I look at problems before getting into the details. Let me try here.
The purpose of Social Security for retirement is to provide assistance based on the need of persons over 65 years of age. The program intends to complement pensions and individual savings, not replace their entire income. The amount one receives decreases as your monthly wage increases. This provides higher amounts for the working poor.
Research shows that without Social Security, two-thirds of the elderly would be impoverished.
Is Social Security solvent?
Under current laws, Social Security will exhaust its trust funds by 2034, and unless Congress strengthens the program, payees will see benefits cut by 23% in just over a decade.
1st Decision: Do we want it, or not?
2nd Decision: How do we fix it to keep it? How do we pay for it? This decision is where our differences start.
Let's look at our simple choices with clarity.
Many Republicans want to reduce benefits by increasing the retirement age to 70.
Democrats want to increase revenue to pay for it.
Some advocate for a combination of both solutions.
What do I think?
Social Security is vital.
Before crises arise, we need a long-term solution, not short-term fixes.
We must place problem-solving before political party divisions and listen to what Americans want.
Details worthy of consideration for changes:
Raising the Social Security payroll tax cap to over $400,000 – and increasing the income level at which Social Security payroll taxes are reapplied – would eliminate 61% of the shortfall.
Reducing benefits for the top 20% of high earners would decrease the shortfall by shortfall by 11%.
Gradually raising the retirement age and the savings would depend on the age.
Increasing the payroll tax by 0.3% would help eliminate 16% of the shortfall. Currently, employers and employees pay a tax of 6.2% of wages, and marginally raising that rate could significantly impact the program's solvency.
Raising the minimum benefit or indexing the minimum benefit to 125% of the federal poverty line would change the minimum benefit for someone who has worked for 30 years from $951 to $1,341 but increase the shortfall by 7%.
Increasing benefits for beneficiaries over age 80 would increase the shortfall by 5% but ensure they don't revert below poverty levels.
Economists have highlighted that Social Security is an economic stimulus, and strengthening it towards solvency will help grow our economy.
Hard working Americans deserve a fact-based discussion without rhetoric or hyperbole to determine the best route forward. Both political parties must work together to find reasonable, commonsense long-term solutions before it's too late.
