Social Security Reform Groups Praise Graham Bill

November 25, 2003

Activist groups and experts supporting Social Security reform were quick to praise Sen. Lindsey Graham's (R-SC) proposal to allow workers to privately invest a portion of their Social Security taxes. A sampling of reaction follows:

Michael Tanner, director of the Cato Institute's Project on Social Security Choice, made the following comments today regarding the Social Security reform bill:

Senator Graham is to be commended for his political courage. The upcoming political year will likely feature a great deal of noise and demagoguery about Social Security. But with this proposal, Senator Graham has helped cut through the rhetoric to show us both the need for Social Security reform and how it can be accomplished. In doing so, he has brought us closer to the day when workers will have true ownership and control over their retirement money.

National Center for Policy Analysis Senior Policy Analyst Matt Moore said: "Sen. Lindsey Graham should be praised for moving the Social Security debate forward. This is arguably our nation's single most important domestic policy issue. If Social Security is not responsibly reformed soon, the government will be unable to afford most any other project."

Social Security Choice.org president and advocate of individual accounts Bob Costello stated: "Ideally, we would like to see even larger personal accounts than what is in this bill but the most important thing is that Senator Graham has taken a huge step toward reforming the Social Security system. It is our hope that the introduction of this legislation will encourage more members of Congress to support the idea of personal retirement accounts—and work to make that idea a reality."

For Our Grandchildren is a national grassroots network that seeks to educate the public on the dire need for Social Security reform and the options available, including individual retirement accounts. National Director James Hamilton made the following comments:

We know if those well along in their careers could set aside some money now, that money would grow over the next twenty years, and help them to have a more comfortable retirement. And we know that if those just entering the workforce could put even a little money aside, their money would grow a lot over the next fifty years. We can save Social Security for the next generation, and generations to come, by making a change that allows workers to place a portion of their Social Security taxes in personal retirement accounts. Senator Graham recognizes this. We congratulate him and we encourage other senators and members of Congress to follow his example.

Executive Director Derrick Max of the Alliance for Worker Retirement Security, a coalition of 40 organizations, commented:

Senator Graham's bill is the most innovative and promising proposal to come out of the Social Security movement to date. Without raising taxes, the Social Security Solvency and Modernization Act offers today's workers the kinds of real choices they need to invest for a secure future while preserving current benefits for those close to, or already in, retirement.

[Senator Graham's] election victory in 2002—after campaigning hard for Social Security reform—marked the beginning of the end of the "politics of the third rail." For decades, candidates who supported modernizing Social Security got nothing but beaten up for their efforts. Today these candidates, from both parties, are winning at the ballot box.

Policy director for the Independent Women's Forum Carrie Lukas made the following statements on the beneficial impacts of individual accounts for women:

Because we disproportionately rely on the system, women should be especially concerned about Social Security's unsustainable course. Without reform, the payroll tax increases that will be necessary to prop up the system will lower women's incomes and damage their job prospects. On average, women hold lower-paying jobs, so lose a greater portion of their income when payroll taxes rise. Payroll tax increases make hiring new employees more expensive, stifling job creation, which is critical to women who tend to move in and out of the workforce to a greater degree than men. The benefit cuts that would be necessary if Social Security's financing problems are not addressed would also be devastating to those women who rely on this income at retirement.

Even when they take time away from the workforce, women would benefit from the compound interest and returns generated from investing in bonds and mutual funds.

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