Subject: To Anna Rappaport. Women are NOT victims.
Anna, you and Heidi treat women in your discussion as victims in need of some beneficient government welfare. What we really want is to earn a market rate of return on our lifelong mandatory FICA taxes.
In Colorado, the Public Employees Retirement Association (PERA) covers some 200,000 people such as teachers, firemen, policemen and many of those are women. They have excellent retirement benefits that far superior to Social Security. PERA was formed in 1924 and was "grandfathered" out of SS when it was started in 1935. PERA's success is due to growth of the private sector. They have been invested in equities since 1962- they have weathered the recession of the early 1970's, the recession of the early 1980's and the "crash" in Oct 1987 and over the past 30 years have averaged 11% per year! A 21 year-old woman entering the workforce today will receive a NEGATIVE return on her money- i.e. she'll pay in more than she receives in benefits. If public employees can have the benefit of private sector growth, why on earth should public policy deny that growth to private sector workers?
Working women should be permitted to redirect some portion of their FICA taxes into Personal Retirement Accounts which they own and which they can invest in the private sector, using professional money managers. The advantage of women owning their accounts is then even FICA taxes paid from earnings of partime summer jobs in high school, and FICA taxes from jobs prior to child raising time off would benefit from compound earnings growth. Then when we drop out of the work force to raise our children, OUR MONEY KEEPS WORKING.
In the case of divorce, a Personal Retirement Account is an asset like any other and would be part of the settlement.
PERA in Colorado has proved that the private sector creates wealth. Think what it means to a young low paid worker to be able to double her retirement benefits by getting market rate of return. $1,000 invested per year for 46 years and earning 1% becomes $60,000, BUT at 7% it becomes $330,000. Which would you rather have?
Carolyn Cox, volunteer with the national grassroots movement Economic Security 2000.
