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E-Newsletter from U.S. Rep. Jan Schakowsky (D-IL) Social Security Alert # 3 January 4, 2005 Dear Friend, Today's Topic: Social Security Benefits on the Chopping Block? According to a Washington Post article published today, President Bush will propose a plan that will significantly decrease Social Security benefits for retirees. "The Bush administration has signaled that it will propose changing the formula that sets initial Social Security benefit levels, cutting promised benefits by nearly a third in the coming decades, according to several Republicans close to the White House." (Washington Post, 1/4/2005) Paul Krugman also published a column in today's New York Times where he debunks the claim that "Social Security faces an imminent crisis." Krugman writes: "Here's the truth: by law, Social Security has a budget independent of the rest of the U.S. government. That budget is currently running a surplus, thanks to an increase in the payroll tax two decades ago. As a result, Social Security has a large and growing trust fund. "When benefit payments start to exceed payroll tax revenues, Social Security will be able to draw on that trust fund. And the trust fund will last for a long time: until 2042, says the Social Security Administration; until 2052, says the Congressional Budget Office; quite possibly forever, say many economists, who point out that these projections assume that the economy will grow much more slowly in the future than it has in the past." (New York Times, 1/4/2005) In the upcoming months, I will continue to periodically email you materials, including articles and columns, on this critical policy debate about the future of Social Security. |
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