White House Advisors Float New Idea to Undermine Social Security
On the heels of President Trump’s repeated calls to eliminate Social Security’s funding stream through payroll tax cuts, influential White House advisors are considering a fresh ploy to undermine Americans’ earned benefits.
“Senior White House economic officials… are exploring a proposal floated by two conservative scholars that would allow Americans to choose to receive checks of up to $5,000 in exchange for a delay of their Social Security benefits, according to three people familiar with the internal matter.” – Washington Post, 5/11/20
This is another colossally bad idea from right-leaning think tanks with influence on the Trump administration, designed to dismantle Social Security under the guise of helping working people. The truth is: today’s workers will need every penny of their future benefits and should not be duped into postponing their right to claim Social Security when needed for retirement, disability or survivors income.
Inducing workers to trade their future retirement benefits for temporary cash payments now is akin to similar schemes in recent years from the White House and Congressional Republicans. In 2018, Ivanka Trump, Sen. Marco Rubio (R-FL), and others hatched a plan for parents to sacrifice their future Social Security benefits in exchange for paid family leave. These ideas represent a gross misuse of Social Security for purposes unrelated to its core purpose: providing baseline retirement security for American workers.
“Republicans are laying in a plan to steal your social security to pay for your decimated wages and benefits, while keeping landlords, banks and big corporations fully capitalized. There is no plan, however, to roll back any of the Trump, Bush or Reagan tax cuts for the obscenely wealthy.” – David Atkins, Washington Monthly, 5/10/20
President Trump has repeatedly promised “not to touch” Social Security, and one must assume that he is either too disengaged or too disingenuous to reject dangerous policies from his own advisors. The trading-cash-for-retirement-benefits scheme is only the latest in a series of proposed assaults on Social Security, including calls from the administration and congressional Republicans to cut payroll taxes, to raise the retirement age, to adopt stingier cost-of-living adjustments, and slash Social Security Disability Insurance (SSDI) by billions of dollars — along with their insistence that ‘entitlements’ be ‘reformed’ to pay for tax cuts for the wealthy and big corporations.
“Seniors will not be fooled by the administration’s duplicity. President Trump postures as a leader who will protect Social Security while his appointed foot soldiers continue to hurl bombs at workers’ earned benefits.” – Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare.
Nursing Home Residents Need Federal Protection from Coronavirus
In the torrent of news coverage about COVID-19, the plight of seniors does not always receive the priority it deserves. Older people are suffering disproportionately – not only because they are more vulnerable to the virus – but because of the federal government’s apparent inability to provide the testing and data necessary to slow the infection rate in nursing homes. This week, some concerned members of Congress took action.
Congresswoman Jan Schakowsky (D-IL) has introduced the Quality of Care for Nursing Home Residents Act of 2020, which the National Committee has enthusiastically endorsed. Among other things, the legislation would require all skilled nursing facilities to:
*Have a full-time infection interventionist on staff;
*Regularly test residents and staff;
*Provide enough personal protective equipment (PPE) for all employees;
*Offer at least two weeks of paid sick leave to each employee
*Facilitate virtual visits for residents and their family members.
This bill offers a health and social lifeline to millions of seniors confined in nursing homes, isolated from friends and family, falling ill and in some cases dying – or living in constant fear of both. Meanwhile, the Trump administration does not even have comprehensive data on the pandemic’s impact on nursing home residents, despite a promise on April 19th from CMS administrator Seema Verma that the government “would begin tracking outbreaks and deaths at long-term care facilities nationwide — and publish the numbers for everyone to see.”
“More than two weeks and 13,000 long-term care deaths later, the federal government still has not tallied the number of nursing homes that have had outbreaks nationwide or the number of residents who have died. And the data is still weeks away from being made public, according to the Centers for Medicare and Medicaid Services, or CMS, the federal agency that oversees nursing homes.” – NBC News, 5/8/20
As NBC News reports, this is not an academic matter. The administration’s failure to act expeditiously is enabling the virus to spread more rapidly in nursing homes, and “hampering officials’ ability to target hot spots and send additional resources where they are needed.” Skilled nursing facilities also are not receiving crucial Personal Protective Equipment (PPE) quickly enough to adequately protect patients and staff.
