Lawmakers Propose Emergency 3% Social Security Raise - The Motley Fool & AMAC
Social Security cost of living adjustments (COLAs) are calculated and determined based on third-quarter data from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which measures changes in the cost of common goods and services. Critics have long argued that the CPI-W doesn’t reflect the costs that commonly dominate seniors’ income, like healthcare. Two Democrat representatives, Peter DeFazio and John Larson, each have previously proposed using the Consumer Price Index for the Elderly, or CPI-E, to calculate COLAs. They plan to introduce a bill in the House today (Friday 10/16) to raise next year’s 1.3% COLA to a 3% emergency boost instead. The bill is to be titled The Emergency Social Security COLA for 2021 Act. Passage would appear to be near zero through both houses of Congress, however. Inflation is indeed low, and this proposal to increase Social Security spending will exacerbate its long-term solvency problems. Maurie Backman’s full piece on the lawmakers’ plan is 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.
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