Thursday, April 15

Social Security expansion bill poised to gain traction in Congress

A recent poll conducted by The Senior Citizens League of its members explored what they thought the new Congress should focus on. Boosting Social Security benefits was cited by 42 percent, followed by reducing taxation of those benefits at 31 percent (reducing prescription drug prices came in third, at 18 percent).

“I think there’s a growing sense that something needs to be done,” said Mary Johnson, Social Security and Medicare policy analyst for the league. “It can take time to get legislation with many moving parts up and running, so you need to allow time to phase in changes.”

However, congressional Republicans typically have balked at the idea of expanding the program due to the associated higher taxes that would come with it, and past GOP proposals have advocated reducing benefits as a way to ease the program’s financial woes.

And, not everyone supports a program expansion.

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“Expanding benefits could help low-income retirees, but middle and high-income workers would likely reduce their personal savings in response to higher expected Social Security benefits,” said Andrew Biggs a resident scholar of the American Enterprise Institute, according to written testimony presented at recent congressional hearing about retirement security. Biggs was a deputy commissioner of Social Security under President George W. Bush.

Biggs also said that while tax increases would eliminate shortfalls, higher taxes could increase borrowing and debt by low-income workers and reduce work and encourage tax evasion by higher earners, according to his written testimony.

While it’s not certain whether Larson’s bill would be able to clear the House in its present form anyway, a a Democrat-controlled House bodes well that it could progress.

However, as with most major pieces of legislation, it could go through various iterations before facing approval or rejection by the full House. And even if it made it through, the measure would also need approval from the Republican-dominated Senate, where priorities could be much different.

“If it gets through the House, and then goes to the Senate and doesn’t get brought up for debate or a vote, it’s going to be a 2020 election campaign issue,” Altman said.

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