Why are Democrats not extending social security?
Why are Democrats not extending social security?

Why are Democrats not extending social security?

House Ways and Means Members of the Social Security Subcommittee look on while rep. Alexandria Ocasio-Cortez, DN.Y., speaks on legislation that would strengthen social security benefits, in Washington, DC, on October 26, 2021.

Photo: Drew Angerer / Getty Images

Democratic Representative John Larson from Connecticut has written a bill titled “Social Security 2100: A Sacred Trust,” which would immediately extend the benefits of the program to all 65 million recipients. It has at least 200 co-sponsors, all Democrats, in the House. And increased social security payments should be an easy boost for Democrats, especially in an election year.

Yet the bill is still awaiting a vote in the House Social Affairs Committee – chaired by Larson – in the House Ways and Means Committee, much less a vote on the floor. Why?

Part of the answer seems to be Wendell Primus, a senior assistant to Parliament Speaker Nancy Pelosi, D-Calif. Primus er seen by many in the world of Washington, DC, progressive policies that embody a mindset from the past of the Democratic Party, where all that seemed possible was to prevent cuts in important social programs, rather than to be attacked.

Primus “cares passionately about children, he has always made it clear that we have to make sure we take care of the children,” Larson said in a recent appearance on The Intercepts podcast Deconstructed. “Wendell’s concern would be that there is only so much money to go around. We only have so much expense.” Pelosi’s office did not immediately respond to a request for comment.

But, Larson explained, “My argument is that this takes care of the kids. [Social Security] it is the No. 1 anti-poverty program for children. ” While social security is best known for its benefits for retirees, it also provides support for children with a parent who has died or become disabled, and children who are themselves disabled. Larson is optimistic that his bill will receive a vote soon, and in fact believes it would be so politically popular that it could be passed with some support from the GOP.

According to Larson, Mark Meadows, former chairman of the House Freedom Caucus and later chief of staff to former president Donald Trump, once told him that if his legislation “comes to the floor, you will find that many Republicans are going to vote for it. [it]. “

Social Security 2100 would then face a tougher challenge in the Senate. According to Senate rules, no changes can be made to Social Security through the voting process, which requires a simple majority. It would therefore be necessary to attract the votes of all 50 Democratic senators as well as 10 Republicans to end a certain filibuster.

Another difficult aspect of the bill is that all of its extended benefits are temporary, lasting only five years. An earlier version of Larson’s bill made the increased benefits permanent, paying for them by gradually raising the payroll tax rate and removing the payroll limit, currently $ 147,000, on which taxes are calculated. The new bill would generate much less revenue because it is written to honor President Joe Biden’s promise not to raise taxes on anyone earning less than $ 400,000 a year.

Larson and other supporters of this version of the bill believe it would be politically difficult for members of Congress to let the new benefits expire, and the issue could then be raised again.

In addition to the co-sponsors of Larson’s bill, it has also been approved by many external organizations, including the NAACP, the National Organization for Women, and MoveOn. Nevertheless, there has been limited political education about the specific new benefits of the bill, so that ordinary citizens may want to educate themselves. These are the key provisions of Social Security 2100:

  • Social security payments will immediately increase $ 360 per year for all 65 million of the program’s recipients

The benefits for each recipient of Social Security would increase instantly by $ 30 a month – meaning $ 360 a year for individuals or $ 720 for retired couples. This is especially important because, although it may be reconsidered, Medicare is raising Part B premiums by an unusually large amount for 2022, adding $ 260 to the annual expenses for the majority of retirees receiving Social Security.

This extra $ 360 would go to all Social Security recipients. While Social Security is best known for supporting older people, the program’s official name is Old-Age, Survivors and Disability Insurance or OASDI. About 15 million recipients are disabled or survivors of workers who have died.

This is not an increase in benefits just for its sake. Rather, it is designed to address the inaccurately low increases in cost of living in social security for decades.

  • The annual adjustment of cost of living would be higher

Since 1975, social security benefits have been automatically increased each year through a cost-of-living adjustment, commonly known as COLA, to prevent them from falling in real terms due to inflation. However, the Ministry of Labor determines the adjustment of the cost of living using a measure called the CPI-W, which is designed to capture the inflation experienced by the working-age population in the cities.

Recently, the Ministry of Labor began trying to measure inflation as it is experienced by older people with something called CPI-E. CPI-E has averaged about 0.2 percent higher per year than CPI-W.

Although the average difference of 0.2 percent may seem smaller, it intensifies over time: In 2047, benefits calculated with CPI-W cost of living adjustments will be 5 percent lower than benefits calculated with CPI-E. Right now, the purchasing power of a worker’s average benefits of $ 19,884 will fall by almost $ 1,000 over the next 25 years.

  • Retirees who earned the least on their jobs would get much more per year

Congress passed a “special minimum benefit” in 1972 for people who had been paid the least during their working lives. For those with 30 years in the labor force, the special minimum benefit has generally been around 85 percent of the federal poverty level for individuals. The Social Security 2100 bill would raise the special minimum benefit to about 125 percent of the poverty level.

A 62-year-old person who has worked full-time for 30 years earns $ 15,080 a year (the current federal minimum wage) and claims that at age 66, her Social Security benefit will receive about $ 11,200 a year under the regular formula. Under the bill’s new special minimum benefit, she would receive about $ 15,900, or 42% more.

  • Higher benefits for surviving spouses

When a member of a couple who have both worked dies, social security benefits can drop rapidly for the survivor, sometimes by as much as half. Social Security 2100 would change the rules so that surviving spouses will continue to receive at least 75 percent of the combined benefits received by them and their deceased partner. This will be especially important for women who tend to survive men.

  • More for average senior workers

Many people will spend their non-social savings down if they live long enough. Social Security 2100 recognizes this by increasing the benefits for retirees who have been entitled to benefits for at least 15 years. Those who have been eligible for 20 years will receive a bump of 5 percent, about $ 1,000 more a year for an average worker today.

  • Taking care of others will count as work

Currently, social security benefits for retirees are calculated based on their income from whatever job they had while working. This penalizes those who have to spend unpaid time taking care of children or other relatives. The Social Security 2100 would change this by recognizing that caring is overt work and giving those who do it with credits as if they had been in the formal workforce.

  • The 1 percent would pay old age, survivors’ and disability insurance taxes on income over $ 400,000

People who are not very aware of social security are often shocked to learn that the taxes that pay for it are only charged up to a certain income threshold. As mentioned above, the limit for 2022 is $ 147,000. Anyone earning over $ 147,000 this year pays no OASDI income tax above this threshold. The Social Security 2100 would leave the $ 147,000 threshold in place – until a worker’s income reached $ 400,000. All salary after that would start to be subject to OASDI taxes again.

The Social Security 2100 would also make many minor changes and technical fixes to the program that would significantly improve it. Those who have become severely disabled would be immediately entitled to benefits instead of being forced to wait five months. Partially disabled people will only have their benefits gradually reduced if they are able to work and earn above a threshold level, instead of having their benefits removed immediately. The Social Security Administration would send annual statements to people throughout their lives so they can see their expected benefits. And that’s not all.

For all these reasons, the passing of Larson’s bill – or just forcing Republicans to defeat it – should be a potent issue for Democrats entering the midterm period, especially in an atmosphere where the party desperately needs to show results.

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