Thread: Group Warns of Social Security Raid by Illegals

Group Warns of Social Security Raid by Illegals

Dave Eberhart, NewsMax
Thursday, March 29, 2007

A watchdog group warns that a huge pot of U.S. Social Security money, vulnerable to being tapped by illegal alien workers, is rapidly ballooning – representing yet another looming landmine for the beleaguered retirement system critical to millions of American seniors.

"The [Social Security Administration's] ‘Earnings Suspense File,' perhaps the best proxy for the eventual payout in benefits to today's illegal immigrants, has almost doubled over the past five years to $585 billion – largely a result of minimal workplace enforcement," Brad Phillips, a spokesperson for TREA Senior Citizens League, one of the nation's largest seniors groups, tells NewsMax

The Earnings Suspense File was established to collect Social Security earnings reports from filers with mismatched names and Social Security numbers, while the Social Security Administration attempts to track down the filers' identities.

Phillips advises that this resource represents a potential pot of gold for millions of today's illegal workers eligible for billions of dollars in benefits under any future immigration amnesty plan.


The chief cause of growth in the file is unauthorized work by non-citizens, according to Social Security Administration Inspector General Patrick P. O'Carroll.

'Totalization'

Under a proposed "Totalization Agreement," millions of illegal Mexicans working in the U.S. today could claim benefits from the Social Security Trust Fund for work performed while in the U.S. illegally. They could do so through immigration amnesty – through which they could claim past Social Security payments for illegal work.

TREA, which recently forced the agreement with Mexico into the public domain by a Freedom of Information Act lawsuit, and other watchdog groups were hopeful that the agreement would directly address and perhaps even moot the hot-button issue of illegal immigrants at some point claiming U.S. Social Security benefits.

It did not.

"A law called the Social Security Protection Act of 2004 forbids illegal immigrants from claiming Social Security benefits – but a loophole exists," Phillips explains to NewsMax.

"If an immigrant gains what's called a valid ‘work-authorized' Social Security number at some point, then he or she could eventually file a claim for benefits. The government would use all earnings to calculate the retirement benefit – even earnings while working illegally," Phillips adds.

The U.S. Commissioner of Social Security signed the so-called "totalization" agreement with the Director General of the Mexican Social Security Institute on June 29, 2004. TREA fought to make it public for over three and a half years.

The U.S. currently has 21 similar agreements in effect with other nations, which are intended to eliminate dual taxation for persons who work outside their country of origin. All of the agreements are with developed nations with economies similar to that of the U.S.

For example, a worker who turns 62 after 1990 generally needs 40 calendar quarters of coverage to receive retirement benefits. Under totalization agreements, a partial benefit can be paid based on the proportion of the worker's total career completed in the paying country.

The agreements allow the Social Security Administration to "totalize" U.S. and foreign credits if the worker has just six quarters, or 18 months, of U.S. coverage.

But, according to TREA, Mexico's retirement system is radically different, since only 40 percent of non-government workers participate, as opposed to 96 percent of America's workers. In addition, the U.S. system is progressive, meaning lower wage earners get back much more than they put in.

Contrast Mexico, where workers get back only what they put in, plus accrued interest.

Once an immigrant gains access to a work authorized Social Security number – whether a legal citizen or not – wages earned while in the U.S. unlawfully could be reinstated to the worker's new Social Security account, warn TREA officers.

GAO also Sounds Alarms

Such writing-on-the-wall concerns are not just being sounded by TREA, however.

In a recent Government Accountability Office (GAO) special report to Congress, that agency voiced a number of issues latent in the agreement:

# SSA [Social Security Administration] has no written policies or procedures it follows when entering into totalization agreements, and the actions it took to assess the integrity and compatibility of Mexico's social security system were limited and neither transparent nor well-documented.

# SSA provided no information showing that it assessed the reliability of Mexican earnings data and the internal controls used to ensure the integrity of information that SSA will rely on to pay social security benefits.

# The proposed agreement will likely increase the number of unauthorized Mexican workers and family members eligible for social security benefits. Mexican workers who ordinarily could not receive social security retirement benefits because they lack the required 40 coverage credits for U.S. earnings could qualify for partial social security benefits with as few as 6 coverage credits.