Some 1.3 million Americans currently reside in skilled nursing facilities across the country – with roughly 3 million employees caring for them. As of April 23rd, nursing homes in 36 states had reported fatalities from COVID, including residents and staff. According to Kaiser Family Foundation executive vice president Larry Levitt, skilled nursing facilities account for more than 50% of all COVID deaths across at least 13 states. In some states, he says, the number is closer to two thirds. Our parents and grandparents and their caretakers in skilled nursing facilities desperately need the kind of rescue that Rep. Schakowsky’s bill offers.
In a larger sense, the pandemic has shone a harsh light on fundamental problems with the availability and affordability of long-term care for seniors. The National Committee has long advocated that older Americans should be able to live as independently as possible in their homes and communities – avoiding institutional care when feasible. Yet, a system where millions of seniors must impoverish themselves in order to obtain skilled nursing care coverage from Medicaid – or where their families must drain their savings to cover long-term care expenses – is one that’s broken and must be repaired.
The nation needs a federal long-term care insurance program so that every senior who needs skilled nursing care can receive it. Medicare and Medicaid must be strengthened – not slashed, as the Trump administration and its allies in Congress have repeatedly proposed. Wages and benefits for those who provide in-home or institutional care must be improved.
For these changes to happen, society’s attitudes toward older Americans and their caregivers must evolve. Seniors, who contribute so much to the economy and to our quality of life, must be valued as much as younger citizens – even if they are ill, disabled, or not always in sight. We must reject the inhumane logic of some of our leaders, who actually have suggested that seniors’ lives be sacrificed for the sake of the economy during this crisis.
Only with a major attitude adjustment will we have a country that treats its senior citizens justly – and reduces the toll that a pandemic like COVID takes on our older loved ones and those who risk their own lives to stand by them.
Payroll Tax Cuts the First Step in Dismantling Social Security
President Trump set off alarm bells for America’s seniors on a Sunday FOX town hall by insisting once again on eliminating Social Security payroll taxes – both employer and worker contributions. The President even threatened to block the next phase of badly-needed Coronavirus relief legislation unless he gets his risky payroll tax cuts. Make no mistake: by pushing to cut off the program’s funding stream, President Trump is taking the first step toward dismantling Social Security.
“I want to see a payroll tax cut on both sides, a very strong one… and I told [Treasury Secretary] Steve [Mnuchin] just today, we’re not doing anything unless we get a payroll tax cut. That is so important to the success of our country.” – President Trump, FOX town hall, 5/3/20
While providing tax relief to working and middle-class Americans is an important consideration as our leaders respond to the Coronavirus pandemic, cutting, eliminating or deferring the Social Security payroll tax is an ill-advised way to do it. Any reductions to the program’s revenue stream would threaten Social Security’s ability to continue paying benefits to the 64 million Americans who depend on those benefits for their economic survival. In light of the recent Social Security Trustees report, it is clear that Social Security needs more revenue – not less.
“Social Security is an earned benefit fully funded by the contributions of workers throughout their working lives. Payroll tax cuts are an assault on that fundamental idea. This is equally true even if the funds are replaced by general revenues from the Treasury.” – Max Richtman, National Committee president, 4/24/20
There are better ways to stimulate the economy and provide relief for financially struggling Americans during the Coronavirus pandemic – including additional rounds of cash payments (the same kind included in the CARES Act that are currently being sent to households around the country). Meanwhile, payroll tax cuts are an ineffectual means of stimulus because they benefit employers and upper-income earners the most, leaving poorer workers with only a few hundred dollars in annual relief. Eliminating payroll taxes puts zero dollars in the hands of the unemployed – or public service workers at all levels of government who do not pay into Social Security.
Social Security, on the other hand, provides some $1.6 trillion annual economic stimulus as beneficiaries spend their benefits on essential goods and services. Reducing payroll taxes undermines Social Security – and its stimulus effect on the economy, making President Trump’s proposals even more nonsensical.
