For 80 years the Social Security program prevented the U.S. elderly from living in extreme poverty conditions. Today more than ever the program is crucial, as private sector pensions are disappearing and the levels of individual savings are minimal. This is especially true for Latinos.
From its inception until today, the federal program has been the target of conservatives. First, when it was launched in the 1930s during the Great Depression, it was denounced as a socialist invention to redistribute wealth. Today nobody attacks its mission, but there are calls to reform it under the argument that it is insolvent, claiming a nonexistent crisis.
Former president George W. Bush failed to transform it into a private system in which Wall Street, not the government, would manage the workers’ contributions. The GOP-dominated Congress today is using the problems of part of Medicare to try to reform the program, applying the same logic as treating a cold in the operating room. Meanwhile, in his 2016 presidential campaign New Jersey governor Chris Christie has seized on the issue, repeatedly proposing to punish the beneficiary by raising the retirement age and reducing benefits.
The program will remain solvent until 2034. At that time, it will be able to meet only 79% of scheduled benefits, and payouts would cover only 73% over the following 55 years. This is not an imminent crisis, and there are other, simpler ways, to strengthen the program. For example, the maximum amount of taxable earnings is $118,500, which means that anyone who earns that amount pays the same as a millionaire. Furthermore, this tax only applies to salaries, not other sources of income. Changes in those areas would increase revenue.
Latinos have a special interest in Social Security. As taxpayers, they are the younger workers whose contributions are helping the growing numbers of retirees. As beneficiaries, they are the most dependent on the program, because of lack of savings and that they live longer than whites after the age of 65.
The Social Security program is – and has been – successful. Its current structure needs to be reinforced, and it is possible to do so without hurting the benefits, to make sure poverty does not come back among retirees.