In 1995, I was honored to attend the White House Conference on Aging as a facilitator and issue expert. At the conference, I heard Arthur Flemming talk about the importance of Social Security and Medicare.
Almost 90 at the time, Dr. Flemming not only knew of their significance personally but also professionally. He had served as Secretary of Health, Education and Welfare in the Eisenhower Administration and helped shape Social Security policy for more than four decades. His government career began in 1939 when President Roosevelt appointed him to the U.S. Civil Service Commission. President Nixon appointed him as the U.S. Commissioner on Aging in 1973.
At the 1995 conference, Dr. Flemming shared his dream “that this national community will not only live up to the obligations that it has at the present time, but … will look forward, not backward, as far as helping our people deal with the hazards and vicissitudes of life.”
I can only imagine how disappointed and angry Dr. Flemming would be to hear the words of his fellow Republicans (including U.S. Senators Rick Scott, Mike Lee and Ron Johnson) discount and threaten the future of Social Security and Medicare.
While he recently reversed course following public criticism, Sen. Scott of Florida had proposed last February that all federal legislation should sunset after five years, and “if a law is worth keeping, Congress can pass it again.” This would have required Congress to renew Social Security and Medicare every five years.
In 2010, Sen. Lee of Utah said his objective was to phase out Social Security — “pull it up by the roots and get rid of it.” He said the same about Medicare and Medicaid.
What would likely have most disturbed Dr. Flemming are the views of Sen. Johnson of Wisconsin, who recently repeated his support for annual votes on funding Medicare and Social Security. He called Social Security a “Ponzi scheme.”
Here’s the definition of a Ponzi scheme: “a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.”
So, let’s assess Johnson’s assertion about Social Security.
Spurred by the Great Depression, the Social Security Act was passed in 1935, and monthly benefits began in 1940. Since that time, it has offered protections against the loss of earnings due to retirement, death or disability to nearly all Americans.
According to the National Academy of Social Insurance, “Social Security is the major source of income for older Americans.” For nearly two-thirds (61%) of beneficiaries, it represents more than half of their income, and for a third, it is “all or nearly all of their income.”
Social Security has proven to be especially vital for older women. As the Social Security Administration points out, “Women tend to live longer than men; often have lower lifetime earnings; and may reach retirement with smaller pensions and other assets than men.”
It may surprise some that most people receive more from Social Security and Medicare than they pay into the system (per the Urban Institute, a nonpartisan organization).
Social Security and Medicare help keep older Americans out of poverty. The National Bureau of Economic Research found that poverty among older Americans decreased significantly during the 20th century. “Between 1960 and 1995, the official poverty rate of those aged 65 and above fell from 35% to 10%.” According to the latest U.S. Census Bureau data, as of 2021, about 10% of persons aged 65 and older still live in poverty.
Clearly, there is a need for ongoing and responsible policy analyses and debates to assure the continued solvency of Social Security and Medicare. Informed and rational differences of opinion can help craft amendments to the Social Security Act that take into account today’s realities. What is not constructive are words and actions undermining the confidence in and integrity of programs that have been proven effective and are essential to the well-being of millions of Americans.
The last major reforms to Social Security were in 1983. Two of the changes included taxing up to one-half of the value of Social Security benefits and a gradual increase in the age by which persons can take full retirement benefits (from 65 to 67).
It may well be time, after 40 years, to have another bipartisan National Commission on Social Security Reform. As was done in 1983, their work could inform the President and Congress to help assure that Flemming’s dream of respecting our nation’s obligations to American workers and retirees will be realized for current and future generations.
Dennis Streets is the retired director of the Chatham Council on Aging.