Despite it being such a patently bad idea, President Trump appears to be obsessed with obliterating the payroll contributions that fund Social Security. He was pitching this fraught idea well before the pandemic. Last August he floated the idea as a means of stimulating what he feared was a stalling economy. The push to cut payroll taxes can be seen as part of a pattern of proclaiming support for Social Security while pushing proposals to undermine it, including the administration’s repeated calls to cut Social Security Disability Insurance (SSDI), and the establishment of new rules that can strip people with disabilities of their benefits.
All of these actions blatantly violate Trump’s repeated promises to seniors “not to touch” Social Security. The complete elimination of payroll tax cuts goes way beyond “touching.” Choking off Social Security’s funding stream is an existential threat to Americans’ earned benefits. Seniors and their advocates, like the National Committee, must continue to push back against the President’s harmful proposals – by letting Congress and the White House know that payroll tax cuts are not acceptable. NCPSSM president and CEO Max Richtman sent President Trump a letter last week imploring him to consider the damage that payroll tax cuts would do to Social Security. Concerned citizens can call the National Committee’s legislative hotline at 1-800-998-0180 and tell our leaders “No” to payroll tax cuts – and “Hands off of Social Security!”
National Committee Tells President Trump ‘No’ on Payroll Tax Cut
National Committee president and CEO Max Richtman has sent the following letter to President Trump and Treasury Secretary Mnuchin, insisting that a payroll tax cut would undermine the Social Security program:
Dear Mr. President and Treasury Secretary Mnuchin:
On behalf of the millions of members and supporters of the National Committee to Preserve Social Security and Medicare, I am writing to state our strong opposition to your proposal that would divert Social Security Trust Funds for purposes for which they were not intended, such as a means to stimulate the economy.
While we agree that providing tax relief to middle class Americans is an important consideration as we respond to the many possible economic and social dislocations that may arise as a result of the coronavirus pandemic, we do not believe that cutting, eliminating or deferring the Social Security payroll tax is an appropriate way to accomplish this goal. Any reductions to this vitally important revenue stream would threaten Social Security’s ability to continue paying benefits to the 64 million Americans who depend on those benefits for their economic survival by reducing the trust funds from which benefits are paid.
Moreover, the proposal would undermine the earned benefit nature of the program. Social Security is an earned benefit fully funded by the contributions of workers throughout their working lives. A payroll tax cut or deferral chips away at that fundamental idea, making it easier each time it is enacted to turn to it again to meet some future crisis, until the payroll tax is not just cut or deferred but is eliminated. Undermining the program in this manner would help achieve the goals of opponents of Social Security including those who would privatize the program. This is equally true even if the funds are replaced by general revenues from the Treasury.
Another problem with a payroll tax cut as an economic stimulus is the fact that it leaves out large segments of the population. Large numbers of federal, state and local government workers do not pay into Social Security, and therefore would not benefit from the payroll tax cut. Ironically, the senior population, those who are directly affected by taking their money from the trust fund, will not see a single dime of relief since most of them are not working.
There are alternatives to the payroll tax cut which would be more targeted and effective to stimulate an economy slowed by the spread of the coronavirus. For example, another one-time payment by the federal government can put money in the hands of taxpayers quickly, and the Making Work Pay Tax Credit can be passed by Congress rapidly as can an expansion of the Earned Income Tax Credit. Spending in other programs that directly help those who lose employment as a result of the virus can be the most targeted relief of all.
Again, the National Committee to Preserve Social Security and Medicare on behalf of its members and supporters are opposed to any alteration to the payroll tax that reduces revenue flowing into the trust funds or undermines the “earned right” nature of the program. We appreciate your consideration.
Sincerely,
Max Richtman
President and CEO
Trustees Report Highlights Need to Strengthen Social Security, Not Imperil It
The 2020 Trustees Report reveals, once again, that Social Security is not going ‘bankrupt’ or becoming ‘insolvent’ — as opponents often claim. If Congress takes no preventative action, the program’s trust fund will be depleted by 2035, after which it still would be able to pay 79% of benefits. However, this year’s report does not reflect any impact that the COVID-19 pandemic may have on Social Security.
