Massive cuts are being proposed which will impact the way in which Social Security and Medicaid are allocated in the United States. The Obama administration has floated a plan known as chained Consumer Price Index (CPI) along with a goal of trimming healthcare funding for the poor and elderly by $400 billion.

These efforts are purportedly connected with the need to trim the federal budget deficit. A “sequester” was imposed earlier this year which is already resulting in furloughs for government workers, lay-offs in the healthcare industry and the elimination of programs which have benefitted low-income people for decades.

The chained CPI will lead to severe reductions of the limited increases in payments based upon the rise in inflation and the cost of living. These reforms, if instituted, would also be applied to benefits received by retired government employees, veterans and recipients of Supplemental Security Income (SSI).

In a recent study released by the Center for Global Policy Solutions (CGPS), the research institute placed the Obama administration proposals within a broader sociological context where the historic national oppression of African Americans has rendered this community to lower-wages and accumulated household wealth. Compounding this centuries-old reality, the economic crisis of the last five years has also disproportionately driven down the living standards of African Americans and other peoples of color.

After retirement African Americans face even lower incomes through pensions and social security payments which are based on earnings during the last few years of their employment. Any cuts to the incremental increases in monthly payments for retirees can only result in deeper economic challenges and poverty.

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With specific reference to Medicaid, the Joint Center for Economic and Political Studies (JCEPS) wrote over a year ago that reductions in funding for this program would cause tremendous suffering among the African American and Latino populations. The same research institute argues that these cuts would in fact increase costs for healthcare companies since people would still need care whether it is funded by the government or not.

The report, Medicaid: A Lifeline for Blacks and Latinos with Serious Health Care Needs, published by Families USA, “reveals that making cuts to Medicaid fails to reduce costs, instead it shifts the burden to states, families, hospitals and the uninsured. In fact, in some cases, the report notes, cutting assistance for treatment can actually increase costs over the long run.”

JCEPS continues pointing out that “As policymakers consider sharp cutbacks in the Medicaid program, this report brings an important potential consequence of their actions to the table – that cutting Medicaid will likely hit hardest at communities of color and, in particular, those who depend on the program to manage and treat their chronic illnesses,” said Ralph B. Everett, president and CEO of the Joint Center for Political and Economic Studies. (October 2011)

Read more at Global Research.

Among U.S. workers, nearly 90 percent of Americans employed in K-12 and higher education actively save for their retirement compared to 59 percent of all American workers. In Retirement Confidence in the Education Sector: Comparisons by Race, a collaboration between the Joint Center for Political and Economic Studies and the TIAA-CREF Institute, the report presents both similarities and disparities in how Black and White education workers fare with planning and managing their retirement savings.

Among education sector employees, 87 percent of African-Americans and 88 percent of Whites save for their retirement. In addition, the report discloses that nearly 80 percent of the respective groups are confident they are investing their savings properly and close to 70 percent of the groups are confident they will have enough money to live comfortably during retirement. A majority in each group say that they are confident they will not outlive their savings and approximately half have calculated how much they actually need to save to achieve this goal, according to the report.

“Building on their established base of solid savings behavior, however, the education workforce is more likely than the U.S. workforce overall to achieve the goal of a financially comfortable retirement,” the report states.

“I think overall [the report is] meaningful because it shows that in one sector, African-Americans and Whites are equally likely to be savers, or to say that they currently save, and that’s not true in all employment sectors,” said Dr. Wilhelmina Leigh, the report’s author and a Joint Center senior research associate.

“I think that’s worth noting,” she added, noting that the study grew out of discussions Leigh had with TIAA-CREF officials after she became a TIAA-CREF Institute fellow in early 2012. The Washington-based Joint Center conducts research and policy analysis on topics of concern to African-Americans and other racial minorities.

“There is something at work within the education sector environment that may not be at work in other sectors that may have fostered this particular outcome” of high rates of retirement savings confidence, she says.

Read the entire article at Diverse: Issues in Higher Education.

A report released today by the TIAA-CREF Institute and the Joint Center for Political and Economic Studies reveals that both African-American and white employees in the education sector feel confident about retirement, but that more planning may be needed.

The report, “Retirement Confidence in the Education Sector: Comparisons by Race,” analyzed data for more than 2,000 employees in the education sector --administrators, staff and teachers or faculty at both the K-12 level and the post-secondary level -- on their attitudes, behaviors and preferences toward retirement. The study also analyzed how these attributes vary by race.   

