House Ways and Means Social Security Subcommittee Chairman John Larson, D-Conn., introduced Social Security 2100: A Sacred Trust on Tuesday.
The recent Social Security COLA announcement served as the backdrop for the introduction of the bill to permanently adjust the cost-of-living formula, repeal the controversial Windfall Elimination Provision (WEP) and provide a benefit bump for current and new beneficiaries.
“Social Security 2100: A Sacred Trust will expand benefits and strengthen Social Security,” Larson said at a press conference. “The pandemic has only underscored what we already knew and has exacerbated systemic inequities—current benefits are not enough.”
Joined by Representatives James Clyburn, D-S.C., and Richard Neal, D-Mass., and Senator Richard Blumenthal, D-Conn., among others, the congressman claimed five million seniors are living in poverty due to longstanding discrimination in the labor force that affects mostly people of color and women.
“These are our sisters, brothers, aunts, uncles, and neighbors,” Larson added. “For too long, Congress has forsaken its duty to enhance benefits. With 10,000 Baby Boomers a day becoming eligible, and with Millennials needing Social Security more than any generation, the time for Congress to act is now.”
Bill provisions
- Benefit bump for current and new beneficiaries – Provides an increase for all beneficiaries that is the equivalent to about 2% of the average benefit. The US faces a retirement crisis and a modest boost in benefits strengthens the one leg of the retirement system that is universal and the most reliable.
- Protection against inflation – Improves the annual cost-of-living adjustment (COLA) formula to better reflect the costs incurred by seniors through adopting a CPI-E formula. This provision will help seniors who spend a greater portion of their income on health care and other necessities. Improved inflation protection will especially help older retirees and widows who are more likely to rely on Social Security benefits as they age.
- Protects low-income workers – No one who paid into the system over a lifetime should retire into poverty. The new minimum benefit will be set at 25% above the poverty line and would be tied to wage levels to ensure that the minimum benefit does not fall behind.
- Improves benefits for widows and widowers in two income household
- Repeals the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) that currently penalize many public servants.
- Ends the 5-month waiting period to receive disability benefits.
- Provides caregiver credits to ensure that caregivers are not penalized in retirement for taking time out of the workforce to care for children or other dependents.
- Extends benefits for students through age 22.
- Increases access to benefits for children who live with grandparents or other relatives.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.