Washington, D.C. - U.S. Rep. Rick Larsen (WA-02) called the Social Security reform plan expected to be announced this afternoon “just another bad idea that won’t fix Social Security.” The House Republican plan, that reportedly mirrors a Senate proposal, would use Social Security’s surplus to create individual accounts for workers younger than 55. 

“Republicans need to keep their eye on the ball. Social Security is not bankrupt. It does have financial problems that we need to address,” Larsen said. “Instead of fixing the solvency problem, this latest plan would worsen the program’s finances and skyrocket the federal deficit.”

“This is just another bad idea that won’t fix Social Security,” he stressed.

Larsen has heard from more than 2,000 constituents in his district who oppose privatizing Social Security. In February, Larsen held Social Security Town Hall meetings in the 2nd Congressional District where he heard from constituents on the issue. An overwhelming majority opposed Bush’s plan to privatize portions of Social Security.

“Our retirement security is based on a three-legged stool,” Larsen said, referencing personal savings such as a 401(k) plans, pensions, and Social Security. “This proposal would play Russian Roulette with your Social Security benefits - the only guaranteed, stable leg on the retirement stool.”

The Congressional plan as proposed today would allow workers to initially invest in government bonds, but different than bonds held by Social Security trust funds, those in the individual accounts could sell those bonds and invest in stocks after a certain amount of time. Annual deficits would increase since the Social Security surplus would no longer be used toward the budget deficit. Workers’ guaranteed benefit would be offset by the amount diverted into their private accounts. Social Security Trustees anticipate that annual surpluses will disappear near 2017. Congress would then have to find a new funding source for the private accounts.

“The American people know that smoke and mirrors don’t solve problems,” Larsen said. “They want real solutions that will strengthen, not weaken, Social Security. And they certainly don’t want more skyrocketing deficits.”