With the White House transitioning from a Trump to Biden administration, it’s important to examine how President-elect Biden’s proposed policies could impact Social Security. First, over the summer Biden campaigned against cuts to the payroll tax. Despite the pandemic, at least Social Security shouldn’t see any further decreases to revenue by a payroll tax cut.
Secondly, Biden proposed important changes to Social Security that could impact revenue and expenses, however, according to the Urban Institute does not solve Social Security’s long-term problem of being able to pay all of its obligations. Biden campaigned on increasing Social Security benefits for widows, people 78 to 82 years old and for certain low-income workers such as people who have worked more than 30 years. Former Senator Tom Harkin and Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, said in the Des Moines Register, “The nonpartisan Social Security Administration has projected that a single provision of the Biden plan — increasing the minimum beneﬁt for low-income, lifetime workers — would lift more than one-half million seniors out of poverty by 2030.”
Regarding the revenue to pay for these proposals, according to the Urban-Brookings Tax Policy Center Biden proposed a payroll tax increase for income above $400,000 a year that could generate $740 billion in revenue over ten years. It’s important to remember that people are only taxed on wages up to $137,700 for the purposes of Social Security.
Another component of Biden’s plan would potentially allow people that serve as caregivers for family members who are young or have a disability to earn Social Security credits. This would reward family caregivers who are being unfairly punished for the purposes of earning Social Security at retirement. Similar to Biden’s other proposal referenced above, the plan would be funded by raising taxes on real estate investors whose incomes exceed $400,000 a year and, according to the campaign by, “taking steps to increase tax compliance for high-income earners.”
The original purpose of Social Security was to lift seniors out of poverty. By providing needed increases to Social Security benefits, and not raising taxes on middle and low-income individuals, Biden’s proposals should be given consideration by Congress. Unfortunately, we know that life in politics is never that simple. While I expect some possible bi-partisan cooperation in Congress around COVID-19 stimulus legislation, it remains unclear what other legislation can be signed into law. However, here is to hoping a bi-partisan agreement can be reached in Congress that benefits seniors throughout the country.