As any senior citizen can tell you, the cost of necessities like medical care, food, and prescription drugs rises every year. Our social security system provides an annual cost-of-living adjustment ("COLA") so that beneficiaries are able to keep up with their increasing expenses. The COLA is intended to allow social security beneficiaries to tread water, and without them these already-modest benefits lose purchasing power, as the cost of living expenses increase each year.
That's why it's distressing that, because of outdated and inaccurate methodology that does not take into account rising costs for seniors, there will be no social security COLA -- or COLA for several other programs including Veterans' benefits--next year. So instead of treading water, our seniors and our Veterans will sink as the benefits they've relied on lose purchasing power.
Social security and veterans benefits are earned over a lifetime of hard work and sacrifice. We are among the wealthiest nations in the world at a time when top CEOs are seeing annual raises averaging 3.9 percent of their already-enormous compensation. If those top CEOs -- whose pay before the raise averaged $16 million each -- deserve a 3.9 percent increase, our seniors and Veterans do as well.
As a member of Congress and the head of a social security advocacy group, we believe that it's time to take action to ensure that seniors, veterans, workers who have been forced to stop work as the result of serious and permanent disabilities, and others receive a badly needed raise. That's why we introduced the Duckworth-Warren Seniors and Veterans Emergency (SAVE) Benefits Act, and why it has been endorsed by Social Security Works and many other groups that advocate for seniors, Veterans, people with disabilities, women, low-income Americans, and many others.
The SAVE Benefits Act would provide seniors, Veterans, people with disabilities, SSI recipients and others a one-time payment equal to 3.9 percent of social security's average benefit, or about $581 per person. That raise would make an important difference in the lives of millions of beneficiaries: it could cover over three months of groceries or it could cover the average out-of-pocket costs Medicare enrollees spend on prescription drugs. For an estimated one million Americans, the SAVE Benefits Act could be the difference between living in dignity or living in poverty.
In Illinois' Eighth District alone, more than 100,000 people would receive a check if the SAVE Benefits Act becomes law, and they would immediately put it to use in our economy. Statewide, Illinois would see a boost of $1.4 billion infused into local communities on necessities like groceries, heat, and medical care.
An additional $48 a month might not seem like much to some, but it makes a difference for these beneficiaries. Modest though they are, social security benefits are vitally important. For most seniors in America, these benefits make up more than half of their total income, and that number only rises among those who become disabled.
We believe Congress should come together to pass this bill which is fully paid for by closing tax loopholes on lavish corporate compensation packages. Corporations are free to pay their CEOs whatever they choose, but taxpayers shouldn't be required to subsidize executive pay over $1 million a year. Closing this loophole provides enough money not just to cover the full cost of the stopgap payment to 70 million Americans, but significantly improves social security's long-range forecast as well.
If all those who share these values make their voices heard -- and the overwhelming majority of Americans do -- we can and will succeed together.