Social Security works, let’s make it stronger

On August 14, 1935, President Franklin Delano Roosevelt signed the Social Security Act into law.  Today, some 82 years later, the program is strong—and its protections more important than ever. By any measure, Social Security has been a resounding success.  Prior to its enactment, 50% of Americans above the age of 65 lived in poverty.  […]

Social Security works, let’s make it stronger

On August 14, 1935, President Franklin Delano Roosevelt signed the Social Security Act into law.  Today, some 82 years later, the program is strong—and its protections more important than ever.

By any measure, Social Security has been a resounding success.  Prior to its enactment, 50% of Americans above the age of 65 lived in poverty.  That number has dropped to 9.5%, thanks to Social Security.  The program provides critical support to retirees, widows, and widowers, as well as to younger families when a breadwinner has experienced a serious, work-ending disability or premature death.

The program’s impact in New Mexico is difficult to overstate.  Statewide, hundreds of thousands of people receive Social Security benefits, including 267,000 retirees, 65,000 individuals with disabilities, and 30,000 children.  Without these benefits, 155,000 people—about 7.4% of our population—would fall below the poverty line.

Social Security has proven to be remarkably reliable: in 82 years; it has never missed a payment.  It is also remarkably efficient:  With administrative expenses constituting less than 1% of total expenditures, Social Security puts even the most efficient private insurance to shame.

Despite the program’s tremendous success, it is perennially under attack from the right.  Proponents of Social Security “reform” argue that it is necessary to cut benefits and raise the retirement age to avoid bankrupting the program.  Not so.  Social Security is expected to be able to pay all benefits and all associated administrative costs, in full and on time, without any changes whatsoever, through 2034.  Even after that the program will be able to meet 77% of its obligations through existing revenue streams.

The projected shortfall is modest—approximately 1% of GDP.  And eliminating that projected shortfall is simple:  fund Social Security the same way we fund Medicare.  Both programs are funded by payroll taxes.  But while the Medicare tax applies to all earned income, the Social Security tax applies only to the first $127,200 a worker earns in a year.  And while the Medicare tax applies to investment income for individuals earning over $200,000 a year, the Social Security tax does not apply to investment income at all.  Funding Social Security the way we fund Medicare would eliminate the impending shortfall and allow Social Security to remain strong for generations to come, without any increase in taxes on the middle class.

The conversation we should be having is not about whether to cut Social Security’s modest but vital benefits, but rather about whether, and how, to expand them.  The argument for expanding retirement benefits is straightforward.  Due to the Great Recession and decades of stagnating middle class wages, the typical family nearing retirement has only $14,500 in savings.  As a result, most new retirees can expect to experience a dramatic decline in their standard of living upon retirement.  In the richest nation on Earth, we can afford to do better.  A few simple fixes, like switching to the more accurate Consumer Price Index for Elderly Consumers to calculate cost-of-living adjustments, and increasing the minimum benefit amount to 125% of the poverty level, could go a long way to improving the lives of American seniors.

There is also a powerful argument for expanding workers’ access to earned disability benefits.  Social Security’s test for disability is among the strictest in the world.  Under current law, an individual’s application will be denied if the government determines that the individual is capable of preforming any type of work “which exists in significant numbers” in the national economy.  The government does not need to show that the individual would actually be able to find a job performing that type of work.  As a result, many people who are genuinely disabled and who have no real hope of finding a job are unable to receive their earned benefits.  That is unconscionable.  The system should be reformed so that disability claims are not denied unless the government can point to specific employment opportunities available to the individual.  And the government should then provide training and other assistance to make sure the applicant can actually obtain the job in question.

Social Security is perhaps the most direct embodiment of our social contract:  we all pay in when we are young and able to work, and we all receive benefits when we become elderly or disabled or die prematurely, leaving behind young children.  The program ensures that millions of Americans are able to live with dignity and independence, and contributes to our economy by putting money in the hands of low-income folks, who are the most likely to spend it.  It’s time to do the patriotic thing and strengthen this vital program for the benefit of all Americans.

David Baake is running for Congress in the 2nd Congressional District.

We're ad free

That means that we rely on support from readers like you. Help us keep reporting on the most important New Mexico Stories by donating today.

Related

Women hold a majority of legislative seats in NM

Women hold a majority of legislative seats in NM

Women hold a slight majority of seats in the Legislature after this year’s elections, though men still hold a majority in the Senate. In…
Politics Newsletter: New Mexico DOJ offers way to curb shooting threats

Politics Newsletter: New Mexico DOJ offers way to curb shooting threats

Hello fellow political junkies! Bomb threats and mass shooting threats have unfortunately become a part of life in the United States. A state official…
Former LFC chair John Arthur Smith dies

Former LFC chair John Arthur Smith dies

Longtime powerful state senator John Arthur Smith, a conservative Democrat who wielded a large amount of power around the state budget for years, died…
Oil Conservation Commission kicks off hearing on use of ‘forever chemicals’ in fracking

