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Racial Lie on Social Security Privatization
Progressive Populist
by Nathan Newman
March 01, 2003

In the last election, Newt Gingrich's old outfit, GOPAC, was caught running radio ads describing Social Security as reparations to whites &emdash; a manipulation of civil rights rhetoric that so outraged black communities in those states that the Republicans were forced to yank the ads.

The propaganda line of the Social Security privatizers is that, since African Americans don't live as long as whites, they are economically exploited by the system. Whites get to collect payments for more years of retirement on average, so blacks who pay in over their lives must be getting the raw end of the deal, right?

Wrong. It's just one more fancy lie by the Social Security privatizers.

Yes, blacks don't always collect as many regular retirement benefits as similarly-situated whites, but they also benefit tremendously from survivor benefits and from the fact that Social Security guarantees a pension at all &emdash; of key importance since blacks are far less likely to have retirement income than whites.

African Americans are 12% to 13% of the American population. Yet black children were nearly a quarter of the Social Security survivor beneficiaries paid because a parent was dead. One in five widows or widowers who received benefits while caring for a child was African American.

Social Security's progressive formula, which pays relatively more to those with low incomes than to those with high incomes, is another big plus for blacks, who on average have lower incomes than whites. Because blacks earn lower incomes, they pay less in taxes. Thus, although their return in total benefits is smaller, their "investment" in Social Security through taxes is also smaller. By contrast, the average white worker is forced into making a larger "investment" in Social Security. Privatization of Social Security would change these formulas to the disadvantage of the black community.

So even on its own actuarial terms, the "blacks earn a poor return from Social Security" is false. But that doesn't stop the GOP from repeating the lie.

The National Council for La Raza has argued that the advantages of Social Security hold for Latinos as well, since Social Security benefits are the sole source of income for one-third of both Hispanic (33%) and black recipients (33%), while the same is true for only 16% of white recipients.

And the whole argument that blacks or other minority groups collect less than their share is based on assuming that they will continue to live less long than whites in the future. If we had a decent universal health care system, that difference would rapidly change.

Essentially, you have conservatives refusing to fund decent health care for all Americans, leading to blacks and other poor minorities dying off early, then using this as justification for further eroding the social safety net.

It's a neat and nasty rhetorical trick.

Conservatives make all these privatization arguments but never propose a real bill, because the minute they laid out a real proposal, their lies would collapse once any basic actuarial analysis was done.

The outrage should not be at Social Security BUT AT THE FACT THAT AFRICAN AMERICANS ARE DYING EARLY! For decades, blacks have been denied equal health care and even charged higher insurance rates than whites, and even when they have health care, they receive worse health care than whites.

In one Florida investigation, hundreds of thousands of blacks who bought health-care policies from the 1940s through the 1960s in the South are still paying higher rates, in some instances more than a third higher than whites.

Even when controlling for access to health insurance, discrimination persists in our health care system transplants and surgery: Whites are two to three times more likely to receive a kidney transplant than non-whites, and three times more likely to undergo bypass surgery. Among preschool children hospitalized for asthma, only 7% of black and 2% of Hispanic children, compared with 21% of white children, are prescribed routine medications to prevent future asthma-related hospitalizations.

Instead of shredding Social Security, if we built a real health-care safety net, blacks would live as long as whites. If conservatives are really concerned about equity (rather than stockbroker profits from privatization) maybe they should support universal health care and the end of racist discrimination in health care.

But then &emdash; the GOP just put Bill Frist, a corporate medical man who made his family fortune from the corporate HCA/Columbia health care chain, as head of their Senate leadership. And HCA has led the way in undermining the health care of poor and minority communities. The corporate chain been buying up the assets of community health systems, then shutting down hospitals in minority communities across the country. As John Robinson of the Martin Luther King Community Center writes:

"Discrimination is fueled not just by personal attitudes and hateful language but by dismissive and abusive corporate behavior toward minorities. Minority Americans are easy pickings for a moneyed giant such as Columbia/HCA Inc.

"In the 1980s we heard a lot about corporate raiders. Today, we face a new threat: community raiders such as Columbia/HCA Inc. These raiders move from minority community to minority community, wringing out profits, destroying jobs, gutting vital services and then moving on to the next victim."

Social Security privatization is just the most audacious corporate raid in history. It adds the additional obscenity of using the language of equity to pursue its discriminatory and anti-poor agenda.

Nathan Newman is a labor lawyer, longtime community activist, a vice president of the NYC National Lawyers Guild and author of the just published book Net Loss [Penn State Press] on Internet policy and economic inequality. Email or see

Posted by Nathan at March 01, 2003 08:46 PM