President Obama has stated that the overall health of social security is sound. He does not feel that it has the intrinsic problems that medicaid and medicare have. He opposed the partial privatization of the program as proposed by President Bush, and opposes plans to privatize it in part or total in the future.
President Obama has repeatedly stated that he is against the lowering of benefits or the raising of the retirement age. He has also stated that "everything is on the table" when discussing solutions for the solvency of social security. He later clarified that statement to not include privatization.
He is an advocate for raising the earnings cap, and has often spoke of it as the main solution to the solvency of social security. He has stated that the tax would be raised on anyone earning more than $250,000. He has also proposed the elimination of income taxes to any senior earning less than $50,000 per year.
Senator Obama also proposed mandatory 401k enrollment, and the creation of a system that requires employers to withhold a portion of each employees pay and place it into an account for that person, and the funds are to be withdrawn at retirement.
In December of 2010, President Obama declared that social security was started as a program for orphans and widows and then expanded. This is not true.
Blueprint for Social Security
During the 2008 election, Senator Obama made a series of campaign videos called "blueprints" that outlined his plans for various items. In the one for social security, Senator Obama gave a summary of his views on social security and outlined them in bullets. In the audio, Senator Obama states that he favors removing the cap on those earning more than $250,000, and that he opposes reducing benefits or increasing the retirement age. He also begins to promote the automative workplace enrollment pension.
Protect Social Security
Adjust payroll tax for earnings above $250,000
No change in taxes for 97% of Americans
Extend social security without cutting benefits or raising the retirement age
Eliminate income tax for retirees earning less than $50,000
Completely eliminate income taxes for 7 million seniors
Secure hard earned pensions
worker pensions a top priority in company bankruptcy
increase worker wages and benefits during bankruptcy
companies must disclose pension fund investments
no golden parachutes for executive during bankruptcy
eliminate bankruptcy for medical debt
Help Americans save more
Automatic workplace pensions
No red tape or complicated forms
opt out at any time
We can extend the promise of social security without shifting the burden on seniors.
I think that's way the best way forward is to adjust the cap on the payroll tax so that people like me, because i'm earning more than $102,000 pay a little bit more and people in need are protected.
And by the way, I think that we should exempt anyone making under $250,000 from this increase. So, it will not burden the middle class. 97% of Americans will see no change in their taxes under my proposal. 97%. What it does allow us to do is extend the life of social security without cutting benefits or raising the retirement age.
Even if we keep social security strong for future generations, it's not enough to help seniors who are struggling to cope with everything from the cost of gas to groceries, because we know that rising costs are hardest on folks with fixed incomes. That's why I want to make retirement more secure by eliminating the income tax for retirees that are making less than $50,000 a year. This would completely eliminate income taxes for 7 million seniors.
If a company goes bankrupt, companies should be a top priority and not just an afterthought. So as president, i'll limit the circumstances when retirement can be cut, and increase the wages and benefits that workers can claim in bankruptcy court. We'll require companies to disclose their pension fund investments. We'll put an end to the outrage of executives getting bonuses while workers watch pensions disappear, and we'll make sure that no american goes bankrupt just because they got sick.
75 million americans today don't have the employer based retirement plans that previous generations counted on. And that's why I proposed an automatic workplace pension. There's gonna be no red tape or complicated forms. Employers will provide a direct deposit of a small percentage of each paycheck into your account, and you can add to it or you can opt out of it at any time.
Blueprint for Fiscal Discipline
As part of the blueprint for fiscal discipline, Senator Obama noted that he would not privatize social security, not raise the retirement age, and pay for social security by "getting the wealthiest Americans to pay their share."
And while John McCain wants to pick up where George Bush left off by trying again to privatize social security, I will never waiver in my commitment to protect that basic promise as President. We will not privatize social security and we will not raise the retirement age. We will protect social security for future generations by asking the wealthiest Americans to pay their share.
Des Moines Register Interview
In December 2007, Senator Obama gave an interview for the Des Moines register and discussed social security. He again stated that social security was not in a crisis.
