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Senator Elizabeth Warren unveiled Thursday her plan to extend social security benefits for seniors and future generations after retirement, a proposal that she would fund by raising taxes on the wealthiest Americans.
The extension of the 84-year-old Massachusetts Democrats program would immediately increase benefits for seniors by $ 200 a month, or $ 2,400 a year, while increasing benefits for retired women, low-income households, persons with disabilities and other disproportionate wages throughout their working lives.
The scheme would be financed by new requirements for higher incomes to pay their "fair share" to the National Social Security Fund. The fund currently holds $ 3 trillion, but has been threatened for years by republican cuts and privatization proposals, resulting in increasingly modest benefits for retirees in recent years.
"Due to inadequate contributions to the program by the rich, we should use this reserve by 2035, resulting in an automatic 20% reduction in benefits if nothing is done," Warren writes.
The top two per cent, those with an individual salary above $ 250,000, would be required to pay 14.8 per cent of their salary to Social Security benefits. The investment income of the richest families and workers would also be subject to a contribution of 14.8%.
"The plan leads to a much more progressive social security system," wrote Mark Zandi, chief economist at Moody's Analytics, in an independent analysis, "while high-income people bear the financial burden of the plan while low and middle incomes people benefit substantially ".
The plan has been praised by Social Security Works, a national group working to protect the program.
"Senator Elizabeth Warren is a powerful leader in the movement to develop social security," said Nancy Altman, president of the group. "His bold new plan is tackling head-on the retirement income crisis, growing income and wealth inequality and the pressure on working families – it's a solution for all generations." . "
Sixty-four million Americans depend on social security for at least a portion of their income: more than 20% of married seniors and 45% of unmarried seniors rely on a benefit equal to 90% of their income .
The numbers are higher for people of color: 40% of Latinx retirees, one-third of black seniors and over one-quarter of Asians and Pacific Islanders rely on benefits as their sole source of income after retirement.
Congress has not increased social security benefits for nearly 50 years and President Donald Trump has proposed cutting them back shortly after signing a $ 1,500 million tax cut. dollars for the richest Americans. Decades of wage stagnation have left the average beneficiary receiving only $ 1,354 per month from social security in 2019.
Aspects of Warren's plan to ensure that low-income workers and those who spend years out of the labor market looking after children or elderly family members will not go through their last years years in poverty have also received praise.
The proposal would create a credit for people who spend years doing unpaid work as a live-in caregiver – 60% of whom are women.
The credit would increase the calculation of Social Security lifetime earnings – used to determine monthly benefits – for anyone providing 80 hours of unpaid care per month to a child under age six, to a family member with a disability, or to a family member with a disability. an elderly parent.
Mattie Kahn wrote to Glamor that this detail of Warren's plan highlighted social security and retirement poverty – more common among women – as a feminist issue:
When people talk about issues that have the greatest impact on the lives of women in the countryside or in boardrooms, the same issues arise: wage gap, paid leave, child care, violence against women and reproductive health. But these structural problems do not affect women in isolation; each has consequences that can sometimes be overlooked.
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Because of workplace discrimination and wages, says Warren, and the fact that some women take time off the job market to care for sick children or parents (and at a rate of higher than that of men), the monthly average of women's social security benefits does not exceed 78%. the average monthly benefit received by men. It's more than unfair. This is catastrophic and it affects the financial future of women.
Altman also applauded the attention that Warren gave to unpaid work at home.
"She knows that caregivers – disproportionately women – who are withdrawing from the labor market to care for loved ones are providing invaluable work for their families and the country," Altman said.
If the number of pensioners living in poverty were considered "excessively high", Warren would also restructure the special minimum benefit created by the Congress in 1972 to help people who worked with consistently low wages before retiring and thus benefited. lower benefits. Profit, wrote Warren to Way, is increasingly difficult to qualify and has lost its value with the increase in the cost of living.
"No one who has spent 30 years working and contributing to social security should retire in poverty," the senator wrote. "That's why my plan is restructuring the special minimum benefit so that more people are entitled to it and the benefits are much better than that." Under this plan, anyone who has worked 30 years of social security coverage will receive an annual benefit of minus 125% of the federal poverty line at retirement age. "
Warren's plan is expected to reduce the poverty rate of seniors by 68 percent, lifting nearly five million people out of poverty.
"Warren's bold plan extends social security and guarantees that all benefits can be paid in full and on time," Altman wrote. "All Americans owe him great gratitude for defending our social security system."
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