Can Taxing the Rich Save Social Security? - The Motley Fool & AMAC
Sean Williams explores both sides of a common argument made to assist Social Security’s ailing financial health– tax the rich more. Will it work? Extending the 12.4% combined employee/employer payroll tax beyond the current $137,700 wage cap would generate immediate revenue to Social Security. This would assist but not eliminate all of the program’s problems, however. Williams notes the benefits would have to be capped also, to garner any savings, and that changes the nature and relationship of Social Security. Raising the cap polls well but does not have broad bipartisan support. Republicans prefer changes like raising the retirement age that solve the structural problem of people living longer and having fewer children. But that approach also takes longer to address the solvency issue. If no changes are made, the first across the board cuts of around 20-24% could hit everyone in nine years, a quicker insolvency date due to the pandemic. Read full article 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 current Rep. Larson (D-CT) and merging them with the Association’s own well researched ideas. One component is Social Security PLUS, a new, voluntary 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 staffs over the past several years. Read AMAC’s plan here.