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Senior Citizen News Article
Sen. Hagel Introduces Bill To Extend Social Security Retirement to 68
First Social Security Bill of this Congress also supports private investment accounts
March 7, 2005 - While President Bush prepares to begin a two-month grassroots campaign to win support for the private investment accounts in Social Security, a Republican Senator, Chuck Hagel of Nebraska, will introduce a bill today calling for increasing the Social Security retirement age from 67 to 68 in 2023. It is the first Social Security bill to be introduced in this Congress.
"We are living longer," Hagel told Bob Scheiffer yesterday on CBS' "Face the Nation." "So when you look at the total universe of this, I think that makes some sense to extend the age."
Hagel also supports adding the private investment accounts, which has cost his plan the support of key Democrats. Sen. Ted Kennedy said on ABC’s “This Week” yesterday this would be a “great threat to seniors.”
“The Social Security system is not in crisis today, but there is clearly a crisis on the horizon,” Hagel said in a speech this morning to explain his bill. “In 2018, more money will be paid out of Social Security than comes in. In 2042, the Social Security Trust Fund will be insolvent. Beyond the next 75 years, there is only a black hole of unfunded liability for future generations.”
“No American age 45 or older will see a change in Social Security or their benefits,” he said. “For Americans under 45, my bill would provide the option of voluntary personal accounts.”
Hagel said, “Providing personal accounts is good policy for both the long-term viability of Social Security and for individuals. Government should be about empowering individuals and enhancing personal freedoms and their futures. Personal accounts help do this.”
Sen. Hagle says his bill will make Social Security solvent for future years because:
"First, my bill would raise the current full benefit retirement age by one year - from 67 to 68.
"Second, my bill would maintain the current early retirement age at 62, but would adjust benefits for those who choose to retire early. Currently, workers who retire early receive 70% of their full retirement benefits. My bill would provide these early retirees with 63% of the traditional benefit.
"Third, currently, an individual’s base Social Security benefit is determined by two factors: their average income over 35 years and the wage index. My bill adds a third component: life expectancy. Over the life of the program, Social Security benefit calculations have never been adjusted to reflect increased life expectancy.
"By factoring increased life expectancy into the base benefit calculation, the rate of increase in benefit payments will be slowed. No other changes will be made to the annual Consumer Price Indexing of benefit increases.
He said these adjustments will not only make Social Security solvent, but "can help us confront the challenges of increasing Medicare costs and shortages in the workforce. It is important to protect the option of early retirement, but our laws need to encourage individuals to stay in the work force, not leave it. Medicare costs, Medicaid costs, and labor shortages can be significantly reduced by keeping people healthy and productive and in the workforce."
"My bill pays for these changes in Social Security by using the existing 3.7 trillion dollar unfunded liability to ensure the long-term health of the Social Security system. Doing nothing will mean that at the end of 75 years, Social Security will have chewed up 3.7 trillion tax payer dollars to keep Social Security solvent and we will still have an insolvent program with trillions of dollars more of unfunded liabilities staring us in the face. In recent testimony before the Senate, Alan Greenspan said Social Security’s total unfunded liability could be as high as 10 trillion dollars over the life of the program," he added.
Source: AP
Senior Citizen Aticles | Hagel Bill
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