Social Security Turns 77: It Works for Maine’s Residents and Economy

Imagine if one out of every two Maine residents over the age of 65 lived in poverty.

That’s what would happen if we had no Social Security.

Without Social Security, the elderly poverty rate in Maine would be nearly half (47.9%) rather than the 8.8% (1 out of 11) that it is today.

One in four Maine residents received Social Security benefits in 2010. Social Security is not a welfare program. We pay for Social  Security through payroll taxes. We earn it over a lifetime of hard work. Nevertheless, it lifts Maine seniors out of poverty and eases their retirement years.

Social Security turns 77 years old today. Since the Reagan era, conservative politicians have warned us that Social Security is on life-support. Time and again, they have told us of an impending crisis in the system citing retiring baby boomers drawing more  benefits than the system has assets. House Budget Committee Chair Paul Ryan proposes deep cuts to Social Security, scaling back a medium-wage-earner’s benefits by almost 40% and increasing Social Security retirement age based on people’s life expectancy saying that individuals should just save more.

But the doom-mongers should take a second look.

According to the trustees’ report on the projected health of our Social Security trust funds, the system will remain solvent for twenty years. After that, and only if Congress fails to act, it will still be able to pay 75% of earned benefits.

Asking the wealthy to pay the same rate of payroll tax contributions toward Social Security as the rest of us (they currently only pay on the first $110,100 of their earnings), would close the funding gap.  What’s more if the defeatist politicians were doing their jobs investing in infrastructure and research and development to help create good-paying jobs, more people would be paying greater amounts into the Social Security system also filling the projected void.

Social Security is even more important in today’s economically stagnant climate. Lower wages, fewer jobs, companies reneging on promised retirement plans, and investment losses mounting in the ups and downs of the stock market, make retirement savings vulnerable. Yet all the while, as Social Security Works says,

Social Security has never missed a payment; it has paid every dollar of earned benefits, on time and in full.

We can all be thankful that we can rely on Social Security, in good times and in bad. And, on the program’s birthday, we can remember why it was created in the first place, in the words of Franklin Roosevelt,

[Social Security] is a law that will take care of human needs and at the same time provide for the United States an economic structure of vastly greater soundness.

Blogger’s Note: Be sure to watch MECEP’s State of the State TV talk show on social security with guests Laura Fortman, Director of Frances Perkins Center; Eric Laursen, author of the book, The People’s Pension; and Lori Parham, State Director of AARP Maine. It airs on Channel 9, August 14-26, on Tuesdays at 7:30 pm, Thursdays at 6:30 pm, Saturdays at 11:30 am, and Sundays at 1:30 pm.  Visit our Facebook page for video clips of the show.