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social security expansion act
Bernie Sanders Calls for Major Overhaul to Solve US Retirement Crisis
"If Congress can bail out the crooks on Wall Street," said the senator, "please do not tell me that Congress can't support a secure retirement for working Americans."
Mar 04, 2024
Days after hearing the testimony of a fourth-generation autoworker whose family has experienced first-hand the shredding of the social contract over the course of several decades, U.S. Sen. Bernie Sanders demanded on Monday that Congress swiftly pass legislation to cut the "unacceptable" rate of poverty among senior citizens and ensure that American workers can once again "retire with the dignity and the respect that they deserve."
In an op-ed for Fox News, Vermont independent senator wrote about the hearing he held last week as chairman of the Senate Health, Education, Labor, and Pensions (HELP) Committee about the country's retirement crisis.
The committee heard from Sara Schambers, whose grandfather retired at 55 from his job as an autoworker at Ford Motor Company, receiving "a pension and good healthcare" provided by the company where he'd worked for three decades.
Schambers' grandmother had to retire early due to a diagnosis of Lou Gehrig's disease, "but she didn’t have to choose between paying her medical bills and buying dinner for her family, because her job provided her with the retirement security she needed."
In sharp contrast, Schambers told Sanders and the rest of the committee that she will not have healthcare or a pension when she retires from her job as an autoworker.
"For generations, getting a job at Ford meant stability and security," said Schambers. "It meant being able to plan for yourself and your children. It meant being able to buy a house and see a future for yourself. But for those of us who were hired in after the financial crisis, that has not been our truth."
Schambers said auto companies have been "adamant that they couldn't afford to add to our pension liability... and that giving back our pensions could affect their stock prices and possibly lead to lower credit ratings. Nowadays, a stock price is more important than 150,000 autoworkers."
In his op-ed, Sanders wrote that the loss of pension and fixed benefit plans among American workers—60% of whom had them in the early 1980s, compared to just 4% in 2023—has led to a 23% poverty rate among senior citizens, one of the highest rates compared to other wealthy countries, according to the Organization for Economic Co-operation and Development.
"In Denmark, only 3% of seniors live in poverty," wrote Sanders. "In France, the senior poverty rate is 4.4%. In Germany, it's 9.1%. In Canada, it's 12.3%. In the United Kingdom, it's 15.5%."
Sanders called on Congress to pass the Social Security Expansion Act, which he introduced last year with nine other senators, including Sens. Elizabeth Warren (D-Mass.), Sheldon Whitehouse (D-R.I.), and Tina Smith (D-Minn.).
The bill would make Social Security solvent for the next 75 years and expand the programs benefits for seniors and people with disabilities by $2,400 a year, making a difference to the 1-in-4 senior citizens who now live on less than $15,000 per year and 1-in-2 who live on less than $30,000 per year, as the Senate HELP Committee noted in a report ahead of the hearing last week.
In keeping with Sanders' longtime push to require the wealthy to pay their fair share into the program, the Social Security Expansion Act would apply the Social Security payroll tax to all income, including those from capital gains and dividends, for those who make more than $250,000 per year.
Currently, the senator wrote, the wealthiest Americans benefit from a cap on the Social Security payroll tax.
"Absurdly and unfairly, a billionaire pays the same amount of money into Social Security as someone who makes $168,700 a year," wrote Sanders. "That means, if you make up to $168,700 a year, you pay 6.2% of your income in Social Security taxes. But if you make 10 times more—$1,687,000—you pay just 0.62% of your income in Social Security taxes."
"That may make sense to someone," he added. It doesn't make sense to me."
In an interview with CNN over the weekend, Sanders was asked about a Republican proposal to raise the retirement age instead of properly funding Social Security by taxing the rich.
"Brilliant idea," said the senator sarcastically. "Yes, we've got our people, 87-year-olds packing groceries in a supermarket. You know, really? People have worked hard their whole lives, this is the richest country in the history of the world. Raise the retirement age, cut benefits? I don't think so."
Sanders proposed that every corporation in America should be required to either provide their employees with a retirement plan or "give workers the option of contributing to a federal pension plan similar to what members of Congress and federal employees receive."
