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Unless Social Security Is Expanded with Increased Funding, We Face An Unprecedented Crisis of Millions of Baby Boomers In Poverty

Trillions needed to maintain lifestyle could come from closing one tax loophole.
 
 
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A majority of Americans, especially women and people of color, will spend their final years living in poverty in coming decades unless Social Security is improved and expanded—not cut back as Republicans and President Obama seek—and there are many fair ways to accomplish that, experts told a congressional briefing last week.

“Don’t listen to anyone inside the Beltway,” said longtime Democratic pollster Celinda Lake. She said she’s surveyed voters in every state and found Americans take a completely different view than Washington’s political leadership. “Real people are wildly in favor of Social Security, wildly supportive of it. And this is a voting issue in 2014.”

Lake’s remarks came after a series of stunning presentations describing why the country was on the brink of a staggering retirement crisis unlike anything Americans have heard about from debt-obsessed Republicans or the White House. The takeaway is that there needs to be a new and entirely different political discussion—and congressional response—about what Social Security provides after a lifetime of work or an unexpected tragedy, so millions of Americans don't become desperately poor.

“There is a retirement income crisis. It’s huge. Two-thirds of working Americans cannot maintain their standard of living in retirement—and that assumes they work until 65,” said Syracuse University’s Eric Kingson, co-director of Social Security Works, which convened the day-long session with Sen. Tom Harkin, D-Iowa. “Somewhere in the discussion about Social Security we forget that its purpose is to assist the American people… The end is the kind of society we want; the kind of support we want.”

Kingson and dozen other experts presented detailed plans on how Social Security can be modernized to better reflect real costs of living for the people it’s intended to help, from tens of millions of seniors, to students who lose a parent while in school. They pointed to a handful of tax breaks—used by wealthier people—that can be adjusted over time not to just stop benefit cuts, which is what Republicans and Obama seek, but to expand Social Security so that no one falls below the federal poverty line—as is now the case.

“The consequence of cutting Social Security benefits, coupled with the near-doubling of the senior population by 2030, would generate a tsunami of seniors living in poverty. And the leading edge of that tsunami would be women, and particularly women of color,” said Dan Adcock, policy director of the National Committee to Preserve Social Security and Medicare. “And that’s because women live longer than men, which means they are more likely to outlive their retirement savings. In addition, women are less likely to receive a pension. And if they do receive a pension, it’s less than what men receive.”

Another overlooked point was that benefits have been repeatedly cut back during the past 30 years, which was when Congress last took a detailed look at the program. That type of downward adjustment is what Obama and Republicans have endorsed in ongoing 2014 federal budget negotiations, although a handful of Democratic and Independent senators, notably Vermont’s Bernie Sanders and Iowa’s Tom Harkin, have firmly rejected that proposal. Senate Majority Leader Harry Reid also said there will be no trading future cutbacks for Social Security recipients in a 2014 budget deal, but even his forceful rebuttal did not note that these earned benefits have been repeatedly cut back.

“We’ve seen substantial reduction in benefits,” said Dean Baker, an economist and co-founder of the Center for Economic and Policy Research, describing how benefits have been parred back since Congress' last major revision of the law in 1983. “They come to a reduction of about 25 percent from what they were back in 1983. The idea that we have not seen a big hit to benefits is flat-out wrong.”