Social Security

Social Security was established in 1935 as a national plan designed to provide economic security for our nation’s workers.  Today, it provides benefits to almost 55 million retired and disabled workers and their families, and to the survivors of deceased workers.  Social Security is the single largest source of retirement income in the United States.  In Southeastern North Carolina alone, over 160,000 citizens receive more than $170,000 in earned benefits every month.

As your Representative in Washington, I oppose any cuts to Social Security benefits.  These benefits are funds you worked hard for, and now I will work hard to ensure you have access to them. We owe it to our grandparents, our parents, ourselves, and most importantly, our children to keep the Social Security program true to its purpose of providing stability for our most vulnerable populations. It is a contract between the American people and their government, and it reflects our values and duties as Americans. We must always work to honor and strengthen this contract, and I assure you that I will continue to work in the 113th Congress to ensure that Social Security will be solvent for generations to come.

To do this, modest changes need to be made; but Social Security must retain the ability to perform its most basic function of providing a stable source of income for its beneficiaries. Proposals to reform Social Security through creating private accounts for citizens would make these earnings subject to the fluctuations of the market, and that is too risky a venture. Therefore, I have strongly opposed any efforts to privatize Social Security and will continue to do so. We must work towards a solution that will strengthen Social Security, not weaken it.

Cost of Living Adjustment (COLA)

I had heard from many constituents who were worried about a lack of cost-of-living raise for Social Security in 2010 and 2011. I shared their concerns and worked hard to find ways to help those who desperately needed the cost-of-living raise, such as co-sponsoring a bill that provided a one-time check of $250 those receiving Social Security benefits. While I am pleased with these accomplishments, I also realize that our senior citizens are continuing to face rising costs and a one-time check of $250 is not a long-term solution for Social Security.

Therefore, I am pleased to tell you that the Social Security Administration announced a 3.6 percent increase in monthly Social Security benefits for 2012. The 60 million Americans receiving Social Security benefits saw this increase reflected in their January 2012 distribution checks.

Medicare

In addition to monthly Social Security benefits, another safety net was created in 1965 when Medicare was established under the Social Security Act to provide health insurance to our nation’s senior citizens.  It now serves approximately one in seven Americans, and it is estimated that 48 million individuals will be covered this year.  Medicare has undergone considerable changes since its inception, but it provides critical health services including hospitalizations, prescription drugs, doctor visits, home health visits, skilled nursing care, and hospice care. 

The Ryan Budget

Earlier this year, Budget Chairman Paul Ryan unveiled his budget plan and a report entitled “The Path to Prosperity:  A Blueprint for American’s Renewal.” Despite an appealing title, it was a radical plan with budgetary objectives that would have a devastating impact on the future of health care for seniors, and I voted against this drastic measure. We certainly need to find a bipartisan solution to addressing the long-term solvency of Medicare and lowering the national debt, but this legislation was simply the wrong approach.  Instead of the Ryan plan, we should instead consider targeted, common-sense reforms that can be implemented over time and improve the delivery of health care, provide for better coverage, and adequately address rising medical costs.

The Social Security Trust Fund

Social Security generates its revenues from payroll taxes paid by covered workers and their employers, federal income taxes paid by some beneficiaries on a portion of their benefits, and interest income from the Social Security trust fund investments.  These revenues are collected by the Internal Revenue Service and used to purchase interest-bearing government security bonds. As these bonds mature, they generate interest -- and therefore a second source of income for the Social Security Administration. Each month, the Social Security Administration directs the U.S. Treasury to pay beneficiaries and cover administrative costs by selling, or redeeming, the necessary amount of government security bonds. It is important to note, therefore, that the monthly benefits the Social Security Administration distributes are not the same funds as revenues that same month. This means that the government is constantly borrowing money from the Social Security trust fund and paying it back – with interest.

From 1984 to 2009, Social Security ran a cash-flow surplus, meaning it generated more revenue than needed for monthly benefit and administrative payments. These surpluses remained in the general fund of the U.S. treasury and represented the total amount of money owed to the Social Security trust fund by the U.S. government. At the end of 2010, the Social Security trust fund had $2.6 trillion invested in the general fund of the U.S. Treasury. The Social Security and Medicare Trustees have concluded that neither Social Security nor Medicare is currently in jeopardy, but there are demographic trends which will exert pressure on both programs in the decades to come.