Americans have lost nearly $2 trillion dollars from their private retirement accounts in the past 15 months, a 20 percent drop in value. Thankfully, Social Security benefits are not subject to market whims. If they were, a new analysis from the Center for American Progress Action Fund concludes that a retiree with a private Social Security account invested in stocks similar to President Bush's 2005 proposal, "would have lost approximately $26,000 if they had retired on October 1, 2008 after 35 years of contributions to such an account."
Meanwhile, come January, Social Security will implement a 5.8 percent Cost of Living Adjustment in retiree benefits, the largest increase in 25 years. Not only are Social Security benefits guaranteed, unlike market investments, but in a year when private retirement accounts are losing money, Social Security benefits are going up.
Yet some conservatives still want to gamble our Social Security in the stock market. Indeed, anyone who still thinks it is prudent to risk our Social Security benefits to the stock market should have their head examined. Not only does the current crisis tell us that such a move would be dangerous, it reminds us exactly why we created Social Security in the first place: to provide a secure retirement for Americans.
I Am Progress's new Golden Pledge campaign (Center for American Progress Action Fund) takes this issue head on. Our campaign: do not privatize Social Security benefits. The campaign asks citizens to take the Golden Pledge to oppose privatizing Social Security.
In what seems like a recurring nightmare, this issue is ripe with examples of prominent conservative leaders telling us how great an idea it would be, only to find out later they were completely out of touch with reality. Take this comment from Dick "Greeted as Liberators" Cheney, "Voluntary personal accounts would represent an entirely prudent risk."
Or how about this ditty from George "Mission Accomplished" Bush, "Because this money is saved and invested, younger workers would have the opportunity to receive a higher rate of return on their money than the current Social Security system can provide."
In his 2005 State of the Union address, he took the case further when he said, "Here's why the personal accounts are a better deal. Your money will grow, over time, at a greater rate than anything the current system can deliver--and your account will provide money for retirement over and above the check you will receive from social security."
The truth is, if we had privatized Social Security then and you had retired a year ago--when the New York Stock Exchange hit an all-time high, your nest egg would have been a whole lot sweeter than if you retired this week. Who wants their primary retirement savings benefit held hostage to a volatile market?
Let's not be foolish. Let's not privatize Social Security. Check out the Golden Pledge campaign and sign the petition.