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But, once again, Republicans are playing politics with the issues that affect our nation's seniors the most. They are clamoring to point fingers at Democrats who have long been in support of amending the archaic earnings limit. But our nation's seniors cannot be fooled. Democrats support repealing the earnings limit while protecting the integrity of Social Security.
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In the 105th Congress, the Republicans brought an increase of the earning limits to the floor but attached it to a risky tax cut package that would have put Social Security in severe jeopardy. Democrats strongly opposed that bill and offered a measure to raise the earnings limit and make the remaining tax cuts contingent on protecting the solvency of Social Security. This Democratic alternative was a responsible tax cut package that did not raid the Social Security Trust Fund. Not one Republican voted for this measure. This is just one of many cases that demonstrates who is on the side of seniors in this fight.
We must stop the finger pointing and come together to protect Social Security for generations to come. This is not the time for politics as usual. The livelihood of our nation's senior citizens is at stake.
Mr. MOORE. Mr. Speaker, I rise today in strong support of H.R. 5, the Senior Citizens' Freedom to Work Act of 2000.
Under current law, over 8,000 Kansas seniors lose some or all of their Social Security benefits due to the Social Security earnings limit because they choose to continue to work. Seniors aged 65 to 69 have $1 of their benefits reduced for every $3 they earn over the current earnings limit of $17,000. Simply, current law penalizes seniors for working. I do not believe it is fair to punish those seniors who want or need to participate in the workforce by having this disincentive to work.
Eliminating the earnings limit is not only fair for working seniors, it will improve the quality and efficiency of Social Security since the program will be easier and less expensive to administer. Furthermore, repealing the Social Security earnings limit is fiscally responsible. While the bill would increase Social Security spending by $22.7 billion over the next 10 years, the resulting lower long-term benefit payments will more than offset the costs.
Mr. Speaker, by allowing seniors who want to work to retain their benefits, Congress will take an important step towards strengthening retirement security for all seniors. This step, however, should not be our last. I urge my colleagues to begin working with me, in the same bipartisan manner that we worked on today's bill, to put Social Security on a firm financial footing for future generations. We need to build on today's success by dedicating a substantial portion of the budget surplus to pay down debt and strengthen Social Security and Medicare.
I urge my colleagues to support H.R. 5 and to join me in the larger challenge of strengthening Social Security and Medicare for our seniors and for generations of future retirees.
Mr. DELAHUNT. Mr. Speaker, today, we take an important step forward in addressing a Social Security inequity that is an injustice to working seniors. Under the Social Security Earnings Limit, beneficiaries aged 65-69 can earn up to $17,000 a year--but for every $3 earned over this amount $1 of benefits is lost.
The cap has always been one of the most unpopular parts of the Social Security program--and for good reason. It penalizes older people for working--and deprives the nation of the talent of working seniors. It's time to get rid of it, once and for all.
The earnings cap is a relic of the Great Depression, when concern over massive joblessness led to a perception that retirees should be discouraged from rejoining the workforce. Today, people are living longer and working longer--and are as entitled as the rest of us to fair wages for their labor.
At a time when unemployment is at a 30-year low and we face acute labor shortages, this Depression-era work disincentive for seniors no longer makes sense.
Older Americans possess enormous talent and experience. It boggles the mind why we'd want to maintain disincentives for them to work. The earnings test not only erodes seniors' standards of living, but also costs the nation valuable skills in the workforce, as well as tax revenue generated by this income.
Retirees who receive income from other sources such as pensions or capital gains do not have any benefits reduced. Why should income from pensions or investments be treated more favorably than earned income?
I received a letter last summer from a retiree from my home town--Quincy, Massachusetts. He wrote: ``I would like to retire with dignity and only want what I deserve. I feel that with your support of this bill, it would enable me to live without worries of finances and diminish the concerns of my family.''
That is what this legislation is all about--simply giving seniors what they deserve.
While this is a step in the right direction, seniors deserve more--and we could and should be doing more--much more.
During Committee deliberations on this legislation last night, an amendment was offered to restore some of the benefits that are reduced due to the Government Pension Offset. This provision would have made widow's benefits more fair, and helped reduce the high rates of poverty that especially face elderly women.
Unfortunately, the Chairman passed on this opportunity--even though the Social Security Administration stated that the costs of adding this provision would be negligible.
Mr. Speaker, removing the earnings limit is progress--but is this all that we are going to do for seniors this year?
Are we going to address other inequities in the Social Security system--like the government pension offset, windfall reductions, duel entitlement provisions--or even the long-term solvency of the program?
Will we finally reauthorize the Older American Act?
Will we enact a Medicare prescription drug benefit?
Our senior citizens deserve more--much more. Passing this bill is the very least we can do. I urge my colleagues to support this legislation--and invite you to join me in efforts to ensure retirement security for all older Americans.
Mr. SMITH of Texas. Mr. Speaker, I rise to support H.R. 5, the ``Senior Citizens' Freedom to Work Act.''
