Statement on the 2025 Social Security Trustees Report
If you have not noticed, the present administration has come all out for the upper income citizens. It was the low-and middle-income citizens which put our president in office either by voting or not voting. My point? Yes, the present administration will eventually be out of office. Then we have the House and the Senate to contend with for our needs. Without their support, the president’s policy cuts supporting citizens would not have occurred. We should be telling them greatly how much we appreciate their sticking everyday citizens in the back because they were afraid of the president.
What you are going to read next is Nancy Altman’s proposal to tax the rich to save Social Security. Bruce and Dale proposed modest increases of 1 tenth of one percent yearly over ten years to secure its financial viability for the next 75 years. It would have worked. The argument is? People at the upper end of the income ladder have more political power than the other 90 or less percent of the population.
The other argument was to cut Social Security in the near term so there would be no funding default. I believe that was the position of Andrew Biggs. Many were the discussions between Dale and Bruce v. Andrew Biggs. I may be wrong. A brief read I thought revealed Andrew Biggs having a different position to date.
Ms. Nancy Altman follows with her position of taxing the rich to make Social Security solvent until the next president comes along and cuts the support for Social Security in league with a bunch of scared Representatives and Senators. Social Security belongs to the people as Dale would say. He would also say minor tweaks of withholding would keep it the third rail for politicians.
The following is a statement from Nancy Altman, President of Social Security Works, on the 2025 Social Security Trustees Report:
Statement on the 2025 Social Security Trustees Report, Social Security Works
“This report shows that Social Security is fully affordable, costing only about 6 percent of GDP at the end of the 21st century. It has a modest funding shortfall, which is still years away. There is no question Congress will act to avert the shortfall, as it always has in the past. The question is what Congress will do.
There are two options for action: Bringing more money into Social Security, or reducing benefits. Any politician who doesn’t support increasing Social Security’s revenue is, by default, supporting benefit cuts.
In poll after poll, the American people are clear that they strongly support making the wealthy pay their fair share into Social Security, and overwhelmingly oppose benefit cuts. As divided as Americans are over many issues, we are united about Social Security.
Not only is requiring the wealthy to pay into Social Security on all their income popular, it is also excellent policy. Income inequality has cost Social Security more than $1.4 trillion since 1983. If the wealthy pay in on all of their income, including unearned investment income, we can easily afford to protect and expand Social Security’s modest benefits.
Democrats have introduced several bills that would do just that. In sharp contrast, Donald Trump and his Republican colleagues want to give even more tax breaks to billionaires.
Importantly, the question about whether to expand or cut Social Security is a question of values, not affordability. America is the wealthiest country in the history of the world, at the wealthiest moment in our history. That money can remain concentrated in the hands of billionaires, or it can go towards Social Security, enriching all of our lives.
There is an urgent crisis facing Social Security, but it’s not a shortfall years in the future. It is sabotage that’s happening right now. Despite Donald Trump’s promise to protect Social Security, Elon Musk’s DOGE is undermining it every day. DOGE has pushed out thousands of Social Security staffers, including nearly half of senior executives. This is an incalculable loss of institutional knowledge and expertise.
These cuts are completely misguided and unnecessary. Social Security is run very efficiently, with well under a penny of every dollar spent on administrative costs. Given that, substantially increasing or decreasing Social Security’s administrative budget has a negligible impact on the system’s finances.
Today’s report is a reminder that even as DOGE’s cuts to the Social Security Administration are wrecking Social Security’s customer service, they are doing nothing to improve its solvency.”
“If you have not noticed, the present administration has come all out for the upper income citizens.” It’s not alone.
Thomas Frank: “The Democratic Leadership Council, the organization that produced such figures as Bill Clinton, Al Gore, Joe Lieberman and Terry McAuliffe, has long been pushing the party to forget blue-collar voters and concentrate instead on recruiting affluent, white-collar professionals who are liberal on social issues. The larger interests that the DLC wants desperately to court are corporations, capable of generating campaign contributions far outweighing anything raised by organized labor. The way to collect the votes and — more important — the money of these coveted constituencies, “New Democrats” think, is to stand rock-solid on, say, the pro-choice position while making endless concessions on economic issues, on welfare, NAFTA, SOCIAL SECURITY, labor law, privatization, deregulation and the rest of it.”
— Thomas Frank, What’s the Matter with Kansas? (2004), p. 243
Yes, Social Security is affordable, but both parties abandoned ordinary voters decades ago in favor of affluent voters… What has changed is that Trump’s duplicitous messaging was more alluring to ordinary voters than Democrats’.
@John,
I’ll keep it simple. What concessions on SOCIAL SECURITY [sic] did House and Senate Democrats vote for?
How quickly they forget!! Obama Wanted to Cut Social Security. Then Bernie Happened.
Of course, that’s not what Obama campaigned on. “In an April 2011 town hall, Mr. Obama suggested lifting the payroll tax cap: “So if we just made a little bit of an adjustment in terms of the cap on Social Security, that would do a significant amount to stabilize the system,” he said. However, the Social Security payroll tax remains capped at $110,100.” Obama’s 2008 promises: kept or broken? – CBS News
Voters were allured by Obama’s duplicitous message. What has changed is that last year Trump’s duplicitous messaging was more alluring to ordinary voters than Democrats’.
@John,
LOL! Lifting the cap is not cutting SS.
But thanks for playing. Do try again sometime.
Since you didn’t actually answer my question, I’ll type slower this time:
What concessions on SOCIAL SECURITY [sic] did House and Senate Democrats vote for?
