Sen. Lindsey Graham (R-SC) has a proposal to modernize Social Security and make it solvent in to the future and it may be the basis of President Bush's policy. The proposal, called the Social Security Solvency and Modernization Act, was originally introduced late in 2003. It languished in the Senate Finance Committee because of more pressing concerns, like National and Homeland Security. However, it will be reintroduced sometime early next year after the swearing in of the 109th Congress.
The proposal grants younger workers the option of investing 4% (up to $1300) of their SS payroll taxes into a private account in the Thrift Savings Plan, a government guaranteed program. This option also allows younger people to have increased survivors benefits if something should happen to their parents and the earnings or losses from the private account will be offset by the benefits received form th 96% of the taxes not invested in the account.
The second option, which also applies to middle age workers, has no private account, but provides the increased survivors benefits and current law SS benefits.
The third option provides only current law benefits. Anyone can opt for this, however, current beneficiaries will stay in the current law system.
This plan is well thought out and comprehensive. It addresses both the issue of modernization (private accounts) and solvency. Who better than Sen. Graham to address this issue. His parents passed away when he was 22 and his sister was 13. His sister survived because of survivor's benefits. He would do nothing to harm this program. He is showing leadership on this issue and is sure to raise his national profile by being a surrogate on many news shows.
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