Since 2020, the richest five men in the world have doubled their fortunes but during the same period, almost five billion people globally have become poorer.
Lisa McCormick said that while underpaid full-time working Americas struggle with economic pressures, it seems painfully obvious that Los Angeles Lakers star player LeBron James could afford to pay the same rate of Social Security taxes as every American who makes less than $168,600.
“Hardship and hunger are a daily reality for many people worldwide,” said McCormick. “At current rates, it will take 230 years to end poverty, but we could have our first trillionaire in a decade, around the same time that Social Security will deplete its trust fund and retirees will see benefits drop by about a quarter.”
To address this, she proposes a solution.
“Americans could add $475 billion in revenue to the Social Security trust fund each year by making everyone with income over $170,000 –the rich– pay the same tax rate as everyone with income up to $169,999 –you,” said McCormick, who earned four of ten votes cast in the 2018 Democratic primary election against US Senator Bob Menendez.
James, who earns a staggering $40 million annually playing in the National Basketball Association (NBA), is cited by McCormick to shed light on the flaws in the current political and economic systems.
“LeBron James is paid over $40 million to play 82 basketball games each year. LeBron’s FICA tax rate is 0.021 percent. That isn’t really fair,” said McCormick. “LeBron is done paying into Social Security during the first quarter of the first game. For the rest of that game, the next 81 games, right through baseball, football & even hockey season, he doesn’t pay another dime.”
McCormick argues that individuals earning above $168,600 stop contributing payroll taxes to support Social Security, creating a looming crisis where Social Security reserves are projected to run out of funds by 2033 if no action is taken by Congress.
LeBron James, often referred to as “King James,” is celebrated as one of the greatest basketball players in history, drawing comparisons to legends like Michael Jordan. His remarkable career includes being the all-time leading scorer in NBA history, achieving four NBA championships, four MVP awards, and two Olympic gold medals.
Despite his immense success on and off the court, James, like all citizens, is subject to societal obligations, including contributing to social programs such as Social Security.
McCormick’s call for reform urges a fair and equitable taxation system to ensure the sustainability of vital programs.
LeBron’s background, marked by his mother’s struggles plus his father’s criminal record and absence in his life, adds a human dimension to the discussion.
Growing up in challenging circumstances, James overcame adversity to become not only a sports icon but a symbol of resilience and success.
Recent reports have raised new concerns about the impending insolvency of the Social Security program, absent congressional action.
Social Security currently provides benefits to more than 66 million recipients. The Congressional Budget Office (CBO) estimates that about 78 million people, or about 20% of the U.S. population, will receive benefits from the Old-Age and Survivors Insurance (OASI) Trust Fund in 2032.
The CBO and the trustees of the Social Security and Medicare trusts have both raised alarms about how soon Social Security will become “insolvent.” Insolvency in this context refers to the point at which the trust fund will be depleted, and payments would come solely from income generated by payroll tax and income tax on benefits.
The 2023 Trustees Report states that the OASI Trust Fund will be able to pay 100% of total scheduled benefits only until 2033, one year earlier than the trustees projected last year. The program would then be able to pay 77% of scheduled benefits.
The CBO’s forecast is even more dire. It predicts the OASI fund will be exhausted in 2032, resulting in payable benefits being 25% less than scheduled benefits.
Workers and employers each pay 6.2% payroll taxes for social security, for a total of 12.4% on the first $160,200 of wages in 2023. Payroll taxes for social security could be boosted in two ways — increasing the tax rate and adjusting or eliminating the wage cap.
Some legislators and others have suggested raising the full retirement age, increasing it for example to age 70 for people born in 1978 or later.
“Reducing benefits, increasing the retirement age, and raising payroll taxes are all options that put the burden on individuals who can least afford it,” said McCormick. “Making the rich pay the same tax rate as everyone with income below $170,000 is a reasonable and responsible way to fix this problem and it is more fair than reducing benefits, increasing the retirement age, and raising payroll taxes.”
As McCormick advocates for reform, she emphasizes that even those at the pinnacle of success should contribute their fair share to uphold social programs that benefit society as a whole.