But through it all, Social Security is still paying full benefits and keeping millions of people out of poverty in retirement. And not only is it largely immune to the wild swings of the stock market and the economy, Social Security is also perhaps the most successful anti-poverty program in American history – particularly for women.

Why? Women tend to live longer than men, are paid less, and are more likely to take time away from work to care for children. As a result, they often have smaller retirement savings accounts. But while women do tend to have a lower Social Security benefit than men ($3,000 less per year, on average), it makes up a much bigger part of their total retirement income.

Of the more than 1 million Washington residents who receive Social Security benefits each month in Washington, 424,000 are women over age 65. Thanks to Social Security, just 10% of Washington women over 65 live in poverty. Without Social Security, that number would jump to 43%. Social Security is an essential economic support for all Americans, older women in particular. You can learn more about protecting and strengthening Social Security for Washington state at Social Security Works – Washington.

In my family, probably like yours, one of our Thanksgiving dinner traditions is to go around the table and say what we are thankful for. It’s an important reminder of how lucky we are to have our friends and family with us.

Odds are, no one mentions the Federal Aviation Administration, the National Highway Traffic Safety Administration or the Federal Communications Commission (FCC) — let alone the local departments of planning or health. But these public institutions – along with many others – actually have a major impact on our 21^st century Thanksgiving celebration.

While it would take too long to list everything that makes Thanksgiving possible, here are some of the big ones to remember as you gather around the table this Thursday:

• Do you work on Thanksgiving Day? Chances are you don’t, or if you do you’ll be compensated at a higher rate. Say thanks to the federal government, which declared Thanksgiving a federal holiday in 1941.

• Traveling to see family? Thank your local, state and federal governments for everything from the street you grew up on, to the interstate highway system, federal air travel standards and safety precautions, and tax subsidies for every mode of transportation.

• Good to see grandma and grandpa? Remember that they can eat pretty well year-round – no cat food, thank you! – and get high quality medical care, thanks to Social Security and Medicare.

• Do you watch football or the Macy’s Day Parade? Give thanks to the Federal Communications Commission, government-enforced NFL player contracts, and taxpayer subsidized stadiums for these television bonanzas.

• Walking off the meal with a stroll around the block? Give yourself and your neighbors a pat on the back for paying taxes for the sidewalks, and thank your state, local and federal government for enforcing poop and scoop pet laws, and zoning requirements that allow your neighborhood to have clean air and quiet streets.

• Last-minute trip to the store? Government-mandated car safety standards, city snow plows and salt trucks, and well-maintained pavement make it all possible.

• Getting ready to cook? The factories and farms that produce your food have been inspected by the Food and Drug Administration. Happy to have a free range turkey or know the ingredients in that canned cranberry sauce? The government requires industry to provide true and accurate information to consumers.

• Preparing the meal? You’ve got potable water coming from the faucet thanks to water safety standards. And if you’re cooking with gas or electricity, thank your government for building hydroelectric dams, managing the extraction of coal and gas, and ensuring that a bonded contractor did the installation in your house correctly with a required safety inspection.

• Taking it easy by eating out or ordering a pre-made meal? Food safety standards for cooking and storage have been established by city and county governments, with workers required to receive food safety certifications. That means your meal should be fully cooked with safe ingredients in a clean kitchen, free from hair and disease.

These are just a few things our government does for us not only on Thanksgiving Day, but every day of our lives. Our infrastructure, safety standards and rules were made possible by the generations before us, who invested time, hard work and money into the success of their communities and our country.

Our government helps make Thanksgiving relaxing, enjoyable – and easy to take for granted. So, when it’s your turn to say what you’re thankful for, just remember the government – and its citizens – that helped to make it all possible.

John Burbank, Executive Director

If you only read the headlines, you might think that by not reaching an agreement to cut the nation’s deficit, the congressional “supercommittee” was a colossal failure. But in fact, their failure was our success. We dodged a bullet that would have decreased economic security and increased personal misery.

One ploy some members of the supercommittee wanted to consider: a reduction in the cost-of-living adjustment for Social Security. Over time, that would have amounted to a $1,000 annual cut for an 86-year-old — equivalent to one entire month’s worth of benefits. Sen. Maria Cantwell spoke out against that idea, urging the supercommittee to put that notion into the circular file. We’re fortunate they did just that.

Unlike the bailouts given to the big banks that wrecked our economy, America’s workers actually earn their Social Security benefits, whether they make the minimum wage — $8.67 an hour here in Washington — or $51 an hour. All workers pay in, and all workers are covered.

