their own wealth and retirement income, some of the nation’s chief executive
officers are now calling for cuts in Social Security.
Scott Klinger for the Los Angeles Times (December 1, 2013)
“Many of the nation’ top CEOs have joined forces to ‘fix
the debt.’ They want to achieve this goal, in part, by reducing Social Security
benefits and raising the retirement age to 70.
One of the chief executive officers, David Cote,
runs Honeywell. ‘As an American, I couldn’t know about this problem and not try
to do something about it,’ Cote told Wall
Street Journal TV. Cote has $134 million in his Honeywell retirement
account, according to documents filed with the Securities and Exchange
Commission, and he has worked there only 11 years. That amount could provide
him a monthly retirement check of $795,134 once he turns 65. The Social
Security retirees whose checks he wants to reduce receive, on average, $1,237 a
Cote is not alone among those with lavish private
retirement benefits to be calling for major cuts in Social Security. He is one
of 200 large-company CEOs who belong to the Business Roundtable, a powerful
lobbying club that represents the interests of America’s corporate leaders.
Roundtable is a leading voice calling for replacing the current formula used to
calculate Social Security cost-of-living increases with a less generous one.
The change it suggests would steadily chip away at retiree benefits each year
until, after 20 years, Social Security checks would be about $100 less than if
the current formula was retained.
The Business Roundtable also advocates raising the
retirement age to receive full Social Security benefits to 70, which would give
the U.S. the dubious distinction of requiring workers to wait longer than any
other developed nation to receive their public pensions.
Like Cote, many of the CEOs on the Business
Roundtable have corporate retirement benefits that ordinary Americans would
find unimaginable: an average of $14.5 million, enough to garner monthly
retirement checks of $86,043, according to a new report, ‘Platinum-Plated Pensions,’ published by the Center for Effective Government and the
Institute for Policy Studies.
The report examines America’s growing retirement
crisis. CEOs’ decisions to cut their workers’ pensions have played a direct
role in this crisis. In 1980, 89% of America’s largest corporations offered
their workers a defined-benefit pension that reliably delivered monthly pension
checks to retirees. Today, only 11% of these firms offer pensions. Most have
switched workers to riskier 401(k) plans, which generate huge fees for Wall Street
— and the prospect of an uncertain retirement for most employees.
The elimination of so many corporate pensions has
left Americans more dependent on Social Security. More than a third of all
Americans over age 65 receive 90% or more of their monthly income from Social
Security, and that’s in an era when many retirees still draw pension benefits.
Six million Americans over the age of 65 currently live beneath the poverty
line, with 2 million more expected to join them by 2020. Cutting Social
Security benefits would make things worse.” [….] Read the rest of the article here.
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