Social Security Works
for the united
states of america
www.StrengthenSocialSecurity.org
2013
Our Social Security Works for America series of 50 state reports includes much information that public officials, members of the
press, and advocates will find useful. In addition to providing information about the program’s history, character and vitality, as well as
compelling, real-life stories, each report includes statistics about the number of people who receive benefits, the types of benefits they
receive and the total amount of funds flowing from these programs into every state, its congressional districts and counties.
Please note that a one-page fact sheet summarizing the data in this report can be found at the end of the report, directly following the
endnotes.
ACKNOWLEDGMENTS
Like our Social Security system, this report is the product of the foresight and hard work of many people. Social Security Works partnered closely with the
Alliance for Retired Americans which is coordinating the release of this report across the country.
We are grateful to the following people for writing, designing and producing this report: Daniel Marans, Policy Director of Social Security Works (SSW),
is the principal author and lead researcher, whose commitment to excellence, along with that of Stephanie Connolly, SSW’s Legislative and Policy
Associate, drove the project to its successful conclusion. Stephanie played a crucial role in the reports’ completion, drafting the appendices, and editing
and verifying the data in the report. Benjamin Veghte, SSW’s Research Director, contributed valuable guidance on research and editorial decisions.
Michael Phelan, SSW’s Deputy Director, and Alex Lawson, SSW’s Executive Director, managed the actual production of the report. We would like to
thank Don Owens and Lacy Crawford, respectively, SSW’s Communications Director and Communications Associate for assembling, sometimes writing
and editing the personal stories included in all 50 state reports. Lacy also helped proofread the data.
Social Security Works also benefited from the work and commitment of several persons who provided original research and analysis for this report. We
would like to thank Dr. Roberto Gallardo of the Mississippi State University Extension Service for calculating Social Security data on the metropolitan and
non-metropolitan counties in each state and sharing the results of his unpublished work, as well as the Center for Rural Strategies for commissioning Dr.
Gallardo’s research. Arloc Sherman, Senior Researcher, and Danilo Trisi, Research Associate, at the Center on Budget and Policy Priorities generously
provided access to unpublished poverty data analyzed by the Center, including the numbers of African American and Latino seniors Social Security lifted
out of poverty in 2011. The Center for Economic and Policy Research provided and updated the invaluable analysis and graph showing the causes of the
recent run-up in federal deficits. Alice Wade, Deputy Chief Actuary of the Social Security Administration, with the help of Virginia Reno, Vice President for
Income Security at the National Academy of Social Insurance, graciously provided data on the value of Social Security’s survivors and disability insurance.
The data presented in this report speaks volumes about the importance of Social Security to families, communities and state and local economies.
We hope the report is useful to you as you work to strengthen Social Security in this 78th anniversary year. Please contact the Social Security Works
Communications Director, Don Owens, if you have questions about this report: dowens@socialsecurityworks.org.
Nancy Altman and Eric Kingson
Founding Co-directors, Social Security Works
Co-chairs, Strengthen Social Security Coalition
The Alliance for Retired Americans is a grassroots organization representing more than 4 million retirees and seniors
nationwide. Headquartered in Washington, DC, the Alliance’s mission is to advance public policy that protects the health
and economic security of older Americans by teaching seniors how to make a difference through activism. Learn more
about The Alliance and its work at www.retiredamericans.org
The mission of Social Security Works is to protect and improve the economic status of all Americans, especially
disadvantaged and at-risk populations, and, in so doing, to promote social justice for current and future generations of
children as well as young, middle-aged and older adults. www.socialsecurityworks.org
The Strengthen Social Security Coalition is made up of more than 320 national organizations and many state
organizations, representing more than 50 million Americans. The Coalition is united around core principles, which include
that Social Security benefits should not be cut and, instead, should be increased for those who are most disadvantaged,
and the belief that our nation’s Social Security, Medicare and Medicaid systems are fundamental to the well-being of
America’s families and to the type of nation we are. www.strengthensocialsecurity.org
Introduction
“We can never insure one-hundred percent of the population against one-hundred percent of the hazards and
vicissitudes of life. But we have tried to frame a law which will give some measure of protection to the average
citizen and to his family against the loss of a job and against poverty-ridden old age. This law, too, represents a
cornerstone in a structure which is being built but is by no means complete. It is a structure intended to lessen the
force of possible future depressions. It will act as a protection to future Administrations against the necessity of
going deeply into debt to furnish relief to the needy. The law will flatten out the peaks and valleys of deflation and
of inflation. It is, in short, a law that will take care of human needs and at the same time provide for the United
States an economic structure of vastly greater soundness.”
—Franklin D. Roosevelt, August 14, 1935
In 1935, when President Franklin D. Roosevelt signed
the Social Security Act into law he called it a cornerstone,
the foundation of a structure to be maintained and built
upon by and for future generations. Social Security could
not protect all Americans against every risk, but, as the
President said, it could lessen the consequences of lost
earnings in old age for workers and their families.
Since then, we have built our Social Security structure
carefully and deliberately. In 1939, we added Survivors
Insurance benefits for widows and dependent children,
eventually extending it to widowers as well. Disability
Insurance benefits were added in 1956, followed by
Medicare and Medicaid in 1965. The automatic cost-ofliving adjustment (COLA) was added in 1972, designed
to maintain the purchasing power of benefits no matter
how long someone lives. We built, maintained and
strengthened these institutions for a reason: to enable
working men and women to protect themselves and
their families. We built them because we, as a nation,
value hard work, personal responsibility, and human
dignity; we care for our parents, our children, our
spouses, our neighbors and ourselves.
As you read through this report, think of the people you
know. Family members who live in dignity in old age
because they can count on a monthly Social Security
check that they or another family member have earned.
Think of that older person who has outlived his modest
savings, but who, thanks to Social Security, can continue
to live independently. Think of a friend’s mother, who
relied on Social Security to provide for her family after
she was severely disabled in a workplace accident. Think
of neighbors, whose widowed father needed Social
Security to pay the bills when their mother passed away
suddenly.
Think, too, of how the institution of Social Security, like
the nation’s highway system, is part of a rich legacy
built by those who came before, a legacy that keeps
working in good times and bad. Throughout the past
few difficult years, Social Security has been even more
vital than before for Americans, and the lifeblood of
many small businesses. Virtually all of the jobs our Social
Security, Medicare, and Medicaid systems support stay
in America.
This series of reports highlights the remarkable success
of Social Security for the United States America. The
numbers tell part of the story: how many people
receive benefits in the United States America, in its
congressional districts and its counties; how many
dollars flow into these jurisdictions in a year; the types of
benefits and the types of people who receive benefits.
Perhaps more importantly, the report presents the
story of hard-working Americans and their families
whose lives are immeasurably better because of the
protections they have earned.
Social Security Works for the united states of america 1
Social Security Works
We built our Social Security system because it is the most
efficient, secure, universal and fair way for Americans
to replace wages in the event of death, disability, or old
age. For 78 years, even as our nation has endured wars,
political crises and severe economic recessions, Social
Security has never missed a payment; it has paid every
dollar of earned benefits, on time and in full.
The importance of Social Security—the nation’s family
insurance against lost wages due to old age, disability,
or death—cannot be overstated. Nationwide, Social
Security provided $774.6 billion in benefits to nearly 57
million beneficiaries in 2012—nearly 1 in 5 (18.1 percent)
Americans.1 Social Security is not just a retirement
program for seniors, however. Over 17 million people
under age 65 received Social Security benefits in 2012—
nearly one-third (30.2 percent) of all beneficiaries.2
In fact, Social Security is the nation’s largest and, despite
its modest benefits, most generous children’s program.
There were about 9.2 million children receiving Social
Security benefits in 2012.3 These include over 4.4
million children who received Social Security benefits
directly,4 and an additional 4.8 million children, who
lived in households where all or part of the income of the
household comes from Social Security.5
For the vast majority of beneficiaries—young and old
alike—Social Security’s benefits are modest, but vital.
