|
|
|
CONCURRENT RESOLUTION
|
|
WHEREAS, When U.S. stock market indexes plunged in 2009, the |
|
value of American retirement accounts was shrunk by half; millions |
|
of older Americans now face diminished prospects for a comfortable |
|
retirement and are more dependent than ever on the safety net |
|
provided by our social security system; and |
|
WHEREAS, Before passage of the Social Security Act of 1935, |
|
economic hardship threatened many elderly Americans; now, only |
|
about 10 percent of the elderly fall below the poverty line; nearly |
|
90 percent of those 65 and older receive social security benefits, |
|
without which almost half of them would have incomes below the |
|
poverty line; and |
|
WHEREAS, Social security is the most successful domestic |
|
program in the nation's history, yet the last presidential |
|
administration sought to dismantle it through privatization; this |
|
rejected proposal has resurfaced in Congress in the guise of H.R. |
|
4529, the Roadmap for America's Future Act of 2010, which would |
|
weaken the solvency of the social security trust funds by allowing |
|
workers under the age of 55 to divert a portion of their payroll |
|
taxes to individual investment accounts in exchange for smaller |
|
guaranteed social security benefits; and |
|
WHEREAS, This measure would undermine the economic security |
|
of the elderly, especially that of the least well-off, for whom |
|
social security provides nearly 80 percent of income in retirement; |
|
moreover, permitting current contributors to channel funds out of |
|
the general social security fund would exacerbate the shortfall in |
|
revenues for current retirees as well as for current and future |
|
recipients of disability or survivors insurance payments, and it |
|
would ultimately require large increases in federal borrowing; and |
|
WHEREAS, Traditional social security benefits provide a |
|
guaranteed, predictable source of retirement income, indexed for |
|
inflation, but any savings in private accounts would be subject to |
|
the volatility of investment markets; in addition, even if workers |
|
could convert their private accounts into an annuity at retirement, |
|
it is unlikely that they could purchase one that protects against |
|
inflation; and |
|
WHEREAS, Privatization has proven disastrous in a number of |
|
other countries; in Great Britain, it brought enormous |
|
administrative costs that devoured some 40 percent of the return on |
|
investment; unscrupulous brokers preyed on unsophisticated |
|
investors, and the basic pension shrank dramatically, throwing many |
|
retired citizens into poverty; in Chile, transition costs, |
|
commissions, and other administrative expenses siphoned so much |
|
value from investment accounts that more than 40 percent of those |
|
eligible to collect were forced to continue working; and |
|
WHEREAS, Administrative costs for flexible private accounts |
|
in the United States would be much higher than the very low |
|
operating costs of social security today; moreover, the government |
|
would need a new bureaucracy to track the myriad small investment |
|
accounts belonging to individual taxpayers; the high cost of |
|
establishing the new accounts would further weaken social |
|
security's long-term finances and require some combination of |
|
federal borrowing, tax increases, and benefit cuts; and |
|
WHEREAS, The privatization of social security would be a |
|
hugely complicated and costly process, fraught with potential |
|
disaster for even the most savvy investors; since most employers |
|
today offer defined contribution plans, such as 401(k)s, rather |
|
than defined benefit plans, retiring workers are already |
|
dangerously exposed to market risks; stocks, commodities, and real |
|
estate have fluctuated more precipitously over the past decade, and |
|
most Americans can ill afford to exchange social security's |
|
guaranteed minimum retirement income, indexed to the rate of |
|
inflation, for a chance to roll the dice in the financial markets; |
|
now, therefore, be it |
|
RESOLVED, That the 82nd Legislature of the State of Texas |
|
hereby respectfully urge the United States Congress not to |
|
privatize the social security program; and, be it further |
|
RESOLVED, That the Texas secretary of state forward official |
|
copies of this resolution to the president of the United States, the |
|
president of the Senate and the speaker of the House of |
|
Representatives of the United States Congress, and all the members |
|
of the Texas delegation to Congress with the request that this |
|
resolution be entered in the Congressional Record as a memorial to |
|
the Congress of the United States of America. |