“Social Security is strong. But its long-term fiscal health cannot be guaranteed if the White House and Congress continue to use the program’s financing structure for economic stimulus during the COVID-19 crisis. Those who would like to dismantle Social Security are using the pandemic to launch a stealth attack. A broad-based payroll tax cut, as the President has proposed, would interfere with Social Security’s traditional revenue stream while failing to deliver effective or equitable stimulus. Meanwhile, Social Security already provides more than $1.6 trillion in annual economic stimulus as seniors spend their benefits for essential goods and services in their communities. Now is not the time – in fact, it is never the time – to tamper with a program that more than 40% of retirees rely upon for all of their income.” – Max Richtman, President and CEO, National Committee to Preserve Social Security and Medicare
The Trustees estimate that the Social Security cost-of-living adjustment (COLA) for 2021 will be 2.3%. However, that projection does not reflect the impact of the pandemic on inflation, and the actual COLA for next year could be lower.
“We do not know the extent of the pandemic’s impact on Social Security, but we do know that seniors need a boost in their benefits. Let’s strengthen the program now by eliminating the payroll tax wage cap and demanding the wealthy pay their fair share. That way, we can expand benefits and adopt a more accurate cost-of-living inflation formula for seniors.” – Max Richtman
As for Medicare, the Trustees say the program’s financial future is relatively unchanged from last year’s report, but the impact of the pandemic is not reflected. The Medicare Part A Trust Fund will become exhausted by 2026, after which the program still could pay 90% of benefits – if Congress does nothing to strengthen Medicare’s finances.
The Trustees estimate that the Medicare Part B premium will rise to $153.30 per month in 2021, an $8.70 increase over last year’s.
Lawmakers can take action to cut beneficiaries’ out of pocket costs and boost Medicare’s fiscal health by passing H.R. 3, The Lower Drug Costs Now Act — which would save the program some $400 billion in projected prescription drug costs by allowing the government to negotiate prices directly with Big Pharma.
“During this time of crisis, Americans are turning to Social Security and Medicare now more than ever. Let’s work to strengthen these programs that have been the bedrock of America’s middle and working classes, and resist proposals by those determined to tear them down.” – Max Richtman
White House Advisors Float New Idea to Undermine Social Security
On the heels of President Trump’s repeated calls to eliminate Social Security’s funding stream through payroll tax cuts, influential White House advisors are considering a fresh ploy to undermine Americans’ earned benefits.
“Senior White House economic officials… are exploring a proposal floated by two conservative scholars that would allow Americans to choose to receive checks of up to $5,000 in exchange for a delay of their Social Security benefits, according to three people familiar with the internal matter.” – Washington Post, 5/11/20
This is another colossally bad idea from right-leaning think tanks with influence on the Trump administration, designed to dismantle Social Security under the guise of helping working people. The truth is: today’s workers will need every penny of their future benefits and should not be duped into postponing their right to claim Social Security when needed for retirement, disability or survivors income.
Inducing workers to trade their future retirement benefits for temporary cash payments now is akin to similar schemes in recent years from the White House and Congressional Republicans. In 2018, Ivanka Trump, Sen. Marco Rubio (R-FL), and others hatched a plan for parents to sacrifice their future Social Security benefits in exchange for paid family leave. These ideas represent a gross misuse of Social Security for purposes unrelated to its core purpose: providing baseline retirement security for American workers.
“Republicans are laying in a plan to steal your social security to pay for your decimated wages and benefits, while keeping landlords, banks and big corporations fully capitalized. There is no plan, however, to roll back any of the Trump, Bush or Reagan tax cuts for the obscenely wealthy.” – David Atkins, Washington Monthly, 5/10/20
President Trump has repeatedly promised “not to touch” Social Security, and one must assume that he is either too disengaged or too disingenuous to reject dangerous policies from his own advisors. The trading-cash-for-retirement-benefits scheme is only the latest in a series of proposed assaults on Social Security, including calls from the administration and congressional Republicans to cut payroll taxes, to raise the retirement age, to adopt stingier cost-of-living adjustments, and slash Social Security Disability Insurance (SSDI) by billions of dollars — along with their insistence that ‘entitlements’ be ‘reformed’ to pay for tax cuts for the wealthy and big corporations.
