June 5, 2000

Bush proposal would allow employees more control over retirement benefits

The National Restaurant Association, which has long advocated Social Security reform that ensures the program’s solvency and allows employees more control over their retirement benefits, is pleased that Republican presidential nominee George W. Bush has come forward with a proactive reform proposal that would benefit employers and employees alike.

Bush’s proposal incorporates many elements of the Association’s plan. For instance, the Association supports Social Security reform that would oppose payroll tax increases, preserve benefits for current and near-retirees, guarantee a minimum government safety net for all retirees, and allow workers to invest a portion of their payroll taxes toward individually owned and directed personal retirement accounts.

Although Social Security is now operating under a surplus, it is expected to begin running deficits in 2008, when a generation of baby boomers starts to collect retirement benefits. By 2032, the Social Security trust fund will likely be depleted. Traditionally, Congress has increased payroll taxes and decreased retiree benefits as a means of shoring up the shortfalls in the trust fund. In fact, Social Security (FICA) tax rates have already increased numerous times in the last 60 years, and the amounts of wages subject to Social Security taxes increases annually.

"Allowing workers to have more control over their retirement savings addresses some key changes in the makeup of today’s workforce," says Association Senior Vice President of Government Affairs and Public Policy Lee Culpepper. "First, most younger workers don’t believe that Social Security will be around when they are older. Second, investment in the stock markets is something workers are more comfortable with."

The restaurant industry is the largest employer outside the government, with 11 million employees.

The Association, which is a member of the Alliance for Worker Retirement Security (AWRS), is pleased to see that those principles are included in Bush’s Social Security plan. AWRS is a coalition of more than 30 organizations whose goal is to reform Social Security so that every American worker has the opportunity to create a secure nest egg for retirement.

"Gov. Bush has shown great courage in offering a pro-employer, pro-employee proposal that keeps Social Security solvent and gives individuals more control over their future," says Culpepper.

Source: Source: Washington Weekly, June 5, 2000. National