"If Congress can provide trillions of dollars in tax breaks to billionaires and large corporations," said the senator, "if Congress can bail out the crooks on Wall Street who caused millions of Americans to lose their jobs, homes, and life savings back in 2008, please do not tell me that Congress can't support a secure retirement for working Americans."
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Sanders Report Warns Nearly Half of Older Americans 'Have No Retirement Savings'
"In the richest country in the history of the world, a secure and dignified retirement should be available to every American, not just the extremely wealthy."
Feb 28, 2024
A report published Wednesday by the U.S. Senate committee chaired by Independent Vermont Sen. Bernie Sanders exposed "the depth of the retirement crisis in America" while exploring "solutions that will allow all of our people to retire with dignity and security—not just the very wealthy."
The report—entitled A Secure Retirement for All—was released ahead of a Wednesday morning Senate Committee on Health, Education, Labor, and Pensions (HELP) hearing on the retirement crisis. The publication revealed that nearly half of Americans age 55 and older have no retirement savings. It also found that half of Americans age 65 and older are living on less than $30,000 per year, while 1 in people are fighting to survive on less than $15,000 annually.
Other key findings include:
- Nearly 5.3 million Americans age 65 and older live in poverty, and roughly 1 in 10 seniors;
- Nearly half of all Americans are at risk of a financially insecure retirement, up from 1 in 3 workers in 1983;
- The average monthly Social Security benefit in 2023 was only about $1,782, or $21,384 annually; and
- The top 20% of earners receive 63% of the $202 billion in annual income tax breaks for retirement accounts, while the bottom 60% receive just 13.4% of these breaks.
"Given the enormous growth of the economy over the past several decades, one might expect that the outlook for retirees is improving," the report states. "Yet, today nearly half of all Americans are at risk of a financially insecure retirement."
"For many, retiring on Social Security alone means that some months you can afford to either keep the lights on or get your prescription refilled," the publication adds. "The cost of healthcare in retirement is an enormous cost driver, for which many find themselves unprepared."
The report offers two main solutions to the retirement crisis: expanding and strengthening Social Security—"the most successful government program in our nation's history"—and enacting "Retirement Security for All" legislation that ensures every worker can save for retirement via their paychecks and guarantees lifetime monthly payments.
Last year, Sanders—along with Sen. Elizabeth Warren (D-Mass.) and Reps. Jan Schakowsky (D-Ill.) and Val Hoyle (D-Ore.)—introduced the Social Security Expansion Act, which would increase monthly benefits by at least $200 and extend the program's solvency for decades by lifting the cap on the maximum amount of income subject to the Social Security payroll tax.
The Social Security Administration's chief actuary said that had the bill been signed into law last year, the program would be able to pay full benefits to every eligible American for 75 years, without any tax increase for 93% of U.S. workers earning less than $250,000 per year.
"In the richest country in the history of the world, a secure and dignified retirement should be available to every American, not just the extremely wealthy," Sanders said on Wednesday. "Right now, more than half of older Americans have no retirement savings. More than 50% of our nation’s seniors are trying to survive on an income of less than $30,000 a year. That is absurd. Congress must address the retirement crisis facing working-class Americans across our country."
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A Simple Choice: Social Security or Billionaire Greed
Any politician who expresses concern about Social Security's finances without being willing to tax the rich is a phony. Nothing but a phony.
Feb 28, 2023
Like they used to say in the old neighborhood, some things ain't complicated. If your senator or representative won't tax the wealthy to protect and expand Social Security, then they care more about America's 728 billionaires than they do about the 66 million children, disabled, and older people currently receiving benefits—or the many millions that will follow them. They don't deserve to stay in office if they can't represent their own people.
Social Security is a vast, highly successful program. That makes it sound complicated. It's not. It was built on simple moral and operational principles. Among them was universality, the idea that the program should include everyone, and the notion that everyone should pay their fair share. Unfortunately, the millionaires and billionaires plundering the economy aren't pitching in the way they should.
That makes the choice for our elected officials simple, too: Are you going to make the wealthy step up or are you going to hide behind word-salad speeches and sleight-of-hand legislation? One thing is clear: any politician who expresses concern about Social Security's finances without being willing to tax the rich is a phony. Nothing but a phony.
We're looking at you, Mitt Romney.
