4ssfairness's Blog

Faulty Assumptions the basis for the GPO/WEP Penalties

4ssfairness — Sat, 30 Jul 2011 22:14:29 +0000

How much have you lost due to the Government Pension Offset and/or the Windfall Elimination Provision? Some have paid as much as $90,000 in Social Security taxes and yet have their entire retirement benefit lost due to the GPO. In my case, I lose $24,000/annually due to the GPO. Would you “invest” $90,000 for your future retirement if you knew that the return would be nothing?

PPT-PTS OF INEQUITY 7-30-11

Today’s Lesson….The Facts About CalSTRS Pensions

4ssfairness — Wed, 02 Mar 2011 05:42:37 +0000

Today’s Lesson … The Facts About CalSTRS Pensions

During my 31 years as an educator I taught my students using facts – dates and figures that could be substantiated. Facts are what we should focus on now as we discuss pensions. Grandstanding and exaggerations have no place in a discussion about something as important as the financial health of our state and its citizens. And “one size” definitely does not fit all when describing the different systems. CalSTRS is different.

The California State Teachers’ Retirement System (CalSTRS) has been providing retirement security for more than 97 years, even through the Great Depression. Here are some facts about CalSTRS and educators’ retirements:

CalSTRS earned 8.2 percent over the past 20 years and 12.7 percent last year. The CalSTRS pension fund is not in immediate crisis. It has assets to pay benefits for at least the next 30 years.

As a percentage of payroll the state is paying less now (roughly 2 percent) than it did 14 years ago when the state paid 4.3 percent of payroll.

I paid for my CalSTRS retirement with 8 percent of my monthly paycheck. That is higher than private-industry workers pay into Social Security.

CalSTRS retirement benefits are based on age, years of service and final pay. The formula used is 2 percent of pay, not the higher percentages you often hear about.

Most CalSTRS retirees don’t receive their own nor their spouse’s earned Social Security benefits (they are penalized for being teachers via the Windfall Elimination Provision and Government Pension Offset).

Just as private-sector retirees rely on Social Security, teachers rely on their CalSTRS pension to remain self-sufficient.

Most CalSTRS retirees don’t receive any employer paid health care.

CalSTRS is already a hybrid retirement plan with a defined benefit formula for one type of compensation and a cash balance plan for other compensation that is similar to a 401(k). The system was created to avoid pension spiking.

CalSTRS has actually cut retirement benefits in the past year. Most of the CalSTRS benefits that were provided in 2000, at the peak of the dot com boom, were limited term benefits and have sunsetted. Those who earned the benefits prior to the sunset will receive them; however, no new retirees can earn those benefits.

Opponents of public pensions have lumped all the pension systems together in their attacks, yet CalSTRS is very different in their formulas and benefits. Even the California Foundation for Fiscal Responsibility is quoted as saying, “Teachers have a more modest formula, and it has been fixed for a number of years now.” (North County Times, 1/10/11).

I am a proud member of the California Retired Teachers Association (CalRTA), which sponsored the Elder Full Funding Act that brought CalSTRS to full funding in 1998. CalRTA has every expectation that Governor Brown will find a funding balance now that is fair to taxpayers and fair to workers, just as we have experienced in the past.

Retirement plan opponents believe that all public retirement systems are the same. The facts don’t support that argument. CalSTRS is different.

Polly Bacich

President

California Retired Teachers Association

ACTION NEEDED FOR SOCIAL SECURITY FAIRNESS PLUS WEBINAR

4ssfairness — Wed, 09 Feb 2011 06:59:06 +0000

Alert #24 A New Congress—We await a new bill! SSFairness.com

SIGN UP FOR WEBINAR EXPLAINING GPO/WEP AND ASK QUESTIONS

As the new members of Congress get settled in and the old ones get re-organized, those of us who were waiting for the GPO and WEP to be repealed are forging on! Despite the large turnover in the House of Representatives, we still have 252 co-signers of the last Social Security Fairness Act who have returned to Congress. We need to remind them that we are still out here. Those of us who have newly-elected Congress members need to “educate” them about how deeply unfair these provisions really are. The cost of the 2011 one-year payroll tax holiday that was given to current workers in December was enough to pay for the repeal of the WEP and GPO for 10 years! Don’t let anyone say that this country can’t pay us for the Social Security we have earned!

