Retirement Security

Every Oregonian deserves accessible retirement plan

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Setbacks in Salem but the Fight Far from Over

This was not a great day in the Oregon House for public workers or the people we serve, but the fight for fairness in this legislative session is far from over.

First, Republican leaders and their allies in the “loophole lobby” derailed a bi-partisan effort to make big corporations and the wealthiest Oregonians to pay a bit more in taxes to produce $275 million in revenue to avoid service cuts. Then Senate Bill 822, which caps COLAs for many PERS recipients, passed the House and went to the governor for signing over our vehement opposition and avowed intention to challenge in court.

The PERS vote was 33-27. A number of those who voted YES — all Democrats — hated the bill but wanted to conclude the debate on PERS and move to focusing on funding the services our members provide. Most of those who voted no want to make even deeper cuts.

Like the PERS vote, the maneuvering over revenue was politically complex.  Pro-public service legislators succeeded in keeping the process moving forward by passing a greatly reduced version of the bill to extend the debate on funding vital services Oregonians rely on.

We are reminded once again of the power of big business to manipulate the political process to avoid paying its fair share. The original revenue bill started the day with bi-partisan support, but corporate lobbyists and the leaders they control compelled some House members to oppose the larger package.

The fight over revenue and against further PERS cuts now moves to the State Senate. Contact your Senator today to call for restoration of the full $275 million revenue package.

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House Committee Approves Retirement Security Study

Defying banking and insurance lobbyists, a House committee in Salem has approved a bill supported by members of SEIU local 503 and allies on the Retirement in Reach Coalition that would bring key players together to develop a responsible plan for workers with no path to retirement security.

The bill would create the Oregon Retirement Savings Investment Board with representatives from employers, the financial services industry, the public and the State Treasurer. The board would recommend a plan to the 2015 Legislature that does not incur liability for the state and that is portable and accessible to all Oregon workers. It now moves on to the Ways & Means committee following a 6-4 vote by members of the House Business and Labor Committee.

“Three out of five families headed by a person 65 or older have no money in retirement savings accounts,” said Jerry Cohen, AARP Oregon state director testifying in support of the bill. “Unless we proactively tackle this issue, the state budget will be saddled with a growing burden in the future as older adults are forced to rely more and more on public safety net programs. HB 3436 is a commonsense solution to a critical problem.”

“Having worked in non-traditional employment like property management and serving as a care provider traditional retirement plans have never been available to me,” Phyllis Wills, an SEIU 503 homecare worker from Hillsboro, told the legislators. “ Many workers need more options for a secure retirement plan. Portability, flexibility and more security in my investments are all important to me. House Bill 3436 brings together the best minds from our state’s Treasurer, Financial Sector and those who have experience providing benefits to workers.

“I’ve seen what happens when people do not have access to a secure retirement. My clients have been low-income, lacked retirement savings and rely state services in old age. They are able to stay in their homes, but struggle to eat, afford medical care and rarely have anything left over to enjoy their golden years.”

Retirement in Reach [retirementinreach.org ]is a broad coalition of organizations working to achieve a secure future for all Oregonians. Members include: AARP Oregon, Family Forward Oregon, Main Street Alliance of Oregon, Urban League of Portland, Elders in Action Commission, Oregon Nurses Association, AAUW, AFSCME, Oregon Action, Oregon Education Association and SEIU.

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Take action today for retirement security

They’re at it again. Led by the anti-public worker editorial board at The Oregonian, the usual suspects are continually attacking public employee retirement.

In case you didn’t see it, The Oregonian has been calling PERS “an expensive mess” and laying the blame for cutbacks to schools, cities, and other government services at our feet1. Together with our allies, we’ve been working to make the truth known.

It was Wall Street banks and risky corporate investment practices – not public employees – that crashed our economy and wreaked havoc with PERS investment returns. Since then, banks got bailed out by taxpayers and proceeded to give multi-million-dollar bonuses to CEOs, while prosperous corporations and the wealthy continue to get billions in tax breaks.

But let’s be clear.

At the beginning of their 2011 session, legislators and Governor Kitzhaber gave away $93 million in tax breaks to corporations. How else could they have spent that money?

•    They could have restored a full week of school for all Oregon kids.
•    They could have hired 744 state police troopers to keep our communities safe.2

In fact, since 2009, tax breaks in Oregon have grown by $3.4 billion.3 Those who benefit from these tax breaks would rather put the focus on PERS and “those greedy public workers.” Why? Because they know that if the public scrutinized their tax breaks, there would be an outcry against them.

