The COVID-19 pandemic has brought attention to widespread economic insecurity, especially among older people and others with limited or fixed incomes.
A key question is: Will that attention spur Congressional action on challenges facing our premiere social insurance program’s long-term sustainability?
As we gear up for the mid-term elections, Social Security might get more of the attention it deserves – and needs. In his August 21 Washington Journal discussion with Pedro Echevarria Academy CEO Bill Arnone highlighted a few areas that might substantially improve economic security in our nation. These policy options, all focal points of our campaign for Pathways to Economic Security, include:
Bringing back the Social Security minimum-benefit “floor” that was a component of the program as originally structured but has eroded over time such that it no longer provides practical protection for some of our lowest-income elderly.
Bringing contributions in line with 21st-century income distribution by raising and/or removing the cap on covered wages, which currently excludes earnings over $147,000 from FICA contributions.
Expanding benefits for widows (and widowers) in particular, who are currently among those in the worst financial condition. They continue to experience higher rates of poverty and insecurity, as measured by the Elder Index promoted by the National Council on Aging’s Elder Equity Collaborative of which the Academy is a partner.
Increasing benefits for the oldest beneficiaries. This policy would add a flat dollar amount or percentage increase once beneficiaries reach age 80 or 85 in acknowledgement of the tendency for health care and caregiving costs to increase and savings to become depleted as one ages.
Eliminating the five-month waiting period for Disability Insurance benefits. This change would reduce the need for workers with disabilities who have savings or assets to draw them down in the interim and eliminate a period of potential hardship for those who do not.
Four Pillars of Economic Security: Labor, Protection, Benefit, and Equity
The four Policy Pillars provide an integrated approach to reducing economic insecurity in the U.S, which includes not only social insurance programs but also social assistance, tax, and labor policy options.
The four pillars also recognize that gaps in our current social protection infrastructure have a disparate impact on the lives of people of color and other historically excluded groups and was designed based on stakeholder input.
Representatives of advocacy and front-line service organizations provided their first-hand perspectives as part of the Economic Security Study Panel’s deliberations. Stakeholders will also be involved in the dissemination of the report’s findings, along with those of other Academy Task Forces, as part of our multi-year Pathways campaign.
Automatic balancing mechanism for Social Security
Bill’s C-SPAN interview also noted an automatic balancing mechanism as another policy option to stabilize Social Security’s financing. This option will be the focus of a future Academy Issue Brief.
Stay tuned for more details. As always, we welcome your comments and questions in the comment section below.