This week, several lawmakers in the House and Senate met to mark the day when millionaires stop paying into the Social Security program for the year. In addition, The Senior Citizens League (TSCL) announced its support for the Guaranteed 3% COLA Act.
Lawmakers Participate in Social Security Action Day
On Thursday, several lawmakers – Senator Bernie Sanders (VT), Senator Elizabeth Warren (MA), Senator Ron Wyden (OR), Congressman Peter DeFazio (OR-4), Congresswoman Jan Schakowsky (IL-9), and Congressman Paul Tonko (NY-20) – met to mark the day when millionaires stop paying into the Social Security program for the remainder of the year. Currently, the Social Security payroll tax cap sits at $127,200, which means the 6.2 percent payroll tax – or the 12.4 percent tax for self-employed individuals – is not applied to annual income above that amount.
At the event, Senator Sanders and Congressman DeFazio introduced new legislation called the Social Security Expansion Act that would strengthen and reform the program in several ways. It would base Social Security cost-of-living adjustments (COLAs) on the Consumer Price Index for Elderly Consumers (CPI-E), increase benefits by approximately $65 per month, improve the minimum Social Security benefit for low earners, apply the Social Security payroll tax to income over $250,000, and apply the 6.2 percent Social Security tax to investment income for high earners.
By increasing the payroll tax cap, the Social Security Expansion Act would extend the solvency of the Social Security program for decades to come, past 2078. At the event, Senator Sanders said: “Anyone who tells you Social Security is going broke is lying. We can increase Social Security benefits for millions of Americans and extend the life of Social Security if we have the political will to tell the wealthiest Americans to pay the same rate as everyone else.”
TSCL agrees with the comments made by Senator Sanders at Thursday’s event, and we enthusiastically support the Social Security Expansion Act since it would reform the program responsibly, without cutting benefits for older Americans. We will advocate tirelessly for it throughout the 115th Congress, and we hope lawmakers sign it into law by the end of this year. For progress updates, visit the Bill Tracking section of our website.
TSCL Endorses Guaranteed 3% COLA Act
This week, TSCL announced its support for the Guaranteed 3% COLA Act (H.R. 991), which was recently introduced in the House of Representatives by Congressman Eliot Engel (NY-16). If enacted, H.R. 991 would base Social Security COLAs on the Consumer Price Index for Elderly Consumers (CPI-E), and it would ensure an annual benefit increase of at least 3 percent.
Currently, Social Security COLAs are based on the way young, urban workers spend their money, and they fail to reflect the spending inflation seniors experience. For example, this year, beneficiaries are receiving a COLA of just 0.3 percent – an increase that is so small, it is the lowest payable COLA in the history of the program. However, if the COLA were based on the more accurate CPI-E, beneficiaries would be receiving a 2.1 percent benefit increase this year according to the Bureau of Labor Statistics.
TSCL enthusiastically supports the Guaranteed 3% COLA Act – a bill that would go a long way in addressing the inadequacy of the Social Security COLA. In a letter of endorsement to Congressman Engel, Art Cooper – Chairman of TSCL’s Board of Trustees – wrote: “Years of record-low COLAs – including multiple years of zero COLAs – will have a devastating impact on the long-term adequacy of Social Security benefits for more than 59 million beneficiaries … Your bill would provide much-needed financial protection for older Americans.”
TSCL looks forward to working with Congressman Engel’s office in the coming months to help build support for H.R. 991, and to help pass it into law. For more information on the bill or for updates on its progress in Congress, click HERE.