Well, there are no easy answers. I'd separate out social security, where i'd argue that there is not a crisis. There may be an actuarial problem that over the next few years we've got to address. But it's a manageable one. And the problem of medicare and medicaid, which are in crisis, and if we don't deal with soon, we're gonna be making our children and grandchildren poorer. The problem on the health care entitlements is that you have an actuarial problem which sends the costs up a little bit per year, and an extraordinary steep annual increase in costs. And so part of the reason that I feel it is so important for us to move forward on health care, an overarching health care reform agenda, and soon, in the next five years, is that you can't solve medicare and medicaid without solving the large inefficiencies in the system.
2008 Campaign Website
Senator Obama's official campaign website re-iterated his opposition to the privatization of social security and removing the payroll cap on those making more that $250,000.
The Obama-Biden Plan
Protect Social Security
Barack Obama and Joe Biden are committed to ensuring Social Security is solvent and viable for the American people, now and in the future. Obama and Biden will be honest with the American people about the long-term solvency of Social Security and the ways we can address the shortfall. They will protect Social Security benefits for current and future beneficiaries alike, and they do not believe it is necessary or fair to hardworking seniors to raise the retirement age. Obama and Biden are strongly opposed to privatizing Social Security. As part of a bipartisan plan that would be phased in over many years, they will ask those making over $250,000 to contribute a bit more to Social Security to keep it sound. Obama does not support uncapping the full payroll tax 12.4 percent rate. Instead, he and Joe Biden are considering plans that will ask those making over $250,000 to pay in the range of 2 to 4 percent more in total (combined employer and employee).
Resource Flyer
Obama believes we need to preserve Social Security by stopping any efforts to privatize it and will work across party lines to maintain Social Security’s solvency for generations. Obama wants to make private saving easier, cheaper, & more automatic for middle-class workers. He supported the Save More for Retirement Act, which encourages automatic 401K enrollment. Obama also voted for new rules to force companies to properly fund their pension plans so taxpayers don’t foot the bill.
The Audacity of Hope
In his memoirs, The Audacity of Hope, Senator Obama discussed why he opposed privatization of social security and asked what would be done with those who lost their money in the stock market.
If the guiding philosophy behind the traditional system of social insurance could be described as “We’re all in it together,” the philosophy behind Bush’s Ownership Society seems to be, “You’re on your own.” Relying on the magic of the marketplace is a tempting idea, elegant in its simplicity. But it won’t work.
Take the Administration’s attempt to privatize Social Security. The Administration argues that the stock market can provide individuals a better return on investment, and in the aggregate they are right; historically, the stock market outperforms Social Security’s cost of living adjustment. But individual investment decisions will always produce winners and losers. What would the Ownership Society do with the losers?
That doesn’t mean we shouldn’t encourage individuals to pursue higher-risk, higher-return investment strategies. They should. It just means that they should do so with savings other than those put into Social Security
Stephanopoulos Interview
In January on 2008, Senator Obama gave an interview to George Stephanopoulos and spoke about social security. Senator Obama noted that everything should be on the table to deal with the issue of social security with the exception of privatization of the system. This contradicts both the notion that there is a no problem with social security and the previous statements that he opposed raising the retirement age.
Stephanopoulos: You've also said with social security "everything should be on the table." Raising the retirement age ...
Obama: Everything should be on the table
Stepanopoulos: Raising payroll taxes...
Obama: Everything should be on the table. I think that we should approach it the same way that Tip O'Neal and Ronald Reagan did in 1983. They came together ... I don't want to lay out my preferences beforehand, but what I know is that social security is solvable. It is not as difficult a problem as we're gonna have with Medicaid and Medicare.
Stephanopoulos: Partial privatization
Obama: Privatization is not something that I would consider. And the reason is this: Social Security is ... that's the floor, that's the baseline. Social Security is that safety net that can't be frayed and we shouldn't put at risk.
Fox Interview - Presidential Series
In an interview on Fox on April 27, 2008, Senator Obama reasserted his desire to raise the cap on social security taxes.
Q: The Republicans are keeping a running total of all your plans. They say it’s $662 billion over four years.
A: Right.
Q: They say for all your promises not to raise taxes on the middle class, that, in fact, you want to raise the cap on the Social Security payroll tax, and you also want to increase capital gains.
