ARTICLES BY TOPIC ¦ SOCIAL SECURITY



Letter to the Editor ¦ September 30, 1996
Don't rush change (Response to David Langer)

I very much enjoyed David Langer's excellent comments on Social Security in his June 24 Others' Views commentary.

When reflecting that OASDI benefits are a statutory obligation of the federal government and must be paid, I am reminded of how the Congress, in its infinite wisdom, has occasionally seen fit to modify that obligation. A couple examples: The first example:

In 1956 Social Security was offered to state and municipal employees. However, a number of married female employees working for New York state or city did not enroll because they relied on their dependent Social Security benefits based on their husband's earnings (whether in public or private employment). On the basis of Social Security law at that time, this was a rational decision. In 1977 Congress changed the Social Security law to require that such dependent benefits be reduced by the state or city pension paid to the wife upon her retirement. (USCA 42, SEC-402(b)(4). Although the deductive item was reduced to two-thirds in 1983, the dependent Social Security benefits in such cases effectively were eliminated. The second example:

Having lived through the gestation and delivery of the Social Security legislation, I recall one of the selling points to the American public was immunity of the benefits from taxation. Until 1984 this was so. But commencing that year, 50% of the Social Security benefit became subject to the federal income tax, and a few years later this was increased to 85%. (The Canadian government at least announced the Canada Pension Plan would be taxable ab initio.)

Such things lead me to wonder how much we should rely on promises from within the beltway. I thoroughly agree with Mr. Langer's comment that Congress should not rush into hasty solutions, and that there is adequate time to deliberate on the issues.

James B. Gardiner
Supervising actuary
State of New York
Insurance Department


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