Senator Rubio unveils proposal to reform retirement policy

Reuters News
Posted: May 13, 2014 5:29 PM

By Gabriel Debenedetti

WASHINGTON (Reuters) - Senator Marco Rubio, a likely Republican candidate for the White House, on Tuesday unveiled plans to give more Americans a way to save for retirement while raising the retirement age for younger workers.

The first-term Florida senator's announcement at the National Press Club in Washington is part of a broader set of proposals that are helping Rubio shore up his policy credentials with the Republican Party's conservative wing.

"I believe the American dream my parents lived is still possible," Rubio said. "But among too many of our people, there is now a nagging sense that achieving it has become more difficult than ever. Financial security has faded for millions Americans, and with it the hope of a stable and secure retirement."

Rubio proposed opening up to more Americans the federal Thrift Savings Plan currently offered to federal employees and members of Congress. It allows workers to make tax-free contributions, similar to a 401(k) plan.

Rubio's plan would also give seniors a fixed amount of money for buying health care plans, from either a private company or from Medicare. Rubio said the government would contribute to the cost of the insurance, pegging the amount to the cheapest option available.

The former Tea Party hero is gradually mending his relationships with leaders in his party's right wing after he helped lead a failed effort to reform the U.S. immigration system in 2013, in what some conservatives saw as an attempt to grant amnesty to illegal immigrants.

"All of the reforms I've proposed so far this year aim to create dynamic economic growth," he said of his suite of ideas.

Rubio's proposal would see Social Security payroll taxes suspended for workers who keep working past age 65.

Democrats rallied against Rubio's plan.

"This afternoon Senator Rubio renewed the GOP's commitment to ending Medicare as we know it, forcing future seniors to spend more out of pocket on medical care when they need it most," said Democratic National Committee spokesman Michael Czin.

Rubio says he will not make a decision on a presidential run until after November's midterm elections and strategists believe his decision could depend on other possible contenders. If former Florida Governor Jeb Bush pursues the presidency, for example, he could attract much of Rubio's home-state money and support.

(Editing by Alistair Bell and Lisa Shumaker)