Tampa Tribune Calls for Action on Reform

September 11, 2003

"The long-smoldering question of how to fix Social Security is about to burst into fiery debate," claims the author of an article in the Tampa Tribune. The article describes how the annual statement distributed by the Social Security Administration now confirms that Social Security is, indeed, unable to pay full scheduled benefits in the future. Further, the author suggests, this public awareness effort may be what it takes to bring about reform including individual accounts.

The article states: "The warning now included in annual statements sent to workers 25 and older a few months before their birthdays [says], 'Your estimated benefits are based on current law. Congress has made changes to the law in the past and can do so at any time. The law governing benefit amounts may change because, by 2042, the payroll taxes collected will be enough to pay only about 73 percent of scheduled benefits.'"

However, the date of reckoning is much earlier, the article adds, continuing to dispel the details of the letter. "'Unless action is taken soon to strengthen Social Security, in just 15 years we will begin paying more in benefits than we collect in taxes,' warns Social Security Commissioner Jo Anne B. Barnhart. 'Without changes, by 2042 the Social Security Trust Fund will be exhausted.'

"These specific statements have been going out since May. Before Christmas, a majority of workers will have received theirs. It won't take workers long to figure out what this means and demand reform."

And so, several presidential hopefuls have revealed their plans. The article notes: "Howard Dean, the former Vermont governor and now a candidate for the Democratic presidential nomination, suggested in June, as he has suggested in years past, that the normal retirement date for today's younger workers might be increased a year to age 68. When questioned about it at a union meeting earlier this month, he denied it, saying, 'I have never favored a Social Security retirement age of 70, nor do I favor one of 68.'

Further, "Sen. John F. Kerry, also running for the Democratic nomination, says he would look at cutting back benefits from wealthier future retirees and charging upper-income workers more in payroll taxes, but he insists: 'I will not touch the contract' that he says is 'sacrosanct between generations.'

The article counters: "The Social Security statement is more correct. The program is a changeable law, not a contract. The coming generational imbalance will force changes. The problem has been obvious for a decade or more. The next generation of retirees is leaving behind too few workers to pay the retirement benefits of the rapidly growing ranks of retirees." Thus, neither of these plans will make the cut.

According to the article, the solution would begin "were the first $500 to $1,000 in taxes set aside in a personal retirement account and the money actually invested in something safe—say, government bonds or money market funds. As the accounts grew, the promised government-paid benefits could be reduced."

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