Trump cabinet pick planning radical steps to fix Social Security... Future benefits possibly at risk... Here's what every American should know...by Peter Reagan, 3/30/17
You probably already know it: Social Security is in dire straits. Currently, the program at risk of facing a major shortfall as soon as 2034, which means that receiving benefits in the future is far from a sure thing – even for today's middle-age workers.
To fix the program, dramatic changes must happen now.
It's with this urgency that President Trump has nominated Mick Mulvaney to run the Office of Management and Budget (OMB). While we don't know for sure what fixes Mulvaney will apply, most would burden all taxpayers and beneficiaries.
Here are three discussed changes that could affect all Americans:
Option #1: Cut Social Security benefits.
Previously, Trump has said that cuts to payouts are off the table. But in a Senate confirmation hearing, Mulvaney indicated otherwise.
According to the Wall Street Journal, Mulvaney told the Senate that he would advocate for cuts to benefits, adding...
"I have to imagine that the president knew what he was getting when he asked me to fill this role."
It isn't hard to read between the lines. In 2009, Mulvaney called Social Security a 'ponzi scheme' and insisted the program as we know it should be brought to an end. Chances are slim his views are drastically different today.
Option #2: Increase Social Security taxes.
In 2016, every American paid 12.4% of their income under $118,500 to Social Security. Now, Mulvaney has the power to adjust that cap.
Already, the SSA announced the cap would increase by 7% in 2017. But Mulvaney is willing to push the cap higher. During his confirmation hearings, he declared that his pledge as a congressman to oppose tax increases would not extend to his service in the OMB.
Option #3: Raise the retirement age.
Today, the age at which Americans can receive full benefits for Social Security is set to increase to 67 for anyone born after 1960. But further increases aren't out of the question.
So even if Social Security stays solvent, the length of time Americans can draw off the program during retirement could shrink significantly.
Asked if he believed that the age limit should be further adjusted, Mulvaney replied with a simple, "I do, yes sir."
It is clear that most older citizens can would well beyond age 66 and should be allowed to do that. It is not uncommon now for citizens to work to age 70. Work can be found for any age, but you need to look at the type of work, your physical condition and your energy level.
Even those whose work has been very physical can transition into sedentary work at a desk when they are no longer able to safely do physical work. Those who once worked long hours, who age and prefer to reduce their hours of work, can find these part-time jobs.
Most of our grandparents didn’t retire and many of us didn’t retire either. Most “retired” couples continue to work part-time.
Social Security should be converted from the Ponzi Scheme that it is, to a Retirement Plan that is a Defined Contribution Plan, not a Defined Benefit Plan. It should create individual accounts that citizens own and should be invested to grow, so that the $500,000 they contribute can become $1.5 million to leave their heirs. The new plan can be made eligible to younger citizens, but the federal government will have to continue to pay out current retirees and near-term future retirees and that would cost an extra $trillion a year.
Politicians would need to be willing to kill their sacred cows to get this done. There is more than a $trillion a year spent on things that are harmful. Healthcare and Education are overpriced, underperforming and broken and need to have government subsidies reduced. These industries need to be
given to the private sector for repair.
Norb Leahy, Dunwoody GA Tea Party Leader