G.O.P. Courts Blacks and Hispanics on Social Security

G.O.P. Courts Blacks and Hispanics on Social Security
By
EDMUND L. ANDREWS

WASHINGTON, March 19 - As part of their campaign to overhaul Social
Security, White House officials and Republican strategists have begun a push
to persuade
African-Americans and Hispanics that Social Security, long thought to be of
benefit to them, is a bad deal.

Republican officials argue that blacks are being shortchanged under the
current Social Security system because they tend to die earlier than do
whites and
to collect retirement benefits for fewer years.

In a parallel effort aimed at Hispanics, they focus on the wealth that
people could build through the sort of individual investment accounts that
the Bush
administration has proposed.

"We are not privatizing Social Security," Hector V. Barreto, the
administrator of the Small Business Administration, said in a recent appeal
to Hispanic
leaders here. "This would be voluntary - voluntary personal retirement
accounts."

African-American and Hispanic communities are strongholds of Democratic
support, and retirees in each group rely more heavily on Social Security
benefits
than whites do.

But Republican Party officials are stepping up their efforts, enlisting
black and Hispanic business executives, evangelical church leaders and even
college
students.

Ken Mehlman, the chairman of the Republican National Committee, has in
recent weeks spoken to a forum of black voters in Maryland, black students
at Michigan
State University and the National Black Chamber of Commerce in Trenton.

"African-American men get on average two to four years of retirement
benefits, while white Americans get 10 to 12 years of benefits," said Tara
Wall, a
spokeswoman for the Republican National Committee. "The odds are stacked
against African-Americans."

Administration officials are also courting national Hispanic groups like the
National Council of La Raza, which has yet to take a clear stand on the
issue.
They also have been booking interviews on Spanish-language television and
radio for Mr. Barreto and other promoters of President Bush's plan.

The effort has infuriated many who say that Social Security is more
important for their communities than it is for whites.

"It's one of the best deals that poor and working poor can get, and blacks
unfortunately are overrepresented in those groups," said Representative
Charles
B. Rangel, Democrat of New York and a senior member of the Congressional
Black Caucus. "If one of the appeals to blacks is that they're not getting a
fair
shake because they die earlier, it would seem to me that they would at least
address the question of why they die earlier and what we can do about it."

Studies by the Treasury Department and the Government Accountability Office
indicate that Social Security provides more generous benefits to low-income
workers, blacks included, even after accounting for shorter life
expectancies.

Social Security is the only source of income for about 38 percent of black
retirees and 40 percent of Hispanic retirees, according to government data.
In
contrast, only 18 percent of white retirees receive income exclusively from
Social Security.

The system is intended to be more generous, relative to taxes paid, to
low-income workers. Retirement benefits replace about 70 percent of working
income
for a person who earns $10,000 year. But benefits replace only 28.5 percent
of earnings for a person who earns $70,000.

But critics have argued for years that Social Security is less "progressive"
than it looks because poorer people tend to die younger than do affluent
people.

The average life expectancy for black males is about 69 years, compared with
75 years for the average white male, according to the Centers for Disease
Control
and Prevention.

In theory, that greatly reduces the average lifetime retirement benefits for
black men.

But the gap is smaller for people who actually reach retirement because
black life expectancies are heavily affected by infant mortality and
violence. A
black man who turns 65 has a life expectancy of 79.6 years, only two years
less than that of a 65-year-old white man.

African-Americans also receive a disproportionate share of disability
benefits and survivor benefits, which are paid to spouses and children of
workers
who die early.

African-Americans account for about 12 percent of the population, for
example, but African-American children account for 23 percent of children
who receive
Social Security survivor benefits. Mr. Bush has indicated that he would not
make any changes to the Social Security disability program, whose benefits
are financed by a separate part of payroll taxes.

Disability benefits are calculated in part based on estimates of what a
worker's future retirement benefits would have been if he had kept working.
Protecting
the survivor benefits under Social Security could be even more difficult
because those are paid from the same pool of taxes used to pay retirement
benefits.
A Treasury Department study in 1996, which analyzed Social Security records
from 1951 through 1988, concluded that people at all income levels received
more in benefits than they had paid out in taxes, even after adjusting for
inflation.

The Treasury economists concluded that a higher mortality rate "does not
reverse the conclusion that Social Security net returns are strongly
progressive."

The accountability office, the investigative arm of the Congress, reached a
similar conclusion in 2003. It calculated that whites ultimately received
slightly
more benefits than did blacks and Hispanics at every income level. But those
differences were small compared with the higher benefits offered to people
at lower income levels.

"If you took a snapshot today and asked who benefits the most from Social
Security, it would be African-Americans," said Robert Johnson, the chairman
of
Black Entertainment Television and a supporter of Mr. Bush's approach.

Supporters of private retirement accounts say this could be a big political
opportunity for Republicans.

"The Democratic Party is so dependent on huge margins in the black community
that if even 25 or 30 percent of blacks back personal savings accounts it
would
be a big gain for Republicans," said Michael Tanner, the director of the
Project on Social Security Choice at the Cato Institute.

Many large African-American organizations, like the National Associated for
the Advancement of Colored People, remain adamantly opposed to Mr. Bush's
plan.

Hispanic groups are more divided. The League of United Latin American
Citizens has firmly opposed Mr. Bush's call for private accounts.

But the National Council of La Raza has taken a more nuanced position. Last
month, the organization said it welcomed the debate over Social Security but
"does not believe that the system needs to be dramatically restructured."

Copyright 2005
The New York Times Company |

Posted by Miriam V. 3/20/05