Many Americans believe that their Social Security contributions have been stolen, diverted to some unauthorized purpose. They are wrong – at least for now. On Wednesday, Senators Lindsey Graham (R-SC), Mike Lee (R-UT), and Rand Paul (R-KY) proposed to do just that—steal our money.
Their Social Security Solvency and Sustainability Act slashes benefits drastically but continues to require workers to pay the same level of contributions specified under current law. Workers’ paystubs would continue to show that they were contributing to Social Security, but that would be only partly true. Workers would be contributing $6.2 trillion more than what would be needed.
Graham, Lee, and Paul propose to “borrow” those excess contributions, all $6.2 trillion worth, the way a school yard bully borrows –with no intention ever of repaying the money. Like school yard bullies, the three Senators even bragged about the fraud. Their press release announcing their proposal describes “What the plan accomplishes,” and lists as the very first accomplishment, “Reduces debt held by the public by $6.2 trillion by 2085.” How can they reduce the debt held by the public? By “borrowing” $6.2 trillion from Social Security’s Trust Funds with no intention of ever paying as much as a penny back.
Given the outrageousness of the fraud that the Senators propose perpetrating on America’s workers, it seems almost beside the point to describe how exactly these three Senators propose slashing benefits, but for purposes of completeness, here is a detailed fact sheet.
Benefits are slashed so substantially, that workers would be better off if Congress took no action whatsoever. According to the most recent Trustees Report, Social Security can pay all benefits in full until 2037. If Congress took no action by that time, Social Security would still pay between 75 percent and 78 percent of the cost of all scheduled benefits through 2080 and beyond. How does this proposal compare? Here’s a chart showing how hard-working Americans are better off with no action rather than with the fraud these three Senators propose:
In the presidential election of 1936, Republican standard bearer Alf Landon sought to undermine workers’ support for the just-enacted Social Security program by warning that workers’ contributions would be stolen by a future Congress. President Roosevelt responded,
“When they imply that the reserves…will be stolen by some future Congress, diverted to some wholly foreign purpose, they attack the integrity and honor of American Government itself. Those who suggest that, are already aliens to the spirit of American democracy.”
I guess FDR never imagined Senators like Graham, Lee, and Paul.
Nancy J. Altman is Co-Director of Social Security Works.