For years my constituents have raised concerns about unfair Social Security earnings limit. Finally, the House is going to eliminate this unfair penalty.
Whenever a working retiree earns more than $17,000 per year, they lose $1 of Social Security benefits for every $3 they earn above the limit. We penalize senior citizens who want to continue to participate in the work force.
There are 800,000 senior citizens who lose part or all of the Social Security benefits they've worked hard for because they earn ``too much'' money in retirement.
The Social Security earnings limit was created during the Great Depression and it punishes senior citizens for their work ethic and desire to be self-reliant in their ``golden years.''
Today unemployment is at an all-time low. The experience and skills developed by older workers during a lifetime in the workplace are being recognized and are in demand.
Social Security recipients are entitled to their benefits because they earned them during a lifetime of hard work. The government should not take those benefits away because individuals want to work. That's why I strongly support the passage of H.R. 5 today.
Ms. JACKSON-LEE of Texas. Mr. Speaker, today I rise in support of the Senior Citizens' Freedom to Work Act (H.R. 5). The Social Security earnings limit discourages those on retirement from remaining in the work force and contributing to the country's economic growth. Due to the longer life-spans and the improved quality of health among retirees, the advent of an aging society, and decreasing work force growth numbers, it is imperative that we explore better ways to tap the vauable and often underutilized resources of older Americans.
Due to the retirement earnings test, Social Security beneficiaries who have attained the normal retirement age (presently age 65) have their benefits reduced by $1 for every $3 that they earn in excess of $17,000. Similarly, Social Security beneficiaries between age 62 and the normal retirement age have their benefits reduced by $1 for every $2 that they earn in excess of $10,800. Although both groups of beneficiaries receive benefit increases once they stop working in order to compensate for reductions while they were working, there are a number of good reasons to support repealing the earnings test for beneficiaries who have reached the normal retirement age.
Repealing the retirement earnings test will allow thousands of Social Security recipients to work without a reduction in their benefits. The Social Security Administration estimates that, in 1999, 793,000 beneficiaries aged 65 through 69 had some or all of their benefits withheld because of the retirement earnings test.
Repealing the retirement earnings test may create positive work incentives. Because many Social Security beneficiaries are unaware that the benefit reductions they experience when they are working are offset by benefit increases once they stop working, they may perceive the retirement earnings test as a tax. In response, they may reduce the number of hours they work or they may decide to leave the labor force altogether.
The most recent economic research indicates that repealing the retirement earnings test for beneficiaries between the normal retirement age and age 69 may encourage work. In a 1998 study, Leora Friedberg, an economist at the University of California, San Diego, found that repealing the retirement earnings test for those beneficiaries would increase their labor supply by about five percent.
Repealing the retirement earnings test will not affect Social Security's finances over the long run. Repealing the RET for beneficiaries who have reached the normal retirement age would not change (for better or for worse) Social Security's currently projected long-range financing shortfall. Repealing the retirement earnings test for beneficiaries above the normal retirement age has a significant short-run cost ($22.7 billion over the next 10 years), but, over the long run, that cost is offset by lower benefit payments.
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Again, under current law, workers who have their benefits reduced due to the retirement earnings test receive an actuarial adjustment that increases their benefits once they stop working. Repealing the retirement earnings test would mean that such workers would no longer receive that actuarial adjustment and that benefit payments would be lower.
Repealing the retirement earnings test will make the Social Security program easier and less expensive to administer. The Social Security Administration estimates that the cost of administering the earnings test in 1999 ranged from $100 to $150 million.
Since those costs include administering the earnings test for workers between age 62 and the normal retirement age, repealing the retirement earnings test for workers above the normal retirement age would save less than that amount.)
In addition, Social Security Administration estimates that it overpaid $787 million in benefits due to the retirement earnings test in 1997. Payments to beneficiaries aged 65 through 69 accounted for 63 percent of retirement earnings test related overpayments in 1998.
If older Americans have the capacity to earn more money without penalty, there will be a greater incentive for them to work. Working older Americans contribute additional money to the economy and provide more revenue for the treasury. Furthermore, with advances in medical technology older Americans will remain healthy longer and live longer productive lives.
I join with my Democratic colleagues and strongly support eliminating the retirement earnings test that penalizes and discourages workers age 65 through 69 from remaining in the workforce and contributing to our prosperous economy.
Mr. WELDON of Florida. Mr. Speaker, later today, the House of Representatives will pass H.R. 5, the Senior Citizens' Freedom to Work Act. This Act will eliminate the current tax law which penalizes senior citizens between 65-69 who continue to work. The Senior Citizens Earnings Test taxes senior citizens up to 33 percent of a senior's Social Security benefits.
One of the most egregious elements of our tax code is the continued over-taxing of American senior citizens who want to continue working. Repealing this tax on working seniors was the first bill I cosponsored when I was sworn into office in 1995, and, finally, I think we see light at the end of this tunnel. I would like to thank Speaker HASTERT for his leadership on this issue for more than a decade.