The average Social Security benefit was $13,648 a year
in 2012, and $15,139 for retired workers.6 Almost twothirds (65.3 percent) of elderly couples and unmarried
people relied on Social Security for half of their income or
more in 2010.7 The program lifted 21 million Americans
out of poverty in 2011, including one million children.8
Social Security benefits are particularly important for
disabled workers. Social Security Disability Insurance
(DI) benefits provide 90 percent of the income or more
for nearly half of non-institutionalized beneficiaries.9
Nonetheless, 1 in 4 DI beneficiaries remains in poverty.10
Through their hard work and payroll tax contributions,
nearly all American workers earn Social Security’s
retirement, disability and survivorship protections for
themselves and their families. Social Security is the
primary disability and life insurance protection for most
the United States of America workers. A 30‐-year‐-old
worker with a spouse and two young children, earning
around $32,000, receives Social Security insurance
protection equivalent to disability and life insurance
protections worth over $465,000 and $476,000,
respectively.11 Today, over 208 million working
Americans have earned these protections for themselves
and their families.12
There is a significant chance that a worker will need
these protections before she retires. Nationwide, nearly
3 in 10 (27 percent) people who turned 20 in 2012
are projected to become severely disabled during
their working years.13 An estimated 1 in 11 (9 percent)
working-‐aged men and 1 in 20 (4.8 percent) working‐aged women will die before reaching retirement age.14
Social Security Works for the United States
of America’s Residents and Economy
• Social Security provided benefits to 56,758,185
Americans in 2012, 1 in 5 (18.1 percent) residents.15
• Americans received Social Security benefits totaling
$774.6 billion in 2012, an amount equivalent to 5.8
percent of the country’s total personal income.16
• The average Social Security benefit in the United
States of America (US) was $13,648 in 2012.17
• Social Security lifted 21,415,000 Americans out of
poverty in 2011.18
Social Security Works for the united states of america 2
Figure 2
Figure 1
The United States of America’s
Social Security Beneficiaries, 2012
Poverty Rate for Beneficiaries
65 and Older With and Without
Social Security, 2009–2011
48.3%
43.6%
15%
Disabled
Workers
8%
Widow(er)s
4% Spouses
65%
Retired Workers
8%
Children
US
10.7%
8.7%
65+
Women 65+
n Poverty rate without Social Security
n Poverty rate with Social Security
Source: Social Security Administration, 2013
Social Security Works for the United States
of America’s Seniors19
• Social Security provided benefits to 36,720,492 US
retired workers in 2012, two-thirds (64.7 percent) of
beneficiaries [Figure 1].20
• The typical benefit received by a retired worker in the
United States of America was $15,107 in 2012.21
• Social Security lifted 14,480,000 Americans aged 65
or older out of poverty in 2011.22
• Without Social Security, the elderly poverty rate in
the United States of America would have increased
from 1 in 11 (8.7 percent) to 4 in 10 (43.6 percent)
[Figure 2].23
“I don’t know where I’d be without the benefits I’ve earned,
probably depressed and homeless. It’s my only source of
income and I’m glad I earned it.”
Mary Stitt, 77 years old, who retired after 5 decades in the workforce
Source: Center on Budget & Policy Priorities, 2013
Social Security Works for the United States
of America’s Women
• Social Security provided benefits to 28,988,043
US women in 2012, 1 in 6 (18.2 percent) of US
women.24
• Social Security provided benefits to 2,443,212 US
spouses in 2012, 1 in 23 (4.3 percent) beneficiaries
[Figure 1].25
• Social Security lifted 8,696,000 US women aged
65 or older out of poverty in 2011.26
• Without Social Security, the poverty rate of elderly
women would have increased from 1 in 9 (10.7
percent) to half (48.3 percent) [Figure 2].27
“Money was very tight after my dad passed away. Getting
the support from Social Security was extremely important—
it allowed us to stay in our house and keep me in the school
I was attending. I’m not sure I would have made it to college
if we had to move and go to a different school.”
Maureen Sullivan, age 27, reflecting on the importance of
Social Security when her Dad died, leaving her mother with two teenagers
Social Security Works for the united states of america 3
Social Security Works for the United States
of America’s Widow(er)s
• Social Security provided Survivors benefits to
4,348,486 US widow(er)s in 2012, 1 in 13 (7.7
percent) US beneficiaries [Figure 1].28
• The typical benefit received by a widow(er) in the
United States of America was $14,724 in 2012.29
“Instead of eating fast food, I could afford a food delivery
service to provide me with balanced meals to rebuild my
health. Instead of risking bed sores by transferring into taxis,
I could afford to hire a wheelchair service, which greatly
reduced the chance of injury… Instead of dropping out of the
workforce permanently—Social Security helped me go back
to school to make myself more competitive in the job market.”
Disabled Veteran Sherman Gillums, age 40, today an Appellate
Representative for Paralyzed Veterans of America, talking about how five
years of Social Security disability benefits served as “the bridge to quality of
life for me and my children that ultimately saved the government money.”
Social Security Works for the United States of
America’s Workers with Disabilities30
• Social Security provided disability benefits to
8,826,591 US workers in 2012, 1 in 7 (15.6 percent)
US beneficiaries [Figure 1].31
• The typical benefit received by a disabled worker
beneficiary in the United States of America was
$12,491 in 2012.32
Social Security Works for the United States
of America’s Children
• Social Security is the primary life and disability
insurance protection for 98 percent of the United
States of America’s 73,728,088 children.33
• Social Security provided benefits to 4,419,404
US children in 2012, 1 in 12 (7.8 percent) US
beneficiaries [Figure 1].34
Social Security Works for the united states of america • Social Security is the most important source of income
for the 7,779,796 children living in the United States
of America’s grandfamilies, which are households
headed by a grandparent or other relative.35
Social Security Works for the United States
of America’s African Americans
• In the United States of America, Social Security
provided benefits to 1 in 4 (24.2 percent)
African American households in 2011,
3,474,517 households.36
• Nationwide, Social Security lifted 1,208,000 African
Americans aged 65 or older out of poverty in 2011.37
Without Social Security, the poverty rate among
African American seniors would have increased from
1 in 6 (17 percent) to half (50 percent).38
• Nationwide, Social Security provided nearly threequarters (73.7 percent) of the income of African
American elderly couples and unmarried individuals
receiving benefits, on average, in 2010. Social
Security made up 90 percent of the total income
for half (49.4 percent) of these African American
elderly households.39
• African Americans were 12.6 percent of the
population in 2011, but represented 19 percent of
disabled worker beneficiaries.40
Social Security Works for the United States
of America’s Latinos
• In the United States of America, Social Security
provided benefits to 1 in 6 (16.5 percent) Latino
households in 2011, 2,205,879 households.41
• Nationwide, Social Security lifted 937,000 Latinos
aged 65 or older out of poverty in 2011.42 Without
Social Security, the poverty rate among Latino seniors
would have increased from 1 in 5 (19 percent) to
half (50 percent).43
• Nationwide, Social Security provided more than three‐quarters (77 percent) of the total income of Latino
elderly couples and unmarried individuals receiving
benefits, on average, in 2010. Social Security was
90 percent of the income for more than half (55.1
percent) of these Latino elderly households.44
• The Social Security Administration estimates that
Latinos receive a higher rate of return on their Social
Security contributions than the overall population—
the highest of any group. That’s because they tend to
have lower lifetime income, longer life expectancies,
higher incidence of disability and larger families.45
4
Sherman Gillums, Jr
Virginia
During his short but distinguished career in the Marines, Chief Warrant Officer 2 Sherman Gillums, Jr., who
enlisted at the age of 17, ascended quickly into leadership, and, in the process, earned two Navy and Marine Corps
Commendation Medals, one Navy and Marine Corps Achievement Medal, and a War on Terror Service Medal. Four
months after the September 11, 2001 attacks, as he prepared to deploy to Afghanistan with the 1st Marine Division,
this proud father of a 2-year old daughter and a 6-year old son became severely disabled. Despite wearing a seatbelt
and driving safely, he sustained a cervical spine injury during a three-vehicle collision that paralyzed him and ended
his military career at age 29.
