Home / News / Article


August 1 2018

The Rubio-Wagner Bills Help Workers by Modernizing Social Security

via National Review
by Carrie L. Lukas

Senator Marco Rubio (R., Fla.) and Representative Ann Wagner (R., Mo.) wrote in USA Today that they are introducing legislation (the Senate bill will drop this week) to modernize our more than 80-year-old public pension system — Social Security — to make it more flexible and better able to meet the needs of today’s workers.

This is welcome news. Currently, workers are required to begin paying Social Security’s taxes on their first day on the job, and then (unless they become disabled) they aren’t allowed to access any of those benefits until they reach the retirement age under the law (which is 67 for workers born after 1960, though people are allowed to retire as early as 62) when they begin to receive a monthly pension.

The proposed reform recognizes that many workers need financial support earlier in their lives more than they do in their sixties. The Rubio bill would allow a worker to access a portion of his or her Social Security benefits after the birth or the adoption of a child, in exchange for delaying his or her eligibility for retirement benefits.

Since many workers lack paid-leave benefits on the job, and have little savings accrued when having a child, this would help many who face a significant financial stress at a very important and vulnerable time. An estimated 17 percent of all workers (and half of low-income workers) who lack paid leave end up going on public assistance when they take time off from work. Giving them access to early Social Security benefits (which they would then effectively pay back by trading one benefit for another) would reduce dependency on other government programs.

Some have argued that it’s unfair to ask those who take parental leave to delay retirement. But the amount of delay is relatively modest — someone who takes three months’ worth of benefits would delay retirement by about three months. Given that someone born in 1970, who reaches age 65, has a life expectancy of more than 15 years (17 years for women), delaying retirement by a few months still leaves room for a relatively long retirement.

Others have argued that this would worsen Social Security’s finances by moving up when some benefits are paid, which would move up the date of the Trust Fund’s exhaustion. That could be addressed by requiring that the Trust Fund be reimbursed by the general Treasury for expenses related to this new benefit. Some may dismiss this as an accounting gimmick, but the Social Security Trust Fund has always been an accounting mechanism, and it’s a distraction to focus on the date that it runs out.

We should rather focus on the big picture of liabilities for taxpayers. This reform wouldn’t change Social Security’s overall financial health: It faces a significant unfunded liability today and would continue to face the same liability if this reform becomes law. But this reform could reduce dependency on other government assistance programs, encourage labor-force attachment, and discourage states from creating other more costly paid-leave programs that require new taxes on all workers.

Touching Social Security has long been considered a political nonstarter, but it shouldn’t be. This is a modest and targeted reform that would help people who really need it, and make our entitlement programs more modern and flexible, rather than bigger.

Independent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
Follow us