On October 30, a legislative initiative that could help millions of retirees was proposed in the US Senate. Faced with rising living costs, Democratic senators proposed an emergency increase to help these citizens, most of whom depend on a fixed income from Social Security. Annual inflation, which stood at 3% in September 2025, is rapidly eroding the purchasing power of everyone in the country, but it has hit those with a fixed pension the hardest.
This legislative response to the economic outlook took the form of two separate proposals: the Emergency Inflation Relief Act (S. 3078) and the Benefits Boost Act (CPI-E). Since the cost-of-living adjustment (COLA) was set, there has been a slight sense of alarm: the adjustment will be 2.8%, which translates into an increase of only $86 per month for the average beneficiary… A figure that seems absolutely insignificant in the face of inflation.
The potential $200 check
The mechanism of this proposed law would seek temporary and immediate assistance. It would be a non-taxable emergency payment (i.e., it would not be taxed by the IRS). The $200 monthly assistance would last for six months, beginning in January and ending in June 2026.
This would include retirees, veterans, SSI recipients, and railroad retirement beneficiaries. In addition, certain Federal Civil Service Retirement System (CSRS) annuitants are included. Democratic senators have defended the proposal by saying that, considering that a beneficiary with an average check receives $2,008 per month, this temporary 10% increase could significantly help improve their quality of life in these economically challenging times. If the bill passes, the total increase in the check would be approximately $256 per month during that period—the $200 plus the $56 from the 2026 COLA adjustment. This proposal is made to use an emergency line to cover basic expenses.
The inertia of Bill S. 3078
Although this all sounds very nice, the promise of $200 per month faces a harsh legislative reality: although the bill was introduced on October 30, 2025, it has only been referred to the Senate Finance Committee. To put it bluntly, the bill has stalled. There have been no votes or major hearings, underscoring strong opposition and low priority on the list of things to do anytime soon.
The first obstacle is the sheer cost of it all: the measure would cost approximately $90 billion, which would come directly from the –already quite empty– coffers of Social Security.
The Structural Problem with Pensions
Beyond temporary relief in the form of checks for six months, the proposed law seeks to structurally reform the pension system. The way in which the expenses of a retired citizen are currently measured means that the checks received by beneficiaries do not cover all the real costs of an elderly person. The current CPI-W (Consumer Price Index for Urban Wage Earners) ignores the high costs of healthcare and housing for the elderly.
Since this index is calculated based on middle-aged people who are working, these individuals do not have the same needs or priorities as senior citizens. The proposed bill seeks to replace this index with another, the CPI-E (Consumer Price Index for the Elderly). This index is designed to more accurately reflect the spending patterns of people aged 62 and over. For now, it is estimated that this structural change would increase benefits by around 0.2 percentage points on average.
Although we would all like our grandparents to receive an extra $200 check each month, the reality is that Social Security is facing a real risk of insolvency. It is estimated that its trust fund will be depleted between 2033 and 2035… The last thing it needs is to have to send out more money right now. It is estimated that when this happens, benefits will automatically be reduced to 78% of scheduled payments.
In addition, ways to finance Social Security are being sought, including taxing all income above $250,000. In a globalized world, we don’t know if this will help or if it will simply cause higher-income earners to move to other countries that penalize them less for earning so much money.