The Social Security system turns 89 this week — nearly 90 years of providing basic financial security to American retirees, their families, and, since 1956, people with disabilities. Today, 67 million – or 1 in 5 U.S. residents Now you can receive social security benefits. I have never been late with a payment.
When President Franklin D. Roosevelt signed the Social Security Act, August 14, 1935In 2017, about half of the nation’s elderly were poor, and many of them were actually living in poorhouses. (As of 2021, 8 percent Fifty percent of people over age 65 live below the poverty line. “We can never protect 100 percent of our people 100 percent from the hazards and vicissitudes of life,” President Franklin Roosevelt declared, “but we have tried to enact laws which will give some protection to the average citizen and his family from an indigent old age.”
This “protection” is modest, but very important. The average Social Security benefit for a retiree is about $1,900/monthWhen I talk to seniors on fixed incomes, as I do when I travel around the country to speak about Social Security, they will tell me the benefits they get are a financial lifeline. “It’s a big chunk of my income,” said a recipient in Milwaukee. “It’s my livelihood,” said a retiree in Richmond. Another senior said simply, “Thank you for Social Security.”
Social Security not only provides retirement benefits, but also serves as insurance for eligible workers and their families. In fact, the average 27-year-old worker with a family is already $2 million The simple fact undermines criticism that Social Security is unfair to younger generations because people get life and disability insurance from it. In fact, Social Security is truly intergenerational. It’s for people who are working now and for those who will be working when they retire.
Social Security’s impact goes beyond workers and retirees. It stimulates the economy as a whole country. Thanks to the “multiplier effect,” every dollar of Social Security payments generates $2 in stimulus for the economy. That’s a total of $1.6 trillion This will act as a stimulus as the payments are disbursed and stimulate economic activity in the states.
The program faces challenges: The Social Security Administration projects that the combined retirement and disability trust funds will be depleted by 2025. 2035 Unless Congress takes preemptive action, this bill will not become law. Contrary to popular belief, this is not because the ratio of pensioners to pension-paying workers is rising. The bill’s authors: 1983 Social Security Reform I had already anticipated that, so I decided to increase my income and extend my retirement age. People born in 1960 are 67 years oldOr later.
The main reasons for the currently projected shortage are: Income inequality The 1983 reformers did not foresee the widening gap between high-income earners and the rest of the population who contribute to Social Security through payroll taxes. Payroll taxes are capped at certain income levels, also known as “tax ceilings.” (The current cap is $168,600 in annual wages.
In the early 1980s, the Social Security “tax cap” 90 percent It accounts for 50% of Americans’ income. As the wealthy get richer and middle-class incomes stagnate, that number is shrinking. 82 percentToday, more and more high earners are earning “up to the limit,” taking badly needed income from the system.
Adjusting the salary cap and ensuring that the wealthy pay their fair share could put the system back on track. We support a proposal by Rep. John Larson (D-Conn.) to do just that. Social Security 2100 ActThe bill would reimpose payroll taxes on wages over $400,000 and, for the first time, would also tax a portion of high-income earners’ investment income. (We support similar legislation by Sen. Bernie Sanders (I-VT), Sen. Sheldon Whitehouse (D-IN), Rep. Jan Schakowsky (D-IL), and Rep. Brendan Boyle (D-PA).)
Larson’s bill not only expands the trust fund’s solvency, but also expands benefits across the board, especially for vulnerable groups of recipients. Increased targeted benefits .
Some in Congress reject any measures to raise revenue and insist that Social Security must be “reformed” (meaning cuts to benefits). We reject cuts as unnecessary and harmful to current and future retirees. This would include: Raising the retirement ageUp to age 69 or 70, means-tested benefits, A stingy equation for cost of living increases or the privatization of social security.
Some proponents of Social Security cuts argue that they would not affect benefits for today’s seniors, but Future generationsWe should expect to get less out of Social Security. But as employer-sponsored pensions disappear, student loan debt rises, and income inequality widens, making it harder to save for retirement, our children and grandchildren will depend on Social Security even more than today’s seniors. Younger workers will need all of the retirement benefits they were promised, and maybe even more.
The 89th anniversary of Social Security is an important year for the program because its future depends on how well it performs. 2024 ElectionMost politicians claim to support Social Security. We urge voters to look behind the words and evaluate what candidates for federal office are really proposing on Social Security.
Those who advocate for cutting benefits for today’s retirees and future retirees (such as by raising the retirement age) do not have the true interests of seniors in mind. Candidates who want to strengthen and expand Social Security care about the economic security of workers and respect the legacy of Franklin D. Roosevelt, who 89 years ago said that Social Security is “the cornerstone of a structure that is being built but is by no means completed.”
Max Lichtman is president and CEO of the National Committee to Protect Social Security and Medicare. He is a former staff director for the U.S. Senate Select Committee on Aging.
