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Congressman John Larson, D-Conn., and other lawmakers debate the Social Security Act 2100, which would include increased minimum benefits, on Capitol Hill on Oct. 26, 2021.
Drew Angerer | News from Getty Images | Getty Images
Social Security passed another milestone when it reached 87th anniversary on Sunday.
The program was signed into law by President Franklin Delano Roosevelt on August 14, 1935. Today, it provides monthly checks to more than 65 million beneficiaries.
But it now faces a deadline after which the program will no longer be able to pay out full benefits unless Congress acts sooner.
In 2035, according to the program’s trustees, only 80% of benefits will be payable.
House Democrat John Larson of Connecticut and Pramila Jayapal of Washington united Monday to call for a bill to expand Social Security for a vote this fall.
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That proposal, called Social Security 2100: A Sacred Trust, would expand benefits, something that hasn’t been done in about 51 years, noted Larson, who proposed the bill and who serves as chairman of the House Social Security Subcommittee.
“It’s long overdue to make sure we’re improving a program that they need, especially during this pandemic,” Larson said of the program’s beneficiaries.
Jayapal, who is the chairman of the progressive faction, called for action as early as next month.
“When Congress returns from recess in September, we need to bring this bill to committee and then send it to the floor for a vote,” Jayapal said.
How the bill would expand retirement benefits
Rep. Pramila Jayapal, D-Wash., participates in a televised interview at the U.S. Capitol on Nov. 4, 2021.
Elizabeth Franz | Reuters
The latest Social Security Bill 2100, proposed by Larson, seeks to improve Social Security benefits in many ways.
It calls for increasing all checks by about 2% of average compensation. At the same time, it would also set the minimum benefit above the poverty line and link it to current wage levels.
The annual living wage adjustment measure will be changed to better meet the costs faced by pensioners.
Widows and widowers will also receive more generous benefits. It would repeal rules that reduce benefits for public workers, including the Windfall Elimination Provision and the State Pension Offset.
The bill also calls for providing caregiver credits to people who take time out of the workforce to care for children or other family members.
Student benefits will be extended up to the age of 26. Children who live with grandparents or other relatives will also have greater access to benefits.
The bill also calls for ending the five-month waiting period for disability benefits.
To pay for the benefit increases, the bill calls for reimposing the payroll tax on wages above $400,000, which would affect about 0.4 percent of workers.
Currently, wages up to $147,000 are taxed with Social Security in 2022. Employers and employees pay a 6.2% payroll tax, for a total of 12.4%.
Bipartisan support can be hard to come by
Social Security 2100: A Sacred Trust currently has 202 House Democratic co-sponsors.
It’s one of several Democratic proposals aimed at tackling Social Security reform. While the proposals differ, each seeks to sweeten benefits while making the wealthy pay more into the program.
However, one key difference is how long they will extend the program’s solvency. Social Security Act 2100 would extend the expiration date to 2038 from the current projected date of 2035. Another proposal led by Sens. Bernie Sanders, I-Vt., and Elizabeth Warren, D-Mass., would extend the program’s solvency past 2096 while expanding the benefits.
While Democrats can negotiate the details of their proposals, they will also have to contend with Republicans, who have voiced their opposition to expanding benefits and raising taxes.
Sen. Rick Scott, R-Fla., has drawn criticism for a proposal to eliminate government programs like Social Security and Medicare every five years. During a Senate hearing in June, he denied any intention to cut income.
“I have suggested that Congress properly review these programs,” Scott said. “I will never support cuts to Social Security, Medicare or Medicaid.”
Nevertheless, bipartisan support will be needed to push any changes to the program through both chambers. But it remains to be seen what fixes both sides can agree on.
“Any Social Security reform that could pass, that could be enacted, would be a compromise,” said Andrew Biggs, a senior fellow at the American Enterprise Institute who was nominated to the Social Security Advisory Council by President Joe Biden, in a recent Interview for CNBC.com.
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