Expanding Social Security Is the Cheapest Way to Bring More Security to America's Retirees - There are many ways to spread the cost of better benefits.  ALL EASY TO DO. ASK THE SSA GODDESS (below)


How should the costs of an expanded Social Security be shared without unduly burdening anyone? There are numerous options, all quite affordable, reasonable, good policy, and fair. Social Security’s wage insurance has been financed, from the beginning, primarily from premiums split evenly between employees and employers. Those premiums today are12.4 percent of wages,  equally divided between employer and employee, up to a maximum salary amount, $118,500 in 2015. The 12.4 percent rate has not increased since 1990.

By Nancy J. Altman, Eric R. Kingson / The New Press 20 January, 2015 The following is an excerpt from a new book, “Social Security Works! Why Social Security Isn’t Going Broke and How Expanding It Will Help Us All,” published by The New Press, 2015, http://www.barnesandnoble.com/w/social-security-works-nancy-altman/1118940783?ean=9781620970379

SSA IS WORKING FINE, BUT IF WE WANTED A LITTLE EXPANSION? Let's study this.  If the 'take' rate were to be gradually increased by 1 percent on employers and employees each, over a two-decade period, as some have recommended and we propose, that would translate to an average increase of about 50 cents a week each year. Just that gradual increase would bring in substantial revenue as shown in Social Security Works!.

Social Security premiums are assessed against covered compensation. A larger and larger
proportion of compensation is paid not as cash but as deferred or non-cash compensation, such as
health insurance and so-called flexible spending accounts for such items as medical expenses,
dependent care, and commuting costs. This compensation is generally not treated as compensation
covered by Social Security. The failure of this compensation to be counted for Social Security
purposes means that those non-cash wages are not insured against loss in the event of death,
disability, or old age. Moreover, the tax code unintentionally encourages employers and
employees to set up deferred or non-cash compensation plans for the express purpose of avoiding
part of the cost of the mandatory Social Security premiums. If just payments to flexible spending
accounts were considered wages for Social Security purposes—as contributions to 401(k) plans
already are, and as we advocate—the change alone would generate meaningful new revenue.  The
revenue produced would be even more if combined with increases in both the Social Security
contribution rate and the maximum dollar amount on which that rate is assessed—a proposal that
is described next.

The maximum amount of wages on which Social Security contributions are made— $118,500 in
2015—increases every year by the percentage that average wages nationwide increase. However,
because wages at the top have gone up rapidly over the last thirty years, while nearly everyone
else’s have stagnated, more and more wages at the top keep escaping from being assessed for
Social Security. This result of uneven wage growth has cost Social Security billions of dollars each
year.  Restoring the maximum to where Congress intended should have been done years ago.  But
we believe that Congress should go further.  The maximum should be scrapped altogether, or at
least with respect to the employer match. This would result in workers all paying the same rate on
all their wages whether they earn the minimum wage or are CEO of a Fortune 500 company. It
also would mean that all wages would be insured against loss in the event of death, disability, or
old age.

Only 6 percent of the workforce earns in excess of the maximum. Our plan gradually phases out
the maximum, so that all workers would contribute to Social Security at the same rate on all their
cash compensation. (It is instructive to note that Congress eliminated the maximum with respect to
the hospital insurance part of Medicare in 1994.) Those 6 percent, who would under the proposal
make larger contributions, would also receive somewhat higher benefits.  Nevertheless, the net
revenue gain to the Social Security trust funds would be substantial.

There is no reason that employers and employees have to pay the same rate, or cover the same
wages. Employers could pay premiums on their entire payroll, while employees could continue to
pay only up to a maximum wage amount. Persons with extremely large annual incomes could pay a
10 percent premium on income from all sources in excess of $1,000,000. There are many ways
that the increased premiums could be allocated. Although our plan does not include some of these
proposals, they are all reasonable and would produce substantial revenues to pay for expanded
benefits.  And as Social Security Works! explains, new dedicated sources of revenue assessed
against the mega-wealthy offer other possibilities for income to pay for an expanded Social
Security system.

Expanding Social Security is Fully Affordable

What will Social Security cost in the future? The cost of Social Security as a percentage of Gross
Domestic Product (GDP) is close to a flat line for the next three-quarters of a century and beyond.
Social Security currently accounts for a bit less than 5 percent of GDP. That percentage is
projected to peak at 6.16 percent in 2035, when the youngest baby boomers, those born in 1964,
reach their 71st birthdays, and then drop slightly, remaining below that peak of 6.16 percent for
the subsequent fifty years and beyond.

To put those percentages into perspective, in 2009, a number of other industrialized countries
spent considerably higher percentages of their GDP on the part of their social security systems that
provides old-age, disability, and survivor benefits. Moreover, they spend more today, as a
percentage of GDP, than we will spend in 2035, when the entire baby boom will be over age 70.
Indeed, we will even spend less at the end of the century than those nations spend today!

And our nation will be much wealthier then, just as we are wealthier now than we were
seventy-five years ago, before computers, smart phones, and other technological advances.
Economists project that our GDP will be 430 percent larger in seventy-five years than it is today,
just as today it is 1,364 percent larger than it was seventy-five years ago—and that is using
inflation-adjusted numbers, so the growth is real growth. That means that the 6.16 percent of GDP
will be easier to afford in the future.

Indeed, expanding your Social Security is not a matter of mathematics or demographics.  It is
about values and political choice.  It is about what kind of nation we want for ourselves and those
who follow.  It is about peace of mind, security and dignity.

(Copyright © 2014 by Nancy J. Altman and Eric R. Kingson. This excerpt originally
appeared in Social Security Works! Why Social Security Isn’t Going Broke and How Expanding It Will Help Us All, published by The New Press in January 2015, and is used here with permission.)


My pal who worked at SS admin said "I've familiar with this book that just came out, because I know about the organization,  Social Security Works that the authors work for.

Social Security has some near-term problems, but they can be fixed, as the article points out. The basic problem is that the people on the far right, like Ted Cruz and Rand Paul, hate it because it helps millions of people each month, and because they are suppressives. That drives them crazy. They are zeroing in on SSDI to start with, because of all the bad publicity it's gotten, but their ultimate goal is to get rid of social security entirely.