And thanks to those worker contributions, Social Security now has an accumulated surplus of $2.7 trillion (that’s trillion with a “t”!). That money goes back to workers when they retire, or if they become disabled and are unable to work; their spouses and children receive Social Security benefits if they die. It is a universal social insurance program.

More than 1 million people in Washington directly receive Social Security benefits. Pinch those checks, and Washington citizens have less money for everyday purchases. That means fewer retail sales, fewer retail jobs, less tax money for public services, higher public tuition at Everett Community College, and more economic stagnation.

Another proposal was to cut Medicare and raise the age of eligibility — just when more and more elderly employed and unemployed workers don’t have health coverage.

Medicare is also largely funded through a payroll tax on workers. When you hit 65, you can get that earned benefit back, in the form of health care until you die. If we cut Medicare now, that means more deaths, more untreated diseases, more uncompensated care at the emergency room, higher overall health care costs, shorter life spans for workers and retirees, and a lot more premature deaths. We would actually increase health costs and human misery at the same time!

Cutting Social Security and Medicare means less dignity and security for workers and families, and higher health care costs for seniors. So was it a failure that Sen. Patty Murray stepped away from the supercommittee with no agreement to cut Social Security and Medicare? No, it was a triumph of common sense. Those “automatic cuts” that take place without the supercommittee agreement aren’t coming until 2013.

That means that decision-making and responsibility returns to Congress (where it belongs) and not a supercommittee that would have usurped Congress’ constitutional duty to make spending and taxing decisions. It means we have a whole year of sunshine to determine what components of federal services need bolstering and which could be curtailed, and how to equitably finance our country. And it means Social Security and Medicare are protected, for the time being, from the ravages of both Republicans and Democrats doing the bidding of Wall Street.

Speaking of Wall Street, where are we going to get the money to fund public priorities like education, infrastructure and health care? Here’s an idea: right now hedge fund managers, those very same people who drove the economy over the brink into this great recession, pay only 15 percent in income taxes. And they pay close to zero for Social Security. Using Social Security and Medicare as a foil, deficit reduction now is all about the financial community waging class war against 99 percent of Americans.

These 21st century robber barons aren’t the top 1 percent; they are the top one-tenth of 1 percent. They make millions and even billions, yet pay proportionately far less in taxes than most middle-class Americans, whether you are making $45,000 or $145,000. So what if these global gamblers paid income tax rates just like that of ordinary Americans? That alone would bring in $20 billion in the next seven years.

Murray was absolutely right to say no deal when it comes to cuts in Social Security and Medicare. There can be no deal if millionaires and billionaires remain just amused spectators. They have got to participate in rebuilding America, the country that enabled them to gain such great wealth.

Our senators, Patty Murray and Maria Cantwell, held firm. That’s a Thanksgiving present for which we can all be truly grateful.

Rappin' retirees: Just scrap the cap on Social Security

Cross-posted from MomsRising.org:

For a long time – even before some of the current crop of presidential candidates began accusing America’s most successful public program of being nothing more than a “Ponzi scheme” – the national conversation about “fixing” Social Security has centered around cutting benefits or raising the retirement age (also a benefit cut, albeit by another name).

Since Social Security does not contribute to the deficit, and is actually running an impressive $2.6 trillion surplus, there is no need to panic about the program’s projected long-term revenue shortfall. A report released today from the Commission to Modernize Social Security suggests that, instead of rushing headlong into hasty cuts, thoughtful policymaking can address Social Security’s long-term solvency while also modernizing the program to meet the needs of more people who depend on Social Security for economic security.

The Concern with Big Cuts to Modest Benefits

The report, Plan for a New Future: The Impact of Social Security Reform on People of Color, focuses on the demographic shifts that will affect Social Security’s proven track record of providing a critical source of income for beneficiaries. The report notes that people of color will become the majority of Americans within the next three decades and explores why and how people of color depend on Social Security differently than white people.

For instance, nearly three-quarters (74 percent) of white Social Security beneficiaries receive retirement benefits, while the majority (58 percent) of beneficiaries of “other” racial and ethnic groups receive disability or survivor benefits. The report details the socioeconomic reasons for this difference and points to areas where Social Security could do a better job in serving vulnerable populations – mainly by improving the process for determining an applicant’s disability and ensuring that agricultural and domestic workers are covered by the program and its benefits. But one of the report’s most compelling points is the case for increasing Social Security benefits.

