By Kevin Wilson
The New Mexico chapter of the American Association of Retired Persons is adamant that Social Security does need to be fixed, and they are concerned about a day that the federal program’s expenses will exceed its revenues.
Their message to Portales residents in attendance was that private investment accounts are not the way to fix Social Security, and the solvency of the program is much better than most believe.
The AARP had a Tuesday morning seminar at the Memorial Building, and spoke to about 30 seniors about the program they’d been paying into for years and what suggested changes would do to benefits for them and the next generation of workers.
Both of the speakers at the event — Clovis and Portales AARP chapter member George Lees and state representative Lou Baca — were clear that Social Security was not meant to be a primary source of income.
Instead, Baca referred to Social Security as one of four pillars of a solid retirement — the other three were pension/savings, earnings and health insurance.
Baca said that the AARP’s position was one against private investment accounts — referred to as “carve-out accounts” because it is assumed the money that would be invested would be “carved out” of current benefits paid to retired people.
Baca said that private accounts would likely require as much as $5 trillion in new spending and bring insolvency to the program 12 years sooner. Numbers from the AARP indicate that Social Security will be able to operate as is until 2018, the first point at which expenditures will exceed income, excluding interest. Ten years later, the AARP data said that expenditures would exceed income including interest.
By 2042, the AARP estimates that the current system would be exhausted but would still pay at least 73 percent of benefits.
Nobody at the meeting spoke in favor of investment accounts, which are proposed as part of the president’s plan for an ownership society.
Lees read a prepared statement from U.S. Sen. Jeff Bingaman (D, N.M.) at the meeting.
“It’s a contract that says to our society, we will look out for you and your family in the event you can’t work,” Lees read.
Bingaman stressed the importance of the program in the statement, but was clearly against private investment accounts.
Baca, a Santa Fe-based representative, encouraged participants to make their voices heard to legislators.
“You have something policymakers want,” Baca said. “If you don’t know what that is, it’s your vote.”
The AARP said that about 47.5 million people currently receive Social Security benefits, with an asset base of $1.7 trillion.