# Under the proposed agreement, more family members of covered Mexican workers would become newly entitled because the agreements usually waive rules that prevent payments to non-citizens' dependents and survivors living outside the U.S.

# The cost of such an agreement is highly uncertain. In March 2003, the Office of the Chief Actuary estimated that the cost of the Mexican agreement would be $78 million in the first year and would grow to $650 million (in constant 2002 dollars) in 2050. The actuarial cost estimate assumes the initial number of newly eligible Mexican beneficiaries is equivalent to the 50,000 beneficiaries living in Mexico today and would grow six-fold over time.

# This proxy figure (above) does not directly consider the estimated millions of current and former unauthorized workers and family members from Mexico and appears small in comparison with those estimates. The estimate also inherently assumes that the behavior of Mexican citizens would not change and does not recognize that an agreement would create an additional incentive for unauthorized workers to enter the United States to work and maintain documentation to claim their earnings under a false identity.

# An analysis performed at GAO's request shows that a measurable impact would occur with an increase of more than 25 percent in the estimate of initial, new beneficiaries. For prior agreements, error rates associated with estimating the expected number of new beneficiaries have frequently exceeded 25 percent, even in cases where uncertainties about the number of unauthorized workers were less prevalent.

# Because of the significant number of unauthorized Mexican workers in the United States, the estimated cost of the proposed totalization agreement is even more uncertain than in prior agreements.

Meanwhile, the juicy Earnings Suspense File (ESF) fund grows and grows.

The latest analysis, conducted by The Senior Citizens League and based on new information released by the Social Security Administration, reveals that:

# From 1937-1999 (a 63-year period), the ESF accumulated a total of $301.8 billion. It almost doubled, however, from 2000-2004 (the most recent years for which data is available) to $585 billion, largely a result of minimal workplace enforcement efforts.

# From 2000-2004, the file grew by an average of $57 billion in "uncredited wages," represented by 9.3 million wage reports per year. By contrast, the file grew by just $18.9 billion and 5.2 million wage reports per year throughout the 1990s, and $7.8 billion and 4.2 million wage reports per year throughout the 1980s.

# According to the Government Accountability Office (GAO), the percentage of reinstatements to valid Social Security numbers from the ESF for "potentially unauthorized work" averaged an estimated 32 percent from 1986-2003, and exceeded 50 percent of all reinstatements for foreign-born workers in some of those years.

"Since we know that Social Security is forecast to go bankrupt by the year 2040, we find it unfathomable that our government would willingly bankrupt the system even sooner by giving billions of dollars to people who broke the laws of the United States," says Shannon Benton, executive director of The Senior Citizens League.

"Our seniors and future retirees deserve to know that the promises made to them by their public representatives will, indeed, be kept," she adds.

If and when President Bush personally signs the totalization agreement, it will automatically become law without any congressional action.

Sen. John Ensign, R-Nev., has introduced S.43, a bill to require totalization agreements to be treated like bilateral trade agreements. His bill would permit a totalization agreement to go into effect only if affirmatively passed by both Houses of Congress.

http://www.newsmax.com/archives/article ... shtml?s=lh

I think it's time for the IRS to lend a helping hand and resolve all these stolen social security cards!

Originally Posted by CCUSA

I think it's time for the IRS to lend a helping hand and resolve all these stolen social security cards!

CC, now the IRS can't do that! That would actually be HELPING Americans, and they are not in that business!

Sen. Ensign and especially that senior citizens group the TREA, deserve a lot of credit. I didn't catch it in the above article, but the TREA had to file a FOIA request to get the text of the Totalization agreement between the SSA and Mexico - someone there is on the ball.

"Since we know that Social Security is forecast to go bankrupt by the year 2040, we find it unfathomable that our government would willingly bankrupt the system even sooner by giving billions of dollars to people who broke the laws of the United States," says Shannon Benton, executive director of The Senior Citizens League.

This is so serious, I can't believe it. No illegals should get their hands on Social Security. They are not U.S. citizens. These are the benefits for our own children! Where will Congress get the money to replace this funding??

Bankrupt, bankrupt, bankrupt, bankrupt....this is happening in all sectors of this country.

Watch how fast the S.S. issue would get resolved if the elected officials had to go on S.S. instead of the cushy retiement that they now can look forward to. At our expense of course.