The reality that Social Security benefits will be slashed by more than 20% — roughly $500 per month — in just six years should be dominating our political headlines, campaigns and debate in Congress this year.
But in our horribly partisan political environment it seems beating your political opponents today matters more than actually solving our real long-term problems.
So, we were more than a bit stunned when Ohio Republican Sen. Bernie Moreno, a Make America Great Again zealot, joined forces with liberal Democratic Sen. Elizabeth Warren of Massachusetts to pitch a sensible solution to keep Social Security afloat for many more years.
To preserve current payments, the bipartisan duo pitched eliminating the cap on Social Security taxes which currently exempts any income above $184,500 annually. Every additional dollar of income is not subject to the 6.2 percent Social Security tax.
How the Warren, Moreno plan would work
Someone earning $184,500 this year will pay $11,439 in Social Security taxes, while their employer pays the same amount. Someone earning double the salary ($369,000) or even $1 million pays the same $11,439, as does their employer.
The government reports only 6% of Americans benefit from this maximum tax, meaning 94% of taxpayers pay the full Social Security tax every year while richer people get a break.
Under the Moreno-Warren proposal, those earning more than $184,500, would pay the 6.2% Social Security tax on every penny of their earnings. The same would be true for their employers. (Self-employed earners pay the full 12.4% tax on their own.)
Yes, a highly conservative Republican courageously proposed raising taxes, a sure sign of the impending doom facing Social Security in the eyes of his constituents.
Equal Social Security taxes fair
The dire predictions for Social Security — a program supported by 93% of Americans — result from fewer workers paying taxes and more older Americans receiving benefits. President Donald Trump’s Big Beautiful Bill, which Moreno supported, also removed a tax on Social Security benefits, further eroding revenue.
Simple math quickly shows the Moreno-Warren plan would raise massive revenue (perhaps $3.4 trillion in 10 years) to shore up and sustain Social Security payments that millions of Americans depend on each month, especially with property taxes and other expenses rising.
And it’s easy for that 94% of Americans who earn less than $184,500 to support raising taxes on the wealthy, especially the millionaires and billionaires.
“This is a no-brainer: the wealthiest Americans, who have benefited the most from America’s opportunities, should contribute the same percentage of their income as a factory worker in Chillicothe, Ohio, or a teacher in Worcester, Mass.,” Moreno and Warren wrote in the New York Times.
The bad news is the Moreno-Warren plan would not fully fund the program.
An imperfect plan to fix Social Security
As you might imagine, those who represent the wealthy and some conservative groups find fault with this idea.
For starters, it’s true that businesses with highly compensated employees would be paying 6.2% in tax on all of their earnings for the first time. That cost could be significant for many businesses and gives us some pause.
A less compelling concern is that high earners would not be compensated for their considerably larger tax payments, a major change for this “earned-benefits” system.
Historically, taxes have been capped because benefits also were capped. The more your earn in your lifetime, the more you receive in later years.
The whole premise of Social Security was to return money to taxpayers when they retire to ensure older Americans can live comfortably.
But it’s also true that high earners should have less need for Social Security payments, which they would still receive.
We’re not necessarily opposed to other solutions, such as raising the tax by 0.1% a year for 10 years to 7.2% for both employees and employers.
We just want a solution that works.
It’s the economy
Our elected leaders have been scared of this issue for decades, constantly kicking the proverbial can down the road even as Social Security funding predictions become more dire.
The longer we lack political courage, the more costly the fix becomes.
Moreno and Warren should be commended for volunteering a viable albeit imperfect solution to this critical issue and we hope they will soon file actual legislation for debate.
We don’t wish to be alarmist, but it’s not hard to imagine current economic concerns growing exponentially if Social Security benefits are cut in 2032 or 2023. Many seniors would struggle to pay their bills, taxes and other costs such as healthcare.
It also would deprive Americans of money they were forced to pay into Social Security on the generations-old promise their money would be there when they grew old.
It’s hard to imagine any sane politician wanting to run for re-election on that set of facts.
Let’s fix this now so Americans can plan their retirements without Congressional drama.
This piece was written by Dispatch Executive Editor Michael Shearer on behalf of the editorial board of The Columbus Dispatch. Editorials are fact-based assessments of issues of importance to the communities we serve. These are not the opinions of our reporting staff members, who strive for neutrality in their reporting.
This article originally appeared on The Columbus Dispatch: Alliance between MAGA Ohio senator, Trump punching bag could head off disaster
| Our view
Reporting by Columbus Dispatch Editorial Board, The Columbus Dispatch / The Columbus Dispatch
USA TODAY Network via Reuters Connect
By Columbus Dispatch Editorial Board, The Columbus Dispatch | USA TODAY Network
