Roth Urges Repeal of Social Security Earnings Limit
Senate Expected to Approve Legislation Wednesday
WASHINGTON -- The Senate Tuesday took up legislation that would allow all seniors to work without having their Social Security benefits reduced. Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) delivered the following statement on the Senate floor Tuesday afternoon:
"Mr. President, today is a great day for millions of seniors, for their families, and for their employers. The Senate will vote shortly to repeal a provision in the Social Security law that discourages seniors from working, the so-called "earnings limit." Repealing this earnings limit is an important step in preparing Social Security for the 21st century.
"Mr. President, Social Security is a wonderful program. Now and in the future, both for today's seniors and for our children, Social Security is the foundation of a secure retirement for most Americans. Social Security has lifted millions from poverty, and is especially important to women.
"But the Social Security earnings limit discourages seniors from working. Seniors can have their benefits reduced by as much as one-third as long as they work. As a result, many seniors choose to cut back their hours, or stop working altogether.
"The fact is, the earnings limit is part of a bygone era. It is the product of the Great Depression, a time when folks believed that an individual should retire completely and make room for others to work. It is antiquated and anti-productive. Although Congress has made the earnings limit less onerous over the years, it has worked only too well. In the early 1950s, almost 50 percent of men over age 65 were working. Today, only 17 percent. And these numbers are even lower for women.
"But in the new economy, we realize the importance of men and women remaining productive participants in our workforce. In the new economy, we appreciate skill and experience.
"Mr. President, abolishing the earnings limit is not only good for seniors, it is good for America. It is good employment and economic policy. It is also good government, will improve public service by the Social Security Administration.
"Repealing the earnings limit will help strengthen the retirement security of Americans by giving seniors the choice of working longer and saving more. As Americans live longer, work will likely be more and more important to the financial security of seniors, especially to women. Also, seniors who work may be better able to voluntarily delay their Social Security benefits. As a result, they will receive a larger check when they do elect benefits, in effect by banking those benefits.
"Mr. President, repealing the earnings limit is good employment and economic policy. We live in a world of great new potential and exciting changes. The Internet and the communications revolution is creating huge new opportunities, and breakthroughs in biotechnology promise longer and healthier lives. But among all this change, there is one constant. Our success as a nation depends on the hard work and talent of our people.
"Today we understand that economic growth is a function of the number of workers and the productivity of each worker. As a nation, we benefit from more workers, not fewer. According to Federal Reserve Chairman Alan Greenspan, we are beginning to suffer from a serious worker shortage that threatens our economic expansion. And in just five years, in 2005, when Baby Boomers reach retirement age, we will need more older Americans working just to maintain the nation's labor force. We do not need disincentives that discourage some of our nation's most experienced workers from working.
"Abolishing the earnings limit will allow us to protect the nation's economic gains of the past 17 years. It will not only help to raise the standard of living for many of our seniors, but help keep the strongest economic growth in our lifetime on track. This is a win-win vote.
"Mr. President, repealing the earnings limit has one other very important value -- improving public service by the Social Security Administration. Administering the earnings limit is complex and difficult. It costs over $100 million per year, and is the culprit in the vast majority of Social Security benefit payment errors. These payment errors are a huge source of frustration to seniors and will now be avoided.
"Let me also note that there is no long-term cost associated with this bill. No senior receives any greater amount of benefits. Rather, we simply provide seniors with greater choice over when they receive those benefits.
"Mr. President, I am very proud of what the Finance Committee and the Senate has been able to accomplish over the past five years. We balanced the budget and have begun to pay down the public debt. We strengthened Medicare and expanded health care, especially for children and people with disabilities. We provided new educational opportunities. We fixed a broken welfare system. We cut taxes and reformed the IRS. And we have protected the Social Security Trust Fund.
"With the passage today of the Social Security earnings limit repeal, we will add one more significant accomplishment to this list.
"Without question, there is still much to do on Social Security reform. But this legislation is a clear and vivid demonstration that we can work together, in a bipartisan way, to achieve lasting and valuable changes to Social Security.
"In closing, let me note that the President has asked for a clean bill, one without extraneous amendments. With the exception of the Manager's amendment which fixes a technical problem with the House bill, we intend to provide that.
"I urge all my colleagues to support this bill -- to sweep away the earnings limit, a relic of the Depression and to move Social Security into the 21st century."
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