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| Archer-Shaw
Social Security Plan Fails To Advance Effort for Long-term Reform |
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WASHINGTON
- April 28 - The nation's second-largest seniors organization expressed disappointment
today with the newly unveiled Archer-Shaw Social Security plan, warning that its
reliance on privatized accounts will set back the effort for genuine reform of
the Social Security system.
"This plan certainly will provoke much highly charged debate in the short run,"
said Martha McSteen, president of the National Committee to Preserve Social Security
and Medicare, "but it will only thwart the cause for serious and sound solutions
to Social Security's long-term solvency if the House leadership seeks to advance
this measure."
"Chairmen Archer and Shaw deserve credit for developing and presenting their ideas,
however, privatization under their proposal will not make the retirement of America's
workers more secure," McSteen said. Even though the Archer-Shaw plan anticipates
that the government will make up any losses from private accounts that workers
incur, it is counter-productive public policy to require that workers divert part
of their Social Security taxes in the first place into private markets with their
known and ever-present risks for unpredictable losses, McSteen said.
The Archer-Shaw plan also threatens to seriously erode the progressive benefits
structure of Social Security that has traditionally kept tens of millions of low
and modest-wage American workers out of poverty in their retirement years, McSteen
said. Under the plan, upper-income earners are much more likely to benefit from
private accounts than low-wage workers, who have substantially less to invest,
she pointed out.
"Even if all of the many concerns about privatization could be satisfied, this
plan still does not identify or establish an assured and reliable funding resource
for the tens of billions of dollars it would require to make the transition to
the new system that's being proposed," McSteen said.
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