Social Security Threatened by Rising Inequality
A steep rise in income inequality over the past several decades threatens the finances of the Social Security system, according to a new report from the Center for American Progress. Rising Earnings Inequality Is Taking a Mounting Toll on Social Security finds that Social Security funds are failing to keep pace with families’ needs as a result of the concentration of income in the hands of the extremely wealthy, who contribute a very small share of their earnings to the program due to the payroll tax cap. The authors argue that policies to reduce income inequality and direct more funds to Social Security – such as a minimum wage increase and payroll tax reform – should be a priority for Congress.