Social Security is once again at the centre of all debates in the United States, and for millions of retired workers this is more than a government program, it is the basis that allows them to live each day with dignity and their main economic support. But, for years many ex-workers have been unfairly subjected to the provisions of the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) (which we will explain later what each of them are).
The centre of the debate has led them to create a new Bill called the Social Security Fairness Act, which establishes the possibility of financially compensating these people, but it has also raised a series of questions among experts. Is this an act of justice or is it a fiscal risk that we will not know how to handle in the future?
While Congress debates this fact, millions of families observe with hope and concern the fruits of their silent struggle for decades. Background of the project
The proposed legislation, known as the Social Security Fairness Act, is an attempt to rectify one of the injustices that has been happening for decades to public sector workers (i.e., teachers, police officers, firefighters, and a long list of workers in this sector). These former workers have been caught with these laws every year and now, this project will include payments retroactively for the year 2024.
What are the WEP and the GPO?
The Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) are two provisions that were introduced in 1977 and 1983 respectively, with the idea that they could correct inequalities in the social benefits formula. Let’s go step by step, these provisions sought to prevent some public sector workers from receiving disproportionately high benefits compared to what their real earnings had actually been. Over time, these measures have been described as unfair (especially for those with the lowest wages) and have created inequalities between sectors of the population.
And what is the controversy?
Against the people who will receive this income, none. However, we are in a situation in which Social Security is facing quite complicated economic challenges, and in which it is estimated that the resources of these funds could run out by 2033, if this bill is accepted, this would cause several million more to be emptied, so, the people who are against this reform, are not against this reform as such, but against not having a “plan b” to fill this economic gap that will remain in the Social Security funds.
On the part of the politicians, there have been many legislators who have supported this project, but this approval will be key for the next elections, since it will be the next government that enters the White House (again the Trump Administration as we already know) who will have to make the decision to officially approve it or leave it as a sketch.
Would it be possible to find a solution?
Some experts have recommended some measures, such as limiting retroactive payments, establishing a time limit for claims or even raising taxes to mitigate the impact that this tax reform will have without the need to put at risk the Social Security system, which as we know is essential for millions of people who survive thanks to it.
So, we will have to see how this bill progresses with the new government that is about to take office, which on the one hand represents an opportunity to correct and thank public sector workers for their dedication over so many years of work without putting the future of all Americans at risk.