There are things to do:

1. If you don’t know if your Congress member was a supporter for the last bill, you can check this list of Social Security Fairness Co-sponsors from the Library of Congress website:

http://thomas.loc.gov/cgi-bin/bdquery/z?d111:HR00235:@@@P

Then send a letter of thanks and/or let them know, again, of what the GPO or WEP has done to you. http://www.house.gov/

2. If you want to know about these provisions in depth, you can download and read the Congressional Research Service 2010 Reports, new on our website under “Further Reading.” http://www.ssfairness.com/further-reading.html

The WEP report refers to a 2008 study showing how the current formula is unfair to low-income workers. From the GPO study, you can read how it is felt that the government cannot help the mostly women affected by the GPO because even more married persons will see how they are treated unfairly by Social Security! Let us know what you think about these detailed papers. People have looked at our website more than 25,000 times!

3. To hear from the Social Security Administration directly about how the WEP and GPO work, sign up for their “webinar,” online seminar, on Wednesday, February 16, at 2:00 PM EST. To participate you must RSVP for the webinar by visiting www.socialsecurity.gov/survey/gpo-wepRSVP.htm. The National Education Association, which sent us this link, says that some webinars provide an opportunity to ask questions and make comments. Just in case they do, be ready to ask them about something that is bothering you or tell them what you think about the WEP/GPO. (Make sure that your computer speaker and mike are working for this!) See below for the full SSA invitation.

4. Join our Facebook Page: Social Security Fairness – Repeal the GPO/WEP to interact with our 296 supporters around the country, mostly from CA with Ky as a runner up. Help us spread the word by reposting our entries on your profile page and invite people to join our worthy cause. Help us go viral!

Thank you for standing up for Social Security Fairness!

SOCIAL SECURITY WEBINAR

The Social Security Administration will be hosting a webinar, “How Some Public Employee or Teacher Pensions May Affect Social Security Benefits,” on Wednesday, February 16, 2011 at 2:00 p.m. EST.

In this webinar, we will walk you through how the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) may affect Social Security benefits of workers whose employers do not withhold Social Security taxes from their salary, such as some school systems and some local, state and federal government agencies. For more information about WEP and GPO, visit our Government Employees webpage, www.socialsecurity.gov/gpo-wep/.

We ask that you share the webinar information with your members, colleagues, and other interested parties.

To RSVP for the webinar, please visit www.socialsecurity.gov/survey/gpo-wepRSVP.htm.

Sincerely,

Aviva Sufian

Associate Commissioner

for External Affairs

Obama lays down a marker on Social Security cuts

4ssfairness — Wed, 02 Feb 2011 07:56:12 +0000

Obama lays down a marker on Social Security
What is the future for Social Security?

Article from Reuter’s Blog

JAN 27, 2011 12:42 EST

Would he or wouldn’t he?

President Obama’s deficit commission endorsed cutting Social Security benefits last month, and many wondered whether the president would endorse those cuts in his State of the Union message this week. Instead, the president reiterated the traditional Democratic position on Social Security in his address that he staked out as a candidate in 2008:

“We must [strengthen Social Security] without putting at risk current retirees, the most vulnerable, or people with disabilities; without slashing benefits for future generations; and without subjecting Americans’ guaranteed retirement income to the whims of the stock market.”

That rhetoric differs significantly from the “everything on the table” messages emanating from the White House since the National Commission on Fiscal Responsibility and Reform issued itsfinal report. Written by commission co-chairmen Alan Simpson and Erskine Bowles, the reportrecommended benefit cuts via a higher retirement age, lower annual cost-of-living adjustments (COLA) and a third, somewhat technical change in the way benefits are calculated.

