STATEMENT OF THE NATIONAL RETIRED TEACHERS ASSOCIATION AND THE AMERICAN ASSOCIATION OF RETIRED PERSONS BEFORE THE SUBCOMMITTEE ON RAILROAD RETIREMENT OF THE SENATE LABOR AND PUBLIC WELFARE COMMITTEE UNITED STATES SENATE TO PROVIDE A TEMPORARY 20 PERCENT INCREASE IN RAILROAD RETIREMENT BENEFITS S. 3852 AUGUST 8, 1972 Mr. Chairman, speaking on behalf of the thousands of retired railroad employees who must rely upon railroad retirement as their sole source of income, the National Retired Teachers Association and the American Association of Retired Persons with a combined membership of over four million older Americans wholeheartedly support S. 3825 and urge that favorable action on this legislation be expedited. The most important problem facing older Americans today is the lack of economic security in retirement. As delegates to the Income Section of the 1971 White House Conference on Aging put it: "There is no substitute for income if people are to be free to exercise choices in their life style." Unfortunately, Mr. Chairman, not only does our society coerce the aging into ever earlier retirement with policies and practices of age discrimination and mandatory retirement, but it rewards them with poverty when they get there. Nothing can justify such cruel and unusual punishment for the crime of growing old. The widening hiatus between retirement and employment incomes, the prevalence of poverty and near poverty among millions of older Americans, and the absence of prospects for any substantial improvement in the income position of retirees, make the status of retirement unattractive. Retirees who have made their contributions to the present standard of living should be guaranteed an equitable share of the fruits of that standard guarantee can only be provided through government programs such as railroad retirement and Social Security. such - 2 Economic security remains the number one problem confronting older persons. While some progress has been made in recent years, the degradation and humiliation of poverty persists in the lives of millions of older Americans. While this country's economic, industrial and medical progress have combined to permit an increasing proportion of the population to reach old age, circumstances have too often reduced the older person to a dependent condition, thus depriving him of his traditional function, status and dignity. The railroad workers of this generation have grown up with the present system of railroad retirement. They have the right to expect that they will receive the benefits of the system which they have financed, and to be protected by this system from the creeping erosive effect of inflation on their economic well-being. The legislation before this Committee, S. 3852, recognizes the public commitment to railroad retirees, an obligation to meet their financial needs as payment for their many productive years of hard work. The Congress has shown leadership in raising public benefit levels during the past two years in an attempt to arrest the impact of inflation on retirement income purchasing power. Unfortunately, these past increases proved to be only a temporary holding action against the onslaught of inflation. Despite the 1970/71 increases in public benefit levels, 4.7 million persons age 65 and over about one-fourth of the total older population resided in households in which the aggregate income fell below the poverty level. 3. The recent increase in Social Security is an unpre cedented step toward providing older Americans with a moderate standard of living. For the first time, the Congress recognized the need to provide older persons with benefit increases beyond the level of meeting the prior impact of inflation on retirement income purchasing power. The substantial increase in Social Security benefits will help lift many older Americans from the poverty level. The Congress must now act to pass similar benefits along to those who rely upon other public retirement systems. The present parity between Social Security and Railroad Retirement must be maintained the Congress must act to provide a 20 percent increase in benefits for railroad retirees. Our Associations are pleased to learn that the long awaited report of the Commission on Railroad Retirement has been filed. As a contributor to the Commission, we are anxious to review the recommendations of the panel. We know that this Committee will give attentive consideration to the recommendations of the Commission and draft legislation which will most benefit railroad retirees and future retirees. One specific recommendation which we offered the Commission bears directly on the legislation before this Committee: THE NATIONAL RETIRED TEACHERS ASSOCIATION AND THE AMERICAN ASSOCIATION OF RETIRED PERSONS BELIEVE THAT EXCLUSIVE RELIANCE ON CONTRIBUTIONS SHOULD BE ABANDONED. 82-813 O 72-9 4 is already onerous. The burden of the regressive tax of railroad retirement Since each generation of workers bears the responsibility of supporting the nonproductive population and since Congress has the responsibility for assuring that the financial burden is distributed in the most equitable manner, our Associations believe that the general revenues must be utilized to finance most future railroad retirement benefit increases. In acting favorably on S. 3852, Mr. Chairman, this Committee will go a long way toward assisting many retired railroad employees improve their quality of life and to live their remaining years with dignity, independence and purpose. Thank you. (Thereupon at 5:30 p.m., the hearing was adjourned.) |