Today, at 38, Sherman holds a master’s degree in Global Business Strategies from the University of San Diego
and works as an Appellate Representative for Paralyzed Veterans of America at the Board of Veterans Appeals in
Washington, DC. His road to self-sufficiency was paved by willpower and endurance beyond that ever previously
needed in his military career. Experiences gained during his military service, however, served him as he regained
basic functioning, learned to drive again, navigated the transition from military officer to civilian professional, moved
across the country, worked full-time in a demanding occupation, and most important to him, remained active in his
kids’ lives.
Social Security disability benefits help make a full life possible for countless other catastrophically disabled veterans
like Sherman. Five years of Social Security, he says, served as “the bridge to quality of life for me and my children
that ultimately saved the government money.”
Sherman explains, “I lived alone. Instead of eating fast food, I could afford a food delivery service to provide me with
balanced meals to rebuild my health. Instead of risking bed sores by transferring into taxis, I could afford to hire a
wheelchair service, which greatly reduced the chance of injury. Instead of worrying about losing benefits and having
to reapply if I tried to work and couldn’t, Ticket to Work [one of Social Security’s special work incentive programs]
gave me the opportunity to test whether I could work again. Then, once I got a job and realized I needed a less
physically demanding one—instead of dropping out of the workforce permanently—Social Security helped me go
back to school to make myself more competitive in the job market.”
When asked what he thinks of members of Congress who propose cuts in guaranteed Social Security benefits for
disabled veterans as a way to reduce government spending, Sherman expresses concern about the impact such
reductions could have on military morale, retention and recruitment: “If that’s a way this country decides to help
control government costs, that needs to be made explicit [and] presented upfront, before we sign on the dotted line
to risk our lives as service men and women. And not just having it in writing or explained to us by the recruiter—have
a disabled veteran right there to tell those kids what it’s like living on disability benefits now and how much less
they’ll get if they’re disabled. And if the new recruits sign on after that, I’d say it’s fair; they know what they’re signing
up for. The problem is, fewer people will sign up.”
“Veterans’ economic security is a national security issue; people have to be willing to serve,” Sherman contends. “As
a father, I have to ask myself whether to encourage my son and daughter to join the armed forces when they’re old
enough. As an individual, I’d put my life on the line out of patriotism alone, but as a parent, your instinct is to protect
both your country and your children. Those don’t feel so much like competing objectives if you know the country will
provide some quality of life if the worst happens in the line of duty. But parents don’t want to be told the country’s
leaders have decided the lost lives and limbs of their adult children serving in uniform are less valuable than those of
past generations.”
Social Security Works for the United States
of America’s American Indians
and Alaska Natives
• In the United States of America, Social Security
provided benefits to 1 in 4 (25.4 percent) American
Indian and Alaska Native households in 2011,
420,348 households.46
• Nationwide, Social Security provided 90 percent of
the income for 1 in 8 (12 percent) elderly American
Indian and Alaska Native married couples, and half
(50 percent) of elderly unmarried persons in 2011.47
• Since Social Security has a higher income
replacement rate for workers with lower earnings,
Social Security replaces more of American Indians’
and Alaska Natives’ pre-retirement earnings than
of the overall population. The median earnings of
working‐-age American Indians and Alaska Natives
are about $30,000, compared to $42,000 for
all working-age people. Social Security provides
average benefits of about $13,251 and $11,017
annually for American Indian and Alaska Native
men and women aged 65 or older, respectively.48
Social Security Works for the United States
of America’s Asian Americans,
Hawaiian Natives and Pacific Islanders
• In the United States of America, Social Security
provided benefits to 1 in 6 (16.6 percent) Asian
American, Hawaiian Native and Pacific Islander
households in 2011, 897,748 households.49
• Nationwide, Social Security provided, on average,
two-‐thirds (67.2 percent) of the total income for Asian
American households with beneficiaries aged 65 or
older in 2010. Social Security was 90 percent of the
income for 4 in 10 (41.7 percent) Asian American
elderly households.50
• Nationwide, Asian Americans and Pacific Islanders
receive a high rate of return from Social Security
because of their long life expectancies. An Asian
American or Pacific Islander man aged 65 in 2011,
can expect to live until age 85, compared to age 82
for all men. An Asian American or Pacific Islander
woman of the same age can expect to live until age
88, compared to age 85 for all women.51
Social Security Works for the united states of america bernice jorge
New York, New York
When I was growing up, there was no Social Security.
There was a need for it, but we didn’t have it until
1935. When we were growing up there was no
help for families that were poor—no welfare, no food
stamps, no safety net. We helped each other. My
mother said we all had to work and go to school. I
was brought up in an area where when people said
their child completed school, they meant elementary
school….
I had to work after school and in the summers. I
finished high school at 17 and moved to New York
to work. My childhood sweetheart went the year
before. My goal was to help my siblings go to school-and they all did. I helped them go to college and get
degrees. My siblings came to New York, too, and my
husband was able to get them jobs in the garment
district. Later, when my mother became ill, she came
up and I took care of her until she died.
I’m so happy I was able to help my brothers and
sisters. I worked; I married my childhood sweetheart,
and raised two children. When I retired in 1993, I took
Social Security immediately. All my siblings received
Social Security. There are three of us left, and my
youngest sister just started to collect last year. I’m so
grateful that I was able to work at a job where I could
contribute to Social Security, plus have a pension. Our
two children are grown up now and on their own.
My husband passed away ten years ago. My Social
Security and pension are enough to meet my needs.
I’m self-sufficient, independent. I don’t have to rely on
ANYONE—my kids or anyone else. I don’t think I could
have made it without Social Security.
6
lower than the median for native-born Americans,
which was $51,147.55
• Social Security is a lifeline for older workers who
have health problems or difficult jobs, among whom
immigrants are disproportionately represented.56
Nearly half (46 percent) of non-citizen immigrants
and 1 in 4 (23 percent) naturalized citizens were
uninsured in 2011, compared with 1 in 6 (15 percent)
native-born American citizens.57 In addition, nearly 6
in 10 (55.7 percent) immigrant workers aged 58 or
older work in physically demanding jobs or difficult
conditions, compared with 4 in 10 (43.8 percent)
native-born workers.58
• An analysis by the non-partisan Congressional Budget
Office (CBO) shows that providing a path to citizenship
for the country’s 11 million unauthorized immigrants
would net Social Security $284 billion by 2024,
extending Social Security’s solvency by two years.59
Social Security Works for the United States
of America’s Rural Communities
• Social Security is more important to Americans
living in rural or non-metropolitan counties than to
Americans living in metropolitan counties. One in
5 (22.7 percent) rural Americans received Social
Security in 2012, compared with 1 in 6 (16.3 percent)
metropolitan Americans.52
• Social Security is more important to the local
economies of the United States of America’s
rural or non-metropolitan counties than to its
metropolitan counties. Total personal income in the
United States of America’s rural counties
was $1.8 trillion in 2012, of which $150.9 billion,
or 8.5 percent, was from Social Security. By
comparison, total personal income in the
country’s metropolitan counties was $11.7 trillion,
of which $592.3 billion, or 5.1 percent, was from
Social Security.53
Social Security Works for Immigrants
Social Security’s Promise for Same-Sex
Couples and Their Families
As a result of the June 26, 2013 Supreme Court decision
regarding the Defense of Marriage Act (DOMA), the
federal government now recognizes the rights of legally
married same-sex couples to many federal benefits,
including Social Security. Since it is so soon after the
ruling, however, the Social Security Administration is still
assessing how the ruling will affect the eligibility of samesex couples and their children for spousal and related
family benefits. It is not clear, for example, whether legallymarried same-sex couples residing in states that do not
recognize such marriages, or partners in civil unions, are
eligible for benefits. SSA advises people who are uncertain
about whether they are eligible to apply in any case.60
Just as Social Security’s protections are critical for
persons in traditional marriages, the availability of Social
Security’s spousal and children protections are similarly
crucial for:
• Social Security is critical for Latino and Asian
Americans, who together made up more than
three-quarters (81 percent) of foreign-born
Americans in 2010.54
• New immigrants tend to have lower career
earnings, so Social Security is likely to be a larger
source of retirement income for them. Nationwide,
the median household income of foreign-born
Americans was $45,821 in 2011, 10.4 percent
Social Security Works for the united states of america 7
• The 50,000 same-sex couples who are married under
state law,61
• The 90,000 couples in civil unions,62
• Others who are in long-term committed relationships
but living in states that do not permit same-sex
marriages or civil unions; and
• The estimated 250,000 children being raised by
same-sex couples.63
Although not all of these same-sex couples and their
families have become eligible for Social Security,
Social Security now works for many of our fellow
Americans who are part of the lesbian, gay, bisexual and
transgender (LGBT) community. As the population ages
and as more states recognize the civil rights of these
fellow Americans, Social Security will become ever more
important to them.