What happened in the weeks since the release of the commission report? A coalition of traditional Social Security backers and Democratic lawmakers seem to have convinced the White House to back away from the Simpson-Bowles recommendations. Their case had two main points — both correct:

1. Cutting benefits is bad policy.
That’s because Social Security has nothing to do with the federal deficit. The program ran a $2.5 trillion surplus in 2009, a number that will hit $3.8 trillion in 2020, according to the Economic Policy Institute. The surplus has been accumulating since implementation of the last Social Security reform measures in 1983, which were implemented for the purpose of building a cushion to fund the anticipated big wave of baby boomer retirements.

Social Security does have a long-term problem, in that the surplus will be depleted around 2035, absent any other changes. But that doesn’t mean the program is careening toward insolvency, as stated often by many pundits and elected officials. Even in 2035, Social Security would be able to fund 76 percent of promised benefits from current revenue.

The causes of this long-range imbalance also are misunderstood. Social Security cutters argue that the program can’t support the nation’s rising longevity rates; therefore we should boost the retirement age and work longer. But rising longevity accounts for only about one-fifth of the long-term problem, according to a new analysis by the Economic Policy Institute:

“The bigger problems are weak wage growth and rising earnings inequality, which account for more than half the projected shortfall that has emerged since the system was last restored to long-term balance in 1983. Earnings inequality has eroded Social Security’s taxable earnings because earnings above a cap are exempt from Social Security taxes. Likewise, slower wage growth increases the costs as a share of taxable earnings. Rising health care costs, which create a growing wedge between compensation and taxable wages, a falling birth rate, and higher disability take-up are also contributing to the projected shortfall.”

Advocates of benefit cuts further state that their changes would be grandfathered in so slowly that no current beneficiaries would feel the pain. But the proposed COLA changes would kick in as early as 2012, reducing the formula used to calculate the adjustment by about 0.3 percent less than it does now. That may not sound like a big change, but compounded over many years it would cut benefits significantly.

Social Security benefits are modest — average annual benefits are a bit under $15,000 per year. A better way to get the program back into long-term balance than cutting benefits is to lift the aforementioned cap on payroll subject to Social Security taxes, currently set at $106,800.

2. Cutting benefits is bad politics for Democrats — and for Republicans.
Numerous polls show remarkably strong opposition to cutting Social Security benefits across all political and demographic groups. A poll last year found that 77 percent of all adults agree that Social Security benefits shouldn’t be cut to reduce the federal deficit. The figure was 84 percent among Democrats, 78 percent among independents and 68 percent among Republicans.

Supporting Social Security is a near-religious issue for core Democratic constituencies that Obama and Congressional Democrats will need at their side in 2012. Yet a Rasmussen poll earlier this month showed that Republicans “hold a 10-point edge when it comes to voter trust on Social Security-related issues, 46 percent to 36 percent, up from a virtual tie last month.” Those numbers stem from the success Republicans had last year convincing seniors that the healthcare reform law will slash Medicare benefits. (It doesn’t). And it’s a stunning finding, considering that Obama rode into office two years ago being hailed as the heir to the legacy of Franklin Delano Roosevelt, who counted Social Security as a signature domestic achievement.

Advocates for protecting Social Security were cautiously optimistic that Obama’s position on Social Security is set following his State of the Union address.

“We’re not taking victory laps yet, but the speech was a positive step,” said Eric Kingson, co-director of Strengthen Social Security and a professor of social work at Syracuse University. “The White House has been under huge pressure from Wall Street, conservatives and deficit hawks to talk about cutting Social Security. The president didn’t do it.”

But pressure to cut Social Security hasn’t evaporated. Tough negotiations loom on the federal budget and the need to raise the government’s debt ceiling. Said Kingson: “Would the White House accept a deal with Republicans involving benefit cuts in that situation? I’m nervous about it.”

