[Congressional Record Volume 146, Number 32 (Tuesday, March 21, 2000)]
[Senate]
[Pages S1474-S1475]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page S1474]]
                REPEAL OF SOCIAL SECURITY EARNINGS LIMIT

  Mr. ASHCROFT. Mr. President, as has been noted, we will be dealing 
today with the repeal of the Social Security earnings limit. I think 
individuals on both sides of the aisle are eager to deal with this kind 
of legislation.
  What is the earnings limit? The earnings limit is simply a way of 
saying that if citizens between 65 and 69 years of age earn over a 
modest amount of money when they earn outside income by working, the 
Government deducts from their Social Security $1 for every $3 they 
earn; that is, for $1 over $17,000, the Government reduces the benefits 
$1 for every $3 of earnings.
  This makes it very difficult for a number of people who are between 
65 and 70 years of age, who want to be able to sustain themselves, who 
want to be able to help their families, who want to be able to remain 
independent and not dependent on Government. Yet Government has this 
rather onerous discriminatory effect on their work habits. It says if 
you earn money, we are going to take money away from what you have 
previously earned as a Social Security benefit.
  The earnings test is a misguided and outdated relic of a time when 
jobs were scarce, unemployment was high, when people did not live as 
long and healthy lives as they do today. It is clearly a disincentive 
for seniors to work. By telling seniors if they work hard and earn 
money, we will just take it away from them or we will deduct it from 
their Social Security, we are saying: Seniors need not apply; seniors 
need not aspire to a better life; seniors need not expect to remain 
independent--all of which are the wrong statements for us to be making 
to our seniors.
  There are a great number of seniors who are working anyhow and paying 
a penalty for working. It seems strange that in a country that needs 
workers, we are asking people to pay a high penalty for working: 1.2 
million working seniors are penalized now; 17,523 working seniors in 
Missouri suffer losses in their Social Security as a result of their 
industry, their willingness to work. But the actual number of seniors 
affected by this pernicious idea of discriminating against seniors in 
the workplace is much greater than this 1.2 million nationwide or 
17,523 in the State of Missouri. There are millions of seniors who 
choose not to work or choose to work only a small amount because they 
don't want to work in such a way that it will erode, undercut, 
undermine, or diminish their Social Security income.
  Keeping seniors out of our workforce has a serious consequence. It is 
against our best interest to remove the kinds of things seniors bring 
to the workforce. They are great workers. They are skilled workers. 
They are workers of value and experience. The current unemployment rate 
of 4 percent indicates to us that we need skilled and experienced 
workers. Seniors are highly valuable members of the workforce. Their 
continuing contributions are crucial. The only limit to what they have 
to offer is the earnings limit. We should not limit what good people 
can offer to this country.
  I have spent quite a bit of time in my home State of Missouri talking 
with constituents. There are real life examples. Beverly Paxton from 
Belton, MO, who represents the Green Thumb organization, says hundreds 
of seniors would be eager to work without the earnings test. 
Furthermore, some don't try to work for fear that the Social Security 
Administration might take benefits away. Seniors don't want to have to 
visit a CPA to find out whether if they go to work they will lose 
benefits or be taxed at such a high rate that working will actually end 
up costing them money.
  Many more limit their hours to avoid the Social Security earnings 
test and its application which would result in the deduction of Social 
Security benefits. A manufacturer from Belton, MO, said to me: Seniors 
work until they reach the income limit. Then they tell the employer: I 
won't be here next week; I will see you next January.

