Perhaps the most memorable part of last year’s State of the Union address was when President Joe Biden went off script in response to some Republican heckling about Social Security and Medicare.
In the moment, he turned it into an informal bipartisan agreement not to cut the entitlement programs, while Republicans would later say he mischaracterized their position to begin with.
This year, Social Security could again steal the show at the State of the Union address if Biden proposes expansion of the program, as some think he might.
Nancy Altman, president of Social Security Works, said in a recent op-ed on The Hill that the State of the Union address poses the perfect opportunity to renew his promise to expand Social Security.
Arguably, there’s a lot more on the line this year when President Biden addresses a joint session of Congress at the U.S. Capitol for the State of the Union address on Thursday, March 7. It’s a high-stakes opportunity to speak to a nation where many are skeptical of not only his border security, foreign and economic policies, but of his age (81) and mental acuity. Numerous political pundits are saying it looms as among the most consequential State of the Union addresses in decades.
While it’s unknown to the public at this point whether proposing Social Security expansion will be included in Thursday night’s speech, one reason to think it might is that it could align with Biden’s repeated efforts in “making the wealthy pay their fair share.”
A preview released by the White House last Friday indicated Biden will talk about, among other things, protecting abortion rights and in-vitro fertilization, reining in big tech, curbing fentanyl, helping veterans, ending cancer, making the wealthy pay their fair share in taxes, lowering health-care premiums, uniting the country and “saving our democracy.”
“Reportedly, Biden is considering focusing on Social Security again in this year’s State of the Union address—by demanding that millionaires and billionaires contribute their fair share.”
Social Security Works President Nancy Altman
Take note of the “making the wealthy pay their fair share in taxes” line. In the op-ed, Altman certainly does.
“Reportedly, Biden is considering focusing on Social Security again in this year’s State of the Union address—by demanding that millionaires and billionaires contribute their fair share. This is both wise policy and winning politics, particularly if Biden pairs it with a call to expand Social Security’s modest benefits,” Altman wrote.
She went on to note that currently, the wealthiest Americans do not contribute into Social Security on their wage income above $168,600, or on any of their unearned investment income. “If we require millionaires and billionaires to pay in all year long on all of their income, just like the rest of us, we can afford to protect and expand Social Security’s modest benefits. Doing that will help address today’s income and wealth inequality, a primary cause of Social Security’s projected shortfall.”
This argument was also seized upon recently by Sen. Bernie Sanders during last week’s Senate HELP Committee hearing, titled, “Taking a Serious Look at the Retirement Crisis in America: What Can We Do to Expand Defined Benefit Pension Plans for Workers?”
“Today, a billionaire pays the same amount of money into Social Security as somebody who makes $168,000 a year as a result of the cap on the Social Security payroll tax,” Sanders said. “The legislation we have proposed would lift the cap on Social Security starting at $200,000. You do that—tax all income—Social Security is solvent for the next 75 years, [and you] increase benefits by $2,400 per person.”
In Altman’s op-ed, she noted that none of the current Social Security bills have a single Republican co-sponsor—”even though Republican voters overwhelmingly support their provisions.”
She said instead, Republicans (along with a small number of corporate-friendly Democrats) are pushing for the creation of a fast-track commission designed to cut Social Security and Medicare behind closed doors. “Speaker Mike Johnson (R-LA) has said such a commission is a top priority, and House Budget Chair Jodey Arrington (R-TX) has demanded it as a condition of keeping the government funded.”
For his part, throughout the campaign former President Donald Trump has differentiated himself from other 2024 Republican presidential candidates by claiming he has no plans to touch Social Security. Last year, Trump said that “under no circumstances should Republicans vote to cut a single penny from Medicare or Social Security.” Newsweek reported he repeated that claim in December, telling Fox News’ Sean Hannity, “you don’t have to touch Social Security.”
Nikki Haley, meanwhile, has proposed raising the retirement age for people now in their 20s to sustain the program.
Altman said 94% of Republican voters oppose Social Security cuts, and 72% want to expand benefits.
“This year’s State of the Union is the perfect opportunity for President Biden to expose this division between Republican politicians and their voters,” Altman wrote. “During the address, Biden should call for expanding Social Security and paying for it by requiring millionaires and billionaires to contribute at the same rate as the rest of us.”
In late January, Politico reported that White House officials are leaning toward proposing an expanded slate of tax increases on corporations and those earning above $400,000 as a central part of the State of the Union address. Also under discussion is pitching those new taxes as a way to fund Social Security benefits.
Will it happen? We find out Thursday night. Biden is scheduled to address the joint session of Congress at 9 p.m. ET.
SEE ALSO:
• Biden: DOL Fiduciary Rule is a Further Crackdown on ‘Junk Fees’
• Biden State of the Union Moment: Bipartisan Agreement on No Cuts to Social Security?
• Trump Touts 401k Growth in State of the Union
• Haley Doubles Down on Raising Social Security Retirement Age for Younger Americans
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.