A: In terms of raising the cap on the payroll tax, right now everybody who’s making $102,000 or less pays 100% of payroll tax on 100% of their income. There are about 3% to 4% of Americans who are above $102,000 in income every year. So if you want to talk about who’s middle class, me giving cuts to folks making $60,000 or $70,000, and potentially asking more from friends of mine like Warren Buffett. That’s a debate I’m happy to have with John McCain, because it’s the people making $75,000, $50,000, $60,000 who are hurting.
Philadelphia primary debate
In the Philadelphia primary debate, which was held on April 16, 2008, Senator Obama again reaffirmed removing the cap on those making over $250,000.
CLINTON: I’m certainly against one of Senator Obama’s ideas, which is to lift the cap on the payroll tax, because that would impose additional taxes on people who are educators, police officers, firefighters and the like.
OBAMA: What I have proposed is that we raise the cap on the payroll tax, because right now millionaires and billionaires don’t have to pay beyond $97,000 a year. Now most firefighters & teachers, they’re not making over $100,000 a year. In fact, only 6% of the population does. And I’ve also said that I’d be willing to look at exempting people who are making slightly above that.
Q: But that’s a tax on people under $250,000.
OBAMA: That’s why I would look at potentially exempting those who are in between. This is an option that I would strongly consider, because the alternatives, like raising the retirement age, or cutting benefits, or raising the payroll tax on everybody, including people making less than $97,000 a year--those are not good policy options
OBAMA: We’re going to have to capture some revenue in order to stabilize the Social Security system. You can’t get something for nothing. And if we care about Social Security, which I do, and if we are firm in our commitment to make sure that it’s going to be there for the next generation, and not just for our generation, then we have an obligation to figure out how to stabilize the system. I think we should be honest in presenting our ideas in terms of how we’re going to do that and not just say that we’re going to form a commission and try to solve the problem some other way.
CLINTON: With all due respect, the last time we had a crisis in Social Security was 1983. President Reagan and Speaker Tip O’Neill came up with a commission. That was the best and smartest way, because you’ve got to get Republicans and Democrats together. That’s what I will do.
OBAMA: That commission raised the retirement age, and also raised the payroll tax. So Sen. Clinton can’t have it both ways.
Meet the Press
In a meet the press interview on November 11, 2007, Senator Obama made the following statements:
Q: You said earlier this year that everything should be on the table for Social Security, including looking at raising retirement age, indexing benefits, and then suddenly you said, “I’m taking them off the table.”
A: That’s not what I said. I said I will convene a meeting as president where we discuss all of the options that are available. I believe that cutting benefits is not the right answer; and that raising the retirement age is not the best option, particularly when we’ve got people who are still in manufacturing.
Q: But in May you said they would be on the table.
A: Well, I am going to be listening to any ideas that are presented, but I think that the best way to approach this is to adjust the cap on the payroll tax so that people like myself are paying a little bit more and the people who are in need are protected. That is the option that I will be pushing forward.
Q: But the other options would be on the table?
A: Well, I will listen to all arguments and the best options.
Drexel Debate
On October 30, 2007, Senator Obama said the following at the Drexel debate
Social Security is not in crisis; it is a fundamentally sound system, but it does have a problem, long-term. We’ve got 78 million baby boomers, who are going to be retiring over the next couple of decades. That means more retirees, fewer workers to support those retirees. We are going to have to do something about it. The best idea is to lift the cap on the payroll tax, potentially exempting middle-class folks, but making sure that the wealthy are paying more of their fair share, a little bit more.
Dartmouth debate
The Dartmouth debate took place on September 6, 2007
Q: Would you raise the cap for Social Security tax above the current level of the first $97,500 worth of income?
A: I think that lifting the cap is probably going to be the best option. Now we’ve got to have a process [like the one] back in 1983. We need another one. And I think I’ve said before everything should be on the table. My personal view is that lifting the cap is much preferable to the other options that are available. But what’s critical is to recognize that there is a potential problem: young people who don’t think Social Security is going to be there for them. We should be willing to do anything that will strengthen the system, to make sure that that we are being true to those who are already retired, as well as young people in the future. And we should reject things that will weaken the system, including privatization, which essentially is going to put people’s retirement at the whim of the stock market.
Facebook debate
The facebook debate took place on January 6, 2006
What we need to do is to raise the cap on the payroll tax so that wealthy individuals are paying a little bit more into the system, if we are going to deal with this problem specifically. Right now, somebody like Warren Buffet pays a fraction of 1 percent of his income in payroll tax, whereas the majority of the audience here pays payroll tax on 100 percent of their income. I’ve said that was not fair.
