The Social Security Solvency Dilemma – Part 3 - AMAC, Inc.
Fixing the Social Security Solvency Dilemma
Despite its potential for catastrophe, the problem of Social Security’s evaporating financial reserves is solvable, and the sooner the better. While popular rhetoric holds that the road ahead for Social Security will necessarily involve balancing the long-term financial picture either by increasing program revenue (tax increases), incorporating formula-based adjustments limiting the benefit payouts allocated to higher earners, or a combination of both, there is a better way.
Cyberspace is alive with suggestions on what a better way might be, and the Association of Mature American Citizens (AMAC) has been prominent in the quest to address the dilemma with an approach that preserves and modernizes Social Security. AMAC has developed a legislative framework that achieves long-term solvency without the need to inflict tax increases on America’s workforce.
AMAC’s approach calls for no payroll tax increases, ensures the targeting of benefits where needed the most, and supports an avenue for all workers to accumulate financial reserves for retirement. AMAC advocates for a bipartisan compromise, “The Social Security Guarantee,” taking selected portions of bills introduced in Congress and merging them with the Association’s own research. See AMAC’s Social Security Guarantee proposal here…
Structurally, the AMAC SSG addresses three prime directives:
- Ensure annual benefit increases, targeting those with lower earnings to receive higher benefits
In keeping with Social Security’s progressive design, AMAC’s plan calls using a flat COLA for all based on the average benefit received by all beneficiaries.
- Guarantee achieving solvency and benefit continuity for future generations
For example, change the full retirement age from 67 to 70, while retaining the early retirement age at 62 and modifying the primary insurance amount (PIA) calculation to achieve modest reductions in the benefit for higher earners.
- Augment future retirees’ financial resources via additional savings opportunities
AMAC’s plan includes building on the retirement planning provisions built into the recently enacted Secure and Secure 2.0 legislative changes.
The AMAC Social Security Guarantee also advances several detailed program modifications, including elimination of “drop-out” years in the PIA calculation and an enhanced survivor benefit provision.
AMAC is resolute in its mission that Social Security be modernized to take into account 21st century economics. It has gotten the attention of lawmakers via meetings with many congressional offices and staff over the past several years. Using the “The Social Security Guarantee” as a base, AMAC’s researchers are actively developing approaches to achieving what is vital to our Seniors—a sustainable future for their retirement lives and a continuation of Social Security’s inherent premise of keeping seniors out of proverty.