My initial reaction was to oppose this, but it might not be a bad idea. Not only are people working longer, many don’t need it. Yet, to some extent, it is “socialist”: it’s taking from those who earned it but don’t need it and giving to those who do need it. Republicans, Eyeing Majority, Float Changes to Social Security and Medicare “Congressional Republicans, eyeing a midterm election victory that could hand them control of the House and the Senate, have embraced plans to reduce federal spending on Social Security and Medicare, including cutting benefits for some retirees and raising the retirement age for both safety net programs.”
Adjustments are needed now that people live to 80. Adjustments are also needed to our defense budget (decrease or just stay same for ten more years before increasing yet again), corporate give aways (vastly decrease), border patrol (increase), infrastructure (increase), and on and on. I wish we had a "Dave" type dude somewhere that could come in and really do the necessary work/cuts. Love me some Kevin Kline.
Can they cut it without Biden's signature? If they cannot they would be foolish to even mention it. I've read for years SS can survive with small cuts and that it won't without them.All it would take is political courage. I've seen no evidence of that in either party. Edit: I'm 63 and will soon be on SS. They need to cut my income. Kinda like if we spend extra money we need to raise taxes or cut other spending to pay for it. I'm not talking about other people'a sacrifices. I'm talking about my very near future. I do worry about people who are overly reliant on it but the ratios of workers to retirees just won't work until some of us baby boomers die off.
Republicans aren't cutting SS. That's just a Democratic scare tactic. Floating is to suggest and Florida and Arizona among others won't go along.
They would if they could. From the link: Yet several influential Republicans have signaled a new willingness to push for Medicare and Social Security spending cuts as part of future budget negotiations with President Biden. Their ideas include raising the age for collecting Social Security benefits to 70 from 67 and requiring many older Americans to pay higher premiums for their health coverage.
Simply a negotiation strategy for raising the debt ceiling. It'll be raised just like it always is from excess spending (Biden). From the article "Republicans will focus on protecting and preserving Social Security benefits". It may be smart to ask wealthy Americans to have a 'means test' in the future.
Increasing legal immigration would provide a relatively painless way of shoring up the social security trust fund. Unfortunately most Republicans or at least the de facto leader of the Republican Party oppose that alternative. From two years ago when said leader was still in office. Trump Cuts Legal Immigrants By Half And He’s Not Done Yet Paper on positive effect of immigration on the social security trust fund Immigration’s Effect on the Social Security System
Interesting, considering the Senator from FL has stated some of the most extremist ideas about social security. Basically suggesting it should be renewed every 5 years. You want to see social security voted on every 5 years? Like having a bunch of politicians “vote” on whether to default on the national debt isn’t insane enough. Of course the guys spin is that “he doesn’t know a single Republican that wants to end it”, so of course they’d renew it ever 5 years. You believe him? Guess the Senator from FL never met Rand Paul or Mike Lee.
In 2018 a bunch of Republicans ran on protecting the Affordable Care Act, after spending years trying to cancel it. Why the change? Because it started polling more popularly, esp after the vote to cancel failed in 2017. If one of these same politicians claims their goal is to “protect” social security are we to believe them? You are being lied to by shameless liars. I’m quite sure all those same politicians that lied in their campaigns would gleefully cancel ACA if they could get enough votes even today, just as they would with most of those transfer payments to poor folks/senior citizens etc. It’s kind of amusing watching conservatives argue for a Marxist policy like means testing, even though that is a mechanism that could potentially benefit Medicare and social security. There are other options available as well, perhaps the most obvious is getting rid of (or substantially raising) the cap on the amount of income that gets taxed at the high end. That has the same functional effect as a means test on the benefits. I don’t think people are against some structural reform considering longer lifespans have fundamentally changed a program that originated when the average person died before collecting, with the average person now living 10 or 15 years there is a fundamental difference in the actuarial math, and that’s all it really is if everyone agrees these things must exist, figuring out the math. A means test is fine on that backend, but I can imagine that has its own issues (some perhaps able to manipulate or “hide” their means, while less able seniors fall through the cracks and end up suffering, relatively). Probably better to keep it as simple as possible imo, considering we are talking about seniors and possibly vulnerable people.
I entered the workforce in 1980 with a Engineering degree from UF. I retired last December after a wonderful career. I am 67 years old and we seniors get our social security payment the 4th Wednesday of each month ($2,700 for me). My social security statement indicates I have paid over my career $167K in social security taxes and $46K in medicare taxes. I EARNED this! I understand tweaks or changes to the system but when I hear about radical changes to this system with cuts in coverage this is betrayal to senior citizens.
From a selfish perspective, approaching retirement age, I’m not a big fan, but I do think it is the right thing to do. I would say bump he retirement age up a year or two at most, and then increase bottom end of the retirement income scale such that the mid to lowest levels don’t have a net decrease. I’d also say accelerate the increase of the FICA earnings cap at a pace higher than inflation to gain more revenue. As to Medicare increase the premium for higher incomes. I’ve also heard there could be some savings between redundancies or the Medicare parts. If they were going to do this I’d rather them do it sooner than later so we could plan for it.
2700 a month equals $486k over 15 years or $648k over 20 years. That’s a respectable modest return on $167k roughly equal to inflation. I don’t think most are proposing anything radical, just tweaking over time to bring the system into balance. You can also argue that our generation spent the accrued trust fund (indirectly ) on tax cuts, wars and other misadventures. So asking our generation to sacrifice a bit isn’t unreasonable IMO.
That's the prevailing sentiment. Do you feel you are entitled to it if a means test shows you don't NEED it? Personally, I've looked at it as a tax to establish a fund to help needy retirees. I agree it wasn't originally set up that way. I would consider a plan to make it that way. That was the only point of my OP.
A pretty easy thing to do that would be kind of like a modest means test would be to make social security benefits 100% taxable after a certain income. Currently around $30k income they become 50% taxable and around $45k they become 85% taxable. Perhaps make them 100% taxable after something such as $75k income. That by itself wouldn’t fix things but it would make a dent. Republicans probably won’t agree to this because it is a “tax increase” vs a “benefit cut” although the result is the same thing.
putting 167K in (evenly) over 40 years yields $860,000 @ 7%. Evenly is not right cuz contributions would have gotten larger over time. However, I only used 7% < than s&p yield* & I suspect he is only counting his contribution, not including the firms. * using that yield, it would be $1,930,000
yes you are correct. It is higher than inflation because the contributions were over 40 years, not all at the beginning. A 7% risk free return is a pretty damn good return.
Somewhere around 2033, the trust fund “runs out” of money. At that point the amount of taxes coming in will be enough to pay for 75% of the benefits. While that seems like a lot, I think that shortfall amounts to about 1.5% of gdp per year which is non trivial but not colossal. That amount is roughly equivalent to the Trump tax cuts. To put things in perspective, the SS trust fund at this point does not have money saved per se, it was lent out to the general fund, which of course is perpetually in debt. So the trust fund has ious. Congress could in theory legislate the ability of social security to borrow directly from the general fund once the trust fund runs out. SS is already running annual deficits. So we will already have substantial SS deficits before the trust fund runs out. It is somewhat of an accounting game.
1. Means testing for Medicare 2. Allow employees to opt out of SS if they waive their right to receive it. 3. Push back the retirement age to 67 or 70 and allow earlier IRA/401k withdrawals so someone 55 and over can retire on their own. Lots of levers to pull, the problem is we don’t pull any of them!!
