Resolution Adopted by the CCAR

SOCIAL SECURITY**

Adopted by the 116th Annual Convention
of the Central Conference of American Rabbis
Houston, TX
March, 2005

Background

Jewish tradition recognizes the vulnerability and abandonment that may come with old age. "Cast me not away in time of old age, forsake me not when my strength is spent," laments the psalmist in Psalm 70. The Bible responds to the fear of old age by urging people to respect and care for their elders: "You shall rise up before the gray-haired and defer to the one who is elder." (Leviticus 19:32) Again and again, we are commanded to take care of those who are most vulnerable in our society, typified by the widow, the orphan and the stranger.

Social Security embodies these biblical principles of intergenerational responsibility and support. For over 60 years, it has been the main avenue through which the United States has assured a reasonable income for its retired workers and their families, as well as for those who have lost family income due to the death or disability of a worker. Social Security, arguably the nation's most successful anti-poverty program, is a social insurance program and a crucial safety net for some of our most vulnerable populations. In all, nearly 47 million Americans receive a check from Social Security each month. Poverty rates among the elderly have fallen from an estimated 50% in 1935 to around 10% today. Over 2/3 of elderly Social Security beneficiaries receive more than half their income from social security, and for the poorest 20%, Social Security benefits are their sole income. Over 30% of Social Security beneficiaries receive disability or survivor benefits. Trustees of the Social Security Trust Fund, who are charged with making seventy-five year predictions based on conservative assumptions, project that by 2018 benefits will exceed revenues and by 2042 the Social Security Trust Fund that has been built up will be depleted. At that point, they predict, Social Security revenues will only cover 75% of promised benefits. Others insist that the assumptions of the Trustees are unrealistically modest and that when current rates of productivity and population growth are taken into account the fund is, in fact, not in crisis at all, though some changes may be necessary to ensure the long-term solvency of the program.

As it enters its second term, the current administration has made reforming Social Security a primary focus of its domestic agenda. It seeks to do this by allowing some of the monies currently paid into the system to be diverted into individual accounts that would be invested in the stock market. Supporters of individual privatized accounts argue that establishing such accounts would increase returns on Social Security dollars and give individuals more control over their retirement money.

Others disagree. They argue that any move towards privatization would involve substantial administrative costs and create larger risks for individuals, destroying the "safety net" aspect of the Social Security system. The stock market is volatile and a drop in asset value before a worker reaches retirement could destroy his/her benefits. 

Furthermore, they argue that individual accounts would undermine the progressive element of the Social Security System. Under the system as it currently exists, Social Security replaces proportionately larger shares of past earnings for low-income workers than for those in higher brackets. A system relying on individual accounts is unlikely to be similarly progressive. In a privatized system, where one relies on the income from individual accounts, those with lower incomes are only able to invest based on what they earn, producing whatever income the market allows. The current progressive system provides a minimum income level for lower income retirees, which individual accounts would not guarantee. And proposals that replace defined social security benefits with individual, private accounts may not provide widow, divorcee, orphan or disability benefits, all of which are important features of the current Social Security system.

A number of possible modifications to the Social Security System have been proposed. We believe that any plan for changing Social Security must be consistent with certain fundamental principles.

THEREFORE, the Central Conference of American Rabbis resolves to advocate for a Social Security System that incorporates the following principles:

  1. Social Security must remain a social insurance program. Its primary role should continue to be providing for the elderly, widows, widowers, orphans, and people with disabilities. This role must be fulfilled by the federal government.
  2. Social Security must continue to provide disability and survivor insurance as well as retirement benefits.
  3. Social Security benefits should be portable and guaranteed, should provide a decent income, and should keep up with inflation. Workers and their families must have a program they know they can count on in old age or in case of disability or the death of a working family member.
  4. Private accounts should not be substituted for Social Security's defined benefits, in whole or in part.
  5. The progressive nature of the program -- replacing a larger share of low-income workers' past earnings as a protection against poverty -- should be maintained.
  6. The impact of any Social Security change should not fall disproportionately on women, minorities, or low-income people. Basic benefit protections for women -- many of whom have lower lifetime earnings and more time away from the workforce because of care giving for children, parents, or spouses -- should be preserved and strengthened.
  7. Any change in the funding of Social Security must not divert funds from other vital social programs.

**Based on a resolution adopted by the CCAR Executive Board in May, 1999.