Today, Social Security's protections for working families - guaranteed, lifelong benefits, full adjustments to guard against cost-of-living increases, increased benefits for families, greater income replacement for low-income workers, as well as disability and survivor benefits - are the bricks and mortar of economic security in the United States. Social Security keeps large numbers of elderly citizens out of poverty. Nearly 12 million older Americans - over 40 percent of Social Security's elderly beneficiaries - would be poor if not for Social Security's basic benefits. Older Americans rely overwhelmingly on Social Security benefits for a major part of their income. The system provides two-thirds of older household beneficiaries with half or more of their income in retirement.

Most older Americans lack substantial economic resources beyond Social Security. Unfortunately, pensions and individual savings just don't reach enough people or provide adequate income. Fewer than half - only 43 percent - of all older American households who receive Social Security also get any pension benefits from past employers. While income from savings is more widely received than pension benefits, it amounts to very little for most retirees regardless of race. For all of those 65 and older, median savings income is $156 per month. Among the bottom fifth, median asset income is a tiny $13 a month.

Today, Social Security faces serious but modest long-run financial challenges. According to the Social Security actuaries, the system will be able to pay 100 percent of benefits until 2034, and after that time, even if no changes are made, tax revenue to the system will be sufficient to cover roughly 70 percent of expected benefits. Given Social Security's critical role in providing family economic security, it is important that we act soon to assure Americans that Social Security will continue to be there for them. It is equally important, however, that we neither jeopardize the system's capacity to provide workers with a guaranteed foundation of retirement security, nor undermine its family protections.

As a first step toward strengthening Social Security for the next century, President Clinton has called on Congress to use almost two-thirds of anticipated unified budget surpluses for Social Security. We agree. Appropriating 62 percent of unified budget surpluses to Social Security over the next 15 years will ensure that 100 percent of the system's benefits can be paid for an additional 18 years, to 2052. Taking this important step would assure that the benefits of our strong economy are returned to the people whose hard work made it possible; that's exactly as it should be.

We believe that a fair and responsible second step would be to increase the cap on earnings subject to the Social Security payroll contribution tax. This approach would act as a progressive counterbalance to the growing wage inequality that has plagued working families for the past two decades. Today, workers and their employers pay Social Security contribution taxes on only the first $72,600 of earnings. Raising the contribution cap for the fewer than 6 percent of workers earning more than the cap can be done in a way that entirely eliminates the shortfall that would still remain if the President's proposal to devote 62 percent of the unified budget surplus is adopted - without cutting any family's benefits or raising taxes on anyone except the most highly paid workers.

We also believe that any reform package should include improved protections for older women. All too often, American women spend their retirement years in dire poverty after lifetimes of hard work both in and out of the home.

Some reform advocates argue that instead of strengthening the current benefits structure, we should substitute private individual investment accounts for some or all of Social Security's guaranteed defined benefits. We oppose individual accounts for two important reasons. First, privatization replaces Social Security's guaranteed, family benefits with risky individual investment accounts that will widen income inequality. Second, these accounts come with a high price tag - large, misguided cuts in the program's guaranteed benefits. America's working families can not afford either of these.

Proposals to replace the system with individual accounts strip away or erode many of Social Security's fundamental protections - inflation-protected benefit guarantees, lifelong benefits, and greater income replacement for lifetime low-wage earners. These and other changes at the heart of individual investment account proposals undermine Social Security's very purpose - to provide a measure of income security by sharing the substantial economic risks that working families face throughout their lives.

The insecurity and risk that individual accounts bring are themselves a high price to ask workers to pay. But privatizers would exact an even greater price because of the very large transition costs that privatization requires. These huge transition costs arise because workers would have to pay twice - once to fund the new individual accounts and a second time to cover both the current expected financing shortfall and the even larger financing hole that results from diverting money into the individual accounts. Although these transition costs can take many forms, they typically come in the form of deep cuts in guaranteed benefits, increased retirement ages, and cuts in the cost-of-living protections.

Using surpluses for Social Security and raising the cap represent responsible steps to strengthen and protect Social Security's family protections. Improving benefits for elderly women would address some of the needs of one our most vulnerable populations. We believe that these measures, not individual accounts instead of Social Security, represent the right direction for reform.