Sen. Elizabeth Warren (D-Mass.) stood up this week to a growing cowardly chorus of lawmakers and corporate executives who have pushed the panic button on Social Security. While many have proposed cuts to America’s minimal retirement safety net that would further gut the program, the freshman senator said it is time to invest more to counter growing medical costs.
Taking to the Senate floor Monday, Sen. Warren touted the need to protect Social Security, especially for those closing in on retirement. She noted that workers are increasingly reliant on the program given the reduction in defined benefit pensions and the fact nearly half of those in the workforce don’t have access to a 401(k) plan.
Not only did she push back on those who support a change in the way cost of living increases are implemented for the program, known as chained CPI, that would decrease the amount seniors receive, Sen. Warren called for the exact opposite. She said the fund should be indexed to measure the real impact of inflation on the elderly, called CPI-E, which would increase benefits.
While she acknowledged that Social Security won’t end the U.S. retirement crisis, it’s a step in the right direction. “The absolute last thing we should do in 2013 – at the very moment that Social Security has become the principal lifeline for millions of our seniors – is allow the program to begin to be dismantled inch by inch,” she stated.
A powerful corporate constituency is doing their damnedest to shortchange hard-working Americans who have played by the rules all their lives. One of the biggest advocates calling for deep cuts for Social Security is the Business Roundtable, made up of big business CEOs. They say the $1,302 a month benefit the average American receives from the fund is too much. Of course, these executives on average have $14.5 million coming to them in their golden years, so they don’t worry about such a pittance.
That’s not the case, however, for the rest of us. The median retirement savings of U.S. workers near retirement age is only $12,000. That’s 1,200 times less than those corporate big wigs trying to slash our earned benefits. These are the same masters of the universe who only contribute three percent of a worker’s salary, on average, to a retirement fund. Thanks for nothing.
A bill introduced earlier this year by Sen. Mark Begich (D-Alaska) that would calculate cost-of-living adjustments using CPI-E would give workers $452 more per year by age 75 and $807 more by age 85. That’s not a financial windfall by any means, but it’s an improvement. It would be paid for by doing away with the payroll tax cap currently set at $113,700.
The benefits of such a change should be considered carefully, Sen. Warren said. “Seniors have worked their entire lives and have paid into the system, but right now, more people than ever are on the edge of financial disaster once they retire – and the numbers continue to get worse,” she stated.