Back in 2011, one of Ernest Bowles and Alan Simpson's wonder “cure alls” for Social Security shortfalls was to raise the retirement age (at which full Social Security can be received) to 70. This was despite the fact that the newest demographic economic data showed that contrary to the myth that “all Americans are living longer”, elderly poor black women were seeing decreases in life expectancy.
Bowles and
Simpson’s solution would not only have added 1.5 million seniors to the poverty rolls,
but literally forced millions more poor black seniors (mainly women- to work until they literally dropped dead. (45% of black men were already dead by 66).
Thus, these two clowns would literally chop off an essential lifeline for
millions of Americans, especially poor female minority Americans. In this
context, one elderly female sent an email to Simpson – the top asshole on the
commission, complaining about his denigrating reference to “pink panthers”- and dismissing Social Security as a "cow with 310 million tits."
Of course, the situation with Social Security has gotten worse since then given congress has basically sat on its hands, doing nothing to save this critical program. Indeed, 2 weeks ago the program's trustees warned that the trust fund that helps pay benefits to more than 75 million Americans will be depleted by the end oof 2032.
While Social Security wouldn't collapse, the incoming revenue from payroll taxes and taxes on benefits would cover only 78 percent of scheduled payments - which will force automatic benefit cuts. For a middle income household that could equate to a loss f up too $18,000 a year. Not small chunk by any means.
Basically, Social Security has paid out more than it receives since 2010. That shortfall has worsened in recent years because of drops in worker participation rate - owing to reduced immigration and fewer births - which result in fewer younger workers paying taxes (as well as the huge tax cuts passed last year in the Trump -GOP 'Big Beautiful Bill).
According to LZ Granderson in the LA Times, the "mess should be dominating midterm campaigns". Especially now as affordability fears ramp up owing to Trump's Iran War and tariffs. But weak-kneed politicos refuse to touch the issue out of fears they will scare voters with talk of benefit cuts or huge tax hikes.
Two changes, meanwhile, have been discussed - one mainly on the left, the other on the right. In the latter case "means testing" has been proposed, e.g. by Ted Cruz. This would reduce or eliminate benefits for millions who have paid into the system, but because they had much higher than average incomes over their earning years, they'd now be disqualified. Basically, Social Security would be then reserved for the lowest earning citizens which would turn it into a welfare program. And we know what happens to those.
Another cockeyed proposal reported in a Washington Post editorial piece yesterday is to resurrect a 1987 plan that freezes cost of living allowances for some deemed not to need it.
A much more rational (and fairer) way to solve the problem is simply to raise the ceiling on income subject to the Social Security payroll tax. To fix ideas, that cap is now at $184, 500 which means anyone earning at least $1 million in wages stops paying any payroll tax from the beginning of March. That is $0.
Interestingly, if the payroll tax cap were raised to $400,000, i.e. all income in excess of that amount subject to the payroll tax, then Social Security's solvency would be ensured forever - or at least as long as this Republic lasts.
A simple solution, but you can be sure it will somehow escape the noggins of too many Reepo hardheads and wannabe Trumper crypto billionaires.
See Also:
Opinion | A missed opportunity to save Social Security - The Washington Post
Excerpt:
A “new option” to reform Social Security turns out not to be
so new. If it had been adopted when first proposed, Social Security today would
be solvent for another 40 years or so.
In October,
the Committee for a Responsible Federal Budget released a proposal to cap the
Social Security cost-of-living adjustment (COLA) at a certain level of
benefits. Rather than adjusting for inflation for every beneficiary, as the
program currently does, it would do so only up to a certain point. They thought
they had a fresh idea. But a CRFB blog
post on Tuesday found that Reps. Tim Penny (D-Minnesota) and Arlan
Stangeland (R-Minnesota) had introduced legislation along the same lines
— in 1987.
As Penny said to Congress at the time, the bill would have created a “flat-dollar” COLA. Social Security would work the same in calculating the initial benefit level for seniors, based on their lifetime earnings. For the annual COLA, it would calculate the monthly increase for the beneficiary at the 20th percentile to account for inflation, then give that flat increase to all seniors.
And:
Hijacking Social Security: How Trump’s "Freedom 250" Grift is Draining Your Benefits
And:
Brane Space: A "Chained CPI"? Yes! For the CHAINSAW!
And:
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