Higher Taxes? Benefit Cuts? How Candidates Plan to Fix Social Security
Tuesday marked the final Democratic primary debate before the Iowa caucuses, and candidates once again missed the mark by failing to address the elephant in the room: funding Social Security.
The reason why the topic of Social Security hasn’t been discussed in the 2020 presidential race is unknown, considering one of the largest voting blocs are retirees directly impacted by Social Security changes — 65% of women and 68% of men age 65 and older voted in the 2018 midterm elections.
According to the Social Security Administration, nearly 64 million Americans received upwards of $1 trillion in Social Security benefits in 2019.
Social Security is projected to be insolvent by 2035.
That’s why we want to look at the top presidential candidates and their views on the benefits program. We used research compiled by the Center for Retirement Research at Boston College to examine this 2020 presidential race issue.
We’ll break it down by candidate.
Social Security and the 2020 Presidential Race:
The former vice president has come under fire from fellow candidate Sen. Bernie Sanders (I-Vermont) for Biden’s views of Social Security.
“Joe Biden has been on the floor of the Senate talking about the need to cut Social Security or Medicare or Medicaid,” Sanders told The Hill website.
According to the CRR, Biden’s plan includes changing the payroll tax cap to increase Social Security revenues. That includes increasing taxes on wealthy Americans.
In terms of benefits, Biden also proposes increasing the minimum benefit — workers working at least 30 years would get 125% of the federal poverty level in benefits — as well as survivor benefits.
Biden has also proposed allowing teachers not eligible for Social Security to begin receiving benefits sooner than the 10-year period as well as allowing some public employees the ability to collect enhanced Social Security benefits.
But that hasn’t always been his stance. From 1984-2018 Biden was a staunch advocate for cutting Social Security benefits, which may raise some question marks about what he will actually accomplish if elected president.
Buttigieg, the former mayor of South Bend, Indiana, is also in favor of upping taxes on the rich to pay for Social Security.
“Social Security does face a fiscal imbalance that needs to be addressed — without raising taxes on working- and middle-class Americans,” his campaign website said.
He also backs a plan to allow years as a caregiver to count toward a person’s benefits. Years spent caring for children, elderly or disabled dependents would count.
Like Biden (and most other Democratic candidates), Buttigieg also supports increasing the minimum Social Security benefit.
While blasting Biden for his past views on Social Security, Sanders supports an expansion of the benefits program.
That includes increasing the payroll tax cap to $250,000 (similar to Klobuchar).
“At a time of massive income and wealth inequality, the wealthiest Americans in this country must pay their fair share into the system,” Sanders said on his campaign website.
Sanders also favors expanding benefits by $1,300 a year for seniors with incomes less than $16,000 and increasing minimum benefits to low-income workers.
A senator from Massachusetts, Warren has proposed a 14.8% Social Security contribution requirement on individual wages over $250,000 to pay for Social Security expansion — including an immediate $200-a-month benefit increase for every Social Security beneficiary.
“Seniors today are already facing a difficult retirement. Without action, future generations are likely to be even worse off,” she said, on her campaign website.
She’s also in favor of a 14.8% contribution requirement on net investment income that applies to the 2% of individuals making more than $250,000 as individuals or $400,000 as families.
Warren, like Biden, supports eliminating a provision so some public sector employees can get enhanced benefits. She also wants to allow full-time students to collect Social Security survivor benefits through the age of 24.
There is very little in terms of information regarding President Trump’s views on Social Security leading up to the 2020 presidential election.
However those decreases were rolled back by Congress both times.
It remains unclear what, if any, plans Trump would have for Social Security if he wins the 2020 presidential election.
• You can find all of the latest and most important news about Social Security here on Money and Markets.
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