“Seniors will not be fooled by the administration’s duplicity. President Trump postures as a leader who will protect Social Security while his appointed foot soldiers continue to hurl bombs at workers’ earned benefits.” – Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare.
Nursing Home Residents Need Federal Protection from Coronavirus
In the torrent of news coverage about COVID-19, the plight of seniors does not always receive the priority it deserves. Older people are suffering disproportionately – not only because they are more vulnerable to the virus – but because of the federal government’s apparent inability to provide the testing and data necessary to slow the infection rate in nursing homes. This week, some concerned members of Congress took action.
Congresswoman Jan Schakowsky (D-IL) has introduced the Quality of Care for Nursing Home Residents Act of 2020, which the National Committee has enthusiastically endorsed. Among other things, the legislation would require all skilled nursing facilities to:
*Have a full-time infection interventionist on staff;
*Regularly test residents and staff;
*Provide enough personal protective equipment (PPE) for all employees;
*Offer at least two weeks of paid sick leave to each employee
*Facilitate virtual visits for residents and their family members.
This bill offers a health and social lifeline to millions of seniors confined in nursing homes, isolated from friends and family, falling ill and in some cases dying – or living in constant fear of both. Meanwhile, the Trump administration does not even have comprehensive data on the pandemic’s impact on nursing home residents, despite a promise on April 19th from CMS administrator Seema Verma that the government “would begin tracking outbreaks and deaths at long-term care facilities nationwide — and publish the numbers for everyone to see.”
“More than two weeks and 13,000 long-term care deaths later, the federal government still has not tallied the number of nursing homes that have had outbreaks nationwide or the number of residents who have died. And the data is still weeks away from being made public, according to the Centers for Medicare and Medicaid Services, or CMS, the federal agency that oversees nursing homes.” – NBC News, 5/8/20
As NBC News reports, this is not an academic matter. The administration’s failure to act expeditiously is enabling the virus to spread more rapidly in nursing homes, and “hampering officials’ ability to target hot spots and send additional resources where they are needed.” Skilled nursing facilities also are not receiving crucial Personal Protective Equipment (PPE) quickly enough to adequately protect patients and staff.
Some 1.3 million Americans currently reside in skilled nursing facilities across the country – with roughly 3 million employees caring for them. As of April 23rd, nursing homes in 36 states had reported fatalities from COVID, including residents and staff. According to Kaiser Family Foundation executive vice president Larry Levitt, skilled nursing facilities account for more than 50% of all COVID deaths across at least 13 states. In some states, he says, the number is closer to two thirds. Our parents and grandparents and their caretakers in skilled nursing facilities desperately need the kind of rescue that Rep. Schakowsky’s bill offers.
In a larger sense, the pandemic has shone a harsh light on fundamental problems with the availability and affordability of long-term care for seniors. The National Committee has long advocated that older Americans should be able to live as independently as possible in their homes and communities – avoiding institutional care when feasible. Yet, a system where millions of seniors must impoverish themselves in order to obtain skilled nursing care coverage from Medicaid – or where their families must drain their savings to cover long-term care expenses – is one that’s broken and must be repaired.
The nation needs a federal long-term care insurance program so that every senior who needs skilled nursing care can receive it. Medicare and Medicaid must be strengthened – not slashed, as the Trump administration and its allies in Congress have repeatedly proposed. Wages and benefits for those who provide in-home or institutional care must be improved.
For these changes to happen, society’s attitudes toward older Americans and their caregivers must evolve. Seniors, who contribute so much to the economy and to our quality of life, must be valued as much as younger citizens – even if they are ill, disabled, or not always in sight. We must reject the inhumane logic of some of our leaders, who actually have suggested that seniors’ lives be sacrificed for the sake of the economy during this crisis.
Only with a major attitude adjustment will we have a country that treats its senior citizens justly – and reduces the toll that a pandemic like COVID takes on our older loved ones and those who risk their own lives to stand by them.
