Social Security: CALL IT INSURANCE
21 February 2005, Editorial Board, Des Moines Register
The debate over Social Security might simmer down a little if everyone understood the program and started calling it by its formal name. It's Old-Age, Survivors and Disability Insurance (OASDI).
Note the word insurance.
Social Security is not a retirement-savings program and was never meant to be. It is insurance, and it's not just for retired people. Iowa Senator Tom Harkin reminded everyone of that last week when he asked how payments to disabled workers would be affected by President Bush's plan to partially privatize Social Security.
No one knows the answer, because plan specifics have not been unveiled.
Currently, about 6.7 million children and spouses of deceased workers are receiving survivors benefits from Social Security. About 7.9 million disabled workers and their families receive benefits.
About 33 million people receive retirement benefits, which are meant to insure against abject poverty in old age, not to provide total retirement luxury.
Because Social Security is an insurance program, it's nonsensical to speak of its 'rate of return' as if it were an investment program.
The debate over privatization isn't about strengthening Social Security. It's about transforming it from an insurance program into a savings program.
That's a false choice. For a secure and comfortable retirement, people don't need one or the other. They need both. Security from insurance; comfort from savings.
via: J. Kevin Morton @ Disability Law Blog
ALSO:
Disability Insurance Side of Social Security Raises Questions
3 March 2005, Alan B. Krueger, New York Times
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