Labor & Employment Law

Dems Vow $250 Boost in Social Security Payment

By Mike Hall

While Republican congressional leaders like Rep. John Boehner (Ohio) and others push raising the Social Security retirement age, cutfinv benefits or privatizing Social Security, Democratic leaders have a different plan when Congress returns to work in November.

On of the first items of business, they say, will be a move to grant Social Security recipients a $250 supplemental payment because for the second year in a row, they will not receive a cost of living adjustment/

Edward Coyle, executive director of the Alliance for Retired Americans, says the payment would be a boost to Social Security recipients, ?many of whom have seen their retirement savings and home values badly shaken by this economic crisis.? He also says:

The purchasing needs of seniors are unique, and often include medications needed to stay alive?$250 may be just dinner and drinks if you are on Wall Street, but it will make a real difference for those on Main Street.

The average retiree?s annual Social Security benefit is a far-from-excessive $14,000, an amount less than minimum wage, says Ross Eisenbrey, vice president of the Economic Policy Institute (EPI). He adds that 3.5 million seniors are living below the poverty level, even with Social Security.

A one-time supplement of $250 would provide assistance for seniors struggling to pay for basic necessities, and would also serve as valuable economic stimulus. EPI research has shown that one of the most effective components of the 2009 Recovery Act was the $250 lump-sum payments that went to recipients of Social Security and Supplemental Security Income (SSI) benefits.

Those payments were quickly spent, stimulating local economies and likely boosting GDP by roughly 0.5% in the second quarter of 2009, according to Eisenbrey. He says that translates to about 125,000 jobs created or saved due to these payments.

After the election, the federal budget deficit commission is set to issue its report?which most expect will call for a higher retirement age and perhaps other cuts. Says Coyle:

We are deeply disturbed by recent calls around the country to raise the retirement age to 70, reduce Social Security benefits and allow Wall Street firms to run a privatized Social Security program.

With private pensions rapidly becoming a thing of the past, this is the time to strengthen?not weaken?Social Security. The first step toward this would be a quick approval of these $250 payments.

Katie Jordan (see video) of the Illinois Alliance Retired Americans says

Now is the time to strengthening Social Security, not reduce benefits, not raise the retirement age, and definitely not privatize it.

Full post as published by AFL-CIO NOW BLOG on October 19, 2010 (boomark / email).