Youtube debate
The youtube debate took place on July 23, 2007
Q: We all know that Social Security is running out of money, but people who earn over $97,500 stop paying into Social Security. The Congressional Research Service says that if all earnings were subject to payroll tax, the Social Security trust fund would remain solvent for the next 75 years.
A: I think that it is an important option on the table, but the key, in addition to making sure that we don’t privatize, because Social Security is that floor beneath none of us can sink. And we’ve got to make sure that we preserve Social Security is to do the same thing that Ronald Reagan and Tip O’Neill were able to do back in 1983, which is come up with a bipartisan solution that puts Social Security on a firm footing for a long time.
Columbus Townhall
In June of 2008, Senator Obama gave the following speech at a town hall
... For millions of Americans, social security is the difference between a comfortable retirement and poverty. We have an obligation to secure the future of one of the most successful programs in our history. And that starts with taking straight to the American people about the challenges that lie ahead. Social Security is strong, but as more baby boomers retire and as our population gets older, that means that there are going to be more retirees and fewer workers to support the system. The long term cash flow needs to the social security system are going to have to be addressed, if we are going to make sure that social security is there for future generations. Now, my opponent in this general election, John McCain, his idea on social security amounts to four more years of what was attempted and failed under George Bush. He said that he supports private accounts through social security in his words, along the lines that President Bush proposed. Yesterday, he tried to deny that he ever took that position which leads us to wonder if he had a change of heart or a change of politics. Let me be clear. privatizing social security was a bad idea when George Bush proposed it, it's a bad idea today. It would eventually cut guaranteed benefits by up to 50%. It would cost a trillion dollars that we don't have to implement on the front end, permanently elevating our national debt. And most of all, it would gamble the retirement savings of millions of americans on the stock market. .... That's why I stood up against this plan in the Senate and that's why I won't stand for it when I am President.
The origins of social security
In December of 2010, President Obama was answering questions about a tax compromise and the health care reform. In defending his compromises, President Obama attempted to assert that most programs start small and eventually expand. In doing so, he cited social security and stated that the program started as one for orphans and widows. This is not true, and is the exact opposite of the program's original purpose to reimburse those who paid in throughout time.
Now, if that’s the standard by which we are measuring success or core principles, then let’s face it, we will never get anything done. People will have the satisfaction of having a purist position and no victories for the American people. And we will be able to feel good about ourselves and sanctimonious about how pure our intentions are and how tough we are, and in the meantime, the American people are still seeing themselves not able to get health insurance because of preexisting conditions or not being able to pay their bills because their unemployment insurance ran out.
That can’t be the measure of how we think about our public service. That can’t be the measure of what it means to be a Democrat. This is a big, diverse country. Not everybody agrees with us. I know that shocks people. The New York Times editorial page does not permeate across all of America. Neither does The Wall Street Journal editorial page. Most Americans, they’re just trying to figure out how to go about their lives and how can we make sure that our elected officials are looking out for us. And that means because it’s a big, diverse country and people have a lot of complicated positions, it means that in order to get stuff done, we’re going to compromise. This is why FDR, when he started Social Security, it only affected widows and orphans. You did not qualify. And yet now it is something that really helps a lot of people. When Medicare was started, it was a small program. It grew.
Under the criteria that you just set out, each of those were betrayals of some abstract ideal. This country was founded on compromise. I couldn’t go through the front door at this country’s founding. And if we were really thinking about ideal positions, we wouldn’t have a union.
Continued Opposition to Privatization
In August of 2010, President Obama used his weekly address to restate his opposition to the possibility of privatizing social security.
Voting Record
Amendment - Social Security Reserve Fund
In 2007, congress attempted to pass an amendment to create a reserve fund for social security. This action was prompted by the increasing awareness that the Social Security program may not be financially solvent in the near future. Opponents claimed that the move was an end-around method to privatize social security. The amendment was largely supported by Republicans and largely opposed by Democrats. The amendment failed in a 45-52 vote. Barack Obama voted against the amendment to create a reserve fund for social security.
Barack Obama voted against the amendment to create a reserve fund for social security.
