Funding: Archives 2014 & Earlier

Group Calls for Return of Social Security “Student Benefit”

Advocacy group Generations United last week released a report on the importance of Social Security for children, particularly those raised by grandparents, and called for the reinstatement of the “student benefit.”

The report – entitled “Social Security: What’s at Stake for Children, Youth and Grandfamilies” – states that more than 6.5 million children in the U.S. receive part of their family income from Social Security, and 6.7 million children live in households headed by grandparents or other relatives.

In 1965, Congress wrote the “student benefit” into existence to extend to age 22 Social Security benefits for children who had lost a parent and were in college. In 1981, Congress voted to end that practice, and only offer aid to children up to 18 years of age.

The report relies on compelling anecdotal evidence from the lives of Americans such as Morisella Middleton, who depended on Social Security to support her three grandchildren after both of their parents died, and she herself had to stop working due to illness.

“Social Security has been my lifeline—my only lifeline,” she said. “It’s been critical for me in raising the children and to their future.”

Beth Finke, writer and NPR commentator was also profiled, and quoted saying that she would never have made it to college without the student benefit.

The report also featured vignettes on Sens. Al Franken (D-Minn.), Lindsey Graham (R-S.C.) and Rep. Jan Schakowsky (D-IL) each of whom have benefitted themselves, or through a close family member, from Social Security.

Their inclusion in the report does not mean that they necessarily support the reinstatement of the student benefit politically, said Jaia Peterson, deputy executive director for Generations United.

In 1965, the rationale to enact the student benefit was that a child may be prevented from finishing high school or entering vocational school or college in the event of the death of the family’s breadwinner.

A 2010 study by the National Academy of Social Insurance indicates that “in the face of skyrocketing costs of higher education, students may be more dependent on their families for support than they were in the mid-1960’s.”

According to that study, in 1979, the maximum Pell Grant covered about one-third of the average tuition and fees for a private college, and three-fourths of the cost of a public institution. By 2009, the cost of college had increased dramatically, and the maximum and average Pell Grants covered less than 10 percent of private tuition and less than 20 percent of public school costs.

The cost of reinstating the student benefit is estimated to cost about 0.07 percent of taxable payroll over the 75-year actuarial horizon. This means, for example, a worker earning $50,000 per year would pay an additional $35 each year in Social Security taxes to sustain the student benefit.

According to Generations United, this is a small price to pay for the benefits, especially to minority and low-income students. A 2001 study concluded that the termination of student benefits brought a disproportionate drop in college attendance among black and low-income young adults because these students were more likely to have disabled or deceased parents.

Finke, who was a Social Security recipient before the student benefit was eradicated said, “Without the college degree, I don’t know where I would be. We certainly did not have the resources to manage that, and if I didn’t have the student benefit I would never be able to go.”

 

 

 

 

 

 

 

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