Currently, Social Security taxes only apply to the first $118,500 of income. Any income above the $118,500 cap is not taxed for Social Security purposes. A worker who earns $35,000 a year pays a Social Security tax rate of 6.2%. At the same time, workers who are paid $150,000 a year pay a 4.9% Social Security tax rate. A person with a salary of one million dollars a year pays a Social Security tax rate of less than 1 percent.
This is not fair and it is not sustainable. Congress needs to raise the Social Security tax rate for the wealthiest Americans.
The Social Security Board of Trustees has said that without action by Congress, Social Security will be unable to fulfill its commitments after the year 2033 (Board of Trustees, 2015) The Trustees emphasized that Social Security will not be totally broke by 2033, but will be only to pay an estimated 75% of benefits at current levels.
Republicans have seized on this information as an opportunity to cut Social Security benefits. They have also called for the privatization of Social Security. After bailing out Wall Street in 2007, these Republicans want to entrust these same bankers to manage your retirement income. Once again, Republicans have devised a plan to make profits from your money without assuming any risk. But who will be there to bailout America's retirees after the next Wall Street meltdown?
Allowing Wall Street bankers to gamble and profit from your retirement income is not the answer. Breaking our promise is not an option. We can protect Social Security and still fulfill our promises to retirees by requiring all Americans to pay their fair share.
The strength of our country is no greater than the strength of the promises we make to one another. Social Security is a promise, made by the government of the United States, that workers would have some level of income when they retire. We cannot break that promise.
The Board of Trustees, Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds (2015). THE 2015 ANNUAL REPORT OF THE BOARD OF TRUSTEES OF THE FEDERAL OLD-AGE AND SURVIVORS INSURANCE AND FEDERAL DISABILITY INSURANCE TRUST FUNDS. http://www.ssa.gov/oact/tr/2015/tr2015.pdf