Sen. Bernie Sanders (I-VT) formally reintroduced The Social Security Expansion Act to Congress last week—a bill that if passed would expand Social Security benefits by $2,400 a year and ensure Social Security is fully funded for the next 75 years.
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.
Under terms of the bill, anyone who is a current Social Security recipient, or who will turn 62 in 2023, would receive an extra $200 in each monthly check that would generate the extra $2,400 a year if the bill were to pass. In a release touting the proposed legislation, the Sanders camp notes it would all be done “without raising taxes by one penny on over 93% of American households that make $250,000 or less.”
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.
“Right now, a Wall Street CEO who makes $30 million pays the same amount into Social Security as someone who makes $160,000 a year. Our bill puts an end to that absurdity…”
Sen. Bernie Sanders (I-VT)
“At a time when nearly half of older Americans have no retirement savings and almost 50% of our nation’s seniors are trying to survive on an income of less than $25,000 a year, our job is not to cut Social Security,” Sanders said. “Our job is to expand Social Security so that every senior in America can retire with the dignity that they deserve and every person with a disability can live with the security they need.”
Sanders added that the bill is funded by making sure that the wealthiest Americans pay their “fair share” into the system.
“Right now, a Wall Street CEO who makes $30 million pays the same amount into Social Security as someone who makes $160,000 a year. Our bill puts an end to that absurdity which will allow us to protect Social Security for generations to come while lifting millions of seniors out of poverty,” Sanders said.
“Social Security is an economic lifeline for millions of Americans, but many seniors are struggling with rising costs,” said Sen. Warren. “As House Republicans try to use a manufactured debt ceiling crisis to cut the Social Security that Americans have earned, I’m working with Senator Sanders to expand Social Security and extend its solvency by making the wealthy pay their fair share, so everyone can retire with dignity.”
Sanders’ release said that by “requiring millionaires and billionaires to finally pay their fair share into the program,” the Social Security Expansion Act would ensure the fund’s solvency to the end of the century, help low-income workers stay out of poverty by improving the Special Minimum Benefit, restore student benefits up to age 22 for children of disabled or deceased workers, strengthen benefits for senior citizens and people with disabilities, increase Cost-of-Living-Adjustments (COLAs), and expand program benefits across the board.
• Read the bill text here.
• Read the fact sheet and list of supporting organizations here.
• Read the SSA’s analysis of the legislation here.
• Read what the wealthiest people would pay under the legislation here.
Republicans leaders say no cuts on agenda
For their part, Senate Minority Leader Mitch McConnell (R-KY) and Speaker of the House Kevin McCarthy(R-CA) have repeatedly said in recent weeks that despite calls from some conservatives to link Social Security and Medicare spending and the debt limit, they will not seek those changes as part of an agreement to raise the nation’s debt ceiling.
As the NYT reported, McConnell told reporters Tuesday that “there is no agenda on the part of Senate Republicans to revisit Medicare or Social Security, period,” adding, “I’ve noticed that the Speaker of the House has said the same thing.”
And just last Friday, Sen Rick Scott (R-FL) relented and explicitly walked off Social Security and Medicare from his controversial proposal—cited indirectly by President Joe Biden in his recent State of the Union address—to terminate all federal programs every 5 years unless they are reauthorized by Congress.
Though not expected to be part of the debt ceiling debate, Republicans did recently propose several changes to Social Security and Medicare in the 2023 Republican Study Committee budget, with raising the retirement age and changing the way cost-of-living adjustments are measured notable among them.
Last June, during a “Senate Project” debate on Fox Nation between Sanders and Sen. Lindsey Graham (R-SC), Graham criticized the Sanders Social Security plan for wanting to increase benefits at a time when the program’s going broke.
“All it does is raise taxes,” Graham said to Sanders during the debate. “To get out of this mess, people like me are going to have to take a little less and pay a little more in. We’re going to have to adjust the age one more time like Ronald Reagan and Tip O’Neil did. There is a bipartisan way forward, but you describe problems which your answer is always the government. It’s always socialism.”
According to the 2022 report from the Treasury Department’s Social Security Board of Trustees, Social Security will be able to pay scheduled benefits until 2034. At that point, the program’s tax revenues will be able to cover only about three-quarters of scheduled retiree benefits.
As The New York Times reported, new forecasts from the nonpartisan Congressional Budget Office released on Wednesday showed Social Security and Medicare spending growth rapidly outpacing the growth in federal tax revenues over the next 10 years.
The CBO predicted Social Security spending would grow by two-thirds over the coming decade, more than double the expected growth rate for spending on the military and on domestic programs. By 2033, the report suggests the federal government will be spending as much on Social Security alone as it does on all discretionary spending—military and otherwise—combined.
The spending growth is the product of a wave of Baby Boomers reaching retirement age and beginning to tap the programs combined with high inflation. This year’s 8.7% COLA, the highest in decades, along with more beneficiaries, led the CBO to predict the program’s spending would increase by $412 billion more over the next decade than it previously forecast in May 2022.
SEE ALSO:
• Bernie Sanders: Expand Social Security; Lindsey Graham: Take Less, Pay More
• Social Security Benefits Need 23% Cut in 2034 Without Action: CBO
• Biden State of the Union Moment: Bipartisan Agreement on No Cuts to Social Security and Medicare?
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
What would really be helpful is, 1. Raise the income threshold ($32k MFJ/$25 Single) so more people wouldn’t pay federal taxes on their SS (the amount has not changed since 1984 when the government began taxing SS and, 2. Make Medicare premiums, at least the base premium, tax free…like employer insurance premiums.