(The following is a message from NAVRE.)
TO NATIONAL OFFICERS, AREA DIRECTORS, ASSISTANT AREA DIRECTORS, NATIONAL LEGISLATIVE COMMITTEE, UNIT OFFICERS AND MEMBERS
Railroad retirees and seniors in general have a vested interest in Social Security for many reasons. We are concerned about the interaction between Tier 1 and Tier 2 of the Railroad Retirement Act and also to those many spouses who worked under Social Security and may be drawing a social security pension in lieu of railroad retirement. Although no legislation has yet been introduced by the Bush Administration one can see trial balloons being dropped in the media on a daily basis. Follow their leads this way.
According to proponents Social Security is in a crisis and the system is going broke. This is a false assumption because there is enough money in the Social Security Trust Fund to pay full benefits through 2042. Social Security needs to be addressed but private accounts is not the answer. Financial experts have indicated that if private accounts are enacted benefits will need to be cut, there will be a need to increase payroll taxes and borrow up to $2.2 trillion to make up for the loss of contributions by younger workers’ paying into the system.
The Social Security Trust Fund has $1.5 trillion in reserves and can pay full benefits for decades to come. Reform is needed to protect and preserve Social Security so it is there as guaranteed benefits for baby boomers and beyond, not destroy it.
Privatization in the case of Social Security as it exists today would mean establishing “personal accounts.” Payroll taxes now being earmarked for the Social Security Trust Fund, which are used to fund benefits, would be diverted into stock market accounts. Privatization would drain the Trust Fund and endanger benefits of current retirees and reduce retirement benefits by almost 50 percent for future generations.
Privatization advocates are purposely vague on how the conversion to private accounts would work, but they acknowledge that there will be benefit cuts, which could total almost 41% for all Social Security beneficiaries–retirees, survivors, children and persons with disabilities–and tax increases in order to pay for transition to private accounts. Costs to administer private accounts could consume up to 20%, money that could be spent on benefits.
NARVRE as a retiree organization by its charter is to protect and preserve retiree benefits whether they are railroad retirement or social security. Being that the current system is interchangeable we stand in opposition to privatization of Social Security as being proposed by the Bush Administration. We will have more information in the near future as to contacting Members of Congress. Please share this with all those on your email lists.
Thomas J. Dwyer
National Legislative Director