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The majority of citizens want social security to continue and to be improved, according to a survey by the National Academy of Social Insurance done in January 2013. This includes respondents from all political-party affiliations, family income levels, and generations. Overall, 89% answered that social security benefits are more important than ever, 84% answered they do not or did not mind paying Social Security taxes, and 75% replied “we should consider increasing Social Security benefits.
Be reminded that Social Security is wage insurance based primarily on taxes on wages/salaries, bonuses, and stock options that fund programs for qualified retirees, disabled people, and the spouse and children who survive the death of a worker, as well as medical benefits under Medicare. It is matched by employers who can include their contributions in their tax returns as tax-reducing costs of doing business.
Why is there so much popular support for Social Security?
First, the scope of Social Security is far reaching. If one considers only the three programs that provide income benefits, over 59 million Americans received almost $863 billion in benefits in 2014. The beneficiaries are not only the elderly but people of all ages. In 2014, 41 million elderly workers and spouses received retirement benefits, as well as 10.8 million disabled workers and dependents, and 6.2 million “survivors.” In addition to old age, suffering a permanent and serious disability or death can cripple a family’s income and can happen to any of us at any time.
Second, for millions of Americans it is the best insurance that is available. Nancy Altman, expert on Social Security and co-author with Eric Kingson on the book Social Security Works! Writes: “Social Security’s life insurance is generally the most valuable employment-based life insurance workers have. And the long-term disability insurance is generally the only disability insurance Americans have.” We all are vulnerable to life’s misfortunes, and Social Security is an important way to “pool our risks.”
Third, Social Security is reliable, efficient, and fiscally sound. It has never missed a payment of benefits. Payments are adjusted annually for inflation. For every dollar, less than a penny goes for administration, which reflects the absence of a need to advertise, or pay outrageous salaries to CEOs, or take money out for profits. Since 1983, revenues being paid into the system have exceeded payments going out to beneficiaries. Social Security now has an accumulated surplus of 2.8 trillion dollars in interest-bearing government treasury bonds. Social Security trustees estimate that the surplus will continue to grow through 2020. When and if there is ever a shortfall in current revenues to cover benefits, there are two alternatives for making up the difference. One is to begin the gradual process of cashing in the treasury bonds. The other is to change the rules governing the Social Security wage tax. The most forthright change would be to raise the present ceiling on taxable income, which now is $118,500. All income above that level is currently ignored by present Social Security wage-tax rules. It would be fair to raise the ceiling and thus increase the upper wage/salary tax base because high-income individuals have seen their incomes rise and sometimes soar, while wages and salaries for the great majority of workers have stagnated or declined. By increasing the ceiling on the Social Security wage tax, there would be another feasible change, that is, it would open up the opportunity to boost the present low and modest benefits for the majority of beneficiaries.