Read this blog entry for reflections of a Social Security Fairness Activist.

4ssfairness — Wed, 19 Jan 2011 04:39:46 +0000

Edit

WE ALL MUST FOLLOW THROUGH ON SSFAIRNESS ACTION ALERTS

HOW DO YOU SPELL “THEY?” or

Reflections of a Social Security Fairness Activist

As an activist for the restoration of social security benefits, there are two comments I have heard over and over again.

If I am talking to a new audience who is just learning about the GPO/WEP, their first reaction is predictably “That is unfair!” Some people even insist that I must not have my facts straight. But then I explain some more and they shake their head and the same words come out of their mouth. “That is unfair!”

Once explained there is no debate that the GPO/WEP are unfair. Even Congress has recognized that fact. And yet, the problems have continued for 30 years. Many professional organizations have worked to push for change and their message has been heard and the problem has even been publicly recognized, but the necessary changes have not occurred.

So, those of us whose retirement has been severely impacted continue to hope that justice will be restored. Some have written letters, some have published editorials in the local newspapers, some have called the offices of Congressmen and some have followed closely the actions of our professional organizations and some have become active in SSFAIRNESS.COM. Others have wrung their hands in desperation.

Hoping for a change in the outlook for restoration of social security equity people start asking questions. Eventually I can count on hearing the following question:

“Are THEY doing anything about the unfair Social Security provisions?”

Before I attempt to answer this, let’s consider the psychology behind this question. The choice of word “they” implies that there is some outside force that is able to make change take place. Well, I wish there were a magic wand to wave and “THEY” would then react to our wishes and equitable Social Security benefits would be restored. Unfortunately, the truth of the matter is the answer to the question “are THEY doing anything is really answered by another question.

“Are YOU doing anything about the unfair Social Security provisions?”

“THEY” IS SPELLED “Y” “O” “U” !

A = Action (Sign up for & act on Action Alerts)

C = Commitment to the cause (Tell others & persist)

T = “They” which is really YOU

We need NUMBERS to make our voices heard and only YOU can make those numbers grow.

Do not expect THEY will answer the call to political action.

YOU must answer that Call to Action and follow through on all SSFAIRNESS ALERTS.

We have a small window of opportunity now and can not pass up this chance as it is highly unlikely we will be heard later.

THANK YOU FOR READING THIS AND TAKING THE TIME TO ACT!! SSFAIRNESS.COM

The case for repeal of the GPO/WEP

4ssfairness — Tue, 11 Jan 2011 08:10:27 +0000

PTS OF INEQUITY PPT 11-24-10

Attached is a PowerPoint which presents the reasons the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP) must be repealed. Use this as you see fit and help us to state our cause in a way which is hard to refute. Once the facts are known, then there are no valid arguments which can be offered against the repeal. Stick the course, persist and keep on writing those letters, emails, and phoning the Congressmen and keep this issue on the forefront. We have only a short while to make ourselves heard and then many decisions will already have been made in regard to Social Security in general. We do not want to lose this window or it may not be possible to bring this back to the attention of the decision makers for a long time to come.

We must persist in making our cause known, We must be the change we wish to see in the world!

In a previous blog you can see a more detailed written version of these ten points of inequity which can be used as a handout. Keep on recruiting your colleagues, your neighbors, friends and family and encourage them to sign up on SSFAIRNESS.COM and follow through on those Action Alerts. It is critical we have a lot of participation. If only 10% of our membership write the letters, etc. then that means only 220 people are being heard. Is that enough to make a serious impact? NO – we need regular action from many more people. You can make a difference – be the voice for change.

Alternative way to stretch retirement income

4ssfairness — Fri, 31 Dec 2010 00:44:36 +0000

Jail vs. Nursing Homes…

…WHAT A WONDERFUL IDEA!

Let’s put the seniors in jail, and the criminals in a nursing home.

