“First there was the working lunch, then the working vacation. Now, thanks to George Bush, we are threatened with the working retirement.” That’s the opening of a dramatic new television ad from Moveon.org, opposing the administration’s plans to cut future Social Security benefits by up to 46 percent. You can see the ad at www.moveon.org. It shows senior citizens loading industrial washing machines, carrying heavy cartons, mopping floors in a hospital, and cleaning up a construction site. You can also see the reality in communities across the country.
Workers in their 50s and 60s, who had planned to retire early, are waiting until age 65 or later. And workers in their 60s, 70s, and 80s, retired (or downsized) from their jobs, are returning to work in astounding numbers.
At the end of 1995, 29.3 percent of the older population (age 55 and above) was working. As the economy improved over the next five years, more jobs were available and the figure rose to 31.7 percent. After the recession began in 2001, employment rates dropped for most workers. But for older workers, employment increased by another 3.7 points, reaching 35.4 percent at the end of last year. In the last nine years, adjusting for population growth, employment rates grew by 8 percent for workers between 55 and 65, and by 22 percent for workers between 65 and 75. For those over 75, the employment rate grew by 42 percent since 1995!
One viewpoint, quoted recently in The New York Times, is that this trend represents a great opportunity. The old dream was to retire free from work, it says. “The new dream may be the freedom to work in new fields, and in jobs that are still rewarding.”
Rewarding? My neighbor, now in his late 70s, works as a security guard. Another neighbor, retired from the same factory with a similarly meager pension, works as a home health aide. Every day they struggle to perform jobs that further undermine their health. They sacrifice time with their grandchildren in order to make ends meet and to help support extended families.
For my neighbors and for millions more, the reasons are not hard to find — more expenses and less income.
Medical expenses now consume 22 percent of seniors’ income, and companies across the country are terminating medical benefits for retirees. Elderly renters spend 41 percent of their income on housing, while property taxes and heating costs soar for homeowners. And at least 2.4 million grandparents are now the primary caregivers for their grandchildren, up from 2.0 million in 1992.
On the income side, employer-paid “defined benefit” pensions are disappearing, and 401(k)-type plans, always inadequate, took a big hit in the stock market crash. As a result, by 2001, savings and pensions together contributed only 34 percent of seniors’ income, down from 41 percent in 1992. Workers with low-paying jobs, who get the smallest Social Security checks, are also least likely to have company pensions or personal savings.
When expenses exceed income, seniors are forced to mortgage their homes and live on their credit cards. Since 1989, credit card balances for those over 65 more than doubled; by 2000, 28 percent had mortgages on their homes, up from 21 percent in 1990. Usurious interest rates and fees, and predatory mortgage loan practices targeted seniors, contributing to a tripling of their bankruptcy rate in the last decade. But the bankruptcy bill just passed by Congress, at the bidding of the financial industry, will keep even more of the elderly on the job.
Now, the Bush privatization proposal includes deep Social Security benefit cuts for future retirees. Federal Reserve Chair Alan Greenspan has called for a “longer working life,” on top of the increase in retirement age to 67, which is already underway. There have been other proposals for cutting the cost-of-living adjustments for current retirees.
Any attempt to “save” Social Security by cutting benefits or raising the retirement age will condemn the majority of workers to a lifetime of toil. But making millionaires pay the same payroll tax as the rest of us could finance an increase in Social Security benefits. We could have universal, comprehensive health care by eliminating drug and insurance company profiteering. These are the two most important demands to insure retirement security for our parents, our children and us.