Payroll Tax Cuts the First Step in Dismantling Social Security
President Trump set off alarm bells for America’s seniors on a Sunday FOX town hall by insisting once again on eliminating Social Security payroll taxes – both employer and worker contributions. The President even threatened to block the next phase of badly-needed Coronavirus relief legislation unless he gets his risky payroll tax cuts. Make no mistake: by pushing to cut off the program’s funding stream, President Trump is taking the first step toward dismantling Social Security.
“I want to see a payroll tax cut on both sides, a very strong one… and I told [Treasury Secretary] Steve [Mnuchin] just today, we’re not doing anything unless we get a payroll tax cut. That is so important to the success of our country.” – President Trump, FOX town hall, 5/3/20
While providing tax relief to working and middle-class Americans is an important consideration as our leaders respond to the Coronavirus pandemic, cutting, eliminating or deferring the Social Security payroll tax is an ill-advised way to do it. Any reductions to the program’s revenue stream would threaten Social Security’s ability to continue paying benefits to the 64 million Americans who depend on those benefits for their economic survival. In light of the recent Social Security Trustees report, it is clear that Social Security needs more revenue – not less.
“Social Security is an earned benefit fully funded by the contributions of workers throughout their working lives. Payroll tax cuts are an assault on that fundamental idea. This is equally true even if the funds are replaced by general revenues from the Treasury.” – Max Richtman, National Committee president, 4/24/20
There are better ways to stimulate the economy and provide relief for financially struggling Americans during the Coronavirus pandemic – including additional rounds of cash payments (the same kind included in the CARES Act that are currently being sent to households around the country). Meanwhile, payroll tax cuts are an ineffectual means of stimulus because they benefit employers and upper-income earners the most, leaving poorer workers with only a few hundred dollars in annual relief. Eliminating payroll taxes puts zero dollars in the hands of the unemployed – or public service workers at all levels of government who do not pay into Social Security.
Social Security, on the other hand, provides some $1.6 trillion annual economic stimulus as beneficiaries spend their benefits on essential goods and services. Reducing payroll taxes undermines Social Security – and its stimulus effect on the economy, making President Trump’s proposals even more nonsensical.
Despite it being such a patently bad idea, President Trump appears to be obsessed with obliterating the payroll contributions that fund Social Security. He was pitching this fraught idea well before the pandemic. Last August he floated the idea as a means of stimulating what he feared was a stalling economy. The push to cut payroll taxes can be seen as part of a pattern of proclaiming support for Social Security while pushing proposals to undermine it, including the administration’s repeated calls to cut Social Security Disability Insurance (SSDI), and the establishment of new rules that can strip people with disabilities of their benefits.
All of these actions blatantly violate Trump’s repeated promises to seniors “not to touch” Social Security. The complete elimination of payroll tax cuts goes way beyond “touching.” Choking off Social Security’s funding stream is an existential threat to Americans’ earned benefits. Seniors and their advocates, like the National Committee, must continue to push back against the President’s harmful proposals – by letting Congress and the White House know that payroll tax cuts are not acceptable. NCPSSM president and CEO Max Richtman sent President Trump a letter last week imploring him to consider the damage that payroll tax cuts would do to Social Security. Concerned citizens can call the National Committee’s legislative hotline at 1-800-998-0180 and tell our leaders “No” to payroll tax cuts – and “Hands off of Social Security!”
National Committee Tells President Trump ‘No’ on Payroll Tax Cut
National Committee president and CEO Max Richtman has sent the following letter to President Trump and Treasury Secretary Mnuchin, insisting that a payroll tax cut would undermine the Social Security program:
Dear Mr. President and Treasury Secretary Mnuchin:
On behalf of the millions of members and supporters of the National Committee to Preserve Social Security and Medicare, I am writing to state our strong opposition to your proposal that would divert Social Security Trust Funds for purposes for which they were not intended, such as a means to stimulate the economy.
While we agree that providing tax relief to middle class Americans is an important consideration as we respond to the many possible economic and social dislocations that may arise as a result of the coronavirus pandemic, we do not believe that cutting, eliminating or deferring the Social Security payroll tax is an appropriate way to accomplish this goal. Any reductions to this vitally important revenue stream would threaten Social Security’s ability to continue paying benefits to the 64 million Americans who depend on those benefits for their economic survival by reducing the trust funds from which benefits are paid.
