Lmst

Right at this moment my #gas supply is being #capped off, so we will no longer burn stuff at home (other than while cooking)! #fossilFree

For as long as I can remember, Americans have been concerned that the government’s #Social #Security program will run out of money by the time they get to use it because the Baby Boomers will suck the well dry.

But as former Secretary of Labor #Robert #Reich explains,
❇️Social Security trustees planned for the Boomers
🆘but will face a shortfall in the next decade 💥because of increased #income #inequality in the US.💥

The Social Security trustees anticipated the boom in boomer retirements.
This is why Social Security was amended back in 1983, to gradually increase the age for collecting full retirement benefits from age 65 to 67.
That change is helping finance the boomers’ retirement.
❓So what did the trustees fail to anticipate? ❓
Answer: ❗️the degree of income #inequality in 21st century America.❗️

Put simply, a big part of the American working population is earning less than the Social Security trustees (including me) anticipated decades ago
— and therefore paying less in Social Security payroll tax.

Had the #pay of American workers kept up with what had been the trend decades ago
— and kept up with their own #increasing #productivity
— their ⭐️Social Security payroll tax payments would have been enough to keep the program flush.

At the same time, 🆘a much larger chunk of the nation’s total income is going to the top than was expected decades ago.

Here’s the thing: 🔥Income subject to the payroll tax is #capped.
Every dollar of earnings in excess of the cap is not subject to Social Security payroll taxes.
This year’s cap is $160,200.

https://kottke.org/24/08/the-reason-social-security-currently-has-a-funding-shortfall

Trump and his Republicans want Social Security to run out of money. They don’t want the rich
— their patrons
— to pay their fair share.

Trump has pledged to protect Social Security but hasn’t offered a plan for how to do that.

Instead, he is promising to repeal taxes on Social Security benefits.

This will not save Social Security.
-- In fact, quite the opposite.

Without the revenue from Social Security taxes, the Social Security trust fund will run out of money even sooner.

🆘This has been the Republican goal for years:

Social Security is one of the most popular and successful government programs ever created,
not only helping retirees but also keeping 26 million people out of poverty.

Getting rid of Social Security will, in the minds of Republican strategists, ⚠️open the way to getting rid of much else Americans depend on.

❓Why is Social Security running out of money?

Not because so many boomers are retiring.

The Social Security trustees anticipated the boom in boomer retirements.

This is why Social Security was amended back in 1983, to gradually increase the age for collecting full retirement benefits from 65 to 67.

That change is helping finance the boomers’ retirement.

🔶The real reason Social Security is running out of money is something the trustees never anticipated:
how much total income is going to the top.

A big part of the American working population today is earning less than the Social Security trustees anticipated years ago
— reducing revenue flowing into the program.

Had the pay of American workers kept up with the trend decades ago
— as well as their growing productivity
— their Social Security payments would have kept the program flush.

But a much larger chunk of the nation’s total income is now going to the top compared to decades ago.

❌Yet income subject to the Social Security payroll tax is #capped.
⚠️No dollar of earnings above the cap is taxed. -- The cap in 2024 is $168,600.

So, as the rich have become far richer
-- more and more of the nation’s total income has escaped the Social Security payroll tax. ❗️

A #CEO earning $20 million a year ➡️pays Social Security taxes on roughly🔸 1 percent of their income,
while a #worker earning under the cap➡️ pays Social Security taxes on 🔸100 percentof their income.

They both end up paying the same amount of money into the program.

This isn’t fair.

The rise in the amount of income above the cap due to inequality has cost the Social Security Trust Fund reserve an estimated
💥 $1.4 trillion since 1983.

⭐️The solution is obvious:

👍Scrap the cap and make the rich pay more in Social Security taxes.

One plan introduced by Democrats in Congress would
❇️eliminate the cap on earnings over $250,000 and also
❇️subject investment income to Social Security taxes.

It’s estimated that this would extend the solvency of Social Security for the next 75 years
-- without raising taxes on 93 percent of American households.

⭐️Bottom line: Trump’s plan will destroy Social Security.

⭐️The Democrats’ plan will save it
— and do so fairly.

If we want to ensure Social Security’s long-term future,
and that working people can retire with dignity,
👉 we must make the wealthy pay their fair share.

https://robertreich.substack.com/p/the-real-fix-for-social-security

#capped

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