Social Security Works Financially
A public trust, Social Security is the nation’s most
conservatively financed and carefully monitored
institution. Social Security does not, and, by law, cannot
add a penny to the federal deficit or debt (which is simply
the accumulation of annual deficits).64 While the federal
budget has run a deficit in every year but five over the
Figure 3
1,600
1,400
1,200
1,000
U.S. Budget Deficits, 2001–2013
n Wars in Iraq and Afghanistan
n Bush-era tax cuts
n Recocvery measures
n TARP, Fannie and Freddie
last half century, Social Security is not allowed to pay
benefits unless it has the funds to cover every penny of
the cost; it simply does not have borrowing authority.65
This is why Social Security has nothing to do with
reducing the federal budget deficit, and should not be
part of any deficit reduction legislation considered by our
nation’s leaders.
To reduce the federal debt, Congress should be looking
at its causes. It should not cut Social Security, which
has not and cannot contribute a single penny to the
federal budget deficit. The large run-up in federal
deficits in recent years resulted primarily from huge
tax cuts in 2001 and 2003; the unpaid costs of the
Iraq and Afghanistan wars; the Great Recession, which
dramatically reduced tax collections and increased
unemployment compensation and other spending; the
economic stimulus and recovery spending; and the
Wall Street bank bailout [Figure 3].66
Not only is Social Security independent of the budget
and self-funded; it is also among the most transparent
pension programs in the world. Each year since 1941,
Social Security’s Trustees issue a report about the
program’s financial health. The annual Trustees Report
projects income and outgo 75 years into the
future—further than private pension programs
and the Social Security programs of nearly
every other nation. It is intended to provide
Congress an extremely long lead time to make
adjustments that are needed from time to
time. Except for Medicare, no other federal
programs are subject to this type of scrutiny.
n Economic and technical changes
Billions of dollars
800
600
400
200
0
2000 2001 2002 2003 2004
2005 2006 2007 2008 2009 2010 2011 2012 2013
-200
-400
Source: Center for Economic and Policy Research analysis of
Congressional Budget Office data, 2013.
Social Security Works for the united states of america It is only because Social Security is required
to project its finances 75 years into the
future that we would even know about its
modest long-term shortfall, still decades
away. This year’s report, signed by Social
Security’s trustees—the secretaries of the
Treasury, Health and Human Services and
Labor, the Commissioner of Social Security
and two Public Trustees appointed by the
President—projects that Social Security can
pay all benefits in full and on time for the next
20 years.67 After that, if Congress were not to
act, it could still pay 77 cents on every dollar of
earned benefits.68
8
Social Security’s projected shortfall is incredibly modest
as a share of the economy. Even with the retirement of
the baby boomers, Social Security’s costs are projected
to go from their current levels of 5.1 percent of gross
domestic product (GDP) to a peak of 6.2 percent in
2037, remaining at or near that level thereafter.69 The
cost of bringing Social Security into actuarial balance
is equal to 1 percent of GDP.70 This increase in Social
Security spending is smaller than the increase in
spending on public education that occurred when the
boomers were children.71
Our Social Security system can and should keep all its
commitments without cutting benefits. For example, one
approach would have everyone make the same payroll
contribution rate (6.2 percent) as about 94 percent
of all American workers do.72 While the vast majority
of Americans must make contributions on all of their
wages, millionaires and billionaires only do so on the
first $113,700 of their earnings this year.73 Asking all
Americans to pay the same rate would come very close
to closing Social Security’s entire projected 75-year
funding gap.74
Social Security Works for the united states of america 9
Conclusion: Maintaining a Legacy
for All Generations
Our Social Security system has withstood the test
of time. It represents the best of American values—
rewarding hard work, honoring our parents, caring for
our neighbors, and taking responsibility for ourselves and
our families. It is based on a promise that if you pay in,
then you earn the right to guaranteed benefits.
Like our interstate highway system, however, Social
Security requires periodic maintenance to remain
strong. Now it is our turn to maintain and build upon that
structure, as those who came before have done. It is our
turn to preserve and improve these valuable systems for
ourselves and for those who follow. It is our turn to build
a legacy for our nation’s children and grandchildren so
when they become workers, they will have the economic
security that Social Security provides.
Maintaining our Social Security system must not be
reduced to a matter of simple arithmetic. Any changes
we make to Social Security must help advance the
program’s mission of providing economic security and
dignity for America’s working families. Closing the
program’s modest funding gap is a means to achieve
this mission, not an end in itself. Cutting benefits now
merely to avoid cutting them later would solve the
arithmetic problem at the expense of Social Security’s
Social Security Works for the united states of america fundamental promise. Basing Social Security’s costof-living adjustments on the stingier chained CPI
(Consumer Price Index), for example, a cut proposed by
many in Washington, would undermine the adequacy
of Social Security’s modest benefits. It would hit longtime beneficiaries, such as people with disabilities and
the oldest old, the hardest, at a time in their lives when
most have little else on which to live. Under the chained
CPI, the average earner retiring at age 65 would see a
cumulative benefit cut of $4,642 at age 75, $13,921 at
age 85, and $28,015 at age 95.75
As important as Social Security is today, the need for
it will only increase in coming years. Our nation faces
an impending retirement income crisis. More than half
(53 percent) of today’s working Americans are not
expected to have sufficient resources to maintain their
standard of living in old age.76 The crisis is the result of
changes in the economy that have diminished private
sources of retirement income. Employers are increasingly
terminating traditional pension plans and either not
replacing them, or replacing them with far more risky and
inadequate 401(k) savings accounts. Just over half (52.5
percent) of all working heads of households are eligible
for an employer-sponsored retirement plan; less than
half (44.6 percent) actually participate.77 Among those
10
households nearing retirement (aged 55-64) with a 401(k)
plan, IRA, or both, the median balance was $100,000.78
Were it not for Social Security, the retirement income
crisis would inevitably be much worse. Social Security
continues to prove steady, stable, and reliable. In a world
of stagnant wages and risky or inadequate 401(k) plans,
Social Security is a fortress of security and reliability. In
this uncertain world, where no one is invulnerable to the
tragedy of premature death or serious and permanent
disability, Social Security is there to cushion the
economic blow of such tragedies.
