It’s baaaack… Senator Joni Ernst, along with Mike Lee of Utah, are rebooting her idea to raid Social Security to pay for parental leave.
At first glance, this might seem like a good idea, but experts agree that it is a very bad one. Even though it would not require new taxes, parents who use it would have their Social Security benefits delayed when they retire to offset the costs. It would undermine Social Security and force seniors to work longer. In fact, diverting Social Security to cover nonretirement needs could significantly erode retirement security.
Even Ernst and Lee acknowledge that every week of paid family leave would require two weeks’ delay in taking Social Security benefits at retirement. In other words taking the full 12 weeks would mean a deferral of nearly six months in retirement benefits.
According to the Urban Institute, delaying Social Security translates into a real financial loss; its report reckoned that parents who took a single 12-week leave would lose about 3% of their future retirement benefits, and those who took four leaves would lose 10%.
There is a plan out there, the Family and Medical Leave Act, that would help not only new parents, but workers facing serious medical conditions of their own who need to care for a family member.
The FAMILY Act is an affordable and responsible way for small businesses to support and retain employees. It would be is funded by small employee and employer payroll contributions of two tenths of 1 percent each (two cents per $10 in wages), or less than $1.50 per week for a typical employer and employee. Less than a cup of coffee per week.
It’s hard to believe that Ernst is serious about providing paid parental leave when she voted for tax cuts that benefit the wealthiest and now is coming up with a plan for families to raid their own future retirement resources.