Yet it’s not all doom and gloom. This Register-Guard editorial regarding State Treasurer Ted Wheeler’s recent proposed changes to PERS presents a fair analysis.4 For the most part, Wheeler is seeking to de-politicize decisions regarding PERS, ensure that any changes are financially prudent, and protect public employees from unwarranted attacks. Further, he wants to save money by bringing home some of the work currently outsourced to consultants. The Treasury staff estimates we could save millions of dollars each year if they had the legislative authority to hire more staff for these jobs.

Please click here to email Ways and Means Co-Chair Peter Buckley, a legislator with enormous influence over the writing of the state budget, asking him to give Treasurer Wheeler the power to hire qualified personnel to safeguard the state’s pension fund instead of contracting this work out to Wall Street consultants.

Representative Buckley is an ally on the issues of contractor accountability and PERS, but he needs to hear from you about the importance of this issue.

As we prepare for the 2013 legislative session and state and university contract negotiations, part of our efforts must continue to focus the debate on the real issues. The retirement problem in Oregon is not that state workers have a decent pension. The real problem is that private sector workers don’t. In fact, most private-sector workers don’t have any kind of retirement security, which makes us an attractive target for opponents of public workers.

While we can’t expect to convince the biased editorial board at The Oregonian, please do all you can to talk with your coworkers, family members, and neighbors about the facts of who actually caused the crash and how the way out of our financial crisis is not to attack the dedicated public employees who work hard every day to provide essential services to our state.

In solidarity,

Linda J. Burgin        Heather Conroy
President                   Executive Director

 

Links

  1. PERS repair should be a priority for governor, Legislature http://www.oregonlive.com/opinion/index.ssf/2012/07/pers_repair_should_be_a_priori.html
  2. What could $93 million have paid for? http://ouroregon.org/sockeye/blog/what-could-93-million-have-paid
  3. Media Watch: The Five Dumbest Things You’ll Read Today, Courtesy of the Oregonian Editorial Board http://ouroregon.org/sockeye/blog/media-watch-five-dumbest-things-you%E2%80%99ll-read-today-courtesy-oregonian-editorial-board
  4. EDITORIAL: Wheeler takes on the gap, PERS needs to match its future income and expenses http://www.registerguard.com/web/opinion/28488192-47/pers-system-percent-state-oregon.html.csp
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New York Times: Our Ridiculous Approach to Retirement Security

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Retirement Plan: Couch Surfing

Joey Stewart, SEIU homecare worker, and his client, L.M. Reese

I have been a caregiver for the elderly, disabled and children all my life, a vocation I began as a teenager.

Providing care for the most vulnerable in our population does not pay well and has not provided the means to a secure retirement.  Since I have little confidence that I can depend on government programs to provide the security I need, I’m faced with a pretty dismal situation. To date, my only solution has been to encourage my siblings and friends to have as many children as possible. Currently, over 24 children call me Uncle Joe and Uncle Joe gives the best gifts and is very cool.  So, as I see it, Uncle Joe should have at least 24 couches to sleep on once I retire.

It’s my hope that the rest of the world doesn’t have to resort to my retirement plan.

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Retirement Security for Mother’s Day

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“I am concerned about meeting my basic needs during retirement”

Sharon Edwards’ story

When I budgeted for my retirement as a single woman, there were some things I didn’t count on. I didn’t budget for 3% inflation. I didn’t budget for the loss of half of my retirement from the market crash. I didn’t budget for hearing loss. I didn’t want to retire at 62, but I had to — my hearing loss kept me from getting another job when I lost mine. I may have to sell my home, or rent out my home to students and move to a smaller, cheaper place.

I am totally dependent on Social Security. I was able to contribute for 10-12 years toward an IRA, and I get about 3,000 annually from it, but it’s not enough to live on. When I turn 65, I will have to come up with my share of the Medicare premium: 100-plus a month. It was a tremendous shock to find out that I will have to pay for Medicare — I thought it was free! I hope one of my family members will be able to help me.

I am concerned about meeting my basic needs during retirement. I have COPD/emphysema and have to take Advair. It’s currently being supplied through a pharmaceutical company’s program to help with costs, otherwise I couldn’t breathe. The medication costs $200 a month.

