Money & Company

Tracking the market and economic trends
that shape your finances.

« Previous Post | Money & Company Home | Next Post »

Michael Hiltzik: The hidden trap door in Social Security

November 2, 2010 |  6:02 pm

One of the great, and little-appreciated virtues of Social Security is its simplicity. Most enrollees can track their future benefits -- statements are mailed to them every year. Payments seldom go astray, and disputes are not common, other than perhaps over disability claims.

The exceptions are workers subject to the two offsets affecting public employees that are the subject of my Wednesday column, the government pension offset and the windfall elimination provision, or GPO/WEP for short. California is the home of the largest group of such workers, mostly teachers, police officers and firefighters.

Public employee unions such as the California Teachers Assn. have campaigned for repeal of these provisions for years. Has the time arrived for reform, not repeal? President Obama's fiscal deficit commission pondering the future of Social Security has not yet shown itself to be well-informed on how the program works. Revising these offsets would be evidence that it's inclined to undertake responsible reform, not ignorant "reform."

The column begins below.

Maggie Ellis spent more than 20 years as a teacher, including 10 at a public school, before she learned a dirty little secret: She won't be getting all the Social Security she thought she would be entitled to in retirement.

Ellis' current job, as a fifth-grade teacher in the Elk Grove Unified School District, isn't covered by Social Security. Her previous work, as a counselor and teacher in the private sector, was covered. And she's about to get married to a self-employed man who's also covered by the program.

But her career in public service is going to cost her a chunk of the Social Security she already earned, as well as a portion, and possibly all, of the spousal retirement benefit she would otherwise be due through her husband.

Read the whole column.

-- Michael Hiltzik