Draft proposal to Bernie Sanders: Employment & Prosperity Opportunity Act
PROPOSAL
For 5 years, reduce full vesting of Social Security retirement from the current 65/66/67 years old to 56 years of age, and simultaneously reduce the qualifying Medicare retirement age from 65 to 56. While this plan is limited to 5 years, participants' full Social Security and Medicare benefits would remain in force through their continued retirement.
PURPOSE
Lowering the Social Security full vesting and Medicare eligibility to 56 years of age for the next 5 years will provide a meaningful incentive to millions of baby boomers to choose early retirement. This wave of retirement will serve to de-bottleneck the labor market and inject upward mobility into the labor force, creating widespread promotions to replace those senior employees who take advantage of this opportunity. Furthermore, as a consequence of this upward mobility, millions of workers will receive raises with their promotions and millions more young workers will be afforded greater opportunities for entry-level employment. While not optimal, many companies may choose to not replace retirees under this plan thereby reducing their overhead and freeing up capital budgets for business expansion instead.
FUNDING
This plan should cost between $1.3-$2.1 trillion (estimated) and would be funded by increasing the Social Security withholding cap to $500,000 per individual (estimated), and increasing the Medicare withholding rate by 3% (estimated). The Social Security cap and Medicare withholding increase could conceivably float according to participation thus ensuring full funding.
SUMMARY OF BENEFITS
Providing an incentive for early retirement will provide widespread:
- promotions and raises across the labor market putting more disposable income in people's pockets and thereby stimulating consumer spending
- entry-level jobs across virtually all business sectors
- economic stimulus to businesses who choose not to replace retirees by reducing overheads and freeing up capital budgets for business expansion
- reduction of "experienced worker" hires which currently impede younger worker hires and promotions
Disclaimer: I am 63 and would benefit from this proposal.
Please discuss.