This way the seniors would have access to showers, hobbies,

and walks. They’d receive unlimited free prescriptions, dental

and medical treatment, wheel chairs etc. and they’d receive money instead

of paying it out.

They would have constant video monitoring, so they could be

helped instantly ,if they fell, or needed assistance.

Bedding would be washed twice a week, and all clothing would be

ironed and returned to them.

A guard would check on them every 20 minutes, and bring their meals

and snacks to their cell. They would have family visits in a suite built for

that purpose.

They would have access to a library, weight room, spiritual counseling,

pool, and education.

Simple clothing, shoes, slippers, P.J.’s and legal aid would be free, on

request.

Private, secure rooms for all, with an exercise outdoor yard, with gardens.

Each senior could have a P.C. a T.V. radio, and daily phone calls.

There would be a board of directors , to hear complaints, and the guards

would have a code of conduct, that would be strictly adhered to.

The “criminals” would get cold food, be left all alone, and unsupervised.

Lights off at 8pm, and showers once a week.

Live in a tiny room, and pay $5000.00 per month and have no hope

of ever getting out.

Justice for all.

Facebook Page Growing….. Soon to Go Viral

4ssfairness — Sat, 27 Nov 2010 08:02:44 +0000

Have you seen this Facebook Page? Social Security Fairness - Repeal the GPO/WEP?

We are stepping out and diving into Social Media to get out the word about the need to repeal the GPO/WEP penalties. Facebook has grown to such proportions that if it were a country, it would be the third largest in the world following China and India. The ability to communicate readily with people all over the U.S. and for free is exactly what we need to promote this cause of restoring Social Security justice for all pubic employees. For some of us retirees the idea of learning new “technology” may not be appealing and for those of us who are still out there working in the trenches time is an issue. However it may be worth it if you are serious about helping us gather LARGE NUMBERS saying the same thing over and over again.

By using Facebook we have grown our presence in the Kentucky and West Virginia area and we have connected with a leader in Texas who has joined our steering committee. In the 3 days following our Action Alert about Facebook, we have grown by 80 members. Now if each of these people is able to bring in 10 more people, we will have gained serious momentum and could go VIRAL from there. We are encouraged by your enthusiasm and hope you will spread the word to as many people as possible that they need to sign up on SSFAIRNESS.COM and follow through with the Action Alerts, writing Congressmen, etc. We do not have much time to organize a ground swell, but that is what it is going to take to overturn laws that have been allowed to exist for 30 years, unfair or not.

Thanks for reading this and I invite you to let us know your thoughts.

Does this sound fair or democratic?

4ssfairness — Mon, 22 Nov 2010 03:00:21 +0000

Equitable or Inequitable?

Even though you and/or your spouse have paid the required minimum or more into Social Security, your benefits may be cut by thousands of dollars if:

1. You have earned your own Social Security credits in another job. Penalized by Windfall Elimination Provision (WEP).

2. Your spouse of at least ten years has earned Social Security credits. Penalized by Government Pension Offset (GPO).

a. You probably will lose all the payments due you as a dependent spouse. (e.g. a stay-at-home childcare parent)

b. You will lose at least part or more often all of the Social Security retirement payments that that normally go to the widow/er.

Points of Inequity

1. GPO/WEP was designed for one purpose, but had a completely different result.

The WEP was originally designed to affect high-income government workers, not the low wage earners that it deeply penalizes. There are no hold-harmless provisions for low-income retirees. It is general knowledge among those who have studied these offsets that they are undesirable, unpredictable and inequitable. (Charlie Rangel) Even President Obama has said he supports repeal of the GPO/WEP.

2. The GPO/WEP formulas are arbitrary.

These offsets were imposed 30 years ago before there were the data and analysis systems that we have now and are without a logical base for reduction amounts.

