UE Convention Resolutions
Protect and Expand
Social Security
The principle that working people are entitled to a comfortable, paid retirement is under massive attack and in serious jeopardy. Vast numbers of employers have declared their intention to jettison defined-benefit pension plans that guarantee retired workers a stable income. Over the past decade thousands of companies have terminated, frozen, or under-funded their pension plans, cheating millions of workers and retirees out of promised retirement benefits. The number of defined-benefit pension plans declined from 95,000 in 1980 to less than 35,000 in 2002, and continues to fall precipitously. Hundreds of companies have simply stopped funding their pension obligations, dumping tens of billions of dollars in liabilities onto the beleaguered federal Pension Benefit Guaranty Corporation (PBGC).
Retirement experts advise that, to live in modest comfort, the average worker will need retirement income equaling 75 to 90 percent of the wages he or she earned while working. That income is expected to come from three sources: pensions provided by employers, personal savings, and Social Security.
A shrinking minority of American workers remain covered by defined benefit pensions. Savings programs such as 401(k)s that are largely replacing real pensions are an utter failure as retirement plans. As for savings, the majority of workers age 55 or older have less than $50,000 saved for retirement, and the lack of good-paying jobs makes it extremely unlikely that this will improve. That leaves Social Security, which on average provides about 40 percent of a workers’ pre-retirement income, but is currently the sole source of income for six out of ten retirees. That number is likely to grow as pensions and savings continue to decline.
In examining this situation and formulating our unions’s Healthcare and Retirement Security Mobilization at the beginning of this year, the UE General Executive Board concluded that the only sensible long-term solution to the crisis of retirement hinges on expanding and improving Social Security. The times demand a shift from UE’s stance of the past few years – defending the current Social Security program from George Bush’s dangerous privatization scheme – to campaigning for a major buttressing of Social Security into a complete retirement security program.
At the end of World War II in 1945, UE and virtually all the unions of both the CIO and AFL agreed on the need to complete the unfinished business of President Franklin Roosevelt’s New Deal, by providing health insurance and retirement security for all Americans. Labor rallied behind legislation, known as the Wagner-Murray-Dingell bill, that would have expanded Social Security into a true national healthcare and retirement system. Most union leaders and members at the time wanted no part of retirement plans or health insurance provided by employers as a result of collective bargaining. With memories of the stock market crash of 1929 and the Great Depression still fresh in their minds, union people in the 1940s had very little faith that employers or "the market" could provide security. But big business used all its political influence to block this important progressive legislation, and the labor movement changed course – for the most part, reluctantly – and negotiated pensions and healthcare plans with individual employers, with eligibility for coverage limited to employees of that company. This system of employer-provided pensions and health insurance is now badly broken, and in need of an immediate response by both our union and our political leaders.
In response to the worsening crisis of employment-based pensions, our union believes that the time has come to declare once again, as labor did sixty years ago, that retirement security as well as healthcare are fundamental rights for all people. We can no longer rely on the goodwill of employers, or our skill at the bargaining table. Just as we need a "single-payer" national health insurance program, we also need an expansion of Social Security into a "single-payer" source of adequate retirement income.
The Social Security Act of 1935 was a product of Franklin D. Roosevelt’s New Deal administration; born of the social and economic injustices and upheaval of the Great Depression, and it was expanded in 1950 to its current scope as a result of continuing pressure on Congress from labor and organized senior citizens. It represents one of the great moral successes of the 20th century, providing a foundation of income for retirees, disabled workers and surviving children. It is estimated that the program touches the lives of more than 95 percent of all Americans and that over 50 percent of elderly Americans would live in poverty if not for their monthly Social Security checks.
The effort to replace Social Security with risky personal investments was to be the centerpiece of George W. Bush’s second-term domestic agenda. The stunning defeat of this initiative as a result of massive public opposition speaks volumes about the commitment of the American people to Social Security in particular, and in general, to shared social responsibility for the well-being of the members of society. For over a quarter century – at least since the rise of the Ronald Reagan administration in the early 1980s – U.S. citizens have been subjected to a relentless drumbeat of "free market" ideology. For these many years we have been told incessantly – and with dissenting voices rarely heard – that "big government" is our greatest enemy, that each person is entirely responsible for his or her own life, health and economic security, and that turning matters over to private business corporations is always the best way to go.
The defeat of the Bush plan to privatize Social Security was a great victory for the labor movement and working people. But we must not let down our guard. The Wall Street investment interests promoting privatization are to a large extent the same forces promoting the destruction of pension plans and their replacement with individual 401(k) saving plans. These financial institutions are powerful, very persistent, and extremely influential over politicians of both parties. President Bill Clinton set up a task force, headed by then-Deputy Treasury Secretary Lawrence Summers, that was preparing a Social Security privatization proposal which was soon to be unveiled, but in 1998 when a White House sex scandal burst into the headlines, Clinton was forced to abandon the plan. The lesson of this bit of recent history is not so much that we should thank Monica Lewinsky for saving Social Security, but rather that having a Democrat in the White House in itself is no guarantee against attempts to privatize vital public programs and resources.
The Social Security "crisis" that we’ve been hearing about for the past couple of decades was invented by Wall Street financial interests who lust after $2 trillion of Social Security funds as a potentially gigantic investment bonanza. Even if Congress were to leave Social Security untouched, the program would be able to meet its obligations in full until 2053, after which about 80 percent of benefits still could be paid.
Our forefathers and foremothers in the labor movement fought for the principle that every person should have the right to retire in dignity and security. They fought first to achieve that goal as a matter of government policy and social right, and when that failed, they sought it at the bargaining table. But with employers now reneging on their pension promises and with the rapid demise of the entire system of employer-funded retirement, it is time for working people to take up again the demand of that earlier generation. Social Security must be expanded to fully live up to its name, and provide true retirement security for all.
THEREFORE, BE IT RESOLVED THAT THIS 70th UE CONVENTION
- UE reaffirms our commitment to complete the UE Mobilization for Healthcare and Retirement Security;
- Calls on Congress and the 2008 presidential candidates to address the country’s retirement security crisis by expanding Social Security to pay retired workers 75 to 90 percent of their pre-retirement income;
- Demands that Congress and presidential candidates reject all efforts to privatize Social Security, reduce benefits, or raise the retirement age, and that they return the retirement age for full Social Security to 65;
- Calls upon Congress to remove the cap on Social Security taxes so that all workers contribute the same percentage of earnings to the trust fund and that any additional funding needed for expansion of the program be raised through business taxes;
- Demands that congressional candidates, presidential candidates, and respective state legislators reject all schemes to undermine, destroy or weaken our existing private- and public-sector pension systems.