JohnH
Are you going to behave yourself? Joel could throw you out of here. He has not done so.
Obama could promise whatever he wanted to. However, he can not raise the SS cap, Congress must do so. I believe Dems had control of the House and Senate for two years. Dems did not have 60 votes to break a filibuster in 2008. So Repubs could block an increase in the Cap. Or maybe not all Dems were into it. Constituents contribute and Business contributes also. $110,100 was then. It increased. The cap is 62.5% higher in 2025. A few notes on the topic:
Contribution and Benefit Base
Social Security’s Old-Age, Survivors, and Disability Insurance (OASDI) program limits the amount of earnings subject to taxation for a given year. The same annual limit also applies when those earnings are used in a benefit computation. This limit changes each year with changes in the national average wage index. We call this annual limit the contribution and benefit base. This amount is also commonly referred to as the taxable maximum. For earnings in 2025, this base is $176,100.
The OASDI tax rate for wages paid in 2025 is set by statute at 6.2 percent for employees and employers, each. Thus, an individual with wages equal to or larger than $176,100 would contribute $10,918.20 to the OASDI program in 2025, and his or her employer would contribute the same amount. The OASDI tax rate for self-employment income in 2025 is 12.4 percent.
For Medicare’s Hospital Insurance (HI) program, the taxable maximum was the same as that for the OASDI program for 1966-1990. Separate HI taxable maximums of $125,000, $130,200, and $135,000 were applicable in 1991-93, respectively. After 1993, there has been no limitation on HI-taxable earnings. Tax rates under the HI program are 1.45 percent for employees and employers, each, and 2.90 percent for self-employed persons.
John:
It is in your interest if you wish to be at Angry Bear talking to people. We are tolerant. However, you are pushing the envelope.
Yes John:
People do believe lies and Tr__p is a master at purposely telling them.
I believe that Andrew Biggs (who is not the Arizona Congressman) always argued that paying benefits to people wealthy enough to provide for themselves was economically inefficient. He asserted that (my paraphrase) collecting taxes on the wealthy prevented it from be put to use to grow the economy. He did not seem to be against helping the poor; he just made it clear that it was welfare.
Since Dale has not posted in months, I note that he would argue against a proposal for taxing the rich because it would make SS a bigger target. He was for making it easy for all workers to help themselves.
Bigg’s latest proposal, Simple Plan to Address Social Security Insolvency, pushes the unitary executive theory. The president in 2033, (trump in his fourth term?) can just decide to limit SS benefits to a fixed cap (with the opposite effect of eliminating taxes on benefits, BTW).
Congress was able to deal with making changes as needed from 1939 to 1983. It is less than half the life of SS that Congress has been afraid of touching it. Applying the “third rail” metaphor has simply justified not doing their job.
@Arne,
The American Enterprise Institute? Seriously?
I appreciate that you considered the source.
I agree and advocate with Dale and Bruce (RIP) that SS should be maintained as “by workers, for workers.” It behooves to know what what others are saying all along the spectrum.
Arne:
Angry Bear does need a knowledgeable person to write on Social Security occasionally. You are all setup on the system. Why not you?
I think Altman’s key point in this piece is not about having the rich pay more, but about the sabotage of SS.
“DOGE has pushed out thousands of Social Security staffers, including nearly half of senior executives. This is an incalculable loss of institutional knowledge and expertise.”
@Arne,
The GOP has hated SS from the time it began. The fact that it has worked has never blunted their hatred. Haters gotta hate.
https://www.ssa.gov/history/tally.html
Votes on 1935 SS Act
House Republicans: Yes – 81, No – 15
Senate Republicans: Yes – 16, No – 5
My historical understanding is that southerners started to hate SS when it started to cover black people and when the Civil Rights Act was passed in 1964 they started to abandon the Democratic party. Nixon and even more so Reagan courted them.
@Arne,
Some Republicans and other opponents of Social Security characterized the program as “socialism” or even a “communist plot” during the debates surrounding its initial enactment in 1935.
For example, the American Medical Association, an organization influential with some Republicans at the time, reportedly called it a “compulsory socialistic tax”. Even President Franklin D. Roosevelt himself, who championed the program, was labeled a “Communist” by some opponents.
Why isn’t SS properly funded? First question is whether or not the underwriting of the current system was time limited. Did in 1983 they say something like “this will work until sometime in the 2030’s and then those future policymakers will need to come up with the “next-gen” Social Security? Or has there been perceptible changes in the key variables that drive towards unexpected funding insufficiency? To my mind I see a couple of likely suspects here. Perhaps longevity has changed so much that 67 as normal benefits age always leaves the system in deficit. Second is that maybe the distribution of lifetime earnings is unexpectedly heavy on the low-side. This would raise the benefit to contribution ratio driving towards underfunding. Is it just too few workers versus expectations are contributing now to support the benefits demand? I’m a current beneficiary, so I get how this can sound, but simply on gut feel I am guessing it’s mostly longevity plus underrunning of expected workforce. Both “improve” if full benefit age is increased. I totally get that some folks will be seriously burdened by another 2 or 3 years but millions won’t be. Maybe there are ways to accommodate those most severely burdened. Anecdata: my parents had 4 kids, youngest is 2 months from her full benefit. We had 9 kids. Those 9 have 3 kids. The 4 over 35 have 3. The 5 over 30 have 3. Now the 4 under 30 are all under 20, so it is very unlikely to stay at 3, but is it getting to 18? I’ll take the under for $100,000.
If you read the 1984 report you will find that they already knew that the 1983 changes were inadequate.