What Does a Biden Presidency Mean for Social Security?
Sean Williams reminds readers that for more than 80 years, Social Security has without fail made guaranteed payments to eligible retired workers. Today, 65 million people receive a monthly benefit, and 46 million are retirees. That is in peril, and it will fall to a President Biden and Congress to shore up the program, as it faces real shortfalls that have been accelerated due to the pandemic. Williams reviews various proposals from Biden over the past year and zeroes in on four discussed here:
- Increase taxation on high earners: The flagship change would lift the maximum taxable earnings cap of $142,800 in 2021. He would reinstitute payroll tax on incomes over $400,000. Collected additional revenue from high earners would push Social Security’s potential insolvency decades down the road.
- Raise the Primary Insurance Amount (PIA) for aged beneficiaries: Biden proposes a 1% annual increase in the PIA of aged beneficiaries between ages 78 and 82. It would cap at 5% and lead to higher monthly benefits.
- Lift the special minimum benefit: Biden’s plan would require the special minimum benefit be raised to 125% of the federal poverty line.
- Make the CPI-E Social Security’s inflationary measure: This more favorable inflation measure would lead to slightly higher annual increases, as it it based more on items seniors buy.
Items 2,3,4 above actually exacerbate the insolvency situation, as any idea to be “more generous” would. Full article here; compare the Biden plan to AMAC’s plan in the link below.
The Association of Mature American Citizens (AMAC) believes Social Security must be preserved and modernized. This can be achieved by making modest changes in them 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.