It is the second plan to tax the wealthy that Sanders, who previously made a 2016 run,
has introduced in the last two weeks, the first targeting the estates of the richest Americans
“At a time when more than half of older Americans over the age of 55 have no retirement savings, our job is to expand Social Security to make sure that everyone in this country can retire with the dignity they have earned and everyone with a disability can live with the security they need,” Sanders said.
The Social Security Expansion Act, which Sanders first introduced in 2017, is also being introduced in the House by Democratic Rep. Peter DeFazio of Oregon. Several declared and potential 2020 Democratic candidates are co-sponsoring the legislation, including New Jersey Sen. Cory Booker and California Sen. Kamala Harris, who have announced their bids, as well as New York Sen. Kirsten Gillibrand, who is exploring a run, and Oregon Sen. Jeff Merkley, who is also considering running.
It would increase benefits for all recipients, with low-income seniors receiving a boost of nearly $1,300 a year. It would also make the annual cost of living adjustment more generous by shifting the formula to take into account health care and prescription drug costs, which rise faster than inflation.
To pay for it, Sanders would subject all income above $250,000 to the existing 12.4% Social Security payroll tax, which is split between workers and employers. Currently, the payroll tax is only applied to wages up to $132,900.
Plus, the senator would levy a new 6.2% tax on single people with investment income above $200,000 and couples above $250,000.
This extra revenue would extend the health of Social Security by 52 years, according to Sanders’ office. As it stands now, the system will no longer be able to pay out full benefits starting in 2034, according to the 2018 annual report
from the Social Security and Medicare trustees.
Democrats campaigned relentlessly — and successfully — in both red and blue states across the country in 2018 on a pledge to preserve programs like Social Security, which Republicans suggested could face cuts to make up for the revenue shortfalls caused by their tax cuts.
Days before the midterm election in November, Sanders laid out the stakes, tweeting: “Let us not forget that (earlier in October 2018), Mitch McConnell stated he wants to cut Medicare, Medicaid and Social Security if Republicans keep one-party rule in Washington. We must expand, not cut, these programs that are life and death for the working class in this country.”
McConnell signaled in a pair of interviews weeks earlier that the Republican plan to address the deficit, which ballooned by about $2 trillion under their watch, would require reforms to Social Security, Medicare and Medicaid — the package of social programs he described as “the real driver of the debt.” Read more