A new federal report says the Social Security trust fund will be depleted in 2035. Vermont Sen. Bernie Sanders says he has a plan to extend Social Security’s solvency and increase benefits. But as our Brett Miller reports, lawmakers remain divided on how to save the system.
Some 50 million retired workers, 6 million survivors of deceased workers and 9 million disabled workers and their dependents were all getting Social Security benefits at the end of 2021. That’s 65 million Americans relying on these benefits as all or part of their income.
But under the new estimate, the program’s cost is expected to overtake its income in 2022 and every year after until reserves run out in 2035.
Thursday, the Senate Budget Committee held a hearing on saving Social Security.
Senate Budget Committee Chair Bernie Sanders says he has a plan to expand Social Security and increase benefits for seniors and the disabled.
“Our job, in my view, is not to cut Social Security, is not to raise the retirement age,” said Sanders, I-Vermont.
The Social Security Expansion Act would keep the Social Security Trust Fund solvent for 75 years by applying Social Security payroll tax on all income, including capital gains and dividends, for people making more than $250,000 a year.
“Ninety-three-point-seven percent of Americans wouldn’t see their taxes go up one penny,” Sanders said.
“I take a different view on how to do this. Mine is realistic. Yours is a fantasy,” said Sen. Lindsey Graham, R-South Carolina.
Graham, the committee’s ranking Republican, doesn’t see taxing the wealthy as a solution. Instead, he wants to change how benefits are paid out and raise the retirement age.
“The wealthier people are going to have to take a little less in benefits. Younger people are living longer so we’re going to have to probably adjust the age once again,” Graham said.
He says that for each person getting benefits, there are fewer workers paying into the trust fund than in years past, meaning less money to go around.
However, current retirees say their benefits are already too low and failing to keep up with inflation.
“After 40 years of work and playing by the rules, my retirement benefits from the airlines, TWA and American Airlines, is $311 a month,” said Robert Roach Jr. of the Alliance for Retired Americans.
Advocates in favor of Sanders’ plan say the future economy will be able to support expanded Social Security benefits which they project will account for less than 6% of gross domestic product by the end of the century.
“Our nation will be much wealthier at the end of the 21st century, just as we are wealthier now than we were 75 years ago. That means that the around 6% of GDP will be easier to afford in the future,” said Nancy Altman, the president of Social Security Works.
Advocates opposed to Sanders’ measure instead support means testing for benefit recipients.
“I find it really hard to understand those who advocate more on taxes on the rich while ruling out slowing benefits for the same people,” said Maya MacGuineas of the Committee for a Responsible Federal Budget.
In any event, all sides agree something has to give.