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House Ways and Means Social Security Subcommittee Chairman John Larson, D-Conn., plans to introduce Wednesday a new bill called Social Security 2100: A Sacred Trust. The bill adopts the Consumer Price Index for the Elderly as the basis of the annual cost-of-living adjustment (COLA), applies the payroll tax to wages above $400,000, and combines the Old-Age and Survivors and Disability Insurance trust funds.
According to the bill's fact sheet, adopting a CPI-E formula "will help seniors who spend a greater portion of their income on health care and other necessities. Improved inflation protection will especially help older retirees and widows who are more likely to rely on Social Security benefits as they age."
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The bill also includes a benefit bump for current and new beneficiaries — equivalent to about 2% of the average benefit, the fact sheet explains.
Larson's bill would require millionaires and billionaires to "pay the same rate as everyone else," the fact-sheet states. "Presently, payroll taxes are not collected on wages over $142,800." The bill would apply the payroll tax to wages above $400,000 and "would only affect the top 0.4% of wage earners."
Larson said Wednesday that while the Social Security cost-of-living adjustment (COLA) for 2022 of 5.9% "is welcome news, it only further underscores the need for Congress to act on Social Security."
Larson noted in a statement that "it has been more than 50 years since Congress has improved Social Security benefits. Seniors are suffering — five million are living below the poverty line — current Social Security benefits are not enough!"
The bill would also:
- Set a new minimum benefit at 25% above the poverty line and would be tied to wage levels to ensure that the minimum benefit does not fall behind.
- Improve benefits for widows and widowers in two-income households
- End the 5-month waiting period to receive disability benefits.
- Provide caregiver credits to ensure that caregivers are not penalized in retirement for taking time out of the workforce to care for children or other dependents.
- Extend benefits for students through age 22.
- Increase access to benefits for children who live with grandparents or other relatives.
- Extend the depletion date (when a 20% cut to benefits would occur) to 2038, giving Congress more time to ensure long term solvency of the Trust Funds.
- Combine the OASI & DI trust funds into one Social Security Trust Fund, to ensure that all benefits will be paid.
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Melanie Waddell
Melanie is senior editor and Washington bureau chief of ThinkAdvisor. Her ThinkAdvisor coverage zeros in on how politics, policy, legislation and regulations affect the investment advisory space. Melanie’s coverage has been cited in various lawmakers’ reports, letters and bills, and in the Labor Department’s fiduciary rule in 2024. In 2019, Melanie received an Honorable Mention, Range of Work by a Single Author award from @Folio. Melanie joined Investment Advisor magazine as New York bureau chief in 2000. She has been a columnist since 2002. She started her career in Washington in 1994, covering financial issues at American Banker. Since 1997, Melanie has been covering investment-related issues, holding senior editorial positions at American Banker publications in both Washington and New York. Briefly, she was content chief for Internet Capital Group’s EFinancialWorld in New York and wrote freelance articles for Institutional Investor. Melanie holds a bachelor’s degree in English from Towson University. She interned at The Baltimore Sun and its suburban edition.