According to the report, a significant majority of both African-American and white education-sector employees voice high levels of confidence regarding retirement planning:

• Approximately 90 percent of each group is currently saving for retirement.
• Nearly 80 percent of each group is confident they are investing their savings appropriately.
• About 70 percent of each group is confident they will have enough money to live comfortably during retirement.

Moreover, a majority of each group feels confident they will not outlive their savings. That said, approximately half have determined how much they actually need to save to achieve this goal.

“It is encouraging to see that retirement confidence levels are fairly high among education-sector employees,” said Stephanie Bell-Rose, senior managing director and head of the TIAA-CREF Institute. “However, it is critical that this confidence is translated into retirement readiness, which can best be achieved by investing in financial education and awareness programs, as well as increasing access to financial advice.”

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"The study confirms that the key challenges in retirement planning among education employees are essentially the same across African-American and white populations,” said Ralph B. Everett, president and CEO of the Joint Center for Political and Economic Studies. "Too many are uncertain of how much money they need to save for a comfortable retirement, and too many feel that they are not saving enough. These are challenges we must address so that more workers can achieve a financially secure retirement."

Read the entire press release by clicking the icon below.

During the economic doldrums that have followed The Great Recession, employees in the education sector (administrators, staff, and teachers or faculty at both the K-12 level and the post-secondary level) are confident about both their retirement savings behavior and their likely retirement outcomes. African American and white American employees in the education sector are more optimistic about their retirement planning and prospects than are U.S. workers overall. Further examination of the high degree of retirement confidence among employees in the education sector, however, yields conflicting insights. This report, produced jointly by TIAA-CREF and the Joint Center for Political and Economic Studies, examines the retirement goals, fears, and confidence of African American and white workers in the education sector.

Dr. Wilhelmina Leigh joins the United States Government Office of Personnel Management for a discussion on retirement savings and economic empowerment for people of color.

Dr. Wilhelmina Leigh spoke on the whys and hows of Social Security modernization at the National Academy of Social Insurance's 25th Annual Policy Research Conference on January 31, 2013.

More presentations, videos, and other conference materials can be found on the NASI website.

Dr. Wilhelmina Leigh discusses retirement preparations for people aged 45 to 65 on Beyond 50 Transformation: Innovation for the Aging Process.

This interview and more Beyond 50 archives can be found at AM 950.

In its deliberations to develop a plan to reduce the federal deficit by more than a trillion dollars over the next decade, the Joint Select Committee on Deficit Reduction considered a proposal to calculate cost-of-living adjustments (COLAs) in all government programs using the Chained Consumer Price Index-Urban (C-CPI-U), rather than the Consumer Price Index (CPI-U).

Implementing this proposal would dramatically reduce Social Security benefits for recipients. Although reducing federal program benefits by changing the COLA computation is indeed one way to reduce the deficit, reducing benefits is not the only way to eliminate the 75-year projected shortfall (of 2.2 percent of taxable payroll) for the Social Security system.

The shortfall can be closed by holding benefit levels harmless and, instead, increasing revenue directed to the system. A recent report of the Commission to Modernize Social Security Plan for A New Future: The Impact of Social Security Reform on People of Color offers recommendations for doing just that.

Read more at GlobalPolicy.tv and the Joint Center Blog.

Social researchers and financial experts agree that women investing for retirement--especially those from African-American, Latino and other ethnic communities--are facing tough choices in the wake of the last decade’s financial downturns.

Today’s tough economy leaves female retirees—regardless of whether they’ve had financial guidance—to grapple with decisions about how to invest their hard earned savings. Although retirement research and best-practice recommendations may be sparse, one thing many working women have going for them is their resilience.

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Experts say that data is limited on how women invest for their post-retirement years, partly because of individuals’ reluctance to share information about their finances, said Wilhelmina Leigh, a senior research associate in economic security for the Joint Center for Political and Economic Studies, in Washington, D.C.

Read more at New America Media.

African Americans are more likely than whites to expect that Social Security will be their major source of income during retirement. Th is was true in both 1998 (35 percent of African Americans versus 17 percent of whites) and 2009 (37 percent of African Americans versus 27 percent of whites). African Americans also are more likely than whites to support the Social Security system as currently structured and to believe that the system should continue to provide the same type and level of benefits. A range of views, however, is held by African Americans and whites on selected proposals for reforming the Social Security system to ensure its solvency.

These findings are from a survey of 850 African Americans and 850 members of the general U.S. population (including 721 white Americans) that was conducted for the Joint Center for Political and Economic Studies by Research America between May 21 and June 9, 2009. The Joint Center for Political and Economic Studies National Opinion Poll about Social Security, Retirement Savings and the Economic Downturn found many striking differences between African Americans and whites on these topics.

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