When I summarized last week the major Democratic candidates’ positions on Social Security and other retirement issues, I received a request by a reader to include Mike Bloomberg’s positions on the issue as well, but, alas, he had no such positions.
Now he’s released a plan. How does it compare to the other candidates’ plans? Honestly, it’s hard to say; with respect to many of the topics it addresses, the details simply aren’t there. It’s so scanty that it merits an “incomplete.”
Let’s look at what the plan says about Social Security:
First, Bloomberg promises to “consider options for preserving and strengthening Social Security’s long-term finances, while maintaining and enhancing benefits for the neediest recipients.”
Yes, that generality is the entire first bullet point. No proposals to boost the sustainability of the program, just an intention to think about this in the future.
Next, he will “implement a new minimum benefit that would help roughly 10% of current recipients.” The other candidates nearly uniformly promise a minimum benefit that’s specifically defined (e.g., 125% of poverty with 30 years of work history) rather than simply promising a minimum benefit boost, generally speaking.
He promises to change the COLA calculation to one customized for the elderly; this is fine and in line with his competitors’ promises.
Finally, he promises to “examine options for addressing other weaknesses in the benefits system,” mentioning specifically the lower benefits of caregivers and the drop in benefits for surviving spouses of dual-income couples, issues that his competitors, again, address with more specificity.
To further help low-income older adults, he proposes to “make housing assistance an entitlement for households making up to 30% of Area Median Income (AMI),” as well as to implement other forms of housing assistance for the poor in general, and to provide funding to retrofit inaccesible homes for disabled seniors.
He promises to re-implement the aborted fiduciary duty rule that would have required brokers to put clients’ interests first. This rule was proposed by the Obama administration but cancelled under Trump, after objections by financial advisors whose business model consisted of commissions rather than fee-for-services. What does this have to do with the elderly and retirement? He connects this up by claiming that “financial advisers who work on commission sometimes prey on elderly customers, steering them into expensive funds and annuities and away from better alternatives.”
He promises to improve reverse mortgage programs, including a promise to “ensure the government subsidizes loans for qualifying low-income seniors.” That’s a new one, I suppose – but how exactly would this work, and why would the elderly be more deserving of loan subsidies than others?
And, finally, he repeats Buttigieg’s “public option” retirement savings proposal, though, unlike Buttigieg’s, his proposal appears to be mandatory, rather than optional (”automatic employer and employee contributions for all income earners who do not participate in a defined contribution or benefit plan at work”), cuts the tax deferral to pay for a government match for low-income workers, and requires annuitization at retirement — and the promise to ”automatically enroll savers in a low-cost, inflation-indexed annuity at retirement age” suggests that these would not be private-sector insurance company annuities but rather a government-run program.
What’s all this boil down to?
Many elements of this document simply don’t feel like a “retirement security policy” (as the text is titled) at all. It’s a declaration of concern for a demographic group and the checking-off of a box on a to-do list of items to demonstrate seriousness as a presidential candidate. But this is, in the end, the way it works, isn’t it? He’s hardly at risk of losing voters, or likely to gain new ones, on the strength of his retirement proposals, regardless of how innovative they are, as the campaign continues on with retirement issues an afterthought.
As always, you’re invited to comment at JaneTheActuary.com!
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