Sen. Bernie Sanders speaks to Alliance for Retired Americans national convention on September 8, 2011. Photo courtesy of the office of Senator Sanders.
The Keeping Our Social Security Promises Act, S.1558, introduced by Senator Bernie Sanders (I-VT), strengthens Social Security for future generations without cutting benefits. The bill "goes big" for the nation's most important pension, life and disability insurance plan.
Before we get into the details of the Sanders bill, though, it is worth providing a little background on just what serious Washington people mean when they talk about "going big."
A week ago, a group of more than 60 budget hawks of both parties sent a letter to the Super Committee asking its members to "go big" and propose a large-scale deficit-reduction package in excess of their $1.5 trillion goal.
There is no doubt that this letter, organized by the Committee for a Responsible Federal Budget (CRFB), a think tank funded by right-wing billionaire Peter G. Peterson, had Social Security in mind when they called for the Super Committee to "go big." After all, no fewer than four of its signers voted for the Fiscal Commission deficit reduction proposal, which recommended cutting Social Security benefits by as much as 40 percent. Among them, Former Senator Alan K. Simpson (R-WY), whose apparent expertise in Social Security led him to call it a "Ponzi scheme" long before it was cool.
Social Security does not and cannot contribute to the deficit. It has a $2.7 trillion surplus and is prevented by law from borrowing.
But assuming we accept the letter signers' premise that Social Security must be part of any deficit-reduction package with aspirations to "go big," there is a perfectly sound bill in Congress that does just that.
Meet the Sanders bill: It's simple, fair, and enormously popular. It has even attracted the support of Moderate Democrats like Sen. Claire McCaskill (D-MO), who is among the bills 9 original co-sponsors and who also signed the CRFB letter. Somehow I imagine it is not what the Alan Simpsons of the world had in mind, but they should give it a second look.
The Sanders bill (S.1558) closes Social Security's 75-year funding gap by applying Social Security payroll tax contributions to covered earnings of $250,000 or more. Currently, only wages up to $106,800 are taxed.
S. 1558 will:
- Guarantee Social Security can pay 100% of promised benefits for the next 75 years. Currently, with no action, Social Security will have sufficient income and assets to pay all monthly benefits in full and on time until 2036. S.1558 extends that through 2085, as estimated by the Social Security Administration.
- Preserve currently scheduled benefits. Many proposals claiming to "strengthen" Social Security either undermine the program's universal values, or the adequacy of its benefits. S.1558 closes Social Security's funding gap without doing either.
- Ensure everyone pays their fair share to Social Security. While nearly all Americans must make Social Security tax contributions on all of their wages, the wealthiest only do so on the first $106,800 of their annual earnings. S. 1558 rights this wrong. Social Security payroll tax contributions are only paid on wages up to $106,800 in 2011. S. 1558 gradually lifts the cap on taxable wages so that all workers contribute on all of their wages. It applies the Social Security payroll tax to covered earnings of $250,000 or more right away, but maintains the current-law benefit base. Importantly, it leaves the current cap temporarily in place, creating a donut hole so that a person's earnings between $106,800 and $250,000 are not subject to a precipitous one-year increase in their payroll tax contributions. The donut hole would close over time, since the $106,800 cap rises with average wage increases. Once the cap reaches $250,000, in approximately 25 years, all wages would be subject to the Social Security payroll tax contribution. Benefits would continue to be calculated on the basis of capped wages, as they are under current law.
- Affect a small number of Americans. Few Americans would be affected by this change to the Social Security payroll tax cap. Just 1.2% of workers had earnings over $250,000 in 2009, including 0.4% of women, 0.3% of African American workers and 0.3% of Latino workers.
- Follow the will of the public. Two-thirds (66%) of voters support enacting Social Security payroll taxes contributions on wages above $106,800, according to a Lake Research poll. This includes 73% of Democrats, 66% of Independents, 59% of Republicans and 60% of Tea Party supporters. A Democracy Corps poll found that 63% of Americans favor eliminating the cap on wages subject to the Social Security payroll tax contributions.
Views expressed are those of the author, and do not reflect the opinions of Social Security Works or the Strengthen Social Security Campaign.
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See www.howtopayoffthenationaldebt.com for more info.
I wanted to let you know about a new petition I created on We the People, a
new feature on WhiteHouse.gov, and ask for your support. Will you add your
name to mine? If this petition gets 5,000 signatures by October 23, 2011,
the White House will review it and respond!
We the People allows anyone to create and sign petitions asking the Obama
Administration to take action on a range of issues. If a petition gets
enough support, the Obama Administration will issue an official response.
You can view and sign the petition here:
http://wh.gov/gwu
Here's some more information about this petition:
Save Medicare - Tax Derivatives
The "secret" $600 trillion Derivatives market that most Americans
have never heard of can solve this serious National Debt problem. It is a
market 40 times the size of the US stock market ($17 trillion).
When consumers buy a pair of shoes or a television set they pay a transfer
fee called sales tax. When hedge funds or investment banks trade billion
dollar Derivatives contracts they pay no transaction fee. It is not fair.
A transfer fee on Derivatives would raise $500 billion per year on trades
which take place in the United States ($5 trillion in 10 years). It would
affect less than 1% of the American population and be directed at those who
can most afford it.
See www.howtopayoffthenationaldebt.com for more info.
I'll bet anything those who favor the flat income tax oppose this plan for a flat social security tax. They are a nothing but a bunch of greedy hypocrites and charlatans.
Has he ever had a bill pass?
Quick: Name me 5 Sanders legislative accomplishments
Are they?
Sanders really is my favorite member of the Senate - I don't always agree with him (Primarily, I think socialism is a nice theory that is a complete and unmitigated failure in actual practice that has no place outside of a philosophy course), but he seems to hit the ullseye on major issues with disturbing acuracy. Disturbing because, why the hell is Sanders alone when he's following the facts and regularly wins some of the most lopsided victories out there at re-election time? Can't we get a couple more Sanders to hopefully jam the Senate back on track? And then a bunch for the House, too? It'd be a serious upgrade to the dysfunction junction in there right now.
Capitalist Profits-Socialist Losses = The United States of BS
We're supposed to have a Regulated Capitalist system. What we actually have is a Capitalist-Oligarchial system. It's got a Capitalist base, but baaaaaad Oligrachist flavoring attached. I don't know what flavor I'd call Sweden/Denmark's Socialism, but, there's still definitely some that are better then others.
His argument, and he is correct, that ss trust fund is not a "retirement" fund as is recognized by state and local governments or businesses or not-for-profits.
Typically, a "retirement fund" is defined by ERISA.
A retirement fund is a separate entity from its funding source.
It has an administrator and beneficiaries and assets and liabilities.
The funding source, say local or state government can ONLY fund the retirement account, but CANNOT borrow the funds nor otherwise touch those funds IN ANY WAY.
It use to be, I don't know about now, if the funding source touched those funds in any way he would go to jail.
The federal government did not set up ss as a typical retirement fund but a program within the federal budget.
It can thus "borrow" the funds when for any other entity it would be illegal.
But it is a program in the federal government with its own dedicated funding source, but accounting wise, the "bonds" in the account are not technically a "legal" liability.
The funds should be considered a transfer between government depts.
Are you a lawyer or an engineer?
Do you think $2.7 trillion is worth arguing about?
Prior to the home-invasion, the (5) robbers and the (1) homeowner voted on the terms of the robbery. The vote was nearly unanimous.