Indiana Accident News

S.A.F.E accounts threaten Social Security safety net

Posted on Jun 22, 2011

On June 3, Rep. Pete Sessions, R-Texas, introduced H.R. 2109 before Congress. Known as the "Savings Account for Every American Act of 2011," the bill would alter Social Security through the creation of so-called S.A.F.E. accounts.

While Sessions and his Republican co-sponsors (including Rep. Dan Burton of Indiana) have cast the legislation as a means of subverting a government-run Ponzi scheme, others fear that it will put the livelihoods of seniors, widows and the disabled in jeopardy.

In the eyes of many, H.R. 2109 represents merely the latest attempt to privatize Social Security. Beginning the first day of 2012, it would allow workers to contribute 6.2 percent of their income into a privately managed S.A.F.E. account, rather than one protected by by the Social Security Administration. Furthermore, the use of private brokerages and investment advisers would represent a boon for Wall Street financiers.

For 75 years, Social Security has provided Americans with an important financial safety net. Evidence suggests that its automatic-enrollment mechanism is the best protection against financial disaster. It frees workers to invest privately without threatening the government guarantee of reliable income after they retire or are no longer able to work.

Critics of Social Security are quick to point out that the program is under-funded and faces a growing deficit as the Baby-Boom generation proceeds into retirement. And while the system is in need of reform, cutting away the only safety net protecting Americans is not the answer.

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