[Congressional Record Volume 149, Number 105 (Wednesday, July 16, 2003)]
[Senate]
[Pages S9497-S9499]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Mr. REID:
S. 1418. A bill to amend title II of the Social Security Act to allow
workers who attain age 65 after 1981 and before 1992 to choose either
lump sum payments over four years totaling $5,000 or an improved
benefit computation formula under a new 10-year rule governing the
transition to the changes in benefits computation rules enacted in the
Social Security Amendments of 1977, and for other purposes; to the
Committee on Finance.
Mr. REID. Mr. President, I believe Social Security is one of the
greatest success stories of our government.
Social Security is the only program in the history of our Nation that
has provided dignity and respect for our senior citizens, regardless of
their income or backgrounds.
For almost 70 years, Social Security has been there for our citizens
when they need it. It has provided seniors with independence and
economic security in their retirement years.
In addition to helping millions of senior citizens, Social Security
has provided economic security for surviving spouses and children and
to countless Americans with disabilities.
It is easy to see why people believe Social Security is the most
successful social program our country has ever adopted.
I rise today to reintroduce legislation that would correct a problem
that plagues a special population of Social Security recipients. I am
speaking on behalf of those affected by Social Security notch.
The Social Security notch causes more than nine million Social
Security recipients born between the years of 1917 and 1926 to receive
fewer Social Security benefits than Americans born outside the notch
years due to changes made in 1977 to the Social Security benefit
formula.
I have continued to speak out on this issue and the injustice it
imposes on millions of seniors. The notch issue has been discussed,
studied and reviewed, yet to date, Congress has not corrected this
wrong. Because of this, many older Americans born during this period
cannot afford the most basic necessities.
Congress must accept responsibility for any error that was made. We
should not ask notch Seniors to accept less because of our mistake.
While we must preserve and protect Social Security for future
generations, we have an obligation to those, who through no fault of
their own, receive less than those that were fortunate enough to be
born just days before and after the notch period.
The notch situation has its origins in 1972, when Congress decided to
create automatic cost-of-living-adjustments to help Social Security
keep pace with inflation. Prior to 1972, each adjustment had to await
legislation, causing beneficiaries' monthly payments to lag behind
inflation. When Congress took this action, it was acting under the best
of intentions.
Unfortunately, this new benefit adjustment method was flawed. To
function properly, it required that the economy behave in much the same
fashion that it had in the 1950s and 1960s, with annual wage increases
outpacing prices, and inflation remaining relatively low. As we all
know, that did not happen. The rapid inflation and high unemployment of
the 1970s generated rapid increases in benefits.
In 1977, Congress revised the way that benefits were computed. In
making its revisions, Congress decided that it was not proper to reduce
benefits for persons already receiving them. It did, however, decide
that benefits for all future retirees should be reduced.
[[Page S9498]]
We have an obligation to convey to our constituents that Social
Security is a fair system. Notch Babies in Nevada feel slighted by
their government and if I were in their situation, I would too. Through
no fault of their own, they receive less, sometimes as much as $200
less, than their neighbors.
The legislation I am offering today is my proposal to right the
wrong. Let us fix the notch problem and restore the confidence of the
nine million notch babies across this land. Government has an
obligation to be fair. My support of notch babies is longstanding. I
sponsored numerous pieces of legislation over the years to address this
issue. With this legislation, my effort continues.
It is unfortunate that these measures have not seen the light of day.
Many who have written to me think Congress is waiting for notch babies
to die rather than honor this debt. I must tell you it concerns me when
our constituents have this perception of their elected representatives.
We have to do something to make sure Americans believe that Social
Security is a fair system. Passage of my legislation provides us that
chance.
My legislation is intended to make good on what this government
should have done long ago. I propose that workers who attain the age of
65 after 1981 and before 1992 be allowed to choose either lump sum
payment over four years totaling $5,000 or an improved benefit
computation formula under a new 10-year rule governing the transition
to the changes in benefit computation rules enacted in the Social
Security Amendments of 1977.
It is time to put these dollars into the hands of those who earned
them. It is time to show our support for notch reform.
I am introducing this legislation because actions speak louder than
words. The `Notch Fairness Act of 2003' that I am introducing on behalf
of notch victims today, is intended to put my words into action. I ask
all my colleagues to join me in support of this important and long
overdue legislation.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 1418
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Notch Fairness Act of
2003''.
SEC. 2. NEW GUARANTEED MINIMUM PRIMARY INSURANCE AMOUNT WHERE
ELIGIBILITY ARISES DURING TRANSITIONAL PERIOD.
(a) In General.--Section 215(a) of the Social Security Act
(42 U.S.C. 415(a)) is amended--
(1) in paragraph (4)(B)--
(A) by inserting ``(with or without the application of
paragraph (8))'' after ``would be made''; and
(B) in clause (i), by striking ``1984'' and inserting
``1989''; and
(2) by adding at the end the following:
``(8)(A) In the case of an individual described in
paragraph (4)(B) (subject to subparagraphs (F) and (G) of
this paragraph), the amount of the individual's primary
insurance amount as computed or recomputed under paragraph
(1) shall be deemed equal to the sum of--
``(i) such amount, and
``(ii) the applicable transitional increase amount (if
any).
