Fixing Social Security: A Look at the Popular Proposals
As the calendar moves relentlessly toward 2034 and the exhaustion of Social Security’s Trust Fund reserves, there seems to be quite a bit of discussion on fundamental approaches to addressing the problem. And while discussion doesn’t appear to be translating into action, it’s interesting to note that, according to The Motley Fool’s Sean Williams, each side of the aisle seems to be basing corrective action around a single core approach. For Democrats, it’s removing the taxation limit on earnings, while Republicans look to pushing out the full retirement age as a primary solution.
Williams’ article dissects each of these core approaches, citing what he calls flaws in their design. With respect to the premise of eliminating the taxation cap on earnings, he points out the limitations on payouts from Social Security and the simple fact that the increased amount high wage earners put into Social Security does not translate to higher benefits. On the suggestion to further increase the full retirement age, he cites the unfairness to those who have difficulty extending their work lives, either for physical reasons or due to the absence of employment opportunities. Further, he suggests that the later filing could logically equate to a fewer number of years to collect benefits and a corresponding reduction in payouts form the program.
Williams concludes his post, which can be accessed here, with the thought that a compromise is needed to overcome the imperfections in both arguments. The Association of Mature American Citizens (AMAC) clearly recognizes this need, and underscores it with a sense of urgency. In fact, AMAC is aggressively advocating a bipartisan solution that can resolve the solvency issue without necessitating tax increases. As explained on AMAC’s website, the Social Security Guarantee Act of 2017 “… is a combination of selected assumptions taken from legislation introduced by Representative Sam Johnson (R) of Texas and Representative John Larson (D) of Connecticut to achieve what is the best path to long-term Trust Fund solvency without raising taxes. It includes recommendations from the Social Security Advisory Board and AMAC.” Learn more about this recommended legislative framework here…