President Biden discussed some of his plans for the country in his recent State of the Union address. He now wants to put taxpayers’ money where his mouth is.
Last week, Biden released his proposed budget for fiscal year 2025, which begins on Oct. 1. In his $7.3 trillion budget, he addressed all major areas of federal spending. The president wants to make big changes to Social Security. Will Americans support what he wants to do?
More money for Social Security in fiscal 2025
Biden wants to increase the discretionary budget for the Social Security Administration (SSA) by $1.3 billion from the 2023 level. That would bring the total budget for the agency to $15.4 billion.
Note, however, that this amount doesn’t include any benefits payments. Social Security dished out more than $1.3 trillion in benefits last year. Most of the funding for the benefits comes from payroll taxes.
The president’s budget proposal relates only to SSA’s administrative functions. He wants more money for the agency primarily to improve service to Social Security recipients.
Biden’s bigger plans for Social Security
Biden has bigger plans for Social Security than just administrative improvements, though. His proposed budget also addresses his desire to work with Congress to strengthen the federal program. The president listed several guiding principles for any Social Security reforms.
Most importantly, Biden remains adamant that no benefit cuts be made to Social Security. He has mentioned in previous public statements that he views an increase to the full retirement age as a benefit cut. The proposed budget also specifically noted that the president opposes any “proposals to privatize Social Security.”
Another cornerstone in Biden’s plan is to extend Social Security’s solvency by “asking the highest-income Americans to pay their fair share.” Although the budget didn’t provide details on what that would mean, Biden has in the past proposed making all income above $400,000 subject to the payroll tax that helps fund Social Security.
The president also wants to collaborate with Congress on “improving financial security for seniors and people with disabilities.” Again, no details were provided in the budget on how Biden wants to accomplish this goal.
Popular ideas
What do Americans think about Biden’s proposed Social Security changes? The president’s plans will probably be popular.
The University of Maryland’s Program for Public Consultation (PPC) surveyed 2,545 people in 2022 to gauge their views on potential changes to Social Security. An overwhelming majority of respondents, fully 80%, supported making all earnings above $400,000 subject to the payroll tax. This proposal received strong bipartisan support, with 77% of Republicans and 86% of Democrats favoring it.
Roughly two-thirds of survey respondents were OK with increasing the Social Security payroll tax rate, something the president has not publicly called for. Again, there was significant support across party lines, with 62% of Republicans and 74% of Democrats favoring the proposal.
Are Americans in alignment with Biden on opposing raising the full retirement age? Not quite. However, a smaller majority of 53% liked the proposal, with 47% not favoring it.
While the president’s budget didn’t specify how he’d like to improve the financial security for seniors and people with disabilities, PPC found that 78% of Americans supported raising the minimum benefit. Eighty-five percent of Democrats favored the proposal, compared with 73% of Republicans.
Dead on arrival?
However, regardless of how much public support they have, Biden’s plans to reform Social Security and his overall budget will almost certainly be dead on arrival in the GOP-controlled U.S. House of Representatives. House Republican leaders issued a statement last week that they “reject Biden’s misguided budget proposal.”
Any changes to bolster Social Security will probably have to wait until the next presidential term and a new Congress. Meanwhile, the clock is ticking until the federal program’s trust funds run out of money. Unless something is done, across-the-board cuts will be required by 2034.
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Joe Biden Wants to Make Big Changes to Social Security. Will Americans Support What He Wants to Do? was originally published by The Motley Fool
