ADVISORY
FROM THE COMMITTEE ON WAYS AND MEANS

Subcommittee on Social Security

Shaw Announces Field Hearing to
Listen to Americans' Views on the Future of Social Security

Congressman E. Clay Shaw, Jr., (R-FL), Chairman, Subcommittee on Social Security of the Committee on Ways and Means, today announced that the Subcommittee will hold a field hearing to listen to Americans' views on the future of Social Security. The hearing will take place on Monday, June 18, 2001, at the Reynolds Alumni Center at the University of Missouri in Columbia, Missouri, beginning at 1:00 p.m.

The format of the hearing is intended to evoke the highest audience participation. Through the use of a facilitator and independent expert, members of the public attending will be given the opportunity to ask questions, provide comments, and share their views on how Social Security should be reformed.

BACKGROUND:

Social Security programs have provided income security to America's families for almost two-thirds of a century and has been enormously successful in reducing poverty among the nation's elderly. However, Social Security is important to people of all ages, not just retirees. Eighty percent of workers ages 21-64 and their families have protection in the event of a long-term disability. Ninety-eight percent of young children and their mothers and fathers are insured for Social Security survivor benefits if a worker in the family dies.

The benefits Social Security provides to all generations depend upon the hard-earned payroll taxes paid by workers of all ages. Social Security operates primarily on a pay-as-you-go basis. Income from payroll taxes and taxes on benefits are used to pay the benefits of today's retirees and other beneficiaries. Since the early 1980's, Social Security has collected more taxes than immediately needed to pay benefits. The surplus revenue is credited to the Social Security Trust Funds in the form of interest-bearing Treasury securities and will eventually be used to pay future benefits.

Social Security faces increasing hurdles in paying promised benefits in the coming years due to the nation's changing demographics. By 2030, there will be twice as many older Americans as there are today - growing from 35 million to 70 million. In addition, people are living longer and having fewer children. As a result, the ratio of workers to beneficiaries has declined from 42 workers per beneficiary when the program began to 3.4 workers per beneficiary today and is expected to decline to less than 2 workers per beneficiary by 2075.

Social Security's trustees estimate cash revenues will fall short of expenditures beginning in 2016. At that point, the Trust Fund balances can be cashed in to make up the difference. To cash them in, the government will have to raise taxes, borrow from the public (i.e., increase the debt), cut other budget priorities, or use any available budget surplus. Beginning in 2038, the Trust Funds will be depleted, and Social Security tax revenues will only cover 73 percent of program costs.

The President has established a commission that will make recommendations for restoring fiscal soundness to the Social Security system, to include the creation of voluntary individual accounts. Congress has also considered numerous Social Security reform plans over the years. However, many Americans may not be aware of the range of options for strengthening Social Security or of the effect that individual accounts or other programmatic changes would have on different groups of people.

In announcing the hearing, Chairman Shaw stated: "Americans need to understand the various reform options, along with their implications, and have an opportunity to express their views on how best to strengthen Social Security. I'm pleased the University of Missouri - Columbia, is hosting this hearing -- we must hear from our young citizens in this debate as it is their lives which will be most impacted by changes to the system. Social Security's future is their future. Moreover, they will bear the burden should we fail to act."

FOCUS OF THE HEARING:

The hearing will focus on frequently discussed options for modernizing Social Security (including changes in benefits, taxes, and personal accounts), and seek participants' views on how to improve the program's financing in the long term.

WRITTEN STATEMENTS IN LIEU OF PERSONAL APPEARANCE:

Any person or organization wishing to submit a written statement for the printed record of the hearing should submit six (6) single-spaced copies of their statement, along with an IBM compatible 3.5-inch diskette in WordPerfect or MS Word format only, with their name, address, and hearing date noted on a label, by the close of business, Monday, July 2, 2001, to Allison Giles, Chief of Staff, Committee on Ways and Means, U.S. House of Representatives, 1102 Longworth House Office Building, Washington, D.C. 20515. If those filing written statements wish to have their statements distributed to the press and interested public at the hearing, they may deliver 200 additional copies for this purpose to the Subcommittee on Social Security, c/o Office of Congressman Kenny C. Hulshof, 33 E Broadway, Suite 280, Columbia, MO 65203, by close of business on Friday, June 15, 2001.

FORMATTING REQUIREMENTS:

Each statement presented for printing to the Committee by a witness, any written statement or exhibit submitted for the printed record or any written comments in response to a request for written comments must conform to the guidelines listed below. Any statement or exhibit not in compliance with these guidelines will not be printed, but will be maintained in the Committee files for review and use by the Committee.

1. All statements and any accompanying exhibits for printing must be submitted on an IBM compatible 3.5-inch diskette in WordPerfect or MS Word format, typed in single space and may not exceed a total of 10 pages including attachments. Witnesses are advised that the Committee will rely on electronic submissions for printing the official hearing record.

2. Copies of whole documents submitted as exhibit material will not be accepted for printing. Instead, exhibit material should be referenced and quoted or paraphrased. All exhibit material not meeting these specifications will be maintained in the Committee files for review and use by the Committee.

3. A witness appearing at a public hearing, or submitting a statement for the record of a public hearing, or submitting written comments in response to a published request for comments by the Committee, must include on his statement or submission a list of all clients, persons, or organizations on whose behalf the witness appears.

4. A supplemental sheet must accompany each statement listing the name, company, address, telephone and fax numbers where the witness or the designated representative may be reached. This supplemental sheet will not be included in the printed record.

The above restrictions and limitations apply only to material being submitted for printing. Statements and exhibits or supplementary material submitted solely for distribution to the Members, the press, and the public during the course of a public hearing may be submitted in other forms.

Note: All Committee advisories and news releases are available on the World Wide Web at "http://waysandmeans.house.gov".

The Committee seeks to make its facilities accessible to persons with disabilities. If you are in need of special accommodations, please call 202-225-1721 or 202-226-3411 TTD/TTY in advance of the event (four business days notice is requested). Questions with regard to special accommodation needs in general (including availability of Committee materials in alternative formats) may be directed to the Committee as noted above.