Washington's Looking to Balance the Budget on the Backs of the Elderly? One in Three Already Face Painful Economic Insecurity

  While advocates for elders are decrying political proposals that would cut budgets “on the backs of seniors and the poor,” Howard Bedlin of the National Council on Aging(NCOA)  says that’s already happening.

Bedlin, NCOA’s policy and advocacy chief, said in an interview that much of the media’s attention to “drastic” proposals to reduce the national debt by House Republicans and the White House fails to reflect the deep cuts to seniors’ program that have already been made in the 2011 budget. 

The 2011 compromise budget, he said, includes stark reductions for seniors in such safety-net programs as low-income housing, home-energy assistance for those in extreme weather, and job training and placement.

Bedlin and other experts on aging are dissecting how the national budget crunch will impact older Americans at this week’s Aging in America conference in San Francisco. 

One in Three Seniors Is Economically Insecure

“One out of three seniors in the United States is economically insecure,” Bedlin stated, living under twice the federal poverty line, or $22,000 per person. “Yet the public perception is that seniors are doing fine and not struggling,” he said.

In addition, according to the Social Security Administration, ethnic seniors are especially vulnerable. About half of African-American, Asian and Latino elders in the United States rely on Social Security for at least 90 percent of their income, compared to only one-third of whites.

“We want to underscore the disproportionate effects of these budget cuts,” said Sandra Nathan, who heads NCOA’s Economic Security Initiative. For example, she said, 46 percent of participants in the Senior Community Service Employment Program (SCSEP) are in ethnic communities, and 60 percent are women.” The program trains older workers and places them in community jobs.

NCOA’s new One Away campaign for elder economic security just released a national survey, conducted for the organization by Harris Interactive, which revealed widespread misperceptions about the financial vulnerability of seniors.

Among the survey’s findings are:

• Less than one-third of Americans knew that low-income elders now pay 25 percent of their incomes for health care out of pocket, despite having Medicare.

• Only one in six people understood that 40 percent of seniors recently faced such housing problems as being unable to pay their mortgages or living in dilapidated housing. 

• Only one in five knew that nearly 6 million older Americans are at risk of going hungry. 

• Fewer than one-fifth of those surveyed knew that average credit-card debt for seniors was $10,000. 

“The unemployment rate for older workers is 25 to 30 percent, the rate of foreclosures is very high, and their credit card debt is the highest of any group,” Nathan said. “African-American and Latino elders use credit cards for rent, food – just to cover their basic needs.”

Strikingly, even though few respondents were aware that so many older adults were struggling, nearly two out of three Americans surveyed said that they personally knew a senior who was struggling economically—and that figure was even higher (70 percent) among young people ages 18 to 34. 

Cuts to Jobs Programs Are “Foolish”

For this fiscal year, Congress and President Obama agreed to slash 45 percent of funding for SCSEP, eliminating 59,000 training and employment positions for older workers – a move Bedlin called “pennywise and pound foolish.”

A new analysis of SCSEP by Northeastern University’s Center for Labor Market Studies shows that even without the cuts, the program only helps one in nine of the 1.1 million impoverished Americans 55 or older who are eligible for the program.