the Alliance for Retired Americans and former Midwest States Political Director for the International Association of Machinists and Aerospace Workers AFL-CIO-CLC.