3. All who pay full Social Security contributions do not receive full benefits.

The present GPO/WEP does not treat all citizens equally when computing benefits. We seek a fair system with an equal standard of distribution for all earned Social Security credits. It is possible to pay Social Security taxes of as much as $90,000 and perhaps more and yet, receive nothing in retirement benefits.

4. GPO/WEP cuts to earned benefits are substantial, commonly causing serious lifestyle reductions, sometimes even to poverty levels.

Nine of ten widows/ers receive no survivor spousal benefits, causing a reduction of earned Social Security benefit which can be as much as or more than $25,000/year. Even a pension of as little as $1,500/month can cause TOTAL LOSS of needed survivor benefits. According to CalSTRS, a California teacher of 30 years receives an annual pension of $34,668/year, a decidedly modest pension for the number of years of service in the classroom. If a person has entered teaching or any other penalized public service

POINTS OF INEQUITY OF GPO/WEP CONTINUED

profession after another career or having been a stay-at-home care taking parent, they will most certainly be earning much less. Therefore they definitely need their earned Social Security benefits to fulfill survival needs.

5. The GPO/WEP are based on incorrect assumptions.

The required money paid into Social Security is taxed independently from one’s pension. Therefore the money should be paid out independent of money received from one’s pension. Neither should affect the other. The GPO/WEP penalties smack of taxation without representation. Money in bank A should not affect money in bank B.

6. The GPO/WEP represent discrimination against women.

The GPO currently penalizes about one half million retirees. 79% of them are women. 75% of those penalized lose ALL of their benefits. 21% have annuities of under $1,000/month. (NARFE)

7. Our education system is at risk because the GPO/WEP penalties affect 1/3 of all U.S. educators, thereby discouraging the choice of teaching as a profession.

A 2009 report by the National Commission on Teaching and America’s Future stated, “In less than a decade more than half of today’s teachers – 1.7 million – could be gone.” The report explains that this is caused principally by retirement, but aggravated by the fact that one of every three new teachers leaves the profession within five years.

8. No law, until recently, to inform employees about the GPO/WEP penalties.

The law to notify new employees about the WEP/GPO only went into effect in 2005. Large numbers of current public employees have not been told that their public service employment is jeopardizing their already earned Social Security benefits.

9. The cost of repeal of the GPO/WEP is minimal when compared to the total amount paid to retirees annually and benefits were paid for by required Social Security taxes.

The cost of repeal of the GPO/WEP is only 2% of the overall Social Security costs paid to recipients. Find Estimated Trust Fund Information at http://www.ssa.gov.

10. Our government is built upon democratic principles and therefore all laws should abide by the principle of equal rights for all citizens. The GPO/WEP do not treat all citizens in an equitable manner when distributing Social Security benefits.

JOIN US! SIGN UP FOR ACTION ALERTS ON SSFAIRNESS.COM!

FOLLOW US ON OUR FACEBOOK PAGE , “SOCIAL SECURITY FAIRNESS – REPEAL THE GPO/WEP”

Equitable or Inequitable?

New Facebook Page – Let’s Go Viral!

4ssfairness — Wed, 17 Nov 2010 07:35:30 +0000

Have you seen us on Facebook? You, your kids or friends have a Facebook Page? Visit our page (Social Security Fairness – Repeal the GPO/WEP) and make a comment. Mark “Like” on the left hand side of our page and all our posts – will automatically show up on your home page. Then use the “suggest to friends” option to the left of our page and share it with your friends. One person recently brought us 50 new members in two weeks. We now have a larger presence in Kentucky and West Virginia. Share our explanatory PowerPoint on your profile so all can understand these illogical offsets. Give it a try and ask your friends to do the same and let’s see where this takes us. Of course the final goal is to get them to sign up on SSFAIRNESS.COM for Action Alerts so that we have the necessary numbers making “noise” to have a real impact for repeal of the punitive Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP).

TELL CONGRESS TO LEAVE NO SENIOR BEHIND!

WE paid our Social Security taxes. Now YOU pay us our earned benefits.