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NATIONAL URBAN LEAGUE REJECTS PRESIDENT’S

SOCIAL SECURITY PRIVATIZATION PROPOSAL

Says Large Cuts in Guaranteed Benefits Would Harm

African Americans, Children and the Disabled

New York, NY, Dec. 11, 2001 — The National Urban League today rejected the privatization proposals put forward by President Bush’s Social Security Commission, taking the position that the Commission’s recommendations would result in drastic cuts to guaranteed benefits and fail to provide real solutions for making Social Security solvent.

The organization charged that those most seriously impacted would be surviving relatives and disabled workers, many of whom are African-American, and that all three of the Commission’s proposals fail to provide a viable way to improve the long-term solvency of Social Security.

"The Commission’s proposals would disproportionately harm African Americans because they reduce guaranteed benefits to pay for private accounts," said Dr. William Spriggs, director of the League’s Institute for Opportunity and Equality, the research and legislative policy arm of the organization.

"At least one trillion dollars will be needed to finance a shift to private accounts but the Commission does not say where that money will come from."

Spriggs noted that the effect would be particularly debilitating for the African-American community because twenty-two percent of children who receive survivors benefits are African American, as are 18% of the disabled.

He added that the proposals prove that voluntary accounts result in reduced benefits even for those who choose not to invest, and that disability and survivor’s benefits would be reduced drastically by changing the benefit formula.

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League Rejects President’s Social Security Privatization Proposal

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"Social Security reform must not occur at the expense of the most vulnerable in our nation," Spriggs said.

The National Urban League Institute for Opportunity & Equality issued a report, The Effects of Social Security on Child Poverty, in May of 2000. It is available on the Web at //www.nul.org/socialsecurity.html.

The President’s Commission issued a draft of its final proposals late yesterday, and met today for final approval. A copy of its recommendations will be sent to the White House some time later this week.

The National Urban League Institute for Opportunity and Equality, conducts research, policy analysis and advocacy on issues of critical importance to the African-American community and the nation. Nationwide Insurance, through a $1.5 million, three-year grant to the National Urban League, provided initial funds for the establishment and operation of the Institute.