  Well, what does this do to our situation where we want people to be 
able to work with continuity and our manufacturers and our enterprises 
to be able to provide service with continuity?
  Here we have an employer who is left in the lurch, having to absorb 
training costs or heavy overtime costs because we have said to seniors: 
You cannot work on a regular basis if that regular basis carries you 
over the income limit. These decisions of people working for quite a 
bit of time and then precipitously dropping off or being underemployed 
by not working very much throughout the entire year are based on the 
arbitrary earnings test limit of the Social Security Administration 
which says if you pass a certain limit, we will start deducting from 
your Social Security check. Even when seniors work around the test, 
they suffer unexpected costs.
  C.D. Clark from Florissant, MO, had earned $25,000 before trying to 
limit earnings to protect himself from the test. He had planned to work 
only 8 months so his Social Security benefits would not be cut; he 
would get himself down under the limit. The Social Security 
Administration, however, assumed he would earn the same amount, the 
$25,000 he had earned previously, and withheld his Social Security 
checks from January through March of this year. When Mr. Clark 
complained to the Social Security Administration that he had not 
reached the income limit of $17,000, he was told: We like to get our 
money up front--as if Social Security was their money, as if it were 
not a benefit for which Mr. Clark had paid years and years of taxes.
  Not only do we find people harmed financially, but seniors express to 
me over and over again that their physical and mental well-being is 
pinned upon their ability to keep working. In St. Joseph, MO, working 
is a mental health issue. Seniors who don't work often lose their sense 
of self-worth. This point was not only made to me in my visit to St. 
Joseph but across the State. In Joplin, for example, I was given the 
same information.
  To the extent that the earnings test keeps as many as 200,000 
Missouri seniors from working, it harms the mental well-being of those 
200,000 Missouri seniors who would like to be active. Over and over 
again, this was a refrain I heard from seniors: We want to work; we 
want to be active; we need to be.
  The earnings test can threaten lives in other ways as well. Lois 
Murphy of St. Louis is 65 and works part-time as a registered nurse in 
the operating room at St. John's Mercy Medical Center. The hospital 
suffers from a labor shortage and needs help from women like Mrs. 
Murphy who are experienced, willing, and dedicated to work. She limits 
her hours because of the earnings limit. This takes a skilled, 
experienced, and needed worker out of the hospital, out of the capacity 
of caring for other individuals.
  Mrs. Murphy wrote to me:

       The $17,000 limit a person could earn plus the small Social 
     Security check is not enough to live comfortably and enjoy 
     your senior years.

  Mrs. Murphy neatly summarized this issue in one simple sentence:

       I think if a senior citizen at age 65 is willing to work, 
     they should be able to earn a lot more or not have a limit.

  Well, I believe Mrs. Murphy is right. Seniors should have the freedom 
to earn if they choose. The problem is that they don't have that 
choice. We must send the earnings test into retirement. We should 
retire the earnings test, not force the retirement of our senior 
citizens.
  One of the business owners and operators I talked to put it this way: 
Seniors are able to work pretty aggressively through most of the year 
until they get up to the brink of the Christmas season when they really 
are needed. Then when they are intensely needed, the test kicks in and 
they have to check out.
  Many seniors who want to work don't work because of the costs imposed 
by the earnings test. Take, for example, a senior in the 28-percent tax 
bracket. The earnings test kicks in. One out of every $3 is taken away 
from Social Security. That turns out to be another tax of roughly 33 
percent.
  Then if you add the 7.65-percent Social Security tax on the people, 
and a State income tax of, say, 6 percent, you get up to a 74- to 80-
percent combined tax load on a working senior citizen. If they have any 
expenses of going to and from work, or wardrobe expenses associated 
with work, it could well be that the senior citizen actually loses 
money. The Government is so aggressive in reducing their ability to 
earn. The earnings test is pernicious and discriminatory toward 
seniors.

[[Page S1475]]

  This is something we ought to address. I am delighted that the House 
has done so and that the President has signaled his agreement with what 
the House has done. I have been working on this since I came to the 
Senate in 1995. I voted to substantially increase the limit in 1997. I 
called for the elimination of the test and cosponsored legislation that 
would get rid of the test.
  This year, I have introduced legislation that would eliminate the 
test. My bipartisan legislation has 43 cosponsors, including the entire 
majority leadership. There are a number of others, organizations and 
all, who have endorsed this concept, including Green Thumb, 60+, the 
Seniors Coalition, National Association of Home Builders, National 
Taxpayers Union, the U.S. Air Force Sergeants Association, Americans 
for Tax Reform, CapitolWatch, National Tax Limitation Committee, United 
Seniors Association, United Seniors Health Cooperative, and the U.S. 
Chamber of Commerce.
  The point is, the House of Representatives recognized the value of 
this concept and unanimously voted to eliminate the earnings limit. The 
President has indicated he would sign clean legislation, unencumbered 
by extraneous amendments. I believe we should follow the lead of the 
House and do what the President is asking us to do--to deliver this 
measure which would eliminate the earnings test. It is something I have 
been working on now for years. It is a counterproductive, unfair 
penalty. I believe that, because the President is prepared to sign it, 
the Senate now needs to move forward and eliminate this out-of-date and 
costly impediment, this discrimination, this very serious problem for 
our seniors, which prohibits our culture from having the benefit and 
value of the best effort of many of our very best workers.
  With that in mind, I look forward to the debate later today. I am 
pleased to have had this opportunity to address this issue.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Vermont is recognized.
  Mr. LEAHY. Mr. President, what is the parliamentary situation?
  The PRESIDING OFFICER. The Senate is now in a period of morning 
business.

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