Moreover, the proposal would undermine the earned benefit nature of the program. Social Security is an earned benefit fully funded by the contributions of workers throughout their working lives. A payroll tax cut or deferral chips away at that fundamental idea, making it easier each time it is enacted to turn to it again to meet some future crisis, until the payroll tax is not just cut or deferred but is eliminated. Undermining the program in this manner would help achieve the goals of opponents of Social Security including those who would privatize the program. This is equally true even if the funds are replaced by general revenues from the Treasury.
Another problem with a payroll tax cut as an economic stimulus is the fact that it leaves out large segments of the population. Large numbers of federal, state and local government workers do not pay into Social Security, and therefore would not benefit from the payroll tax cut. Ironically, the senior population, those who are directly affected by taking their money from the trust fund, will not see a single dime of relief since most of them are not working.
There are alternatives to the payroll tax cut which would be more targeted and effective to stimulate an economy slowed by the spread of the coronavirus. For example, another one-time payment by the federal government can put money in the hands of taxpayers quickly, and the Making Work Pay Tax Credit can be passed by Congress rapidly as can an expansion of the Earned Income Tax Credit. Spending in other programs that directly help those who lose employment as a result of the virus can be the most targeted relief of all.
Again, the National Committee to Preserve Social Security and Medicare on behalf of its members and supporters are opposed to any alteration to the payroll tax that reduces revenue flowing into the trust funds or undermines the “earned right” nature of the program. We appreciate your consideration.
Sincerely,
Max Richtman
President and CEO
Trustees Report Highlights Need to Strengthen Social Security, Not Imperil It
The 2020 Trustees Report reveals, once again, that Social Security is not going ‘bankrupt’ or becoming ‘insolvent’ — as opponents often claim. If Congress takes no preventative action, the program’s trust fund will be depleted by 2035, after which it still would be able to pay 79% of benefits. However, this year’s report does not reflect any impact that the COVID-19 pandemic may have on Social Security.
“Social Security is strong. But its long-term fiscal health cannot be guaranteed if the White House and Congress continue to use the program’s financing structure for economic stimulus during the COVID-19 crisis. Those who would like to dismantle Social Security are using the pandemic to launch a stealth attack. A broad-based payroll tax cut, as the President has proposed, would interfere with Social Security’s traditional revenue stream while failing to deliver effective or equitable stimulus. Meanwhile, Social Security already provides more than $1.6 trillion in annual economic stimulus as seniors spend their benefits for essential goods and services in their communities. Now is not the time – in fact, it is never the time – to tamper with a program that more than 40% of retirees rely upon for all of their income.” – Max Richtman, President and CEO, National Committee to Preserve Social Security and Medicare
The Trustees estimate that the Social Security cost-of-living adjustment (COLA) for 2021 will be 2.3%. However, that projection does not reflect the impact of the pandemic on inflation, and the actual COLA for next year could be lower.
“We do not know the extent of the pandemic’s impact on Social Security, but we do know that seniors need a boost in their benefits. Let’s strengthen the program now by eliminating the payroll tax wage cap and demanding the wealthy pay their fair share. That way, we can expand benefits and adopt a more accurate cost-of-living inflation formula for seniors.” – Max Richtman
As for Medicare, the Trustees say the program’s financial future is relatively unchanged from last year’s report, but the impact of the pandemic is not reflected. The Medicare Part A Trust Fund will become exhausted by 2026, after which the program still could pay 90% of benefits – if Congress does nothing to strengthen Medicare’s finances.
The Trustees estimate that the Medicare Part B premium will rise to $153.30 per month in 2021, an $8.70 increase over last year’s.
Lawmakers can take action to cut beneficiaries’ out of pocket costs and boost Medicare’s fiscal health by passing H.R. 3, The Lower Drug Costs Now Act — which would save the program some $400 billion in projected prescription drug costs by allowing the government to negotiate prices directly with Big Pharma.
“During this time of crisis, Americans are turning to Social Security and Medicare now more than ever. Let’s work to strengthen these programs that have been the bedrock of America’s middle and working classes, and resist proposals by those determined to tear them down.” – Max Richtman