Rubio-Trump’s Parental Leave Policy Will Only Exacerbate Retirement Crisis
Florida Senator Marco Rubio and Ivanka Trump may have a new parental leave policy idea that they would like you to consider, reportedly based on this Independent Women’s Forum proposal : New parent is given 12 weeks of leave earning 45 percent of their vacation. normal wages (social security disability equivalent). Under this deal, the parent waives six weeks of Social Security benefits if they are eligible.
Let us remind you that during the elections, the president’s eldest daughter positioned herself as a champion of the Working Mom. Ivanka is said to take parental leave very seriously , shying away from questions about her father’s attitude toward women and questions about her company’s vacation program . In fact, she had a hand in drafting her father’s first parental leave policy , which proposed extending six weeks of paid leave for newborns and foster mothers.
This was true: leave policy must necessarily include men, not only because some couples include only men, but also because the father’s taking parental leave was associated with better outcomes for the child, mother, father-child relationship, and companies. mom and dad work for. (This plan is no longer available on the Internet, but I wrote about some of its shortcomings at the time .)
This proposal is theoretically open to men and women, but it highlights another problem that gets worse every day: It will worsen America’s retirement crisis.
America’s retirement crisis
You have no doubt come across an article or 10 that laments the plight of the American worker and his or her bank account. We don’t have enough money to cover the cost of a minor emergency. We’re inundated with medical bills, student loan payments, and credit card debt. Companies no longer pay pensions to their employees, and as the gig economy and contract jobs make up more of our employees, our retirement accounts are shrinking (if we open them at all).
Many people – about 40 percent of workers have zero savings for retirement – will rely entirely or almost entirely on social security in old age. This plan would punish these workers doubly.
Under the Independent Women’s Forum plan, if you have a child, you carry (full) Social Security benefits from 67 to 67 years and six weeks, and so on if you decide to have more children. It also fails to take into account that Social Security is not only used to pay retirement benefits: it also pays disability and survivor benefits. Will they audition? (Virginia’s Tom Garrett suggested a similar measure , except that you can pay off your Social Security student loan debt if you agree to raise your retirement age.)
Social Security is not some bribery fund open to the politicians’ pet projects. We pay for this in the hope that in old age we will receive a monthly stipend. And the Social Security Trust Fund is already a problem with failure – a problem, which Republican lawmakers, such as Speaker of the House of Representatives Paul Ryan, too eager to raise when this would mean a reduction of benefits in the future – this needs to be addressed, but not multiply.
It’s also frustrating when you consider that the plan’s author, Christine Shapiro, estimates the benefits to be around $ 7 billion a year. The GOP just gave corporations a $ 1.5 trillion tax cut over the next decade. Wasn’t there room in the equation to add paid vacation?
Don’t forget, too, that the Trump administration has suspended financial regulation to have your financial planner act in your best interest when advising you on retirement investments. Instead, we could lose $ 10.9 billion in savings over 30 years as advisors fill their pockets with our potential 401 (k) contributions. And Trump signed House Resolution 67 that dismantled Obama’s Labor Department rule that encouraged cities to develop automatic IRA programs for private sector workers. Collectively, this does not mean a healthy pension, if it is equal to one at all.
Best Policy
The case for the proposal goes like this: well, parents aren’t getting anything right now other than 12 weeks of unpaid leave, so that’s better.
It may be in the short term, but an even better option is New York Senator Kirsten Gillibrand, who will provide 12-week leave for new mums and dads with up to 66 percent of their salaries, as well as caregivers. a loved one with a serious medical condition. It will be paid through a payroll tax of 0.4%. And, according to Politico , Ivanka Trump also “discussed raising payroll taxes or other social security payments to create a new, personal paid vacation fund” in private conversations. She must keep them.
You might argue that the Gillibrand plan punishes childless people who have no children, except for the fact that the children will work to pay for social security and free medical care for everyone else in the future. On the other hand, the Rubio-Trump idea would punish people who have children by forcing them to retire later. The party so obsessed with family paddles really needs to rethink if that’s what it wants to send.
What Rubio and Ivanka Trump are trying to achieve is a remarkable goal of paid maternity leave is long overdue in the US and while the two position themselves at the forefront of the debate, it is Nebraska Senator Deb Fischer, according to Politico , who helped usher in one of the more interesting politicians of the leave. Child Care in Recent Years: A recent GOP tax bill includes a tax credit for businesses that offer paid family leave and sick leave to their employees. This is a good first step, but a federal mandate would be even better for all working families.
“Social security is based on the assumption that it is more important for workers to have money when they are older than when they are younger, ” says the IWF newsletter . “But many young parents understandably may decide that having 12 weeks of paid parental leave to care for their new child is worth a short grace period in their retirement benefit.” For obvious reasons, they may also need both paid leave and full retirement benefits, just like in any other industrialized country. It doesn’t have to be an either-or situation.