We paid into Social Security so it would be there when we need it. They have no right to touch it! We gave bonuses to those Wall Street crooks who destroyed the system. We’re being taken advantage of. We deserve better than this.

Do you have a retirement security story?

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Actions Show How 1% Win on Social Security at Our Expense

SEIU 503 members joined community allies in Portland, Salem and Albany March 15 — the day millionaires get a boost in their paychecks — for informational actions replicated across the nation to dramatize the unfair advantage Social Security contributions rules afford the wealthiest Americans.

In Portland near the MAX stop at Northeast 7th Avenue, commuters were leafleted and by members who offering “free” rides in a large pink cardboard Cadillac for the 1% who stop paying Social Securty in mid-March each year.

Read SEIU 503 member LeeLa Coleman’s account of the March 15 action in Portland.

Social Security’s guaranteed benefits are an integral part of ensuring retirement security for all, after a lifetime of hard work and contributions. But our Social Security tax system has a cap: when workers reach $110,100 in earnings for the year, they no longer get taxed. This means they stop contributing to Social Security while the majority of us continue throughout the year.

For example, an employee who makes $220,200 — twice the cap — will stop paying Social Security taxes halfway through the year. An employee who makes 12 times the cap stops paying within the first month. For the last of the top 1% of wage earners, that stop date is now.

On top of the fact that the Social Security tax doesn’t apply to earnings over $110,000, it also doesn’t apply to investment income and capital gains — popular sources of income for America’s wealthiest. This means that those with the highest incomes effectively end up paying a lower Social Security tax as a percentage of their overall income, even though they may be eligible for higher benefits when they retire.

Take for example Mitt Romney, who paid just 0.1% of his income toward Social Security last year. Most of us paid at least 4.2%, and prior to the payroll tax holiday, which has been extended through 2012, were paying 6.2% toward Social Security.

As private employers continue to eliminate pension plans and cut retirement contributions of all types, Social Security is more important than ever before. For millions of low-wage workers who pay into the system year-round, Social Security benefits are less than $1200 per month, and this is often their primary source of retirement income.

As a basic foundation of many people’s retirement, the program works and has helped protect more than 20 million Americans from poverty. But Social Security benefits are not high enough to provide a secure retirement for all Americans.

So what’s the solution? According to Mitt, the answer is to cut benefits and raise the retirement age. Once again, his ‘solutions’ would only hurt the average American worker more. Romney has earned enough money in his lifetime that he probably has few worries about retirement; the rest of us aren’t so fortunate.

A guaranteed way to fix the imbalance in Social Security’s formula is to simply eliminate the cap, so that all workers pay the same percentage of their overall income into the Social Security Trust Fund.

By expanding the Social Security tax base so that all Americans pay the same rate on their income, we would generate more than enough revenue to raise benefit levels, expand access to Social Security and fill its long-term funding gap. If the 1% paid their fair share of Social Security taxes, we could make Social Security solvent for the rest of the 21st century and improve benefits for our most vulnerable seniors.

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I’m celebrating the 1%’s Pay Raise

Are you wondering why I’m wearing this Mitt Romney mask?

Well I’ll tell you… I’m celebrating.

Today is the day that 1% percent stop paying into Social Security while the rest of us contribute all year long toward our retirement.   That’s right.

American workers that earn more than $110,000 are paying a much lower Social Security tax than  the rest of us.  According to the Wall Street Journal, the top 1% of Americans (or people like Mitt Romney and Donald Trump) will have finished paying into Social Security by mid-March while the rest of us continue to pay 6.2% of our paychecks into the fund all year long, year in and year out.

So I’m putting on my Romney mask so I can imagine what it would be like to get a pay raise on top     of a half-a-million-dollar-plus salary.

As a public health worker, it’s hard to imagine what it would be like to own two Cadillacs let alone earn Mitt Romney’s salary.

For most of us in the 99 percent, the reality of retirement means figuring out how to live on less than $1,200 per month. That’s what most low wage workers receive from Social Security.  We must strengthen Social Security so that it will be around for future generations of Americans and so those Americans with no other source of income can still survive on Social Security alone. All of this could be achieved by eliminating the cap on Social Security taxes so that everyone pays the same percentage of their pay into the Social Security Trust Fund.

If I were a member of the 1 percent, I would do my part so that all Americans have an opportunity to retire with dignity. And then, we would all have a reason to celebrate.

LeeLa Coleman

SEIU 503 OHA Public Health Local 219

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