Further, Social Security benefits, while growing in
importance, are already modest and declining. For a
lifetime average earner retiring at age 65 in 2013, Social
Security benefits replace 41 percent of pre-retirement
earnings.79 That replacement rate alone ranks 30th out
of 34 among members of the Organization for Economic
Cooperation and Development.80 Social Security’s
replacement rate will drop to 36 percent of preretirement earnings by 2025, mostly due to the ongoing
increase in the full retirement age to 67.81 If health care
costs continue to rise faster than inflation, Medicare
Part B and Part D premiums will further reduce Social
Security benefits’ value.82
Social Security Works for the united states of america The solution is clear. It is time to double down on
what works. It is time to expand Social Security, not
cut it. Social Security Works and the Strengthen
Social Security coalition, which includes over 300
national and state groups representing over 50 million
Americans, support legislation in Congress that would
do just that. Specifically, bills introduced by Senator
Tom Harkin (D-IA) and Senator Mark Begich (D-AK),
respectively, would increase benefits across the board
by asking millionaires and billionaires to pay the same
rate that average Americans pay into the program.83
Among their proposals is the adoption of the
Consumer Price Index for the Elderly (CPI-E), a formula
for determining the annual cost-of-living adjustment
(COLA) that reflects the higher inflation experienced
by seniors.
Expanding Social Security is not only affordable; it is a
wise public investment. We are the wealthiest nation
in the world. Our nation is much wealthier than it was
in 1935, 1939, 1956, 1965, or 1972, when Social
Security’s key structures were built and improved. The
consequences of not expanding Social Security are
far worse—a deeper retirement income crisis; greater
income inequality; a more sluggish consumer economy—
than the cost of doing what is right.
11
Endnotes
1 Total annual benefits from Social Security Administration (SSA), Annual Statistical Supplement, 2013, “Table 5.J1—Estimated total annual benefits paid, by state
or other area and program, 2012 (in millions of dollars),” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j1. Total
beneficiaries from SSA, Annual Statistical Supplement, 2013, “Table 5.J2—Number, by state or other area, program, and type of benefit, December 2012,” June 28, 2013.
http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j2. Total US population from U.S. Census Bureau, “Annual Estimates of the Resident
Population for Selected Age Groups by Sex for the United States, States, Counties and Puerto Rico Commonwealth and Municipios: April 1, 2010 to July 1, 2012,” 2012
Population Estimates, 2013. http://factfinder2.census.gov/
2 SSA, Annual Statistical Supplement, 2013, “Table 5.J3—Number and total monthly benefits for beneficiaries aged 65 or older, by state or other area and sex,
December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j3
3 There are exactly 9,196,404 children receiving benefits, including 4,419,404 children receiving benefits directly and 4,777,000 children supported by a parent or other
relative receiving benefits. The number of children supported by a parent or other relative receiving benefits dates to 2010, so it likely understates the total for 2012. Unless
otherwise specified as children under 18 to the exclusion of all others, the term “children” used in this section is consistent with the Social Security Administration’s use of the
term to include three groups: “children under age 18,” receiving benefits through a parent receiving retirement or disability benefits, or a deceased parent; “students aged 1819,” which refers to children receiving benefits at ages 18 and 19 who are matriculated in an institution of secondary education; and “disabled adult children,” which refers
to those adults with a severe disability that began before age 22, at a time when a parent was receiving retirement or disability benefits or was deceased. Children receiving
benefits: SSA, Annual Statistical Supplement, 2013, “Table 5.J10—Number of children, by state or other area and type of benefit, December 2012,” June 28, 2013.
http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j10. Definition and eligibility of disabled adult children: SSA, Benefits for Children with
Disabilities, 2013, 2013, p. 11. http://www.ssa.gov/pubs/EN-05-10026.pdf. Children dependent on a parent or relative receiving benefits: Congressional Research Service
(CRS), Thomas Gabe, Social Security’s Effect on Child Poverty, December 22, 2011, Figure 1, pp. 3-4. http://socialsecurity-works.org/wp-content/uploads/2013/07/
CRS_Children-Social-Security_2011.pdf
4 Of the 4,419,404 million children who received benefits in 2012, 3,258,000 were under age 18; 154,302 were students aged 18-19; and 1,006,676 were disabled
adult children. SSA, Annual Statistical Supplement, 2013, “Table 5.J10—Number of children, by state or other area and type of benefit, December 2012,” June 28, 2013.
http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j10
5 The estimated 4,777,000 children not receiving benefits directly, but living in households that do, include 1.816 million children under age 18 with a parent or guardian
receiving benefits, and 2.961 million children under age 18 in families where a relative other than a parent is receiving benefits. Figure is from 2010, the most recent year it
was available, so it likely understates the total for 2012. Congressional Research Service (CRS), Thomas Gabe, Social Security’s Effect on Child Poverty, December 22, 2011,
Figure 1, pp. 3-4. http://socialsecurity-works.org/wp-content/uploads/2013/07/CRS_Children-Social-Security_2011.pdf
6 Average benefit found by dividing total spending by total beneficiaries. Total annual benefits from Social Security Administration (SSA), Annual Statistical Supplement,
2013, “Table 5.J1—Estimated total annual benefits paid, by state or other area and program, 2012 (in millions of dollars),” June 28, 2013. http://www.ssa.gov/policy/docs/
statcomps/supplement/2013/5j.html#table5.j1. Total beneficiaries from SSA, Annual Statistical Supplement, 2013, “Table 5.J2—Number, by state or other area, program,
and type of benefit, December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j2. Average retired worker benefit
found by multiplying average monthly retired worker benefit by 12. SSA, Annual Statistical Supplement, 2013, “Table 5.J6—Percentage distribution of monthly benefit
for retired workers, by state or other area and monthly benefit, December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.
html#table5.j6
7 SSA, Income of the Population 55 or Older, 2010, Table 9.A1, March 2012. http://www.ssa.gov/policy/docs/statcomps/income_pop55/2010/sect09.html#table9.a1
8 Center on Budget & Policy Priorities (CBPP), Social Security Keeps 21 Million People Out of Poverty: a State-by-State Analysis, October 16, 2012. http://www.cbpp.
org/cms/?fa=view&id=3851. The state-level data reflect an average from 2009-2011, and therefore do not add up to the national totals, which date to 2011.
9 Center on Budget & Policy Priorities (CBPP), Social Security Disability Insurance is Vital to Workers with Severe Impairments, August 9, 2012, p. 11. http://www.cbpp.
org/files/8-9-12ss.pdf
10 CBPP, Ibid.
11 $465,000 value of disability benefits includes $329,000 of Disability Insurance benefits, and $136,000 of Old-Age and Survivors Insurance benefits once the disabled
worker reaches the full retirement age. Estimates of illustrative worker’s career earnings and corresponding value of disability and life insurance benefits understate current
amounts, since they are in wage-indexed 2007 dollars for a worker beginning to receive benefits in 2008, the most recent year for which data was available. SSA, The
Insurance Value of Potential Survivor and Disability Benefits for an Illustrative Worker, Memorandum from Orlo R. Nichols, Actuary, to Alice H. Wade, Deputy Chief Actuary,
August 15, 2008. http://socialsecurity-works.org/wp-content/uploads/2012/03/Illustrative_Survivor_and_Disabilitycase_2008.pdf
12 Social Security Administration (SSA), Annual Statistical Supplement, 2012, “Table 4.C1—Estimated number of insured workers, by insured status, December 31, 1940–
2012 (in millions),” February 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2012/4c.html#table4.c1
13 Social Security Administration (SSA), Office of the Chief Actuary, Actuarial Note 2012.6, A Death and Disability Life Table for Insured Workers Born in 1982, February
