Pete Buttigieg, 2020 Democratic presidential candidate, has proposed long-term care benefits for seniors and a new tax that would protect Social Security “forever.” But his proposed carbon tax will only raise taxes on Social Security recipients, adding to the financial strain for Americans on fixed incomes.
The high cost of long-term care is a concern for older Americans. Among those aged 65 and older, 70% will need long-term care of some form.
Buttigieg’s proposed Long-Term Care America would provide Americans aged 65 and older with a benefit of $90 per day. He estimates that 11 million would receive benefits from the program throughout their lifetime.
His plan would also give at-home, family caregivers 12 weeks of paid leave, with a credit toward Social Security for family members and unpaid caregivers. Essentially, his plan would require the Social Security administration to recognize at-home caregivers as work and allow them to claim credits towards benefits.
To “protect Social Security forever,” Buttigieg is proposing yet another tax – a payroll tax on those who earn $250,000 or more per year. He wants to periodically increase taxes on American’s top earners and increase benefits over time to keep seniors out of poverty.
Buttigieg’s focus on older Americans isn’t surprising. For the first time in history, seniors will outnumber children in the United States by 2035. But his plan is just another ploy to capture votes from seniors who are facing shrinking incomes and higher medical care costs.
While Buttigieg’s plan sounds good on paper, his other proposed measures will only put further financial strain on older Americans.
The presidential candidate has called for a carbon tax and dividend – paid for by a national energy tax that increases over time. His proposed tax would allow Congress to raise taxes automatically every year and without having to vote.
Social Security recipients will see severe tax increases as a result of his plan.
To make up for higher household costs, Buttigieg has proposed a “dividend” from the federal government that would be sent to American households. But that dividend would be subject to federal income tax. It would also impact Social Security benefits.
A report from the Citizens’ Climate Lobby looked at how the tax would affect a typical couple over the age of 65 with an income of $38,000 and $12,000 in Social Security benefits.
“Based on that income, the tax rate schedule shows that their marginal tax rate would be 10 percent. However, the addition of $1,584 of taxable Dividends from the Carbon Fee causes more of their social security benefits to become taxable, and their marginal tax rate due to the Dividends is 20.12 percent, so that after paying their income tax, the couple is left with only 79.88 percent of their gross Dividend,” the report found.
Conservatives are largely opposed to a carbon tax, with 75 conservative groups writing to Congress to oppose such measures.Wake up Right! Subscribe to our Morning Briefing and get the news delivered to your inbox before breakfast!