The National Committee to Preserve Social Security and Medicare sent the following letter to members of the United States Senate last night, as they formulate a final version of an economic stimulus package:::
March 23, 2020
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:
Senators David Perdue and Thom Tillis’s amendment to the coronavirus stimulus bill suspending payment of Social Security payroll taxes for the rest of the year, and
A provision in the bill deferring payment of the employer share of Social Security payroll tax – half until next year and the other half until 2022.
We oppose any proposals 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 as a result of the coronavirus epidemic, we do not believe that 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 pay future benefits to 64 million Americans.
Moreover, these proposals 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 suspension 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 permanently 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.
Furthermore, there are alternatives to a payroll tax cut or deferral which would be more targeted and effective to stimulate an economy slowed by the spread of the coronavirus. For example, a 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. In addition, we strongly support Senators Chuck Schumer, Elizabeth Warren and Ron Wyden’s plan to increase by $200 the monthly benefit for all Social Security, Veterans, and Supplemental Security Income (SSI) beneficiaries through the end of 2021.
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.
President and CEO of the National Committee to Preserve Social Security and Medicare