Social Security is a social insurance program, not a welfare program, which the National Academy of Social Insurance (NASI) describes as encompassing “broad-based systems for insuring workers and their families against economic insecurity caused by loss of income from work and the cost of health care.” President Lincoln expressed this sentiment more poetically, noting that “the legitimate object of government is to do for a community of people whatever they need to have done but cannot do at all or cannot do so well for themselves in their separate and individual capacities.”

Social Security, like other social insurance programs, is not a hand-out, but rather an insurance policy that workers pay for to protect themselves for when they can no longer work. Since 1935, when the Social Security Act was passed, this system has worked extremely well—sharply reducing poverty, especially among the elderly—despite the fact that benefits are modest by any measure (the average monthly benefit in 2011 is $1,177 for retired workers).

When Social Security was enacted, it was assumed that private pensions would supplement Social Security benefits. With fewer and fewer employers providing pensions today, reliance on Social Security has increased: nearly two in three people 65 and older get half or more of their income from Social Security. For people of color, reliance on the program is even greater: Social Security benefits are the only source of income for two out of every five Latino and African American retiree beneficiary households. This adds to the urgency of modernizing the program to meet the needs of changing economic and demographic realities.

Many experts, including the Commission to Modernize Social Security, are focusing on how to improve benefit adequacy in addition to staving off unwise and unwarranted benefit cuts.

But can we afford adequate benefits?

In 2009, NASI published a report, Fixing Social Security: Adequate Benefits, Adequate Financing, which provided specifics about the impact and cost of various proposals to improve benefit adequacy without breaking the bank and options to strengthen the systems finances. The Commission report builds on these analyses, providing a blueprint for policymakers to modernize Social Security to fulfill its role for the American people of the future.

The report shows that by:

• eliminating the cap on Social Security payroll contributions (currently set at $106,800, which means people who earn $1 million per year pay the same amount of Social Security taxes as those earning $106,800 or less),
• including new state and local workers in Social Security,
• slowly raising Social Security’s payroll tax, and
• treating salary reduction plans like 401(k)s,

Social Security will be able to:

• provide higher benefits to widowed spouses,
• provide benefits to women who stay home to care for children or relatives (thus failing to earn the wage credits required to receive Social Security benefits),
• reinstate the student benefit up to age 22 (which will help low-income students attend and complete higher education), and last, but not least,
• increase benefits across the board.

From the new report, Plan for a New Future: The Impact of Social Security Reform on People of Color. (Click to enlarge)

Listening to What Americans Want

Poll after poll shows that Americans overwhelmingly support Social Security and would rather pay more to strengthen the program than see benefits cut. In a show of bipartisan agreement, Social Security is popular across party lines: 85 percent of Independents and 81 percent of Republicans agree with 93 percent of Democrats that they don’t mind paying Social Security taxes. As for contributing more from wages to preserve and strengthen Social Security, a survey released by NASI in 2009 found that 77 percent of Americans say it is critical to preserve Social Security even if it means paying higher payroll taxes to do so.

The NASI survey also asked respondents on how they felt about some of the proposed policies, outlined above, for increasing Social Security’s revenue and expanding benefits. The responses show that Americans are overwhelmingly in favor of the kind of policies the Commission is proposing:

• 83 percent support lifting the Social Security tax cap so that all workers pay the same payroll tax rate, regardless of income.
• 78 percent support reinstating the student benefit by extending benefits for children whose working parents have died or become disabled, from the current cut-off of student benefits at age 19 to age 22 if the recipient is attending college or vocational school.
• 76 percent support improving benefits for widowed spouses of low-income working couples who generally have inadequate benefits from lifelong low-pay work.
• 64 percent support counting the time that working parents take off to care for children toward  future Social Security benefits so they do not receive lower benefits because of this gap in paid work.

Another survey, released last week by the Institute for Women’s Policy Research, reaffirmed that, across age groups, race and ethnicity, and gender, the majority of Americans in every group do not mind paying Social Security taxes. Furthermore, most Americans believe we should increase Social Security benefits.

Finding common ground among policymakers in an increasingly polarized political climate is difficult, but Americans have already expressed broad agreement that Social Security benefits are important and should be increased if possible. Regardless of party affiliation, age, race, or gender, most Americans do not mind paying Social Security taxes and want to improve benefits rather than cut or otherwise weaken the vitally important insurance protections that only Social Security provides.

