Nation Council of Women's Organizations
WOMEN'S CHECKLIST ON SOCIAL SECURITY REFORM
KEEP THE HEART in social security
Social Security is the heart of our nation's social insurance
program, providing universal coverage for workers and their families
through the pooling of resources that guarantees benefits to all.
Check each reform proposal to see if it meets the women's check
test.
DOES THE REFORM PROPOSAL...
CONTINUE TO HELP THOSE WITH LOWER LIFE-TIME EARNINGS, WHO ARE
DISPROPORTIONATELY WOMEN?
Social Security's benefit formula is structured so that the lowest
paid workers receive benefits that replace a higher proportion of
their pre-retirement earnings than higher-wage workers. Many of
the lowest paid workers also have no pensions from their jobs. Any
reform must retain this feature benefitting lower-paid workers.
MAINTAIN FULL COST OF LIVING ADJUSTMENTS?
Social Security's annual cost-of-living increase (COLA), which is
indexed to inflation, is a crucial protection against the erosion
of benefits. Because women live longer than men, on average, and
rely more on Social Security since they often lack other sources
of retirement income, this provision is particularly important to
women. Even when employment-based pension income is available, it
is rarely inflation-protected.
PROTECT AND STRENGTHEN BENEFITS FOR WIVES, WIDOWS, AND DIVORCED
WOMEN?
Social Security's family protection provisions help women the most.
Social Security provides guaranteed, inflation-protected, life-time
benefits for the wives of retired workers, widows, and many divorced
women, many of whom did not work enough at high enough wages to
earn adequate benefits on their own accounts. (Similarly low-earning
men married to higher-earning women also have these protections;
however, while 63 percent of female Social Security beneficiaries
aged 65 and over receive benefits based on their husbands' earning
records, only 1.2 percent of male Social Security beneficiaries
aged 65 and over receive benefits based on their wives' earning
records.)
PRESERVE DISABILITY AND SURVIVOR BENEFITS?
Social Security provides benefits to 3 million children and the
remaining care-taking parent in the event of the premature death
or disability of either working parent. Spouses of disabled workers
and the widows (or widowers) of workers who died prematurely also
receive guaranteed life-time retirement benefits. Two out of five
of today's 20 year olds will face premature death or disability
before reaching retirement age.
PROTECT THE MOST DISADVANTAGED WORKERS FROM "ACROSS- THE-BOARD"
BENEFIT CUTS?
Some proposed "across-the-board" benefit cuts such as raising the
retirement age or the number of years of work history used in
calculating benefits would disproportionately hurt those with the
most physically demanding or stressful jobs who cannot work more
years, as well as those who have low life-time earnings, including
many women (because they move in and out of the labor force to
provide family care), minorities, temporary, seasonal and part-time
workers, agricultural workers, and the chronically under and
unemployed. These workers are also unlikely to have other
employer-provided retirement benefits.
ENSURE THAT WOMEN'S GUARANTEED BENEFITS ARE NOT REDUCED BY INDIVIDUAL
ACCOUNT PLANS THAT ARE SUBJECT TO THE UNCERTAINTIES OF THE STOCK
MARKET?
Proposals to divert workers' current payments from the Social
Security system into individually-held, private accounts, whose
returns would be dependent on volatile investment markets and would
not be guaranteed to keep pace with inflation nor provide spousal
benefits (including benefits to widows and divorced women), would
reduce the retirement income of many women. Without the guarantees
of a shared insurance pool, cost-of-living increases, and spousal
and lifetime benefits, many women could easily outlive their assets.
ADDRESS THE CARE-GIVING AND LABOR FORCE EXPERIENCES OF WOMEN?
The Social Security system is based on marriage and work patterns
that have changed. Currently, the benefit formula, which generally
helps those with low life-time earnings, also favors those with 35
years of labor force participation, years which many women lack
because of family care-giving. Moreover, the effects of sex-based
wage discrimination during their working years are not fully offset
by the more generous treatment low earners receive. Such issues as
divorce, taking time out of the workforce for caregiving, the
differences in current benefits between one and two- earner couples,
and the inadequacies in benefits for surviving spouses must be
considered at the same time that solutions to strengthening the
financial soundness of the system are being sought.
FURTHER REDUCE THE NUMBER OF ELDERLY WOMEN LIVING IN POVERTY?
Social Security has helped reduce poverty rates for the elderly,
from 35 percent in 1959 to less than 11 percent in 1996. In 1995,
the poverty rate for all women over the age of 65 was 13.6 percent
while the poverty rate among women aged 65 or older who lived alone
was 23.6 percent. Without Social Security, the poverty rate for
women over 65 would have been an astonishing 52.9 percent. Nevertheless
unmarried women still suffer disproportionately; single, divorced,
and widowed women aged 65 or older have a poverty rate of 22 percent,
compared with 15 percent for unmarried men and 5 percent for women
and men in married couples.
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