U.S. Senators Bernie Sanders (I-Vermont) and Elizabeth Warren (D-Massachusetts) led a group of lawmakers late this week in introducing legislation that would expand Social Security’s annual benefits by $2,400 per year.
The benefit boost under the proposed Social Security Expansion Act would be funded by lifting the cap on the maximum amount of income subject to the Social Security payroll tax. This year the cap was $147,000.
If passed, the expansion bill would apply the payroll tax to all income, including capital gains, above $250,000 a year.
“At a time when half of older Americans have no retirement savings and millions of senior citizens are living in poverty, our job is not to cut Social Security,” Sanders head of the Senate Budget Committee and a co-chairman of the Expand Social Security Caucus, said in a statement.
“Our job must be to expand Social Security so that every senior citizen in America can retire with the dignity they deserve and every person with a disability can live with the security they need,” Sanders continued. “And we will do that by demanding that the wealthiest people in America finally pay their fair share of taxes. It is absurd that a billionaire in America today pays the same amount of Social Security taxes as someone making $147,000 a year. It is time to scrap the cap, expand benefits, and fully fund Social Security.”
The proposed legislation comes a week after the annual Social Security trustees report showed that the program is positioned to fully fund benefits until 2035.
“Social Security is an economic lifeline for millions of Americans, but many seniors are struggling with rising costs,” said Warren (D-Cambridge). “As Republicans try to phase out Social Security and raise taxes on more than 70 million hardworking Americans, I’m working with Senator Sanders to expand Social Security and extend its solvency by making the wealthy pay their fair share, so everyone can retire with dignity.”
Sanders announced the new bill Thursday, June 9 during a Senate Budget Committee hearing.
In addition to increasing annual benefits and lifting the tax cap, the proposed Social Security Expansion Act would also increase the program’s cost-of-living adjustments by switching to a different measure of inflation. According to the Social Security Administration, the average monthly Social Security benefit payment was around $1,540 as of April 2022.
“With the cost of living at an all-time high, Social Security has never been more important, yet congressional Republicans continue to play games with its funding,” said U.S. Representative Peter DeFazio (D-Ore.), the lead sponsor of a companion bill in the House.
“This legislation would ensure that the Social Security Trust Fund remains solvent for another 75 years, increase monthly benefits for most recipients by $200, and alter the cost-of-living-adjustment formula to meet the everyday needs of our nation’s seniors,” DeFazio added.
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