Bob Marx believes Social Security is an essential program that America’s retiring population counts on for economic stability.
Forty percent of Americans aged 65 or older depend on Social Security to keep them from slipping below the poverty line. Despite the essential nature of the program, funds for retirees are running out.
Many view Social Security as a fund or retirement account that is tied to the individual contributor. This is not how the program actually functions. Rather, employee taxes are used to pay benefits directly to current retirees, and current payees depend on the next generation of employees to pay for their retirement benefits. The problem with Social Security’s sustainability stems from the current economic climate—higher unemployment, lower wage growth, and a 3.6% cost of living increase translate to full Social Security benefits running out in 2033—a mere 21 years from now.
Bob Marx, neighbor island candidate for Hawai‘i’s Second Congressional District, remarked on the need for Social Security reform Tuesday, commenting that “now more than ever we need to ensure our kupuna are taken care of.” Social Security is in dire need for reform—the program took in $691 billion in tax revenue in 2011, $45 billion short of the Social Security’s $736 billon in expenses. To continue paying 100% of benefits past 2033, the combined employer-employee tax rate would have to be raised 4.3% from 12.4% to 16.7%.
The problems with Social Security extend further than its potential inability to pay future benefits. The employer-employee combined tax rate burdens the employee rather than the employer. Faced with a higher tax rate, employers stay competitive by reducing employee wages to offset the higher taxes. Marx noted, “The problem [with any reform] will be preventing employers from pushing the costs onto workers… [which will] further depress our economy.”
Bob Marx has been adamant about the need to ensure our elderly are taken care of. At an event in downtown Hilo, Marx spoke with residents about the need for social security reform. “Our elderly have more expenses than ever and poverty is a real possibility.” When asked about what he would do if elected, Marx replied: “I will ensure the stability of our retirees and ensure all of our social welfare programs are solvent well into the future.” Marx proposed raising funds to pay for Social Security by increasing taxes on non-earned income. “Taxes on capital gains and dividend earnings are lower than they were 10 years ago—and look at the resulting situation our economy is in.”
As the Federal Government’s largest expenditure, Social Security is a program that is an essential public service. In this economic climate, much focus is on cutting costs and inevitably, cutting corners. “Services such as Social Security are the product of our government’s responsibility to retirees,” stated Marx. “We should prioritize those most in need, ensuring that they can retire above the poverty line.”
- Video: What Is Social Security Tax? (turbotax.intuit.com)
- Your Social Security Statement is Now Online (answers.iquote.com)
- Social Security goes digital (radio.woai.com)
- EDITORIAL ADVISORY BOARD: How would Mom get by without Social Security? (nwitimes.com)
- AMAC Tells Congress: Social Security Reform is a “No Brainer” and Lawmakers Need to Act Now (gloucestercitynews.net)
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