2013. http://www.socialsecurity.gov/OACT/NOTES/ran6/an2012-6.pdf
14 SSA, Office of the Chief Actuary, Actuarial Note 2012.6, Ibid.
15 Total beneficiaries from SSA, Annual Statistical Supplement, 2013, “Table 5.J2—Number, by state or other area, program, and type of benefit, December 2012,” June
28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j2. State population data from U.S. Census Bureau, “Annual Estimates of the
Resident Population for Selected Age Groups by Sex for the United States, States, Counties and Puerto Rico Commonwealth and Municipios: April 1, 2010 to July 1, 2012,”
2012 Population Estimates, 2013. http://factfinder2.census.gov/
16 Total annual benefits from SSA, Annual Statistical Supplement, 2013, “Table 5.J1—Estimated total annual benefits paid, by state or other area and program, 2012 (in
millions of dollars),” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j1. Benefits’ equivalent percentage of Total Personal
Income calculated using state figures from Bureau of Economic Analysis, Regional Economic Accounts, “SA1-3 Personal income summary (thousands of dollars),” March
27, 2013. http://www.bea.gov/regional/index.htm
17 Average benefit found by dividing total spending by total beneficiaries. Total annual benefits from Social Security Administration (SSA), Annual Statistical Supplement,
2013, “Table 5.J1—Estimated total annual benefits paid, by state or other area and program, 2012 (in millions of dollars),” June 28, 2013. http://www.ssa.gov/policy/docs/
statcomps/supplement/2013/5j.html#table5.j1. Total beneficiaries from SSA, Annual Statistical Supplement, 2013, “Table 5.J2—Number, by state or other area, program,
and type of benefit, December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j2
18 Center on Budget and Policy Priorities (CBPP), Social Security Keeps 21 Million People Out of Poverty: a State-by-State Analysis, October 16, 2012. http://www.cbpp.
org/cms/?fa=view&id=3851
19 For the purposes of this analysis, “seniors” describes individuals aged 65 or older. Herein, all references to “seniors” will reflect this definition.
20 SSA, Annual Statistical Supplement, 2013, “Table 5.J2—Number, by state or other area, program, and type of benefit, December 2012,” June 28, 2013. http://www.
ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j2
21 For the purposes of this analysis, “typical” is used to describe the “median” benefit. Herein, all references to “typical” will reflect this description. Monthly median benefit
multiplied by 12 to calculate annual figure. SSA, Annual Statistical Supplement, 2013, “Table 5.J6—Percentage distribution of monthly benefit for retired workers, by state or
other area and monthly benefit, December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j6
Social Security Works for the united states of america 12
22 Center on Budget and Policy Priorities (CBPP), Social Security Keeps 21 Million People Out of Poverty: a State-by-State Analysis, October 16, 2012. http://www.cbpp.
org/cms/?fa=view&id=3851. The state-level data in the other companion reports reflect an average from 2009-2011, and therefore do not add up to the national totals,
which date to 2011.
23 CBPP, Ibid.
24 SSA, Annual Statistical Supplement, 2013, “Table 5.J5.1—Number, by state or other area, and sex, December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/
statcomps/supplement/2013/5j.html#table5.j5.1 Percentage of women receiving benefits calculated using total female population from U.S. Census Bureau, “Annual
Estimates of the Resident Population for Selected Age Groups by Sex for the United States, States, Counties, and Puerto Rico Commonwealth and Municipios: April 1, 2010
to July 1, 2012,” 2012 Population Estimates, 2013. http://factfinder2.census.gov/
25 Total spouses receiving benefits calculated by adding number of spouses of retired workers to number of spouses of disabled workers. SSA, Annual Statistical
Supplement, 2013, “Table 5.J2—Number, by state or other area, program, and type of benefit, December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/
statcomps/supplement/2013/5j.html#table5.j2
26 Center on Budget and Policy Priorities (CBPP), Social Security Keeps 21 Million People Out of Poverty: a State-by-State Analysis, October 16, 2012. http://www.cbpp.
org/cms/?fa=view&id=3851. The state-level data in the other companion reports reflect an average from 2009-2011, and therefore do not add up to the national totals,
which date to 2011.
27 CBPP, unpublished, Ibid.
28 SSA, Annual Statistical Supplement, 2013, “Table 5.J2—Number, by state or other area, program, and type of benefit, December 2012,” June 28, 2013. http://www.
ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j2
29 Monthly median benefit multiplied by 12 to calculate annual figure. SSA, Annual Statistical Supplement, 2013, “Table 5.J9—Percentage distribution of
nondisabled widow(er)s, by state or other area and monthly benefit, December 2012,” June 28, 2013. http://ssa.gov/policy/docs/statcomps/supplement/2013/5j.
html#table5.j9
30 The number of Social Security disability beneficiaries cited here includes only those disabled workers receiving disability benefits. It does not include those disabled
workers and “disabled adult children” who receive Old-Age (retirement) and Survivors benefits. Herein, any use of the term “disabled worker” will refer only to those disabled
workers receiving disability benefits.
31 SSA, Annual Statistical Supplement, 2013, “Table 5.J2—Number, by state or other area, program, and type of benefit, December 2012,” June 28, 2013. http://www.
ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j2
32 Monthly median benefit multiplied by 12 to calculate annual figure. SSA, Annual Statistical Supplement, 2013, “Table 5.J8—Percentage distribution of disabled workers,
by state or other area and monthly benefit, December 2012,” June 28, 2013. http://www.ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j8
33 In this case, “children” refers to individuals under age 18, and includes neither disabled adult children, nor individuals aged 18-19. When discussing Social Security’s
insurance protections for children, children under age 18 was considered the most appropriate group to reference in this analysis, since even students aged 18-19 receiving
benefits as dependents of a disabled or deceased parent must have qualified for benefits before age 18. While disabled adult children may receive benefits for a severe
disability sustained at age 18 or later, it must occur before age 22, meaning that a large proportion of beneficiaries will likely have begun receiving benefits before age 18
as well. Population under age 18: US Census Bureau, 2012 Population Estimates, “Annual Estimates of the Resident Population for Selected Age Groups by Sex for the
United States, States, Counties and Puerto Rico Commonwealth and Municipios: April 1, 2010 to July 1, 2012,” 2013. http://factfinder2.census.gov/. Data on percentage of
children insured from SSA, Survivors Benefits, June 2013, p. 4. http://www.ssa.gov/pubs/EN-05-10084.pdf
34 SSA, Annual Statistical Supplement, 2013, “Table 5.J10—Number of children, by state or other area and type of benefit, December 2012,” June 28, 2013. http://www.
ssa.gov/policy/docs/statcomps/supplement/2013/5j.html#table5.j10
35 Association of American Retired Persons (AARP), “Grandfacts: State fact sheets for grandparents and other relatives raising children,” 2011. http://www.aarp.org/
relationships/friends-family/grandfacts-sheets/
36 The term “households” as it is used here refers to households reporting income in the past 12 months. Households receiving Social Security benefits are those
households listed as receiving “Social Security income.” U.S. Census Bureau, 2009-2011 American Community Survey 3-Year Estimates, “Selected Population Profile in the
United States,” 2012. http://factfinder2.census.gov/
37 Unpublished calculations of March 2012 Current Population Survey data performed by the Center on Budget and Policy Priorities (CBPP) for Social Security Works.
38 CBPP, unpublished, Ibid.
39 SSA, Income of the Population 55 or Older, 2010, Table 9.A3, March 2012. http://www.ssa.gov/policy/docs/statcomps/income_pop55/2010/sect09.html#table9.a3
40 SSA, Social Security is Important for African Americans, February 2013. http://www.ssa.gov/pressoffice/factsheets/africanamer-alt.pdf
41 The term “households” as it is used here refers to households reporting income in the past 12 months. Households receiving Social Security benefits are those
households listed as receiving “Social Security income.” U.S. Census Bureau, 2009-2011 American Community Survey 3-Year Estimates, “Selected Population Profile in the
United States,” 2012. http://factfinder2.census.gov/
42 Unpublished calculations of March 2012 Current Population Survey data performed by the Center on Budget and Policy Priorities (CBPP) for Social Security Works.
