A politically unpopular tax hike could give Social Security another 75 years
In this piece Sean Williams describes a solution noted in the April 2019 Trustees’ report that would instantly resolve Social Security’s $13.9 trillion cash shortfall over the next 75 years. Contained within every trustees report is a figure known as the “actuarial deficit” It is the figure that describes how much of a payroll tax increase is required today in order to completely cover the funding shortfall over the next 75 years. The report estimates that if Congress increased the current 12.4% payroll tax on earned income by 2.78% to 15.18%, Social Security’s cash shortfall would go away over the next 75 years. Williams goes to explain that such a seemingly simple solution has not passed because it is also a tough political sell to legislators who must seek re-election often. Other reform ideas exist that require different people “pay” to solve the solvency issue. Read full piece here.
The Association of Mature American Citizens (AMAC) believes Social Security must be preserved and modernized. This can be achieved by making modest changes in cost of living adjustments and the retirement age, with no additional taxes on workers. AMAC advocates for a bipartisan compromise, “The Social Security Guarantee Act,” taking selected portions of bills introduced by former Rep. Johnson (R-TX) and Rep. Larson (D-CT) and merging them with the Association’s own well researched ideas. One component is Social Security PLUS, a new yet voluntary early retirement plan that would allow all earners to have more income available at retirement. This component is intended to appeal especially to younger workers. AMAC is resolute in its mission that Social Security be preserved and modernized and has gotten the attention of lawmakers in DC, meeting with a great many congressional offices and their legislative staffs over the past several years. Read AMAC’s plan here.