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Despite the time of year or political season, the topic of Social Security is always at the forefront of discussion, specifically among seniors tracking the status of the program and of their benefits.
In 2021, interest from investments will stop covering the cost of the program, which provides benefits for 55 million people. The fund is projected to run out of money by 2033 – three years earlier than predicted last year, according to the federal Social Security Administration’s 2012 report. Various options have been bandied about in Washington to keep the program afloat longer, including cutting benefits and removing income tax caps to funnel more money into the system.
The Senior Citizens League, an Alexandria, Va.-based, nonprofit advocacy group for seniors on issues including Social Security, Medicare and veteran and military retiree benefits, seized on the Social Security debate in a September mailer to members. A reader sent PolitiFact the mailer and asked us to examine the claims made by the organization.
TSCL’s latest mailer warned about international Social Security agreements, called totalization agreements, that coordinate the U.S. Social Security program with comparable programs of other countries. The totalization agreements prevent workers in one country from paying dual national retirement system taxes when working in another country, and the pacts also help fill gaps in benefit protection for workers who have divided their careers between the United States and another country.
The U.S. has these types of agreements with about two dozen countries. A pending agreement with Mexico was signed in 2004 but has not yet been adopted[this is repeated later]. TSCL says it retained a law firm to study the U.S./Mexico agreement and, "They believe if the Agreement goes into effect, the millions of Mexican citizens who will become eligible for Social Security benefits may have a far stronger claim to benefits and protection against cuts than U.S. citizens!" as reported in the mailer.
TSCL has 1.3 million members/supporters, according to its website. The organization has been criticized in the past for its "scare tactics" aimed at seniors and about issues involving Social Security and health care, and for seeking donations from its members in misleading solicitations.
We asked Shannon Benton, TSCL’s executive director, about the Social Security letter and the research done on the totalization issue. Benton says the group has worked on the issue for years, including sending out various mailers about the Mexican agreement in the past.
TSCL hired Virginia law firm William J. Olson, P.C. to do the work over the years. The firm handles constitutional law and has done work on behalf of other organizations including Gun Owners of America and the Conservative Legal Defense and Education Fund. It has filed eight Freedom of Information Act requests between the Social Security Administration and the State Department and filed a lawsuit to obtain a copy of the agreement in December 2006, attorney Bill Olson told us in an email.
One of TSCL’s main concerns with the Mexican agreement has been whether millions of immigrants who have worked in this country illegally would become eligible for U.S. Social Security benefits, along with their dependents, and hurt the program’s trust funds, Olson wrote.
Previous PolitiFact checks found that there were no plans in Congress to allow illegal immigrants to collect Social Security benefits, even though many pay in the system. They could receive benefits only when and if they became legal.
But would Mexican citizens working in the country legally have greater protection from future cuts than U.S. citizens?
To break down the issue, we started at the beginning. The totalization agreement with Mexico has not yet been adopted by both countries, and there are no ongoing negotiations, according to a spokeswoman for the Social Security Administration.
We asked the administration for the number of workers who would be covered by the agreement with Mexico, but received no response. Barbara Neuby, a political science professor at Kennesaw State University who has been researching world pension changes, estimated the possible number of Mexicans covered under this agreement at around 1 million.
Those are "people who have paid into this [Social Security] system, those who are here [in the United States] legally," Neuby said.
Social Security benefits are not a contractual right and can be changed by Congress, a 1960 U.S. Supreme Court ruling, Fleming v. Nestor, established. But the TSCL claim that the totalization agreement would give Mexican citizens stronger claims to benefits and protections against cuts doesn’t hold up, according to experts on the issue.
The agreement is based on U.S. law, and that covers every beneficiary, Neuby said. For citizens of Mexico to be treated differently than U.S. citizens, Congress would have to create an exclusion for them, she said, a move that would be "political suicide."
"If Congress cut the U.S. benefits and not the Mexican citizens’ benefits, the people in Congress would be chased and would probably be shot," Neuby said, adding that such a move would be "political suicide" for Congress members.
Added Gary Burtless, a senior fellow of economic studies at the Brookings Institution: It’s hard to see how the description of totalization agreements "can be squared with the idea that foreign citizens who receive Social Security would be exempt from a legislated cut in Social Security benefits that applies to U.S. citizens."
While it is true that Congress can cut Social Security benefits, the claim that the pending totalization agreement would better protect Mexican citizens from benefits cuts is not accurate. The pending agreement has not been approved by the United States or Mexico, but to exclude some citizens from any cuts would require an exemption by Congress that is highly unlikely.
We rate the claim False.
Email and phone interview, Shannon Benton, executive director, The Senior Citizens League, Oct. 3, 9, 2012
Totalization articles, The Senior Citizens League website, various dates
Email interview, U.S. Social Security Administration, Dorothy Clark, spokeswoman, Oct. 3-4, 9, 2012
Fact sheet, United States/Mexico Totalization Agreement, Social Security Administration, June 2004
Phone interview, Barbara Neuby, professor of political science, Kennesaw State University, Oct. 4, 2012
Email interview, Kevin Doyle, associate state director of communications, AARP, Oct. 5, 2012
Email interview, BIll Olson, attorney, William J. Olson, P.C., Attorneys at Law, Oct. 9, 2012
Email interview, Gary Burtless, senior fellow, Economic Studies, Brookings Institution, Oct. 9, 2012
Huffingtonpost.com, "Senior Citizens League mailer the holy grail of elderly scare tactics," March 18, 2010, May 25, 2011
Sunshine-for-seniors.blogspot.com, "Attempts to extract money from the elderly," July 2, 2012
PolitiFact Rhode Island, "U.S. Sen. Sheldon Whitehouse says proposal would keep Social Security solvent through 2033, alive for 75 additional years," Aug. 26, 2012
PolitiFact Wisconsin, "Ron Johnson Says U.S. Sen. Russ Feingold voted to give Social Security benefits to illegal immigrants," Nov. 1, 2010
PolitiFact, "Sharron Angle says Harry Reid wants to give illegals Social Security benefits," Sept. 17, 2010
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