Safety net: While benefits would be reduced for higher-earning retirees, Johnson’s plan introduces a stronger safety net component to Social Security. For a low-earner who worked a full career, a new minimum benefit would boost monthly benefits by about 10 percent over current benefits. For a very-low earner with a full career, benefits would rise by over 20 percent. There also would be a bump up in benefits for individuals after their 20th year of retirement, a policy designed to offset some of the effects of lower COLA payments.The Democrats will reflexively spin this as pushing Grandma off a cliff. It's what they do.
Saturday, December 10, 2016
A little less universal, a little more progressive
Although Social Security is supposed to be a "universal" program - your benefit is proportional to your contribution - it's always had a bit of progressiveness for lower-income Americans. It looks like the Sam Johnson plan is designed to shift towards more means-testing. Andrew Biggs does an excellent job of unpacking some parts of the reform proposal: