SECURITY AND AFRICAN AMERICANS
Segment Of American Life Shortchanging Us
over the Old Age Survivors and Disability Insurance Program (OASDI)
is just another example of the way blacks keep getting the short
end of the stick. Let’s be honest about it, there’s much talk,
but the rhetoric reveals that in the end, we’ll still be stuck
at the short end.
in America, until death parts us, life is most unfair among
African Americans. African Americans receive less from the
OASDI system, popularly known as Social Security, because we die
sooner and receive less income in life.
Put in place
by New Deal President Franklin Roosevelt 70 years ago, Social
Security programs deliver cash benefits to 50 million
beneficiaries every month. Most Americans associate Social
Security only with the old age retirement benefit. Yet it does
more, 70 percent of funds go to retirees, 15 percent to disabled
workers, and 15 percent to survivors.
controversy over Social Security is because it is a "pay as you
go" system. The taxes paid by today’s workers are not set aside
to pay their own benefits down the road, but rather go to pay
the benefits of current recipients. It’s financed using the
Federal Insurance Contribution Act (FICA) payroll tax, paid by
all working Americans on their earnings up to $90,000 a year.
Social Security is colorblind, but fundamentally the system,
like most systems in America, is unfair to blacks. Demographic
disparities show African-Americans and white people have
different relationships to the program. Racial disparities in
income, unemployment and life expectancy cause blacks to be more
dependent on the federal retirement system than white people.
African Americans on average earn less, and suffer from
unemployment more, than other groups; especially in younger
years when black employment gaps compared to whites are at their
highest. In 2002, median earnings of working-age blacks in jobs
covered by Social Security were $22,100, compared to $28,400 for
all working-age people.
Social Security retiree benefit is $955 per month. The average
monthly benefit for African American men is $850 and is their
predominant source of retirement income. Social Security
provides income to 82.3 percent of African Americans 65 and
older; however, the poverty rate among African Americans age 65
and older is more than twice that of all older people.
to grave, the net worth of blacks is less than 10 percent of
that of whites; as they get old, blacks have to rely on Social
Security for income. It’s 44 percent of their total income and
the only source of income for one in three
African Americans 65 and older. In contrast,
wealth-building instruments such as interest and dividends
provide a source for 50 percent of the income of Americans 65
and older, but less than 25 percent of older African Americans’
income. Because African-American men die earlier on average
than their white counterparts (69 vs. 75 years old), they
receive less retirement benefits offered through Social
Security. A 2001 study found that African-Americans receive
$21,000 less from Social Security over their lifetimes than
white people with similar incomes and marital status.
moment, blacks are in the spotlight over Social Security because
we die younger, get disabled at earlier ages and have the
heaviest reliance on it. The argument blacks collect less than
their share of Social Security is based on the assumption Blacks
will continue to live less long than whites. Social Security is
not the reason African-American men have shorter life spans;
it’s the health-care, educational, nutritional and income
disparity. Any involvement African Americans have toward
solving Social Security's, and our children’s, future financial
problems should take into account social justice in America.
Racial inequalities continue to plague us in American society
and if corrections are not made to problems such as un-and-under
employment, the education system, criminal justice, and election
reform and accountability, blacks will continue to collect
Social Security’s $225 lump sum death benefit more often, and in
greater numbers, than most Americans.