Social Security Threat Looms

MAY 2005
- Retirement Officials Oppose Mandate - With the winds of change swirling around Washington on the issue of
Social Security, Massachusetts retirement officials are keeping a
watchful eye on developments in the nation's capitol. Even though the
fate of President Bush's plan to “reform” Social Security is yet to be
known, the danger of the state's mandatory inclusion in Social Security
is not something to be taken lightly.

As
longtime members may recall, the fight to keep Massachusetts out of
Social Security spans back several decades. In fact, the issue can be
traced to the very beginnings of the federal program, when public
employees were intentionally prohibited from enrolling in Social
Security.

Beginning in the mid-70s
and resurfacing with each “reform” initiative, there has been the
threat of forcing Massachusetts and the other six non-Social Security
states into the program. At first glance, the money that would be paid
into Social Security by public employees appears attractive to federal
officials. However, government accountants have determined that the
long-term drain on the system far outweighs any short-term financial
gains.

Most important to
Massachusetts retirement officials is the tremendous financial burden
that mandatory coverage would place on the state and local governments.
It is estimated that mandatory Social Security would carry a cost of
$5-8 billion over the next ten years, which is on top of the cost to
maintain the benefits already earned under our current pension system.

In
addition, the benefits currently earned by public employees upon
retirement would have to be scaled back. New employees could ill afford
to continue contributing 10% into the public pension system, along with
an additional 6.2% into Social Security.

Over
the years, the Association has been vocal in its opposition to
mandatory Social Security and has worked alongside a number of other
organizations and coalitions to stop any forward movement on the issue.
In addition to representing the Association in Washington on the issue
of the Social Security GPO/WEP, the firm of Lussier, Gregor, Vienna and
Associates is also heavily involved in opposing mandatory coverage.

A
number of state officials have joined with the Association in calling
on our Congressional delegation to keep a watchful eye on the issue.
Retirement board members Thomas Welch (Needham), Jerry Miller
(Pittsfield), Thomas Curtis (Medford) and Roy Sacco (Belmont) have led
the effort on behalf of the Mass Association of Contributory Retirement
Systems by calling on our US Senators to actively support the state's
position.

In the Senate, both
Senators Kennedy and Kerry have joined an effort to head off any
attempt to include non-Social Security states in the federal program.
They have joined a bipartisan coalition of Senators from the seven
non-Social Security states, who are leading the charge on the issue.

That effort to oppose mandatory coverage is being lead by Ohio Senator George Voinovich, a member of the Republican leadership.

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