KOHL: WE MUST STRENGTHEN SOCIAL SECURITY BENEFITS FOR THOSE WHO NEED THEM MOST

WASHINGTON - Today U.S. Senate Special Committee on Aging Chairman Herb Kohl (D-WI) held a hearing on Social Security, with a particular focus on how to target benefits for the populations who need them most. As a result of the global economic downturn, many Americans are relying on Social Security now more than ever. 

 

"The impact of the financial downturn provides a stark contrast to the dependability of Social Security, and it is also the reason that the program's guaranteed, inflation-protected benefits are more vital to Americans now than ever," said Chairman Kohl. "However, as crucial as the program is today, the fact is that it was designed in another era. We need to make sure that the most vulnerable in our society are not left behind as we examine ways to strengthen the program."

 

Kohl stressed that the stability of Social Security can be achieved for generations to come with slight modifications, and at a modest cost. At the hearing, Chairman Kohl called for reform proposals to be submitted to the Committee, which he hopes will serve as a repository of ideas when Congress moves on Social Security reform. 

 

"Health care reform is the number one priority of the administration and of my colleagues here in the Senate. But with an urgent need to contain the federal deficit, there is no doubt that sometime soon all eyes will turn to Social Security. Social Security can be strengthened, benefits for those who need them most can be increased, and long-term solvency can be ensured with just a few, small common-sense changes," Kohl said.

 

Although Social Security still serves as a major protection against poverty in old age, it reflects an American society of 70 years ago. Much has changed:  today people are living longer, women's participation in the labor force has significantly increased, and household composition has changed with many more people who either never marry or who divorce and do not meet the Social Security requirements for spousal benefits. These changes suggest that Social Security, as it is currently designed, may not be as effective as it could be in addressing the needs of today's society.

 

Witnesses at today's hearing discussed ideas to modernize the program to better reflect today's working families and workplace, while ensuring that benefits are adequate and equitable. Leon Burzynski, President of the Wisconsin Alliance for Retired Americans, discussed the importance of benefits, highlighting several examples of retirees in his organization who depend on Social Security for their livelihood. Kenneth Apfel, who served as Social Security Commissioner under President Bill Clinton, provided a broad overview of the importance of benefits to survivors, the disabled, and retirees, highlighting particular subpopulations where Social Security is a key source of income. Apfel also offered his thoughts on how we can improve Social Security for future generations. 

 

Joan Entmacher, Vice President for Family Economic Security at the National Women's Law Center, offered testimony on the importance of benefits to women in particular, and outlined several proposals to adjust benefits to help low income women and other groups.  Melissa Favreault, Senior Research Associate at the Urban Institute's Income and Benefits Policy Center, testified on ways to better steer benefits to those who need them most. Specifically, she will look at ways to help low-income earners and the oldest retirees.

 

John Irons, Research and Policy Director for the Economic Policy Institute, discussed strategies to increase revenue in order to extend solvency and pay for benefit modifications. He outlined the current budget projections and then discuss revenue generating proposals, such as lifting the earnings cap to the historical level of 90 percent of all income earned and continuing to tax employers above the cap. Finally, Andrew Biggs, a Resident Scholar at the American Enterprise Institute, detailed how and why Social Security's long-term shortfalls worsened significantly in the latest Trustees Report. 

 

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