43 Unpublished calculations of March 2012 Current Population Survey data performed by the Center on Budget and Policy Priorities (CBPP) for Social Security Works.
44 SSA, Income of the Population 55 or Older, 2010, Table 9.A3, March 2012. http://www.ssa.gov/policy/docs/statcomps/income_pop55/2010/sect09.html#table9.a3
45 SSA, Social Security is Important to Hispanics, February 2013. http://www.ssa.gov/pressoffice/factsheets/hispanics-alt.pdf
46 The term “households” as it is used here refers to households reporting income in the past 12 months. Households receiving Social Security benefits are those
households listed as receiving “Social Security income.” U.S. Census Bureau, 2009-2011 American Community Survey 3-Year Estimates, “Selected Population Profile in the
United States,” 2012. http://factfinder2.census.gov/
47 SSA, Social Security is Important to American Indians and Alaska Natives, February 2013. http://www.ssa.gov/pressoffice/factsheets/amerindian-alt.pdf
48 SSA, Social Security is Important to American Indians and Alaska Natives, February 2013. http://www.ssa.gov/pressoffice/factsheets/amerindian-alt.pdf
49 The term “households” as it is used here refers to households reporting income in the past 12 months. Households receiving Social Security benefits are those
households listed as receiving “Social Security income.” For states in which there are large numbers of Asian American residents as well as Native Hawaiian and Pacific
Islander residents, the numbers of beneficiaries and residents were added to calculate percentage of total Asian American, Native Hawaiian and Pacific Islander residents
receiving benefits. U.S. Census Bureau, 2009-2011 American Community Survey 3-Year Estimates, “Selected Population Profile in the United States,” 2012. http://
factfinder2.census.gov/
50 SSA, Income of the Population 55 or Older, 2010, Table 9.A3, March 2012. http://www.ssa.gov/policy/docs/statcomps/income_pop55/2010/sect09.html#table9.a3
51 SSA, Social Security is Important to Asian Americans and Pacific Islanders, February 2013. http://www.ssa.gov/pressoffice/factsheets/asian-alt.pdf
52 Unpublished calculations of Social Security Administration and Bureau of Economic Analysis data performed by Dr. Roberto Gallardo, Mississippi State University
Extension Service, on behalf of the Center for Rural Strategies, and shared with Social Security Works. For the purposes of this analysis, “rural” refers to counties designated
by the Office of Management and Budget (OMB) as non-metropolitan, including micropolitan areas, or “small cities,” with urban clusters of 10,000-49,999 people, and noncore areas lacking a centralized population of any kind. “Metropolitan” refers to counties with at least one urbanized area of 50,000 people or more, and adjacent counties
in which 25 percent of the workforce or more commutes to county with 50,000 people or more. Dr. Gallardo’s initial calculations distinguished between “small cities” and
“rural” counties. For Social Security Works, he created a weighted average of “small cities” and “rural” counties that allowed us to contrast metropolitan and non-metropolitan
figures. US Department of Agriculture, Economic Research Service (ERS), What is Rural?, May 10, 2013. http://www.ers.usda.gov/topics/rural-economy-population/ruralclassifications/what-is-rural.aspx#.UeSGcGTTWGN
Social Security Works for the united states of america 13
53 Unpublished calculations of Social Security Administration and Bureau of Economic Analysis data performed by Dr. Roberto Gallardo, Mississippi State University
Extension Service, Ibid. Dr. Gallardo’s figures date to 2011. In order to approximate 2012 figures, Social Security Works multiplied 2011 figures by the difference in
the Consumer Price Index Research Series Using Current Methods (CPI-U-RS) from 2011 to 2012. Methodology adopted in consultation with employees of the US
Census Bureau, Income Statistics Branch. Bureau of Labor Statistics (BLS), “Updated CPI-U-RS All items, 1978-2012,” March 29, 2013. http://www.bls.gov/cpi/
cpiursai1978_2012.pdf
54 US Census Bureau, “America’s Foreign-Born in the Last 50 Years,” June 2013. http://www.census.gov/how/pdf//Foreign-Born--50-Years-Growth.pdf. Social Security
provided all or nearly all of the income for over half (55.1 percent) of Latino senior households, and 4 out of 10 (41.7 percent) Asian senior households in 2010, compared
with one-third (34.7 percent) of white senior households. SSA, Income of the Population 55 or Older, 2010, Table 9.A3, March 2012. http://www.ssa.gov/policy/docs/
statcomps/income_pop55/2010/sect09.html#table9.a3
55 US Census Bureau, American Community Survey 2011, 1-Year Estimates, “Selected Population Profile in the United States,” 2012. http://factfinder2.census.gov/
56 More than half (51 percent) of workers who retired earlier than expected in 2012 cited a health problem or disability as the cause. Employee Benefit Research Institute
(EBRI), “2012 Retirement Confidence Survey Fact Sheet #2: Changing Expectations About Retirement,” March 2012, p. 1. http://www.ebri.org/pdf/surveys/rcs/2012/fs02-rcs-12-fs2-expect.pdf
57 Kaiser Family Foundation (KFF), “Key Facts on Health Coverage for Low-Income Immigrants Today and Under the Affordable Care Act,” March 2013, p. 4. http://
kaiserfamilyfoundation.files.wordpress.com/2013/03/8279-02.pdf
58 Center for Economic and Policy Research (CEPR), Hye Jin Rho, Hard Work? Patterns in Physically Demanding Labor Among Older Workers, Table 8, August 2010, p. 14.
http://www.cepr.net/documents/publications/older-workers-2010-08.pdf
59 SSA, Office of the Chief Actuary, Estimated Long-Range Financial Effects on Social Security of the “Border Security, Economic Opportunity, and Immigration
Modernization Act,” legislation introduced as S. 744 (113th Congress) by Senator Marco Rubio and passed by the Senate on June 27, 2013, June 28, 2013. http://ssa.
gov/oact/solvency/MRubio_20130627.pdf. At the time of the publication of this report, the US House of Representatives had yet to vote on the Senate’s immigration bill—
or any other, for that matter.
60 SSA, “Update on the Supreme Court Decision Regarding the Defense of Marriage Act and Its Implications for Social Security Benefits,” July 12, 2013. http://ssa.gov/
pressoffice/pr/doma-pr-alt.pdf. More on the financial loss experienced by same-sex couples and their children who are denied Social Security benefits here: National
Committee to Preserve Social Security and Medicare (NCPSSM) and Human Rights Campaign (HRC), Living Outside the Safety Net: LGBT Families and Social Security,
February 2013. http://www.ncpssmfoundation.org/Portals/0/lgbt-report.pdf
61 The Williams Institute, Marriage for Same-Sex Couples. http://williamsinstitute.law.ucla.edu/headlines/marriage-for-same-sex-couples/
62 The Williams Institute, Ibid.
63 The Williams Institute, Ibid.
64 Social Security does not contribute to the deficit, because benefits can only be paid from revenue collected by the Social Security trust funds—the Old-Age and Survivors
Insurance (OASI) trust fund and Disability Insurance (DI) trust fund—which are completely separate from the general budget. Social Security Trustees, Table II.B1, 2012
Social Security Trustees Report, April 25, 2012, p. 6. http://www.ssa.gov/oact/tr/2012/tr2012.pdf. In 2010 and 2011, the General Fund transferred money to the Social
Security trust funds in order to replace revenue lost due to a temporary two-percentage-point payroll tax reduction. The payroll tax cut, and the General Fund transfer that
resulted, was a temporary stimulus measure that will expire at the end of the year. It never fundamentally changed Social Security’s self-sustaining funding structure. The
trust funds do not have borrowing authority, and therefore, cannot deficit-spend. In the event that trust fund revenues fall short of what is needed to pay 100 percent of
benefits, then, by law, benefits could not be paid in full and on time. That is why, if Congress does nothing to shore up the program’s finances by 2033, Social Security will
only have sufficient revenue to pay about three-quarters of scheduled benefits through 2086. Social Security Trustees, Table II.B1, 2012 Social Security Trustees Report,
April 25, 2012, p. 11. http://www.ssa.gov/oact/tr/2012/tr2012.pdf. This modest funding shortfall is often cited as evidence that the program is financially unsustainable,
or “in deficit.” In fact, it is just the opposite: it attests to Social Security’s self-sustaining funding structure that bars it from deficit-spending or borrowing from the general
budget in any way.
