United States Senate Special Committee on Aging

Social Security and Retirement Savings

Social Security is an enormously successful and important program that keeps millions of seniors out of poverty and provides a sense of security to all Americans. Social Security provides a guaranteed retirement benefit that is protected from inflation and lasts for as long as you live. In addition, Social Security provides benefits for survivors and disabled workers and their families. Senator Kohl believes that any reform to Social Security should preserve these important protections.

While Social Security faces a long-term financial problem, it is not in a "crisis" and it is not going broke. Social Security can pay full benefits for another 40 or 50 years, and after that - even if nothing were done - Social Security could still pay 75 to 80 percent of promised benefits. Senator Kohl believes that Congress should act to shore up Social Security's finances, and that this can be done through relatively modest adjustments. Instead of minor adjustments, however, the President has proposed adding private accounts to Social Security. This would undermine its guaranteed benefit and would not improve Social Security's finances. The proposal would divert money into private accounts instead of paying current benefits. And it would require up to $5 trillion in borrowing that would add to the national debt. Senator Kohl opposes private accounts that would require a massive benefit cut or increase in debt.

While we act to make Social Security solvent for the long-term, Congress should also encourage retirement saving outside of Social Security. Healthy retirement savings will mean a secure retirement for retirees as well as strong investment in the businesses of today. Senator Kohl has supported legislation that set aside the Social Security surplus in a "lockbox" and that eliminated the earnings limit for Social Security beneficiaries over age 65.