Authors: Peter Arno and Kyle Moore
While often discussed separately, ReLab’s new working paper, “Reducing Inequality Through Social Security,” investigates if Social Security reform can help reduce inequality for all U.S. workers.
The paper, co-authored by Kyle Moore and Peter Arno, uses data from the Social Security Administration to determine that income inequality would experience a small reduction if Social Security reform includes both removing the maximum taxable earnings cap, the “salary cap,” and increasing the minimum benefit. This effect is due to ensuring that all workers pay the same percentage of their earnings into the program while providing increased support to those below the federal poverty level.
This research supports the need to focus not only on ensuring Social Security’s solvency for future generations, but also building the program’s ability to support all working Americans.