(CNN) — Sen. Bernie Sanders has a plan to add more than 50 years of sustainability to Social Security, the New Deal-era program that’s facing a looming cash crunch.
The proposal would shore up Social Security with payroll taxes on income above $250,000. It’s the latest in a flurry of ambitious legislation being floated by lawmakers with their eyes on the 2020 Democratic presidential nomination.
It is the second plan to tax the wealthy that Sanders, a Vermont independent who previously made a 2016 run, has introduced in the last two weeks, the first targeting the estates of the richest Americans.
Sanders, who’s also preparing to introduce a Medicare for all proposal in the coming weeks, is looking to solidify — and boost — one of the country’s most popular social safety net programs by having the rich pay more.
The Social Security Expansion Act, which Sanders first introduced in 2017, is also being introduced in the House by Democratic Rep. Peter DeFazio of Oregon. It would increase benefits for all recipients, with low-income seniors receiving a boost of nearly $1,300 a year. It would also make the annual cost of living adjustment more generous by shifting the formula to take into account health care and prescription drug costs, which rise faster than inflation.
To pay for it, Sanders would subject all income above $250,000 to the existing 12.4% Social Security payroll tax, which is split between workers and employers. Currently, the payroll tax is only applied to wages up to $132,900.
Plus, the senator would levy a new 6.2% tax on single people with investment income above $200,000 and couples above $250,000.
This extra revenue would extend the health of Social Security by 52 years, according to Sanders’ office. As it stands now, the system will no longer be able to pay out full benefits starting in 2034, according to the 2018 annual report from the Social Security and Medicare trustees.
Democrats campaigned relentlessly — and successfully — in both red and blue states across the country in 2018 on a pledge to preserve programs like Social Security, which Republicans suggested could face cuts to make up for the revenue shortfalls caused by their tax cuts.
Days before the midterm election in November, Sanders laid out the stakes, tweeting: “Let us not forget that (earlier in October 2018), Mitch McConnell stated he wants to cut Medicare, Medicaid and Social Security if Republicans keep one-party rule in Washington. We must expand, not cut, these programs that are life and death for the working class in this country.”
McConnell signaled in a pair of interviews weeks earlier that the Republican plan to address the deficit, which ballooned by about $2 trillion under their watch, would require reforms to Social Security, Medicare and Medicaid — the package of social programs he described as “the real driver of the debt.”
Lawmakers have long grappled with how to address Social Security’s solvency issues. Republicans generally favor increasing the retirement age or tinkering with the formula to make payouts less generous, but President Donald Trump has promised not to touch benefits.
Democratic lawmakers in both chambers are looking to boost seniors’ checks and ask the rich to pay for it. Connecticut Rep. John Larson, along with more than 200 lawmakers, last month reintroduced the Social Security 2100 Act, which would raise benefits and payroll taxes on everyone, but place an additional levy on those earning more than $400,000. It would extend Social Security’s solvency beyond 2092.
The proposals are the most significant effort to reshape to Social Security since former President George W. Bush tried to introduce private investment accounts into the system in 2005.
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