LINCOLN, NEB.– A typical 20-year-old in Nebraska will lose $152,000 during retirement if the President’s Social Security privatization plan is enacted, according to a report released today by the Institute for America’s Future. It would also mean a 15 percent cut for a 45-year-old worker in Nebraska today and a 25 percent cut for a 35-year-old worker.
Nebraska leaders released the report at a news conference at the State Capitol, one day before President Bush is expected to visit Omaha in a series of stops designed to sell his plan to replace the Social Security safety net with a risky privatization plan.
“Privatization will destroy Social Security,” said Ken Mass, president of Nebraska’s AFL-CIO. “The plan that the president unveiled last night actually creates a crisis where none exists.”
The president’s plan uses inflation, not real wages, to calculate benefits. Since wages rise more quickly than inflation, today’s typical 20-year-old can expect a 30 percent cut in benefits—or an average $152,000—under Bush’s proposals.
According to the report, private accounts might allow workers to earn back a small fraction of this amount, but the amount they could earn is a third of what they would get if social security was not privatized at all, and that’s only if the market is steady. If the market is in a slump, then their loss could be even bigger.
Jeff Leanna, a student at the University of Nebraska at Omaha depended on Social Security benefits after the death of his father.
“Financial security is just not something you take a gamble on,” said Leanna. “After my Dad died and it was just me and my mom, we depended on Social Security checks to live day-to-day and keep our house. Now the president wants to take that safety net away.”
Tomorrow morning at 7:00 a.m., hundreds of Nebraskans are expected to gather at the Qwest Center in Omaha to protest Bush’s privatization plan. Leading the rally will be the AFL-CIO’s Ken Mass and Alliance of Retired Americans Board member, Donna McGrath, both of whom spoke at today’s press conference. They’ll also be joined by state senator Gwen Howard.
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