Before embracing cuts that won’t alleviate any short-term deficit concerns, and that could undermine long-term economic security for millions of American families, policymakers should step back and take the time to consider the alternative: providing adequate benefits that meet the needs of 21st century families.

Jennifer Clark is the Income Security Project Coordinator at the National Academy of Social Insurance, where she coordinates the education project, Improving Lives of Vulnerable Americans Through Social Security.

The quality of a child’s pre-school shouldn’t depend on their parent’s disposable income; every child deserves the opportunity to get a strong start in life. To accomplish that, day care has to be not only affordable for parents, but the people working there need the opportunity for professional development and compensation to ensure well-trained and experienced professionals are caring for the next generation.

Luck shouldn’t determine whether you can afford the college degree or other training you need to move up. Diligence, hard work and applied talent should have a lot more to do with it. That’s one of the reasons we need statewide tax reform: to improve funding for higher education, so our state’s colleges and universities become affordable again for a middle-class family.

You shouldn’t have to fear losing your job because you or someone in your family got unlucky with the flu – or because you are lucky enough to welcome a new child into your family. We need strong workplace standards like paid sick days and family leave insurance so everyone can take responsibility for their health, their family and their job.

And after a lifetime of hard work supporting yourself and/or your loved ones, there’s no reason you should have to gamble on the chance to retire with dignity and a measure of economic security intact. That’s why it’s important we not only maintain Social Security benefits, but expand them.

It boils down to this: To have a real shot at the American Dream, people need to get their cards from a straight shuffle, not a crooked deal. Making a living, keeping your family healthy, and being able to get ahead should have more to do with the content of your character and your willingness to work hard, than where and when you’re born.

Occupy Wall Street and We Are The 99% exist because the rules of our economy are rigged to grant extraordinary favor to the few at the expense of the rest. It’s no surprise that people are rejecting the stagnant wages, sky-high costs for childcare and college, underwater mortgages and dwindling nest eggs they’ve been dealt. Now we’ve got to rewrite our public policies to keep the dealers honest and ensure everyone gets a straight shuffle.

Rappin' retirees on Social Security: Just Scrap The Cap (We're Movin' In)

When we win, we like to party - and that’s why you’re invited to join us for “Straight Shuffle”, a dinner to benefit the Economic Opportunity Institute.

This won’t be a typical stuffy fundraising dinner. Would you expect that from a place that led the effort to pass a landmark paid sick days law in Seattle, produced a hilarious music video to help save Social Security, and submitted expert testimony in court to defend Washington’s minimum wage law — all in the same year?

Don’t think Social Security cuts affect you? Think again. Because if Social Security is cut, your parents might be movin’ in.

Here’s the deal: right now, everyone pays Social Security taxes on the first $106,800 they earn, which means most people pay Social Security taxes on their whole paycheck. But since $106,800 is the cap (unless Congress acts to change it), a whole lot of wealthy people don’t pay a dime in Social Security taxes on most of what they make… Learn more »

Tell Congress: Don’t cut Social Security – Just Scrap the Cap »

The event will be held at the Jackson Conference Center on the campus of Everett Community College, October 18th from 6:30 – 8:00 PM. The keynote speaker will be Nancy Altman, author of “The Battle for Social Security” and a nationally-renowned expert on Social Security. She will be joined by U.S. Congressman Rick Larsen, as well as WSLC President Jeff Johnson, whose family received Social Security survivor benefits.

Nancy Altman will puncture myths and misinformation circulating about Social Security, discuss possible changes to strengthen benefits, and describe its importance to all generations of Americans – from children of the Great Depression to those born in this Great Recession.

The event is free and open to the public. Learn more and RSVP >

Detailed Parking Map of Everett Community College >

Where: Jackson Event Center, Everett Community College
When: 6:30 – 8:00 PM; Tuesday, October 18th, 2011

John Burbank, Executive Director, EOI

It used to be that working hard and playing by the rules earned most people economic security and the ability to retire with dignity. But jobs are being outsourced, the jobs that remain offer lower wages and fewer benefits, and the retirement savings of most Americans has been decimated by the stock market — if it wasn’t already used to pay the mortgage.

Employers are shifting pension costs onto workers in a fend-for-yourself retirement system. The typical defined contribution retirement account held only $17,794 in 2009. The typical retirement account for people who had been putting money in from 2003 to 2009 was $59,381.

That may seem like a big number, but it’s closer to peanuts. The best retirement accounts provide a stream of income until death. That’s called an annuity, and at $59,381, it would be $285 per month. At $17,794, it’s closer to $85 a month. Both figures leave the retiree living in severe poverty.

