A new study touted by the Iowa Federation of Labor shows “privatizing” Social Security would have a devastating impact on Iowans. Federation president Mark Smith says letting younger workers invest a portion of their Social Security taxes would undermine the security of retirees. He says most Iowans didn’t need the study to figure it out after seeing what happened to Enron and WorldCom.Four democrats who’re running for Iowa Congressional seats as well as democrat Senator Tom Harkin have signed a pledge to oppose privatizing Social Security. Harkin says Iowans get five billion dollars in Social Security’s old age or disability benefits every year, and privatizing the system would harm the state’s economy. He says the private accounts are not voluntary, as even if you don’t participate, you lose 25-percent of your benefits.Harkin says the proposal is just another way for Wall Street to tap into the “piggy bank” Americans are saving for their retirement. He says privatizing it could send it the way of Enron or WorldCom.Democrat candidates Ann Hutchinson in the First Congressional District, Julie Thomas in the Second, Leonard Boswell in the Third and John Norris in the Fourth have signed the pledge. Paul Shomshor, the democrat running in the Fifth District, refused to sign it. The study by economists from M-I-T and the Brookings Institute found the average monthly Social Security check for a retired Iowan would be cut by three-hundred-88 dollars if the Bush plan to privatize the system is enacted.
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