The commission that worked on Social Security's finances in the 1980s raised the cap on the Social Security payroll tax, with the expectation that it would capture 90 percent of the income earned in this country. As Linda Benesch notes, however, rising income inequality has caused that number to plummet. As of February 28, 2023, a person making a million dollars per year has finished paying into Social Security for the year. (I calculated that figure for Jeff Bezos once; he was done paying his "fair share" about 28 seconds after the New Year's Eve ball dropped in Times Square!) Moreover, wealthy people earn the lion's share of their income from non-payroll sources like investments and business revenue. That isn't taxed for Social Security at all.
Social Security is a vast, highly successful program. That makes it sound complicated. It's not.
Meanwhile, here in the real world, people making less than $160,200 annually—that is, the vast majority of American workers—will be paying this tax all year.
That's why the idea of "scrapping the cap" on this tax is so compelling. Sen. Bernie Sanders' Social Security Expansion Act would re-impose this payroll tax on income above $250,000 and would add in the kinds of non-payroll income that mainly benefit the super-wealthy. In the House, a bill from Rep. John Larson would scrap the cap on income above $400,000.
Both bills substantially expand Social Security while bringing in substantial new revenue. The Larson bill would provide a sizeable down payment and the Sanders bill would fully fund Social Security, something politicians like Sen. Mitt Romney claim to be concerned about. Romney has wept crocodile tears over the program's expected revenue shortfall for years, but he's ruled out tax increases.
People say we live in a divided country, but Americans are united on this subject. 71 percent of voters polled after the last election want Congress to "protect Social Security and Medicare." The message to Capitol Hill is simple: do your damned jobs.
Romney's proposed bill, which in an Orwellian flourish is called "the TRUST Act," would create "congressional rescue committees" that would meet privately to determine the fate of critical social programs. Since Romney (who is extremely wealthy himself) opposes revenue hikes, that leaves only benefit cuts.
It will take ongoing political pressure to protect and expand Social Security. But it will be a great day when it happens.
Romney and his cosponsors hope to elude responsibility for their actions by hiding behind as-yet-unnamed committee members and their backroom deliberations. That includes some Democrats. The bill's Democratic backers, including Joe Manchin, are more likely than Romney to say that they're open to hiking taxes on the wealthy. But they're supporting a 'bipartisan' process with Republicans who will never go along with that.
These Dems know that. They're trying to have it both ways—sounding reasonable while promoting a process that's designed to lead to cuts and cuts alone.
And make no mistake: that's the play. Romney's bill uses a well-worn playbook for trying to cut popular programs. As the bill's summary says, "Congress must use specified expedited legislative procedures to consider legislation that is approved and submitted by the rescue committees." In other words, it gets rushed to the floor for a vote for an immediate up-or-down vote, without committee review or the chance to revise it.
That's an attempt to circumvent democracy. Public trust in our democracy has plunged to frightening lows as the wealthy buy more and more custom-designed legislation. The TRUST Act is designed to make an undemocratic and unaccountable political process even more undemocratic and unaccountable.
That's what the Simpson/Bowles Deficit Commission tried to do during the Obama administration. It's part of the old anti-government playbook laid out by billionaire Pete Peterson and the astroturf anti-social-welfare organizations he funded for decades. One pro-TRUST congressional Dem even used a Peterson-funded, consultant-designed phrase to defend his actions. If I hear the words "we have kicked this can down the road for too long" again I won't be responsible for my actions. Maybe somebody's can should get kicked, but it ain't yours or mine.
Maybe somebody's can should get kicked, but it ain't yours or mine.
Don't count the double-talkers out. There's a lot of money riding on this, and it's all with the billionaires. It will take ongoing political pressure to protect and expand Social Security. But it will be a great day when it happens. Taxing the wealthy will have other benefits, too. It will strengthen the social contract when the public sees their country's oligarchs being forced to assume some responsibility for the society that enriched them. It might reduce their stranglehold on politics a little, too.
This country's billionaires gainedmore than $2.1 trillion in wealth since the pandemic began and now have total estimated riches of $5.1 trillion. Meanwhile, almost half of all Americans aged 55 and older have no retirement savings at all. The average person on Social Security only gets $1,688 per month. And you're trying to tell us that's what this country can't afford?
As we used to say in the old neighborhood: Get outta here.
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