Fortunately, one underpinning of the American Dream remains intact: Social Security. Social Security is the float that keeps seniors out of poverty. But it’s not just a retirement program. Yes, my dad gets it, advancing along in his 10th decade. So does my colleague, whose husband died early, leaving her a widow with two young kids. Another friend, disabled by Parkinson’s disease and no longer able to work, gets disability insurance from Social Security, as does the Ingraham High School student who lost his dad. Social Security is insurance for life.

It’s not what the Wall Street bankers want you to think, and it’s not what D.C. politicians are saying. But these are the facts: Social Security has a $2.5 trillion surplus. It pays a regular and dependable stream of payments to 54 million citizens. In Washington, more than 1 million people receive the earned benefit of Social Security. They, their parents or spouses paid into it, and have earned the benefits they now receive. Social Security isn’t an entitlement; it’s earned through years of hard work.

In Snohomish County, almost 100,000 citizens receive Social Security, including 15,000 disabled workers, 6,700 children and more than 7,000 widows and widowers. Those benefits total $113 million, which is pushed back into the county economy for food, services, rent, utilities and other essentials. Because of the multiplier effect, the economy grows by $170 million, which accounts for 1,600 jobs. As goes Social Security, so go the livelihoods and financial security of more than 100,000 people.

But the benefits don’t seem to matter to the Wall Street one-percenters. They want us to believe Social Security is in trouble, and that benefits won’t be paid. They are pocketbook thieves and ideological warriors, eager to earn a buck by gambling Social Security benefits on Wall Street. Win or lose their bets, they will pocket a hefty amount — because the house always wins.

The average Social Security benefit is $1,162 per month. For the bottom half of seniors, Social Security provides more than 80 percent of their retirement income. For the top half, Social Security is one-third of their income, on average. Policy makers should be considering how to strengthen Social Security, not cut benefits to retirees, widow(er)s and their families. The easiest way: End the cap on taxable income that enables millionaires to get away with paying a lower rate than middle class families. This fix would ensure that the top 1 percent contributes equally to Social Security. It’s fair, increases benefits as private retirement plans dwindle, and evens the playing field so everyone can retire in dignity.

Want to know more? I recommend the free forum, “The Threat to Social Security: An Issue for All Generations,” from 6:30-8 p.m. Tuesday at the Jackson Conference Center at Everett Community College. The keynote speaker will be Nancy Altman, author of “The Battle for Social Security” and a nationally renowned expert on Social Security.

She will puncture myths, discuss changes to strengthen benefits, and describe Social Security’s importance to every generation of Americans — from children of the Great Depression to those born in this Great Recession. U.S. Rep. Rick Larsen, D-Everett, will also speak. Since the Economic Opportunity Institute is a sponsor, I will be there as well. I look forward to seeing you there.

Women have long been identified as society’s caregivers, and there’s plenty of research to back that up. Not only do women spend twice as much time as men caring for members of the household, but nearly three quarters of elder care is performed by women.

Unfortunately, much of this caregiving is unpaid, which can result in disproportionate economic insecurity among women. You might have heard of this referred to as the “motherhood penalty” or “caregiver penalty.”

This penalty affects women’s ability to obtain full-time work, maintain consistent employment and receive benefits through employers. It also reduces the amount of Social Security benefits a caregiver receives in older age. Because so much of this work is unpaid, caregivers have a shorter history of wage work.

This penalty is obvious in the Social Security benefit calculations, as Social Security benefits are based on an average of wages collected over 35 years. For people who spend periods of time out of the workforce to raise children or care for a vulnerable family member, those years are counted as ‘zeros’ in the benefit formula. This results in a lower overall benefit, which is reflected in the lesser benefits received by women over 65 compared to men of the same age.

One alternative to help mitigate this penalty is to provide a credit for time spent caregiving. For example: for each year spent raising children, a parent could eliminate one year – up to a total of five years – from the 35 year averaging period. This means benefits would be calculated based on a 30 year average, offering stay-at-home parents a higher benefit and more economic security in older age.

This idea isn’t novel, as a similar method of calculating benefits is used for disabled beneficiaries.  However, it is an approach that could boost Social Security’s already powerful ability to keep women out of poverty. It’s also an approach that deserves more consideration from policymakers who are committed to ensuring Social Security is most effective in providing the economic security it promises.

This blog post is part of the #HERvotes blog carnival.