On August 14, 1935, President Franklin Roosevelt signed the law creating Social Security. For 70 years it has insured working families against the loss of income due to retirement, death or disability. The future of the program, and the government's ability to finance it, have been the subject of much debate recently.
Since his reelection last November, President Bush has traveled across the country telling Americans that if major reforms aren't enacted, the Social Security system will go bankrupt. "A lot of us are getting ready to retire and we're living longer," Mr. Bush told an audience in Atlanta last month. "Interestingly enough, we've been promised greater benefits than the previous generation." Adding to the problem he said is the fact that fewer young workers are paying into the system.
A new survey by AARP, a membership organization for Americans 50 and over, indicates that a majority of Americans agree that Social Security is in danger of running low of funds. Among the 1,200 people, 18 and older, who were polled by telephone, 59% said they were "not too confident" or "not confident at all" in the future of the government's retirement program.
Despite their lack of confidence, AARP policy director John Rother says, 80% said the government should keep the Social Security program alive. "People want this program protected," Mr. Rother says. "They want it to be strengthened. They actually do want Congress to take action, but they do not want to see radical changes."
Those "radical changes" include the personal investment accounts proposed by the President and others, that would allow workers to invest about one third of their Social Security funds in what Mr. Bush has called "a conservative mix of stocks and bonds."
Ursula Williams of Students for Saving Social Security, is among those who believe personal accounts will "fix" Social Security. "The present system is broken for us," she says. "We need these accounts. We are in dire need because we know the burden of debt is going to fall right on us."
Americans are encouraged to set aside personal savings while they are working to supplement their Social Security retirement benefits, but Ms. Williams says that's difficult for students. "This is an opportunity for the government to help us save while we are paying off our bills, paying off our loans."
Economist Christian Weller of the Center for American Progress suggests private accounts will exacerbate Social Security's problems because the government will have to borrow money to make up for the funds diverted to personal investments. And he doubts the accounts will benefit the workers who invest.
"The President has proposed that people can borrow money from Social Security, put it into an individual account, and upon retirement they would have to repay that amount, plus inflation, plus market interest rate," he says. "Only if your rate of return is above [the market interest rate] will you come out ahead. On average you would come out not worse, not better off, than you would in just simply leaving the money where it is."
Mr. Weller says Social Security is a "crucial middle-class benefit." John Rother of the AARP says their survey indicates that many Americans agree and are counting on that government check more than ever to help them get through retirement.
"They think it will be their single most important source of retirement income," Mr. Rother says. "And people are willing to pay more to preserve the benefits they know they will need, given the fact that their other sources of retirement income from employers and from the stock market are less certain. Social Security is the one thing they are counting on for their own future."
With such strong public support for the nation's economic "safety net," Social Security will certainly continue for another 70 years, at least. What's less certain is how the gathering political pressures for reform might eventually change this venerable government program.