Oil Conservation Commission kicks off hearing on use of ‘forever chemicals’ in fracking

The Oil Conservation Commission kicked off its week-long hearing on a petition to ban the use of PFAS chemicals in oil and gas extraction.…
PNM joins day-ahead market to better manage resources, increase coordination

PNM joins day-ahead market to better manage resources, increase coordination

The Public Service Company of New Mexico announced on Monday that it will be joining the California Independent System Operator Extended Day-Ahead Market. This…
NM receives $2.88 billion in revenue from federal mineral, energy leasing

NM receives $2.88 billion in revenue from federal mineral, energy leasing

New Mexico received $2.88 billion this year in revenue from federal mineral and energy leases. The U.S. Department of Interior’s Office of Natural Resources…
MLG speaks about education during oil, gas industry meeting

MLG speaks about education during oil, gas industry meeting

New Mexico produces the second highest amount of oil and gas in the country. The taxes from oil and gas production provide funding for…
Early childhood summit convened to discuss future of program

Early childhood summit convened to discuss future of program

About 200 people from tribal governors to legislators to advocates and teachers gathered at Bishop’s Lodge to discuss Early Childhood Education’s future in New…
Stansbury outlines funding secured for early childhood and youth services programs

Stansbury outlines funding secured for early childhood and youth services programs

U.S. Rep. Melanie Stansbury secured $8.3 million for childhood development and youth services in the 1st congressional district through federal community project funding. Stansbury,…
Heinrich introduces legislation to address affordable housing

Heinrich introduces legislation to address affordable housing

U.S. Sen. Martin Heinrich, D-New Mexico, introduced legislation in the Senate on Monday that would provide tax credits to incentivize new investments and additional…
New Mexico in critical nursing shortage

New Mexico in critical nursing shortage

With 8,800 nurse positions posted for hiring in New Mexico, hospital leadership told the Legislative Health and Human Services Committee on Tuesday that access…
As rhetoric around undocumented workers heats up, new report shows their tax contribution

As rhetoric around undocumented workers heats up, new report shows their tax contribution

A nonprofit group released data showing how much taxes migrants pay in the U.S. as rhetoric on immigration grows more prominent just months from…
Indigenous Women Rising rebrands amid decrease in donations and increased costs

Indigenous Women Rising rebrands amid decrease in donations and increased costs

Indigenous Women Rising, a grassroots abortion fund provider supporting Native individuals, is experiencing a decrease in donations while, simultaneously, an increase in those needing…
U.S. Supreme Court has one bodily autonomy case on its docket

U.S. Supreme Court has one bodily autonomy case on its docket

With the U.S. Supreme Court refusing to hear one reproductive rights case this term, the high court has only one case on its docket…
Heinrich helps introduce resolution in response to death of Amber Nicole Thurman

Heinrich helps introduce resolution in response to death of Amber Nicole Thurman

U.S. Sen. Martin Heinrich helped to introduce a resolution on Tuesday in the Senate that every patient has the basic right to emergency health…
Stansbury announces bill to expand medical residencies in Tribal communities

Stansbury announces bill to expand medical residencies in Tribal communities

U.S. Rep. Melanie Stansbury introduced a bill that would provide $4 million annually to create an office within the Indian Health Service to oversee…
Sexual assault helpline launches during Domestic Violence Awareness Month

Sexual assault helpline launches during Domestic Violence Awareness Month

A new, dedicated statewide sexual assault helpline officially went live on Monday. The New Mexico Coalition of Sexual Assault Programs launched the helpline to…
Golden Opportunity to use community collaboration to battle opioid epidemic

Golden Opportunity to use community collaboration to battle opioid epidemic

The opioid epidemic is easing in the Albuquerque area and more help is on the way, according to the New Mexico Department of Health.…
Politics Newsletter: Election recap

Politics Newsletter: Election recap

Hello fellow political junkies! The election is over (finally) but the work of government continues as does the work of covering and chronicling the…
From disappointment to gratitude: NM leaders respond to election results

From disappointment to gratitude: NM leaders respond to election results

While the snow falls on parts of New Mexico,  discussions  still center on the 2024 election’s results. The 2024 general election in New Mexico…
Heinrich wins third term in Senate

Heinrich wins third term in Senate

U.S. Senator Martin Heinrich won reelection to a third term, defeating Republican Nella Domenici. Heinrich and Domenici held a hard fought race that concluded…
Politics Newsletter: Election recap

Politics Newsletter: Election recap

Hello fellow political junkies! The election is over (finally) but the work of government continues as does the work of covering and chronicling the…
Women hold a majority of legislative seats in NM

Women hold a majority of legislative seats in NM

Women hold a slight majority of seats in the Legislature after this year’s elections, though men still hold a majority in the Senate. In…
PRC nominating committee sends names to governor

PRC nominating committee sends names to governor

The New Mexico Public Regulation Commission nominating committee is submitting four names to Gov. Michelle Lujan Grisham to consider for appointment to the regulatory…

GET INVOLVED

© 2023 New Mexico Political Report