Democrats Unveil New Social Security Bill
House members announced the reintroduction of the Social Security 2100 Act on January 30, NPR reported. Initiated by Representative John Larson (D-CT), the legislation proposes increasing payroll taxes and expanding benefits for current and new recipients of the program, as Forbes explained.
According to Larson’s proposal, the bill would result in a two percent benefit increase, helping “seniors who spend a greater portion of their income on healthcare and other necessities.” Approximately 60 million Americans received a combined $1 trillion in Social Security benefits last year. This number is predicted to rise to $80 million within the next decade.
Quoted in the New York Times, Larson, who is currently also Chairman of the Social Security subcommittee, stressed, “Our bill, supported by more than 200 members of the House, would enhance and expand the nation’s most successful insurance program, which touches the lives of every American.”
President Franklin D. Roosevelt signed Social Security into law over eight decades ago. Since then, policymakers have implemented amendments to offset inflation and enhance the program’s financial capabilities. Notably, Larson re-introduced the legislation in Congress on the 137th anniversary of Roosevelt’s birthday.
Co-sponsored by more than 200 members of Congress, the bill would set the new minimum benefit at 25 percent above the poverty line. It would also increase payroll taxes from 12.4 percent to 14.8 percent over the next 24 years, PBS reported. This would impose payroll taxes on annual earnings that exceed $200,000.
Republican Andrew Biggs, a principal deputy commissioner of Social Security under President George W. Bush, acknowledged several positive features of Larson’s legislation. “It doesn’t just fix Social Security for 75 years,” Mr. Biggs said, according to the New York Times. “It would keep the system permanently solvent. That’s a real plus.”
Legislators are still concerned about whether the current trust fund is capable of covering benefits for the baby boomer generation, whose members are rapidly entering retirement. According to a government report published by researchers at the Social Security Board of Trustees, the current fund is set to be depleted by 2034.
While recognizing the need for Social Security reform, Representative Kevin Brady (R-TX) expressed optimism about the government’s readiness to respond to increased retirement, Forbes reported. According to Brady, employment growth, economic development, and significant wage increases over the past decade have improved retirement security.
“We almost romanticize retirement in this country, and for good reason,” emphasized the former chair of the House’s tax law writing committee.
Social Security Works President Nancy Altman, on the other hand, stressed that the bill would only require 218 votes in the House in order to pass. “Expanding Social Security, with no cuts, is wise policy and winning politics. People are worried about a retirement income crisis, and this is a solution,” she said.
As the Hill reported, the legislation would become the first major expansion of Social Security since 1972, the year in which Congress increased the plan’s eligibility age in response to a financial crisis.