In a floor speech today, Senator
To tackle the retirement crisis, Harkin recently introduced the
"Whether it's a young family struggling to pay off student loan debt, save for their kids' education, and put something aside for their own retirement, or a 65-year old nurse finally eligible to stop working, most Americans are deeply worried that they will not have enough money to live on when they stop working," Harkin said. "We can do better. We must do better. That's why I recently introduced the
The full text of Harkin's remarks, as prepared for delivery, is as follows.
"I rise today to talk about a subject near and dear to my heart - retirement security. I have been focused on retirement issues for years. And I know from my constituents that the dream of a secure retirement is growing fainter and fainter. Whether it's a young family struggling to pay off student loan debt, save for their kids' education, and put something aside for their own retirement, or a 65-year old nurse finally eligible to stop working, most Americans are deeply worried that they will not have enough money to live on when they stop working.
"They're right to be worried. We are facing a retirement crisis, which is one of the most under-reported crises out there. Consider this: The retirement income deficit - meaning, the difference between what people have saved for retirement and what they should have at this point - is a staggering
"Everyone wants to enjoy their golden years with dignity and financial independence, but that is becoming less and less likely for the average person. People who run out of money when they get old can't keep up their standard of living. They become a burden to their families - if they're lucky enough to have family to turn to - and they have to rely entirely on the modest benefit provided by
"One of the primary causes of the retirement crisis is that only half the workforce has access to a retirement plan at the workplace. When I started in
"Unfortunately, instead of trying to improve the pension system and lift everyone up, there are too many people out there trying to score political points by scapegoating public servants for state and local budget shortfalls. Pensions aren't the cause of states' fiscal problems, and retired public servants aren't living high-on-the-hog on the taxpayers' dime. Those are malicious myths being spread by people who have two objectives: to discredit public-sector unions and to dismantle the pension system.
"Pensions are one of the best ways to ensure that middle class folks can have a secure retirement, because they provide a guaranteed source of income that people can count on for as long as they live. Can current pension systems be improved? Certainly. But there's no reason to abandon a system that has worked for millions of people.
"The sad truth is that, these days, the vast majority of employees with any retirement plan at all just have a 401(k). Those plans can be a good way to help people put a little money aside to supplement their pension, but 401(k)s were never intended to replace pensions. Savings rates are too low, and there's no simple way for people to convert their savings into a stream of retirement income they can't outlive.
"The promise people made about 401(k)s was that more businesses would start them and more people would participate. But decades after the start of 401(k)s, the number of workers participating in retirement plans has stayed flat. According to
"We have definitely seen some modest increases in overall savings in the past few years. That should be good news. But when you dig into the data, when you look at who is really saving more, it becomes clear just how unequal the system really is. Most of the money is being saved by higher income Americans, while working class and low-wage workers are struggling to even earn regular full-time hours at work. A household in the 90th percentile of the retirement savings distribution has nearly 100 times more retirement savings than the median household, which has a negligible amount.
"And there is an unacceptable amount of racial and gender inequality in the current system.
"Addressing the issue of retirement security would also be particularly beneficial to women. We all know about the income gap between men and women, but what a lot of people don't realize is that the gap is especially pronounced after retirement. In 2011, the median annual income of older women was
"Additionally, women are concentrated in jobs that don't traditionally offer retirement plans. This means that despite having higher rates of savings, women still lag behind men when it comes to total retirement savings.
"We can do better. We must do better. That's why I recently introduced the
"My legislation tackles the retirement crisis head-on by ensuring that the 75 million people without a workplace retirement plan would have the opportunity to earn a safe and secure pension benefit. The plans would be called Universal, Secure, and Adaptable Retirement Funds -
"The concept is simple. Employers who don't offer a pension or a well-designed 401(k) would just automatically enroll their employees in a
"Over time, as people contribute, they will earn a real retirement benefit that will be a better bang for the buck than what they could have gotten on their own. That is because
"I want to emphasize two more key points about my bill. First,
"Finally, I would be remiss if I didn't remind everyone that we can't truly address the retirement crisis by reforming the private retirement system. We also need to improve the most efficient, most effective retirement program we have -
"By improving the private retirement system and bolstering
"During this time of economic insecurity, it's more important than ever that working people have the opportunity to prepare for retirement. I urge my colleagues to help rebuild the pension system in this country by supporting the
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