Senators Are Starting to Talk About How to Fix Social Security Insolvency

Social Security is facing a funding shortfall. According to projections from the Social Security Administration and Congressional Budget Office, Social Security’s trust fund for retirement benefits may run out in 2032. That could result in an across-the-board benefit cut. No one wants that to happen.

A CNBC article reported that the Senate Budget Committee held a hearing focused on the “path forward” for the program.

Sen. Sheldon Whitehouse, D-R.I., expressed confidence that a solution could be found in time. “It’s actually not all that hard or complicated. And the sooner we do it, the better off everyone will be.”

A few ideas were tossed around on how to shore up Social Security. Suggestions included creating a separate investment fund, increasing payroll taxes for high-wage earners, and cutting benefits for those who can afford it.

While no agreement was made, it’s a positive sign that Senators are sitting down to discuss the solvency situation. Experts say Social Security reform will likely require a combination of ideas.

A Solvency Solution

The Seniors Trust believes the best solution has already been introduced. We want Congress to enact The Social Security Expansion Act. This landmark bill buttresses the long-term solvency of Social Security by expanding benefits for seniors — not cutting them!

If passed, this legislation will make four major changes to Social Security for retirees:

• Benefits will be increased for most recipients by about $200 per month.
• The Consumer Price Index for the Elderly (CPI-E) will be used to calculate Social Security Cost-of-Living Adjustments (COLAs) instead of the Consumer Price Index for Urban Wage Earners (CPI-W) used currently. The CPI-E takes the unique spending habits of seniors into account — particularly regarding the cost of healthcare — and offers a more realistic COLA for retirees.
• The minimum Social Security benefits would be increased to provide higher payments to seniors and greatly reduce senior poverty.
• The long-term solvency of the Social Security program would be guaranteed.