If you are receiving Social Security benefits or plan to receive them, there is good reason to be worried. As it stands now, those benefits will be cut significantly. The problem is fewer people will be paying into the system while more people will be taking money out of the system. This is unsustainable.
About 50 million people over the age of 65 receive regular Social Security benefits now. By 2035, that number is projected to increase to 80 million. So, starting next year, the plan will be losing money. The projection is that in about 15 years, benefits will be slashed by 20%.
Clearly, changes need to be made. With the hope of keeping benefits at current levels, I have two ideas. First, increase legal immigration. However, those additional immigrants must be sent to low unemployment states, such as North Dakota, South Dakota and Minnesota. We certainly have plenty of room for them. Actually, we need them. In these three states alone, there are tens of thousands of job openings that employers can’t fill. If they don’t want to come to the Upper Midwest, then they don’t get into the U.S.
These legal immigrants will then be paying into the social security system. For that matter, they will also be paying taxes to support schools, and other local and state services, as well as putting more money into the pockets of local businesses. It’s a win-win for everybody, except bigots or xenophobes.
The other necessity is to change the unfair Social Security tax system. Rich people need to pay their fair share. Most working people now pay a 6.2% Social Security payroll tax, while their employers also pay 6.2%. Self-employed people pay 12.4%. However, the tax for everyone is capped at $132,900 in earnings. That’s absurd. In other words, the person making $133,000 a year pays the same amount of Social Security taxes as the person making $133 million a year. As Yakov Smirnoff would say, “What a Country!”
There should be no cap on earnings for Social Security taxes. This is especially meaningful now because rich Americans recently received a massive tax cut, thanks to fiscally irresponsible Republicans and President Donald Trump. That tax cut will give away trillions of dollars to the very wealthy and corporations, while the federal deficit has exploded to more than one trillion dollars a year.
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The very rich can certainly afford to pay higher Social Security taxes, and it’s the right thing to do. Millions of Americans rely on Social Security as their prime source of income in their retirement years. We need to make sure the money is there for them, without cutting benefits or raising the eligibility age.
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