Ever since President Franklin D. Roosevelt signed Social Security into law in 1934, millions of America’s worker shave earned benefits by paying into the system, creating a safety net that keeps retirees, survivors of workers who die young and people with disabilities out of poverty. The Social Security program has proved remarkably durable and adaptable, never missing a paycheck and reliably meeting the needs of successive generations. Now, 70 years later, President Bush wants to privatize Social Security. His plan would replace Social Security’s guaranteed benefits with risky private accounts. The Bush plan would force drastic cuts in benefits and saddle future generations with $4.9 trillion in debt over the next 20 years, most of which would be owed to foreign countries.

Bush and his corporate allies are trying to scare Americans into believing Social Security faces a crisis so they can sell privatization. But while Social Security does face problems that must be addressed, privatization will make the situation worse, not better.

Privatizing Social Security will:

Bush plan cuts Social Security benefits

	Lifeline:Without Social Security, retired AFT member Joan King says she wouldn’t be able to afford the medications she needs.

While Bush says he won’t cut Social Security benefits for workers 55 and older, his plan to cut benefits and privatize Social Security would leave many future seniors in poverty. Between 1960 and 2004, Social Security helped cut the poverty rate among seniors from 35 percent to 10 percent. But Bush’s plan would mean average retirees would lose $152,000 in benefits if they live for 20 years after they retire, according to the Center for Economic Policy Research, are search and public education group. Taxpayers would have to somehow take care of our nation’s seniors.

A secret White House memo that circulated in January called for a change in the way guaranteed benefits are calculated that would cut payments nearly in half for today’s workers when they retire. The confidential memo called for freezing the standard of living for retirees by pegging Social Security benefits to the increase in prices rather than wages. Because wages rise faster than prices, this would slash the amount of retirees’ Social Security benefits.

After 35 years working as a teacher and paying into the Social Security system, Joan King and her husband now are retired and rely on Social Security retirement benefits as well as their pensions. King, a retired member of the Classroom Teachers’ Association, Orlando’s joint affiliate of AFT and the National Education Association, says retirees like her would find it hard to get by if they faced 40 percent smaller Social Security checks every month. “I’d be sacrificing for sure,” she says. “I postpone getting some medication now, so I’d have to take a hard look at medical costs. It’s not a luxury. It’s something you have to do.”

Bush plan takes 70 cents of $1

Although he has not provided specifics, Bush appears to want to allow younger workers to divert about one-third of their Social Security contribution to private accounts they could invest in the stock market. Although Bush says private accounts would be voluntary, his plan would cut a retiree’s benefits by 40 percent—even if that person didn’t choose a private account. And for workers who choose a private investment account, the government would take back 70 cents in retirement benefits for every $1 in their private accounts on top of the 40 percent benefit cut—to pay back the trust funds for the payroll tax contributions diverted into individual accounts.

Bush plan creates trillions of dollars of U.S. debt

If Bush privatizes Social Security and diverts millions of dollars from that fund,the money to pay benefits to today’s retirees would have to come from somewhere else. Bush says the federal government would have to borrow the money—analysts project about $4.9 trillion over the next 20 years alone. Much of the borrowing would involve selling US government bonds to foreign countries—meaning US workers’ retirement would depend on the willingness of foreign countries to lend the money. Bush’s plan actually weakens the Social Security trust fund. Since Bush took office, the federal deficit has risen to $413 billion, and his plan to privatize Social Security would pass more debt to future generations.

Bush plan bars workers from controlling their private retirement investments

In selling his plan to privatize Social Security, Bush emphasizes workers’ ability to control their own retirement money through private accounts. What he doesn’t say is politicians, not workers, will pick the Wall Street firms to control the accounts. Politicians would decide which companies would be poised to make billions of dollars in profits from the fees they would collect to administer the private accounts.

A recent study by the University of Chicago Graduate School of Business shows Wall Street firms would enjoy a whopping $940 billion windfall over 75 years. AFL-CIO President John J. Sweeney has called on financial firms—many of which administer union pension funds—to publicly oppose Bush’s privatization plan. In late January, members of the Greater Boston Central Labor Council rallied in the city’s financial district, saying Wall Street should not profit while working Americans see their retirement benefits slashed. “The whole point of privatization is to fill the pockets of Wall Street,”says King.

With Bush attacking Social Security, King is working to mobilize the state and local chapters of her retiree organizations to save the nation’s most important family protection program. “We’re talking to our families and to our senators and representatives,” she says. “We’re telling people to call today,” says King. “Don’t wait."