Remarks on Retirement Security

Columbus, Ohio

June 13, 2008

As Prepared for Delivery

For generations, we have worked to keep a simple promise in this country - Americans who work hard their entire lives have earned the right to retire with dignity and security.

That is the promise that my grandparents knew, even though they came of age in the Depression. My grandfather would go on to serve in Patton's Army, and my grandmother worked on a bomber assembly line while he marched across Europe. When they set out west from Kansas to build their lives after the War, they did so with the confidence that Washington would help them reach a secure retirement. That was the promise that FDR made, and it was a promise that Washington kept for decades while folks like my grandparents moved through the ups and downs of life in America's middle class.

But today, Washington is not working to preserve this fundamental part of the American Dream.

A secure retirement is no longer a guarantee for the middle class. It's harder to save and harder to retire. People are losing their pensions. If we do not act, the promise of social security will grow harder to keep. That's why I will fight every day to extend the promise of a retirement that is dignified and secure when I am President of the United States.

It starts with protecting Social Security today, tomorrow, and forever. For millions of Americans, Social Security is the difference between a comfortable retirement and the risk of poverty. We have an obligation to secure the future of one of the most successful programs in our history. And that starts with talking straight to the American people about the challenges that lie ahead.

Social Security is strong, but as more baby boomers retire, the long-term cash-flow needs to be addressed. We have to make sure Social Security is there for future generations.

Now, John McCain's ideas on Social Security amount to four more years of what was attempted and failed under George Bush. He said he supports private accounts for Social Security - in his words, "along the lines that President Bush proposed." Yesterday he tried to deny that he ever took that position, leaving us wondering if he had a change of heart or a change of politics.

Well let me be clear: privatizing Social Security was a bad idea when George W. Bush proposed it. It's a bad idea today. It would eventually cut guaranteed benefits by up to 50%. It would cost a trillion dollars that we don't have to implement on the front end, permanently elevating our debt. And most of all, it would gamble the retirement plans of millions of Americans on the stock market. That's why I stood up against this plan in the Senate, and that's why I won't stand for it as President.

But Senator McCain's campaign went even further a few months ago, suggesting that the best answer to the growing pressures on Social Security might be to cut cost-of-living adjustments or to raise the retirement age. I think there is another option that is fairer to working men and women. We have to protect Social Security for future generations without pushing the burden on to seniors who have earned the right to retire in dignity.

Here's where I would start. Right now, the Social Security payroll tax is capped. That means most middle-class families pay this tax on every dime they make, while millionaires and billionaires are only paying it on a very small percentage of their income. That's why I think the best way forward is to first look to adjust the cap on the payroll tax so that people like me pay a little bit more and people in need are protected. That way we can extend the promise of Social Security without shifting the burden on to seniors. And we should exempt anyone making under $250,000 from this increase so that the change doesn't burden middle-class Americans. This means that 97% of Americans will see absolutely no change in their taxes under my plan - 97%.

Now, there was a time when John McCain thought this wasn't such a bad idea. When he was asked a few years ago whether he could see himself lifting the cap on the payroll tax, he said, "I could." But today, he's attacking me for holding the very same position.

You know, John McCain has proposed a series of debates, and I'm looking forward to having them. But when it comes to Social Security, he might want to finish the debate with himself first.

Now, even if we keep Social Security strong for future generations, it's still not enough to help seniors who are struggling with the cost of everything from gas to groceries - because we know that rising costs are hardest for folks on fixed incomes. That's why I'll make retirement more secure by eliminating income taxes for retirees making less than $50,000 per year. This would completely eliminate income taxes for 7 million seniors. Two of those people are Ron and Jane Payne, who I just met before the event. Since they retired, they've been spending more and more of their limited income on gas and groceries and health care premiums. This tax cut would eliminate the income taxes they pay and save them over $1,400.

In contrast, John McCain believes that senior citizens living on modest incomes should continue to pay taxes. In fact, the tax cuts for the rich he is proposing would provide essentially no benefits to the vast majority of senior citizens.

And it's time to end the outrage of CEOs cashing out while workers lose their pensions. Right now, bankruptcy laws are more focused on protecting banks than protecting pensions. And that's how John McCain wants to keep things for another four years. He voted against a proposal that would've made the claims of workers and retirees a priority in bankruptcy court - and he opposed a proposal that said companies should not unfairly cut the pension benefits of men and women who've worked their whole lives to earn them.

Well that's not fair. That's not the America that I believe in. It's time to stop cutting back the safety net for working people while we protect golden parachutes for the well-off. If you work hard and play by the rules, then you've earned your pension. If a company goes bankrupt, then workers need to be a top priority - not an afterthought.

As President, I'll limit circumstances when retirement benefits can be cut, and increase the wages and benefits that workers can claim in bankruptcy court. We'll require companies to disclose their pension fund investments. We'll put an end to the outrage of executives getting bonuses while workers watch pensions disappear. And we'll make sure that no American goes bankrupt just because they get sick.

Finally, we're not going to help folks reach a secure retirement unless we encourage savings. But today, personal savings is at an all-time low as Americans are dealing with higher costs and a credit crunch. Meanwhile, 75 million working Americans don't have employer-based retirement plans.

That's why I've proposed automatic workplace pensions. There will be no red tape or complicated forms - employers will provide a direct deposit of a small percentage of each paycheck into your account. You can add to it, or you can opt out at any time. And employers will have an easy opportunity to match employee savings. If you switch jobs, your savings will roll over into your new employer's system. If you become self-employed, you will control your account. Studies show that about 80 percent of Americans will enroll if given the option to pursue our type of plan. And we will also help middle-class families start their own nest egg by matching 50% of the first $1,000 saved - a match that will be directly deposited into your savings account; a tax cut that will truly encouraging savings, investment and wealth creation. These steps will put a secure retirement within reach for millions of working families.

Since the New Deal, we've had a basic understanding in America that if you work hard and pay into the system, you've earned the right to a secure retirement. That's the promise that was kept for my grandparents and Michelle's parents, and for so many families here in Oregon and across the country. And if we keep that promise today, we're not just valuing work and our workers, we'll be keeping our businesses and our economy strong for the next generation. That's a future worth fighting for. And with your help, that's what I will do when I am President of the United States of America.