Things Harris Should Promise Thursday to Help Those Who Struggle Economically.
Start by fixing what used to work but has been broken by the actions or deliberate inaction of conservatives and neoliberals in Congress (most of whom are millionaires.)
In 1983, Social Security was facing a crisis, much like today. People were living longer and fewer people were of working age. Looking ahead to the wave of Baby Boomers born after 1945 who would begin retiring in 2007 President Reagan and House Speaker Tip O’Neill reached a compromise. They raised the Social Security payroll tax gradually to the current 12.4% rate to “prefund” the higher payouts to come, pushed back the “full retirement” age to 67 and added a tax on Social security benefits for those earning over $25,000 as an individual or $32,000 as a couple.
Now in 1984, a person living on $25,000 a year was doing pretty well. The national average income that year ws $15,000 — enough to obtain a starterhome mortgage and buy a car. Try that now on $25,000! The median income for a family of four was. $26,000. So maybe people earning enough income from Social Security and any other work could afford to pay income tax on at least some of their Social Security check income.
But those levels for being taxed have never been adjusted upward to account for inflation.
Today, a single men earn an average of $70,000 a year, and women earn $58,000, while average income for a family of four is $76,000. For the elderly or an elderly couple today, trying to get by on just $25,000, if living alone or $32,000 if with a spouse, is quite a challenge. The idea of taxing away somt of their Social Sedcurity benefits if they earn more than that is obscene.
And remember, most Social Security beneficiaries who are getting earning $25,000 or couples earnint $32,000 aren’t gettint all that money as Social Security benefit checks; they’re getting much smaller heks and are earning the rest by continuing to work at regular jobs into their 70s or 80s, and paying income taxes on that money, and then are also having to pay taxes on their Social Security benefits!
Nobody except an absolute greedhead would object to having some of their Social Security benefits taxed if they earned over $150,000 a year or were couple earning $200,000 or more.
Clearly those income threshholds for taxing Social Security should be cancelled or at least indexred he same way benefits are adjusted every year.
And while we’re talking about inflation adjustments, Harris should also fix the highway robbery that’s been going on with Social Security, where the buying power of benefit checks received by over 71 million American elders and disabled people has lost 36% of their value since 2000 (because of the SSA’s use of an inaccurate CPI index based upon the cost of living for urban office workers!), The answer to that problem is to use a more accurate index based upon the elders’ actual cost of living, and there should be an annual adjustment the folllowing year to correct any under-estimates discovered once all the data for the prior year comes in, instead of basing the inflation adjustment on the inflation rate during three monthe in late summer and fall.
These are common-sense proposals which would go a long way towards improving the living standards of the elderly and the disabled.
The changes would also be welcomed by elders whatever their political leanings. Anyone living on Social Security will support such reforms. Also benefitting would be children who have lost a parent, who become eligible for Social security benefit payents until the age of 18 (or 19 if still in high school).
Would these changes make fixing funding for Social Security more urgently important than it already is? Absolutely. But the changes would also drastically increase voter support for those needed fixes, like getting rid of the cap on the Social Security tax that currently isn’t applied on any income above $168,600. That tax should also be broadened to apply not just to wages and salaries, but to the so called “unearned income” of investors. Such reforms would fully fund even a more generous Social Security program.
Does anyone think that if Harris promised such reforms, there would be Republican elders out on the street holding signs saying “Don’t increase my Social Security benefits!” and “Don’t exempt my Social Security benefits from income taxes!”?
Yeah, sure…
What is galling about this situation is that even though Social Security is critical to the survival of 90% of those receiving benefits, Congress has been playing games to avoid addressing the funding issue now for several decades, all the while warning falsely that Social Security could “go bankrupt by 2030’ if action isn’t taken, as i it were a matter of natural law, when it’s really because of unnatural stalling by politicians of both parties (especially Republicans).