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Newt Gingrich on Social Security
Former Republican Representative (GA-6) and Speaker of the House
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Modernize via personal social security savings accounts
Modernizing Social Security through personal social security savings accounts would raise take-home pay and free workers to put billions of dollars in savings and investment; that would be a huge benefit to our economy. The accounts indeed represent a
new, very large tax-free shelter for saving and investment. It adds up to a dramatic increase in savings and investment-and an economic boom.The Ryan-Sununu bill provides for a personal social security savings account option for Social Security and
solves the long-term problems of the program. Under this bill, workers & employers would still contribute a total of 6.4% [of income]. But this is money that belongs to the workers in their own individual accounts, so it is not a tax that goes to the
government. The Ryan-Sununu plan would be effectively the largest tax cut in world history.
Personal social security savings accounts will in fact fulfill the promise that the Social Security system cannot deliver: a guaranteed retirement account.
Source: Gingrich Communications website, www.newt.org
Dec 1, 2006
Retirement policies & tax policies ARE health policies
21st century healthcare would break down barriers of isolation & encourage people to stay active. In a very real sense national retirement & tax policies ARE health policies When these policies make it harder to stay active and easier to become indolent,
we are fostering illness, decline, and actually increasing our health expenses. Good health is about a lot more than health policy. 69% of workers aged 45 to 74 reported that they plan to work in some capacity in their retirement years, even if they
won the lottery. For those aged 33 to 52, the younger boomers, 75% said they would work into their retirement years.
The baby boomer’s desire to stay active is good news for the economy. We must recognize that rethinking government rules for retirement
and reforming Medicare to encourage economic activity are key steps toward a better future. The policies that may have made sense in earlier eras when people died younger are simply not applicable in an era when more people are healthier longer.
Source: Saving Lives and Saving Money, by Newt Gingrich, p.193-194
Sep 22, 2003
Show true cost of FICA--double what is shown on paychecks
The social security system was originally based on the principle of a low rate of return per dollar invested because there were so many workers and so few retirees that the system could transfer wealth from the worker to the retiree without anyone
noticing or complaining. It was fine for 1935, when it was devised, but now, we are entering a very different era. The generation known as the baby boomers is so big that if we retain the 1935 system, the boomers will bankrupt the retirement system their
children and grandchildren will turn to in about 30 years. One of the steps we need to take is to amend the law so that an individual’s paycheck reflects the amount of money that is actually being paid into the FICA system.
People will realize that they are paying twice the tax they believed they were paying. For over half the American population the total FICA tax they are paying is bigger than their income tax.
Source: Lessons Learned the Hard Way, by Newt Gingrich, p.209-210
Jul 2, 1998
Convert to IRA-based system
We are now able to develop a personal, modern, social security system. Information technology makes it possible to handle each person’s retirement account separately. For another, the growing understanding that the system we have is in crisis makes
people more willing to discuss new proposals than they used to be. Not that many years ago, few people who understood the true, underlying predicament of the social security system dared to be candid about it in public. Our ability to keep track of
individual accounts combined with the power of compound interest creates the possibility for new workers to have four or five times as much money for their retirement as they would have if we kept the present system. One estimate is that for a 20-year
old today, a system of individual retirement accounts would provide $975,000 in retirement as compared with the current system’s $175,000. Why would anyone want to cheat a young person out of the possibility of one day having an additional $800,000?
Source: Lessons Learned the Hard Way, by Newt Gingrich, p.210
Jul 2, 1998
Reduce taxes on Social Security earnings.
Gingrich wrote the Contract with America:
[As part of the Contract with America, within 100 days we pledge to bring to the House Floor the following bill]:
The Senior Citizens Fairness Act:
Raise the Social Security earnings limit, which currently forces seniors out of the workforce; repeal the 1993 tax hikes on Social Security; and provide tax incentives for private long-term care insurance to let older Americans keep more of what they have earned over the years.
Source: Contract with America 93-CWA9 on Sep 27, 1994
Page last updated: Feb 08, 2010