Social Security–the problem and possible solution
That Social Security is facing problems in the long-term is little news to those have have followed the program for decades. The days of stockpiling surpluses from more taxes coming in than are paid out will end in 2020 As Brad McMillan notes in this Forbes Magazine article, more revenue must be raised. Currently, Social Security contributions are limited to the first $132,900 of income, but benefits are limited as well, so limiting the amount taxed to pay for those limited benefits seems equitable to most people. If Congress extends the tax to all earned income, does it raise benefit payments? If no, then higher earners will be subsidizing those who make less, turning Social Security into a welfare-like program. What about extending payroll taxes to things like rental income, dividends, and so forth? McMillan explores these issues in the 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.