``(B) For purposes of subparagraph (A)(ii), the term
`applicable transitional increase amount' means, in the case
of any individual, the product derived by multiplying--
``(i) the excess under former law, by
``(ii) the applicable percentage in relation to the year in
which the individual becomes eligible for old-age insurance
benefits, as determined by the following table:
``If the individual
becomes eligible for The applicable
such benefits in: percentage is:
1979..................................................55 percent
1980..................................................45 percent
1981..................................................35 percent
1982..................................................32 percent
1983..................................................25 percent
1984..................................................20 percent
1985..................................................16 percent
1986..................................................10 percent
1987...................................................3 percent
1988...................................................5 percent.
``(C) For purposes of subparagraph (B), the term `excess
under former law' means, in the case of any individual, the
excess of--
``(i) the applicable former law primary insurance amount,
over
``(ii) the amount which would be such individual's primary
insurance amount if computed or recomputed under this section
without regard to this paragraph and paragraphs (4), (5), and
(6).
``(D) For purposes of subparagraph (C)(i), the term
`applicable former law primary insurance amount' means, in
the case of any individual, the amount which would be such
individual's primary insurance amount if it were--
``(i) computed or recomputed (pursuant to paragraph
(4)(B)(i)) under section 215(a) as in effect in December
1978, or
``(ii) computed or recomputed (pursuant to paragraph
(4)(B)(ii)) as provided by subsection (d),
(as applicable) and modified as provided by subparagraph (E).
``(E) In determining the amount which would be an
individual's primary insurance amount as provided in
subparagraph (D)--
``(i) subsection (b)(4) shall not apply;
``(ii) section 215(b) as in effect in December 1978 shall
apply, except that section 215(b)(2)(C) (as then in effect)
shall be deemed to provide that an individual's `computation
base years' may include only calendar years in the period
after 1950 (or 1936 if applicable) and ending with the
calendar year in which such individual attains age 61, plus
the 3 calendar years after such period for which the total of
such individual's wages and self-employment income is the
largest; and
``(iii) subdivision (I) in the last sentence of paragraph
(4) shall be applied as though the words `without regard to
any increases in that table' in such subdivision read
`including any increases in that table'.
``(F) This paragraph shall apply in the case of any
individual only if such application results in a primary
insurance amount for such individual that is greater than it
would be if computed or recomputed under paragraph (4)(B)
without regard to this paragraph.
``(G)(i) This paragraph shall apply in the case of any
individual subject to any timely election to receive lump sum
payments under this subparagraph.
``(ii) A written election to receive lump sum payments
under this subparagraph, in lieu of the application of this
paragraph to the computation of the primary insurance amount
of an individual described in paragraph (4)(B), may be filed
with the Commissioner of Social Security in such form and
manner as shall be prescribed in regulations of the
Commissioner. Any such election may be filed by such
individual or, in the event of such individual's death before
any such election is filed by such individual, by any other
beneficiary entitled to benefits under section 202 on the
basis of such individual's wages and self-employment income.
Any such election filed after December 31, 2003, shall be
null and void and of no effect.
``(iii) Upon receipt by the Commissioner of a timely
election filed by the individual described in paragraph
(4)(B) in accordance with clause (ii)--
``(I) the Commissioner shall certify receipt of such
election to the Secretary of the Treasury, and the Secretary
of the Treasury, after receipt of such certification, shall
pay such individual, from amounts in the Federal Old-Age and
Survivors Insurance Trust Fund, a total amount equal to
$5,000, in 4 annual lump sum installments of $1,250, the
first of which shall be made during fiscal year 2004 not
later than July 1, 2004, and
``(II) subparagraph (A) shall not apply in determining such
individual's primary insurance amount.
``(iv) Upon receipt by the Commissioner as of December 31,
2003, of a timely election filed in accordance with clause
(ii) by at least one beneficiary entitled to benefits on the
basis of the wages and self-employment income of a deceased
individual described in paragraph (4)(B), if such deceased
individual has filed no timely election in accordance with
clause (ii)--
``(I) the Commissioner shall certify receipt of all such
elections received as of such date to the Secretary of the
Treasury, and the Secretary of the Treasury, after receipt of
such certification, shall pay each beneficiary filing such a
timely election, from amounts in the Federal Old-Age and
Survivors Insurance Trust Fund, a total amount equal to
$5,000 (or, in the case of 2 or more such beneficiaries, such
amount distributed evenly among such beneficiaries), in 4
equal annual lump sum installments, the first of which shall
be made during fiscal year 2004 not later than July 1, 2004,
and
``(II) solely for purposes of determining the amount of
such beneficiary's benefits, subparagraph (A) shall be deemed
not to apply in determining the deceased individual's primary
insurance amount.''.
(b) Effective Date and Related Rules.--
(1) Applicability of amendments.--
(A) In general.--Except as provided in paragraph (2), the
amendments made by this Act shall be effective as though they
had been included or reflected in section 201 of the Social
Security Amendments of 1977.
(B) Applicability.--No monthly benefit or primary insurance
amount under title II of the Social Security Act shall be
increased by reason of such amendments for any month before
July 2004.
(2) Recomputation to reflect benefit increases.--
Notwithstanding section 215(f)(1) of the Social Security Act,
the Commissioner of Social Security shall recompute the
primary insurance amount so as to take into account the
amendments made by this Act in any case in which--
(A) an individual is entitled to monthly insurance benefits
under title II of such Act for June 2004; and
(B) such benefits are based on a primary insurance amount
computed--
[[Page S9499]]
(i) under section 215 of such Act as in effect (by reason
of the Social Security Amendments of 1977) after December
1978, or
(ii) under section 215 of such Act as in effect prior to
January 1979 by reason of subsection (a)(4)(B) of such
section (as amended by the Social Security Amendments of
1977).
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