Sen. Elizabeth Warren (D-MA) unveiled another key aspect of her progressive agenda hours before the third Democrat presidential debate in Houston, Texas, proposing Thursday to raise Social Security benefits by $200 per month and pay for it by raising taxes on the “rich.”
Warren – who has largely driven her campaign on the unofficial slogan “I have a plan for that” – unveiled her plan to expand Social Security benefits.
“Typical Social Security benefits today are quite small,” Warren explained in a Medium Post. “In 2019, the average Social Security beneficiary received $1,354 a month, or $16,248 a year.”
There is a sense of urgency to raise Social Security benefits, Warren said, pointing to the GOP’s tax cuts and calling them a “$1.5 trillion tax giveaway that primarily helped the rich and big corporations.”
Her plan – which she describes as the “biggest and most progressive increase in Social Security benefits in nearly half a century” – promises Social Security beneficiaries an immediate $200 per month increase, funded by raising taxes on the rich, or as her campaign puts it, “by asking the top 2% of families to contribute their fair share to the program.” Warren also pledges to update the “outdated rules to further increase benefits for lower-income families, women, people with disabilities, public-sector workers, and people of color.”
Her plan states:
My $200-a-month increase covers every Social Security beneficiary — including the 10 million Americans with disabilities and their families who have paid into the program and now receive benefits from it. Adults with disabilities are twice as likely to live in poverty as those without a disability. While 9% of people without disabilities nearing retirement live in poverty, 26% of people that age with disabilities live in poverty. Monthly Social Security benefits make up at least 90% of income for nearly half of Social Security Disability Insurance beneficiaries.
This benefit increase will also provide a big boost to other groups. It will help the 621,000 disabled veterans who are Social Security beneficiaries. It will benefit the 1 million seniors who exclusively receive Social Security Insurance — which helps Americans with little or no income and assets — and the 2.7 million Americans who receive both SSI and Social Security benefits.
On top of this across-the-board benefit increase, I’ll ensure that current and future Social Security beneficiaries get annual cost-of-living adjustments that keep pace with the actual costs they face.
As it currently exists, the Social Security program is on its way to insolvency, with some estimates pointing to 2035 as the year it will expire. The program currently comprises roughly a quarter of the budget, costing $945 billion in 2017 alone.
As the New York Times notes, Warren’s plan to expand Social Security benefits to recipients – roughly 64 million – would, “cost more than $150 billion in its first year.” Warren’s plan would also change the dynamics of the earned benefits for the rich, causing a more intense discrepancy between the contributions given versus benefits ultimately received.
“Without action, future generations are likely to be even worse off,” Warren’s Medium post reads, mentioning the plight of LGBTQ seniors, specifically:
Meanwhile, the prospect of paying for long-term care looms over most retirees. 26% of seniors wouldn’t be able to fund two years of paid home care even if they liquidated all of their assets. And for people that have faced lifelong discrimination, like LGBTQ seniors who until recently were denied access to spousal pension privileges and spousal benefits, the risk of living in or near poverty in retirement is even higher.
While Warren acknowledges that the Social Security program’s looming insolvency is on the horizon, she places the blame squarely on “inadequate contributions to the program by the rich” and vows that her plan “addresses both the solvency of Social Security and the need for greater benefits head on.”
Her plan specifically raises the Social Security contribution requirement to 14.8 percent on individuals making $250,000 annually. She said this will “split equally between employees and employers at 7.4% each”:
While most American workers contribute to Social Security with every dollar they earn, CEOs and other very high earners contribute to Social Security on only a fraction of their pay. My plan changes that and requires very high earners to contribute a fair share of their income. My plan also closes the so-called “Gingrich-Edwards” loophole to ensure that self-employed workers can’t easily reclassify income to avoid making Social Security contributions.
Second, my plan establishes a new 14.8% Social Security contribution requirement on net investment income that applies only to the top 2% — individuals making more than $250,000 in annual income or families making more than $400,000 in annual income. My plan creates a new contribution requirement — modeled on the Net Investment Income Tax (NIIT) from the Affordable Care Act — that asks people and families above these high income thresholds to contribute 14.8% of the lesser of net investment income or total income above these thresholds. My plan also closes loopholes in the NIIT that allow wealthy owners of partnerships and other businesses to avoid it. This contribution requirement will ensure that the very wealthy are paying into Social Security even when they report the bulk of their income as capital returns rather than wages.
This is far from the first expansive, progressive, and expensive plan Warren has offered, with her climate change agenda costing at least $3 trillion alone.