There’s a new proposal to save Social Security before $500 monthly cuts hit
There’s a new proposal designed to tackle the looming Social Security shortfall that could lead to benefit cuts of as much as $500 a month in just seven years.
But the legislation doesn’t offer a solution as much as a way to find one, giving a specially formed committee a short time frame to address the issue.
READ MORE: Here’s what the average Social Security monthly benefit could look like next year
The Bipartisan Social Security Commission Act, led by Reps. Tom Cole, R-Oklahoma, and Tom Suozzi, D-New York, would establish an independent commission of lawmakers and outside experts to formulate a plan to solve Social Security’s insolvency. The bill comes as the latest Social Security Trustees Report projection showed the program’s primary trust fund would be depleted in 2032.
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Once that happens, some 70 million recipients, including retirees, spouses and dependents, could see cuts of about $500 per month.
“I am going to tell you the truth that many of my fellow politicians in Washington refuse to acknowledge: the solvency of Social Security is at a critical point, and millions of Americans who have paid into this program throughout their working lives may not receive the money they deserve. Therefore, doing nothing on Social Security is not an option,” Cole said in a statement.
The committee is modeled after the 1983 Social Security Commission. It would contain members appointed by the president, congressional leaders from both parties in the House and Senate and the Chair and Ranking Member of the committees with jurisdiction over Social Security – the House Committee on Ways and Means and the Senate Finance Committee. Two of the congressional appointees must be non-elected experts.
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According to the bill, the commission must provide Congress with a report on plans within one year of its formation. Once that proposal is presented, it will receive expedited consideration on both the House and Senate floors.
By law, Social Security can’t pay out more in benefits than it receives in revenue once the trust fund is gone, necessitating the cuts.
For the past 16 years, the cost of Social Security retirement program has exceeded its cash income, forcing it to dip into trust fund reserves to pay benefits, studies show. That trust fund will be exhausted in less than seven years.
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