Social Security's Promise

Social Security is the most successful retirement program in history of the world. It was founded on a promise: if you work in America, America will guarantee you a solid foundation for retirement.

In 1937, when Social Security began, more senior citizens lived in poverty than any other age group. Today, seniors have the lowest poverty rate of any population in America. Nevertheless, without Social Security, fifty percent of seniors would sink below the poverty line. DeLauro believes that preserving Social Security is part of our moral duty to keep retired Americans from falling into poverty.

Opposing Privatization of Social Security

President Bush has a proposal to partially privatize Social Security, and he has pledged to make its enactment one of his top priorities. This plan would do nothing to solve the challenges facing Social Security, but instead will add over five trillion dollars to an already bloated federal budget deficit.

DeLauro will fight this plan by every means available. She believes that privatizing Social Security would make retirees less secure. It will also harm our economy and lead ultimately to the destruction of the entire Social Security program.

Harmful to all Americans

Plans to partially privatize Social Security would undermine retirement security by cutting guaranteed benefits over 40% for future retirees, even for those who don't choose an account. Risky privatization accounts won't make up the difference. Such accounts would take nearly $5 trillion from Social Security over 20 years, and jeopardize benefits earned by current retirees, disabled workers and children who have lost a parent. Today, the average monthly benefit is $950, and without this money, nearly 50% of American seniors would be living in poverty.

Beyond the basic benefit of Social Security, Americans should be encouraged to seek a comfortable retirement based on savings and a balanced portfolio of investments. That is why IRAs, 401(k)s,  and similar incentives for retirement savings are critical. But any sound retirement plan starts with the guaranteed benefits of Social Security.

Social Security Faces Long-Term Challenges, but There Is No Crisis

Even if we do nothing, Social Security could pay the full benefits promised by its present formula until at least 2052—and pay very substantial benefits thereafter. With a few modest changes, Social Security can be easily preserved for today's young people. DeLauro is working with others in Congress to draft some simple adjustments to Social Security that will ensure its solvency for generations to come.

Privatization Dangerous for Our Economy

The people who retired in the 1930s and 40s received benefits in excess of the amount they contributed. Those funds were taken from the Social Security contributions of the generation that retired in the 1960s. Likewise, the benefits for those who retired in the 1960s were paid by those then working, many of whom retired in the 1980s --- and so on. If the President's plan diverts one-third of the contributions of today's workers into private accounts, how will we pay today's retirees? Those who support the privatization scheme suggest a simple, but destructive, solution: borrow another $5 trillion.

The President's tax cuts for the wealthy have already added $1.85 trillion to the national debt and will add another $4.6 trillion over the next 10 years. By adding a further $5 trillion over 20 years to the debt for privatization, President Bush would run up more debt in two presidential terms than all his predecessors combined during the entire history of the United States.

Keeping the Promise

Social Security was always meant to be the bedrock of a balanced retirement plan. It guarantees Americans a dignified retirement, even if pensions, investments, and savings fail. Privatization would eliminate the last secure pillar of retirement in America. DeLauro believes that we must encourage Americans of all ages to save more of their income for the future. However, these efforts must complement Social Security, not threaten it.