Senator Rubio Makes Major Policy Address on Retirement Security
Yesterday Senator Marco Rubio (R-FL) made his first major policy address on his ideas to strengthen retirement security for Americans at the National Press Club. His speech yesterday is being seen as a step for the Senator to position himself to run for president in 2016. He proposed three broad reforms to the American retirement system listed below:
- "The first goal is to make it easier for people to save more and work longer." To do this, Senator Rubio proposed opening the Thrift Savings Plan (TSP) to all Americans who don't have access to an employer sponsored retirement plan. The TSP is a retirement plan open to federal employees, and as Senator Rubio said, "it is one of the most efficient savings plans in America. It charges fees which are a fraction of those in private defined-contribution plans, allowing beneficiaries to save more." He also called for eliminating the Social Security payroll tax for seniors and people who employ seniors. This would incentivize employers to hire seniors, and give seniors more money to live off of independent from the federal government. Senator Rubio also pointed out that for every percentage point the employment rate of seniors rises, the employment rate for young people rises by .21 percent.
- "Our second reform goal for guaranteeing a secure retirement for 21st century seniors is to enact reforms that save Social Security for future generations." On this point Senator Rubio called for reducing the growth of Social Security benefits for wealthy retirees. He argued that doing so will make Social Security solvent for a longer period of time.
- "Our third and final goal is also the most difficult, and that is saving Medicare." With the Medicare trust fund set to go bankrupt by 2026, Senator Rubio proposed a premium support system for Medicare which would give seniors a fixed amount of money for them to either spend on a health insurance plan within Medicare or with a private provider. If seniors choose a plan that costs less than the fixed amount they are given by the government, they get to keep the extra money. If they choose a plan that is more than the fixed amount they are given, they have to supplement the cost with their private money. Senator Rubio argued that this proposal gives seniors more freedom in picking health care plans and will spur competition in the health care market.
To read the speech in its entirety, click here