SENATE CONCURRENT RESOLUTION NO. 39
(By Senator Oliverio
)
Urging the United States Congress address the looming demographic
problems of the social security system by increasing the
system's rate of return, rather than by broadly cutting
benefits or raising payroll taxes, and advocating reform
legislation permitting workers to allocate a portion of their
federal payroll taxes into personal retirement accounts that
the workers would own and control.
Whereas, Social security is a federal program that does not
recognize the retirement needs of many Americans. Social security
tax revenues alone will be insufficient to pay current benefits as
early as the year 2015 and the social security trust funds will be
completely exhausted by the year 2037; and
Whereas, The investment return on social security
contributions made by workers today is significantly below that
available from other sources and workers deserve the opportunity to
invest more productively for their own retirements. More retirement investment opportunities might dramatically increase workers'
savings rate and retain more young adults who otherwise would leave
the state for jobs elsewhere; and
Whereas, According to the chairman of the federal reserve
system, the unfunded liability of the social security system
exceeds $9 trillion. Many workers are already facing very low or
even negative rates of return on their lifetimes of social security
contributions and the aging of the U. S. population means that
fewer and fewer active workers will be supporting more and more
retirees under today's pay-as-you-go financing for social security.
The ratio of retirees to workers has shrunk from 15 to 1 in 1950 to
less than 3 to 1 today and soon will fall to less than 2 to 1.
Raising payroll taxes to compensate for this demographic shrinkage
will mean that today's workers get an even worse return on their
federal retirement contributions than they do now and broadly
cutting social security benefits would worsen rates of return; and
Whereas, States and localities that allow their own employees
to invest a portion of their taxes for retirement have shown that
workers can do better for themselves with those accounts than under
social security. An increasing number of countries, including
Australia, Chile, Poland, Sweden and the United Kingdom, now allow their citizens to allocate their taxes to these personal retirement
accounts; and
Whereas, The social security trustees have consistently and
repeatedly stated in their annual reports that the social security
system will be unable to deliver on its long-term promises under
its current financing scheme and the public, especially younger
people, are, therefore, rightfully suspicious of social security's
ability to deliver on its long-term promises to them; and
Whereas, The social security administration's own actuaries
have judged these bipartisan proposals to be fiscally sound for the
next 75 years. These proposals would reduce or eliminate the
pressure for higher taxes or broadly reduced benefits while
reducing social security's unfunded liability and would not affect
people in or near retirement nor those eligible for or drawing
social security's disability benefits; therefore, be it
Resolved by the Legislature of West Virginia:
That the Legislature hereby urges the United States Congress
to enact legislation amending the Social Security Act and other
statutes to allow workers to allocate a portion of their social
security taxes to personal retirement accounts that they themselves
would own and control and to reject legislation that raises federal
retirement taxes, broadly reduces social security benefits or fails to lower social security's unfunded liability; and, be it
Further Resolved, That the Clerk of the Senate is hereby
directed to forward a copy of this resolution to the Clerk of the
United States House of Representatives, the Secretary of the United
States Senate, the President of the United States and the members
of West Virginia's congressional delegation.
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