Social Security, Part 2


2005-2-3

I'm Gwen Outen with the VOA Special English Economics Report.

One out of six Americans receive money from the Social Securitysystem. Monthly payments go to retired workers and disabled peopleand to their survivors. Two-thirds of Americans age sixty-five andolder depend on Social Security for at least half the money theyget.

The system is financed mostly by a twelve-point-four percent wagetax shared by workers and employers. This year, close to fiftymillion people will receive more than five hundred thousand milliondollars in benefits.

But, in his State of the Union speech Wednesday night, PresidentBush said: "With each passing year, fewer workers are payingever-higher benefits to an ever-larger number of retirees." Thirteenyears from now, he said, Social Security will be paying out morethan it takes in. In his words: "We must pass reforms that solve thefinancial problems of Social Security once and for all."

His proposals face resistance, not only from opposition Democratsbut also some Republicans. It is often said that politicians riskpolitical death if they touch Social Security. Experts say anychanges will probably reduce future benefits. Yet no one can evenknow what the population will be like years from now.

The president said the system will not change for Americans nowage fifty-five or older. But he warned younger workers that SocialSecurity would be out of money by two thousand forty-two. As he saidthat, Democrats in Congress shouted "no, no, no." Mister Bush saidthe only solutions would be higher taxes, new borrowing or "suddenand severe cuts."

He said the best way to make the system better for youngerworkers is through voluntary personal retirement accounts. He saidthe plan would permit workers to set aside four percentage points ofthe money they pay in Social Security taxes.

The money would be invested in what he called a "conservative mixof bonds and stock funds." He said there would be ways to protectinvestments from sudden changes in the market before a person isabout to retire.

But Democrats say younger workers could lose much of theirretirement savings.

A powerful group for older Americans, A.A.R.P., says it opposesany major changes. It says public opinion studies show that mostAmericans want Social Security to remain as it is.

Internet users can learn more about Social Security atvoaspecialenglish dot com.

This VOA Special English Economics Report was written by MarioRitter. I'm Gwen Outen.