This Social Security Earnings Test has two adverse effects: it discourages seniors from working and for those who do work, it takes away a portion of the Social Security benefits they have earned. With today's labor shortage, this policy is greatly outdated and needs changing.
The Senior Citizens earnings tax penalty takes $1 of working seniors' Social Security benefits for every $3 they earn over a federal imposed income limit. Seniors earning more than $17,000 are subject to the earnings tax. In 1999 there were over 4 million working senior citizens, at least 800,000 of them lost some of their Social Security benefits because of the earnings test. By repealing this tax penalty, the ten year benefit to senior citizens would be about $23 billion. Seniors can use this extra money for helping with their grandchildren's education, a trip to visit their family or other loved ones, a car, medical expenses, and prescription drugs.
Republicans have ended 40 years of raiding the Social Security Trust Fund to fund pet projects by tax and spend politicians. Repealing this seniors' tax builds on that commitment to senior citizens by making sure they get the benefits they have worked for, even if they choose to continue working. In Florida, over 80,000 seniors could be able to take advantage of this tax fairness package. This bill ensure that they get the money they have earned as well as the Social Security benefits they deserve.
A similar bill introduced in 1998 as part of the plan to abolish the Social Security earnings limit only received support from 19 House Democrats. This year the President has indicated his willingness to sign such a bill, but he did not include it in his recently submitted FY 2001 budget. The measure enjoys support from such groups as AARP, United Seniors Association, and the 60 Plus Association. Let's do the right thing and pass this bill.
Mr. WATTS of Oklahoma. Mr. Speaker, millions of older Americans are penalized every year simply because they set their alarm clocks to get up early in the morning, get dressed and head off to work. But unlike the rest of us who pull into rush hour traffic in the morning, that 65 year old in the car next to yours is paying the government a fee to go to work that day. That fee is called the Social Security Earnings Limitation.
My colleagues, today we can eliminate that fee and undo that injustice. Today we can begin to give America's senior citizens equal treatment under the nation's tax laws. Today we can guarantee that those senior Americans who want to continue to work--and can continue to work--today we can guarantee that they won't be penalized for making that contribution to their families, to their communities and to society in general.
By allowing older Americans the opportunity to stay in the workforce without penalty, we are allowing them to supplement their incomes, we are helping them to stay healthier, and we are giving them the opportunity to add to their later retirement. This is especially important as we see more and more Americans living into the eighties, their nineties and even into their hundreds.
So I encourage my colleagues today to give their older neighbors a fair break. Vote for the Senior Citizens' Freedom to Work Act.
Mr. BALLENGER. Mr. Speaker, I am pleased that another popular tax relief proposal, the Senior Citizens' Freedom to Work Act, is coming up for a vote today. First, let me point out that the debate over H.R. 5 should contain no rhetoric that this repeal of the Social Security earnings limit will break the bank. The Social Security actuaries have confirmed that repeal of the earnings limit maintains the current projected solvency of the Social Security Trust Fund.
The repeal of the Social Security earnings limit for individuals who have attained the full retirement age has been a very high priority of mine and for my Republican colleagues elected to the House in 1986. Although we were able a few years ago to secure a gradual increase in the earnings limit for seniors who were 65 to 69 years old, the complete repeal of the earnings limit for this group is a big victory. I am pleased that so many senior citizens' groups have joined us in this fight, and I welcome President Clinton's announced support for this repeal as well.
The Social Security earnings limit is a relic of the Great Depression when it was necessary to entice older workers to leave the work force, making more jobs available to younger workers. Today, many businesses and communities face a serious worker shortage. My congressional district has an especially low rate of unemployment now: a meager 1.6 percent. This means that opportunities for older workers abound, providing earning potential and related benefits to the seniors willing and physically able to meet the challenge. Further, I am pleased that H.R. 5 provides immediate relief by covering income earned after December 31, 1999.
For those in the 10th Congressional District and elsewhere who do not know me well, I am proud to report that I am a working senior. Too old now to benefit from this change in the tax code, I nevertheless enjoy a higher quality of life--and perhaps better health--which comes with being more active. In addition, I feel that my many years of experience add to my job performance as a long work history does for so many seniors.
Again, let me say that I appreciate the support of our colleagues in getting this repeal bill before the House today. Our Nation's seniors deserve this extra incentive to remain productive in their later years and our work force needs them.
Mr. BUYER. Mr. Speaker, I rise in strong support of H.R. 5, the Senior Citizens Freedom to Work Act. I have long supported repeal of this onerous, burdensome rule on this nation's working seniors.
The earnings limit penalty requires seniors age 65 to 69 who earn over $17,000 to forfeit 33% of their Social Security benefits. Seniors with golden parachutes or extensive investments do not face such a penalty ..... only those who get up every morning, head off to work, and make valuable contributions to our labor force. This is unfair.
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