65 White House, Office of Management and Budget, Table 1.1 Summary of Receipts, Outlays and Surpluses or Deficits: 1789-2018, 2013. http://www.whitehouse.gov/
omb/budget/Historicals
66 Center for Economic and Policy Research (CEPR), “U.S. Budget Deficits 2001-2013,” Analysis of Congressional Budget Office data, unpublished.
67 Social Security Trustees, 2013 Social Security Trustees Report, May 31, 2013, p. 4. http://www.ssa.gov/oact/tr/2013/tr2013.pdf
68 Social Security Trustees, Ibid.
69 Social Security Trustees, 2013 Social Security Trustees Report, May 31, 2013, p. 4. http://www.ssa.gov/oact/tr/2013/tr2013.pdf
70 Social Security Trustees, Ibid, “Table VI.F4.—OASDI and HI Annual and Summarized Income, Cost, and Balance
as a Percentage of GDP, Calendar Years 2013-90,” p. 200.
71 National Academy of Social Insurance (NASI), Janice M. Gregory, Thomas N. Bethell, Virginia P. Reno and Benjamin W. Veghte, Strengthening Social Security for the
Long Run, November 2010, p. 7. http://www.nasi.org/sites/default/files/research/SS_Brief_035.pdf
72 The most recent data on the percentage of workers with earnings below the taxable maximum are from 2010. SSA, Annual Statistical Supplement, 2012, “Table 4.B4—
Percentage of workers with earnings below annual maximum taxable, by sex, selected years 1937–2010,” February 2013. http://www.ssa.gov/policy/docs/statcomps/
supplement/2012/4b.html#table4.b4
73 SSA, “Benefits Planner: Maximum Taxable Earnings (1937-2013),” May 13, 2013. http://www.ssa.gov/planners/maxtax.htm
74 SSA, Provisions Affecting Payroll Taxes, “E2.1 Eliminate the taxable maximum in years 2013 and later, and apply full 12.4 percent payroll tax rate to all earnings. Do not
provide benefit credit for earnings above the current-law taxable maximum,” January 4, 2013. http://www.ssa.gov/OACT/solvency/provisions/charts/chart_run362.pdf
75 Social Security Works analysis of SSA data. Social Security Works, Social Security COLA Cut: A Benefit Cut Affecting Everyone, 2013. http://www.
strengthensocialsecurity.org/sites/default/files/Chained_CPI_Fact_Sheet_FINAL_Feb-2013_0.pdf
76 Center for Retirement Research at Boston College (CRR), Alicia H. Munnell, Anthony Webb, and Francesca Golub-Sass, The National Retirement Risk Index: An Update,
October 2012, p. 3. http://crr.bc.edu/briefs/the-national-retirement-risk-index-an-update/
77 Just over half (52.9 percent) of all working heads of households are eligible for an employer-sponsored retirement plan; of that half, 4 in 5 (83.8 percent) elect to
participate. The resulting total of all working heads of households who participate in an employer-sponsored retirement plans is 3 in 7 (44.6 percent). Federal Reserve,
Changes in U.S. Family Finances from 2007 to 2010: Evidence from the Survey of Consumer Finances, June 2012, p. 38. http://www.federalreserve.gov/pubs/
bulletin/2012/PDF/scf12.pdf
78 Federal Reserve, Ibid, p. 30.
79 Social Security Trustees, 2013 Social Security Trustees Report, “Table V.C7—Annual Scheduled Benefit Amounts for Retired Workers With Various Pre-Retirement
Earnings Patterns Based on Intermediate Assumptions, Calendar Years 2013-90,” May 31, 2013, p. 145. http://www.ssa.gov/oact/tr/2013/tr2013.pdf
80 CBPP analysis of OECD data, “Social Security: We’re Number…30!” May 11, 2011. http://www.offthechartsblog.org/social-security-we%E2%80%99renumber%E2%80%A6-30/
81 CBPP, Policy Basics: Top Ten Facts About Social Security, November 6, 2012. http://www.cbpp.org/files/PolicyBasics_SocSec-TopTen.pdf
82 CBPP, Ibid.
83 Strengthen Social Security Coalition, “Bills Introduced in the 113th Congress to Expand Social Security,” May 2013. http://www.strengthensocialsecurity.org/sites/
default/files/113thBillFactSheet.pdf
Social Security Works for the united states of america 14
Key Facts About Social Security
in the united States of America
Social Security Works for the United States of America’s Residents and Economy
• Social Security provided benefits to 56,758,185 Americans in 2012, 1 in 5 (18.1 percent) residents.
• Americans received Social Security benefits totaling $774.6 billion in 2012, an amount equivalent to 5.8 percent
of the country’s total personal income.
• The average Social Security benefit in the United States of America (US) was $13,648 in 2012.
• Social Security lifted 21,415,000 Americans out of poverty in 2011.
Social Security Works for the United States of America’s Seniors
• Social Security provided benefits to 36,720,492 US retired workers in 2012, two-thirds (64.7 percent) of
beneficiaries [Figure 1 in full report].
• Social Security lifted 14,480,000 US residents aged 65 and older out of poverty in 2011. Without Social Security,
the elderly poverty rate in the United States of America would have increased from 1 in 11 (8.7 percent) to 4 in 10
(43.6 percent) [Figure 2 in full report].
Social Security Works for the United States of America’s Workers with Disabilities
• Social Security provided disability benefits to 8,826,591 workers in 2012, 1 in 7 (15.6 percent) US beneficiaries
[Figure 1 in full report].
Social Security Works for the United States of America’s Women
• Social Security provided benefits to 28,988,043 US women in 2012, 1 in 6 (18.2 percent) US women.
• Social Security lifted 8,696,000 US women aged 65 and older out of poverty in 2011. Without Social Security, the
poverty rate of elderly women would have increased from 1 in 9 (10.7 percent) to half (48.7 percent) [Figure 2 in
full report].
Social Security Works for the United States of America’s Children
• Social Security provided benefits to 4,419,404 US children in 2012, 1 in 12 (7.8 percent) US beneficiaries
[Figure 1 in full report].
Social Security Works for the United States of America’s People of Color
• Social Security provided benefits to 1 in 4 (24.2 percent) African American households in the United States of
America in 2011, 3,474,517 households.
• Social Security provided benefits to 1 in 6 (16.5 percent) Latino households in the United States of America in
2011, 2,205,879 households.
• Social Security provided benefits to 1 in 4 (25.4 percent) American Indian and Alaska Native households in the
United States of America in 2011, 420,348 households.
• Social Security provided benefits to 1 in 6 (16.6 percent) Asian American, Hawaiian Native, and Pacific Islander
households in the United States of America in 2011, 897,748 households.
Social Security Works for the United States of America’s Rural Communities
• One in 5 (22.7 percent) rural or non-metropolitan Americans received Social Security in 2012, compared with
1 in 6 (16.3 percent) metropolitan Americans.
This report and individual reports for each of the 50 states are available at
http://strengthensocialsecurity.org/statereports2013. For further information
email info@socialsecurityworks.org, or contact Social Security Works, 815 16th
Street, Fourth Floor, Washington, DC 20006.