The Corner

Economy & Business

The Rubio-Wagner Bills Help Workers by Modernizing Social Security

(Brendan McDermid/Reuters)

Senator Marco Rubio (R., Fla.) and Representative Ann Wagner (R., Mo.) wrote in USA Today that they are introducing legislation (the Senate bill will drop this week) to modernize our more than 80-year-old public pension system — Social Security — to make it more flexible and better able to meet the needs of today’s workers.

This is welcome news. Currently, workers are required to begin paying Social Security’s taxes on their first day on the job, and then (unless they become disabled) they aren’t allowed to access any of those benefits until they reach the retirement age under the law (which is 67 for workers born after 1960, though people are allowed to retire as early as 62) when they begin to receive a monthly pension.

The proposed reform recognizes that many workers need financial support earlier in their lives more than they do in their sixties. The Rubio bill would allow a worker to access a portion of his or her Social Security benefits after the birth or the adoption of a child, in exchange for delaying his or her eligibility for retirement benefits.

Since many workers lack paid-leave benefits on the job, and have little savings accrued when having a child, this would help many who face a significant financial stress at a very important and vulnerable time. An estimated 17 percent of all workers (and half of low-income workers) who lack paid leave end up going on public assistance when they take time off from work. Giving them access to early Social Security benefits (which they would then effectively pay back by trading one benefit for another) would reduce dependency on other government programs.

Some have argued that it’s unfair to ask those who take parental leave to delay retirement. But the amount of delay is relatively modest — someone who takes three months’ worth of benefits would delay retirement by about three months. Given that someone born in 1970, who reaches age 65, has a life expectancy of more than 15 years (17 years for women), delaying retirement by a few months still leaves room for a relatively long retirement.

Others have argued that this would worsen Social Security’s finances by moving up when some benefits are paid, which would move up the date of the Trust Fund’s exhaustion. That could be addressed by requiring that the Trust Fund be reimbursed by the general Treasury for expenses related to this new benefit. Some may dismiss this as an accounting gimmick, but the Social Security Trust Fund has always been an accounting mechanism, and it’s a distraction to focus on the date that it runs out.

We should rather focus on the big picture of liabilities for taxpayers. This reform wouldn’t change Social Security’s overall financial health: It faces a significant unfunded liability today and would continue to face the same liability if this reform becomes law. But this reform could reduce dependency on other government assistance programs, encourage labor-force attachment, and discourage states from creating other more costly paid-leave programs that require new taxes on all workers.

Touching Social Security has long been considered a political nonstarter, but it shouldn’t be. This is a modest and targeted reform that would help people who really need it, and make our entitlement programs more modern and flexible, rather than bigger.

Carrie Lukas is the president of the Independent Women’s Forum.

Most Popular

Politics & Policy

The Great Misdirection

The House Democrats are frustrated, very frustrated. They’ve gotten themselves entangled in procedural disputes with the Trump administration that no one particularly cares about and that might be litigated for a very long time. A Washington Post report over the weekend spelled out how stymied Democrats ... Read More

Australia’s Voters Reject Leftist Ideas

Hell hath no fury greater than left-wingers who lose an election in a surprise upset. Think Brexit in 2016. Think Trump’s victory the same year. Now add Australia. Conservative prime minister Scott Morrison shocked pollsters and pundits alike with his victory on Saturday, and the reaction has been brutal ... Read More
NR Webathon

We’ve Had Bill Barr’s Back

One of the more dismaying features of the national political debate lately is how casually and cynically Attorney General Bill Barr has been smeared. He is routinely compared to Roy Cohn on a cable-TV program that prides itself on assembling the most thoughtful and plugged-in political analysts and ... Read More
Film & TV

Game of Thrones: A Father’s Legacy Endures

Warning! If you don't want to read any spoilers from last night's series finale of Game of Thrones, stop reading. Right now. There is a lot to unpack about the Thrones finale, and I fully understand many of the criticisms I read on Twitter and elsewhere. Yes, the show was compressed. Yes, there were moments ... Read More

The Merit of Merit-Based Immigration

Having chain-migrated his way into the White House and a little bit of political power, Donald Trump’s son-in-law is shopping around an immigration plan. And if you can get past the hilarious juxtaposition of the words “merit-based” and “Jared Kushner,” it’s a pretty good one. As things stand, the ... Read More