Social Security is one of the programs that helped shepherd the most vulnerable Americans through the pandemic. When prices started rising in 2021, the country was reminded once again of just how deeply tens of millions of people depend on the monthly benefits that Social Security provides.
President Biden campaigned on reforming Social Security to be fairer and more efficient. Many of his proposals have not come to fruition, but despite several big setbacks, Biden has already left his fingerprints on the crown jewel in America’s social safety net during his very first year in office.
Here’s what President Biden’s inaugural year has meant for Social Security.
Biden Oversaw the Biggest COLA in 40 Years
The most significant economic storyline during Biden’s time in office so far has been rising prices and the highest rate of inflation in 40 years. With the cost of everything going up and up and the holidays fast approaching, the government responded to the crisis in Mid-October with the largest cost-of-living adjustment (COLA) in four decades.
The Social Security Administration (SSA) announced that 2022 would bring a 5.9% increase in benefits, the biggest jump of any COLA since 1982. The average retired worker now collects $92 more per month than in 2021, bringing the average check up to $1,657 from $1,565.
The 5.9% increase applies not only to retired workers, but to eligible spouses, eligible disabled recipients, and SSI recipients.
Biden Made it Easier to Claim Benefits
In December, President Biden signed an executive order that cut a whole lot of bureaucratic red tape — and not just for Social Security recipients, according to the Washington Post. The order targeted 36 federal services administered by several different departments and agencies that deal with government benefits, including things like disaster aid, student loan relief, and, of course, Social Security.
The order was designed to reduce the so-called “time tax,” which Social Security recipients and other people “pay” while crawling their way through a sluggish and frustrating bureaucratic process to get the benefits that they’re entitled to receive. Because of the nature of government benefits, many of those people are poor, elderly, displaced, or otherwise vulnerable. Among other things, the order included the creation of a new online tool to make it easier to apply for Social Security and to receive benefits promptly.
You Can Now Earn More Money While Collecting Benefits
Another big change affects the many people who collect Social Security benefits before full retirement age while still earning some income. In 2021, the SSA allowed recipients to earn up to $18,960 before it started temporarily withholding $1 in benefits for every $2 they earned in income. In 2022, that threshold jumped to $19,560.
Those who reach full retirement age in 2022 can earn up to $51,960 before the SSA withholds $1 for every $3 earned, up from $50,520 in 2021. The so-called income test never applies after a recipient reaches full retirement age.
Much of the Impact Has Been Indirect
Recipients see the results of cost-of-living adjustments as soon as they get a bigger check from the SSA — but some of the biggest impacts that the Biden administration has had on Social Security aren’t so obvious.
In November, President Biden signed a massive $1 trillion-plus infrastructure bill that didn’t directly affect Social Security, but altered the course of the program nonetheless. According to the National Committee to Preserve Social Security and Medicare, the high-paying jobs that the infrastructure legislation is expected to produce will pump new cash into the payroll contributions that fund Social Security. That, the organization says, will help the country confront a looming solvency crisis that is currently on pace to deplete the Social Security Trust by 2034.
Opponents Say Biden’s Expansions Could End Up Hurting Seniors
Depending on who you ask, President Biden’s Build Back Better bill is either dead, on life support, is being reborn as a series of smaller bills, or won’t survive intact despite its core provisions eventually passing. Either way, the bill — and the spending packages Biden has already signed — has plenty of detractors who worry about its impact on Social Security.
The conservative Heritage Foundation, for example, outlined its case for why Biden’s spending — both proposed spending and that which has already taken place — could make it harder to confront the program’s nearly $20 trillion in unfunded liabilities. That, the administration’s opponents argue, will force a reduction in benefits that could cost seniors hundreds of dollars per month starting in 2034, when the Social Security Trust is expected to be depleted.
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This article originally appeared on GOBankingRates.com: How Joe Biden’s Presidency Is Affecting Social Security After One Year in Office