Social Security Expansion Act
Sen. Bernie Sanders (I-VT) formally reintroduced the Social Security Expansion Act to Congress in February—a bill that if passed would actually expand Social Security benefits by $2,400 a year and ensure Social Security is fully funded for the next 75 years.
To do it, the Sanders bill seeks to require “the wealthiest American households to pay their fair share of taxes,” claims a Sanders-released fact sheet. “Today, because of the earnings cap on Social Security taxes, a CEO making $20 million a year pays the same amount of money into Social Security as someone who makes $160,200 a year. This legislation would lift this cap and subject all income above $250,000 to the Social Security payroll tax. Under this bill, over 93% of households would not see their taxes go up by one penny.”
The estimates reflect an analysis of the legislation conducted by the Social Security Administration at the request of Sanders, which was released Feb. 13 in a letter from Chief Actuary Stephen Goss.
The premise behind raising the income tax, Sanders argues, is that the burden of funding Social Security needs to be shifted away from the middle class and more toward the wealthy by raising the OASDI payroll tax to covered earnings above $250,000 for 2024 and later. Under current circumstances, the Sanders proposal claims those earning over the cap pay an effective Social Security payroll tax rate of 1% or less, while those earning under the cap get stuck footing a bill that’s six times higher.
Under the Sanders proposal, all earnings taxed above $250,000 would not be credited for benefit computation purposes—meaning the wealthy who would pay additional Social Security taxes would not receive higher benefits for doing so down the road.
The Social Security Expansion Act was first introduced on June 9, 2022 by Sanders and U.S. Rep. Peter DeFazio (D-OR). This time, Sanders has a new coalition of supporters in fellow Senator Elizabeth Warren (D-MA) and Reps. Jan Schakowsky (D-IL) and Val Hoyle (D-OR), who are showing renewed interest in Social Security reform amid Republican talk of proposed cuts to Social Security as the U.S. faces its latest debt ceiling crisis.
Eight other senators and 25 Democrats from the House of Representatives signed on as cosponsors of the bill.
Next Page: Raising the cap to $400,000
You keep saying the wealthy pay a less percentage than the waitress. But you don’t point out that the wealthy’s S.S. payment is capped at a maximum like everyone else. If you make 200k a year or 2 million a year, you don’t get any more increase in benefit. The benefit is based on that capped taxable amount of $160k. This is FAIR. Unless you see S.S. as a welfare plan – which of course Bernie & Pocahontas do!
As someone concerned about the future of Social Security, I believe that implementing gradual increases in the retirement age is a crucial step towards fixing the system. After reading the article “3 Proposals to Fix Social Security,” it became clear to me that adjusting the retirement age is a practical solution to ensure the program’s long-term sustainability.
Considering the rising life expectancies and changing demographics, it is necessary to make adjustments that align with the current reality. By gradually raising the retirement age, we can address the challenges posed by an aging population and ensure that Social Security remains viable for future generations.
This proposal recognizes the significant improvements in healthcare and overall quality of life that have resulted in longer, healthier lives for many individuals. It acknowledges that people are now able to work and contribute to society for more extended periods. Adjusting the retirement age would reflect these societal changes and distribute the financial burden more evenly.