Wednesday, February 25, 2004
Contact: Bob Weiner/Jeffrey Buchanan
“RASH AND WRONG” ON SOCIAL SECURITY DEFICIT: FORMER CLAUDE PEPPER HOUSE AGING
COMMITTEE STAFF DIRECTOR SAYS GREENSPAN IGNORES POST-BOOMERS’ LOW BIRTHRATE
FLOODING SYSTEM WITH RENEWED SURPLUS, MAKING DEFICIT A “MYTH”
(Miami, FL) -- Bob Weiner, former
Chief of Staff of the House Aging Committee under Claude Pepper (D/Miami),
asserts that “Federal Reserve Chairman Alan Greenspan’s testimony today calling
for reduced social security benefits is rash and wrong and based on an
incorrect myth of a Social Security deficit.” Weiner points out that “the Trust
Fund is solvent for 39 years -- the Trustees even added a year to the projected
solvency last year -- and that baby boomers aren’t booming with babies
themselves, having record low births.
In addition, people are working longer, paying into the system. The fund will actually be even more
solvent with fewer withdrawals down the road.”
Weiner asserts that “what many
political leaders and ‘flamethrowers’ are actually doing – now
uncharacteristically including Greenspan -- is using
solvent Social Security money to reduce the overall federal deficit.” Weiner is calling for “the same courage today that Claude Pepper
displayed 25 years ago in fighting against benefit reductions such as delaying
eligibility, reducing the cost of living allowance, and voluntarizing the
“Pepper’s outrage in 1978 at Carter Commerce Secretary Juanita Kreps’ statement
about increasing the retirement age to 68 for full Social Security retirement
benefits. Pepper demanded and got
a meeting with Kreps. Senator
Pepper kept saying he would ‘fight it to our death.’ Kreps asked, ‘Even
(delaying the start) to the year 2000?’ He vehemently exclaimed, ‘Yes!’ Kreps finally responded, ‘Well, I
haven’t made the proposal anyway.’
That’s how it’s done, and that’s the courage we need from somewhere
now,” Weiner asserts.
Weiner points out that “the baby
boom is a short transitional factor.
The ‘boomers’ aren’t booming with babies themselves. The high birthrate of 2.9 which they
represent (births from 1940-1969) is followed by their own parenting rate of
2.1 per woman (1970-2000). Moreover, since 1990, there is a 10% increase in
women having no children at all. The Social Security trust fund will later be making money by leaps and bounds with
fewer people withdrawing from it.
“Moreover, if the economy
improves – as both parties are calling for and the President claims it will –
the taxes from workers will reduce or curtail the federal deficit as was the
case in the 90’s,” Weiner says.
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“Even if a short term fix is
needed – my own January 13 statement from Social Security says that under
current economic conditions, payroll taxes will be enough to pay 73% of
scheduled benefits by 2042 – I have never heard any of the doomsayers report
that soon thereafter, the boomers’ own low baby-producing rates will mean that
suddenly the system following them will be awash in funds – and that therefore
the system should be then triggered to give more back to beneficiaries to
compensate. In fact, at worst, assuming no economic improvement, the averaging
out makes the system about right as it is, other than a possible short-term
congressional loan down the road far under what we’re now paying for the Iraq
War or in tax breaks for the wealthy.
“It is time to quit scaring our seniors
with false claims. Social Security should remain the third rail of American
politics – it should stay untouched,” Weiner concludes.
(Robert Weiner was Staff Director of the U.S. House Aging
Committee, chaired by Cong. Claude Pepper (D-Miami), 1975-1980, and advisor to
Pepper until Pepper’s death in 1989. He is president of Robert Weiner
Associates Public Affairs and Issue Strategies.
Source: Robert Weiner Associates 301-283-0821 or