Friday, August 10, 2012
Social Security: Just the Facts: How to Reform Social Security so it Empowers all Workers to be Independent
Yesterday I wrote a blog about what I believe should be in the Democratic Party Platform and what as a Liberal Democrat I would put in it. One of those things that I would put in it, is what I call a Workers Bill of Rights without laying out specifics, which is what I will be doing today. As it gets to Pension Reform where I'll go past Social Security Reform and into Pension Reform. What I did do yesterday was layout what I meant about Workers Bill of Rights, what I mean about that concept. Which is pretty basic but important and it gets to this by setting up a system where all Americans will have the opportunity and even expected to be as independent in life as possible. Starting at when they become adults and all the way through their senior years and will be given the opportunity to do that. Even low skilled Low Income workers or workers who are unemployed and on Public Assistance, that they will have the opportunity and even expected to put themselves in position. To be as independent and as successful in life as they possibly can and not be allowed to just live off of. Public Assistance indefinitely but instead prepare themselves to leave Public Assistance and either back to the workforce or enter the workforce. With a good job because they got themselves the skills they needed.
Social Security is a good place to start in a Workers Bill of Rights because its a Pension Insurance plan. That we all pay into the moment we start working in life and pay Payroll Taxes. I would like to reform it in a way that would leave the basic Social Security in tack, so that income is always there for anyone whose eligible for it and needs it. But where we could reform and improve it so all workers would be allowed to have their own Personal Retirement Account through Social Security. And no I'm not talking about privatizing Social Security for all of you Progressives who might be freaking out about hearing these ideas. What I'm talking about is a separate program that wouldn't be run by the Federal Government but by the people themselves. And any administration of this law that may be needed would be run by lets say the States or Private Sector but the people would manage their own Personal Retirement Accounts.
My idea is what's called Social Security Plus and it came out around the Social Security Reform debate of 2004-05 that went no where. It was sort of like the Democratic Alternative to President Bush's Social Security Reform plan that went basically nowhere in that Republican Congress. Neither the House or Senate even voted on the Bush plan but what Social Security Plus would be, is basically what its called an add on to Social Security. The base of Social Security would stay in place but all workers, rich, middle or low income would have an option. Of increasing their Payroll Taxes, that would be matched by their employer, which would be Tax Free from both the worker and employer. That would go into a Personal Retirement Account, that would be Tax Free as long as the worker doesn't spend any of that money before they retire. Low Income workers would get their Earned Income Tax Credit expanded to cover this, so they don't lose any more spending money.
We have millions of American Workers and Retirees who don't have either a pension or Individual Retirement Account or Personal Savings Account. Or enough money in any of these accounts, to cover their expenses as they are retired but with a Retirement System like this, more American Workers. Would be empowered to be able to put more of their money away and be able to live independently as they retire later on, because their Personal Income would be larger.