Personal Finance
House just voted yes to increase Social Security for some beneficiaries
A bipartisan bill to change Social Security benefit rules for pensioners passed in the House of Representatives on Tuesday, with 327 lawmakers voting to support the measure.
Now, the proposal heads to the Senate, where the chamber’s version of the bill has 62 co-sponsors, “surpassing the majority needed to pass the bill on the U.S. Senate floor and send it to the president’s desk to be signed into law,” Reps. Abigail Spanberger, D-Virginia, and Garret Graves, R-Louisiana, co-leaders of the bill, said in a joint statement.
The proposal — called the Social Security Fairness Act — would repeal rules that reduce Social Security benefits for individuals who receive pension benefits from state or local governments.
It would eliminate the windfall elimination provision, or WEP, that reduces Social Security benefits for individuals who worked in jobs where they did not pay Social Security payroll taxes and now receive pension or disability benefits from those employers. About 3% of all Social Security beneficiaries — about 2.1 million people — were affected by the WEP as of December 2023, according to the Congressional Research Service.
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The bill would also eliminate the government pension offset, or GPO, which reduces Social Security benefits for spouses, widows and widowers who also receive pension checks. As of last December, about 1% of all Social Security beneficiaries — or 745,679 individuals — were affected by the GPO, according to the Congressional Research Service.
These rules, which have been in effect for decades, reduce the incomes of certain retired police officers, teachers, firefighters and other public servants, Graves said during a Tuesday speech on the House floor.
“This has been 40 years of treating people differently, discriminating against a certain set of workers,” Graves said.
“They’re not people that are overpaid; they’re not people that are underworked,” he said.
Supporters call bill a ‘step in the right direction’
The National Committee to Preserve Social Security and Medicare said the House vote on the Social Security Fairness Act is a “step in the right direction” and a “bipartisan victory for public sector employees and their families.”
“We have long advocated for the repeal of the WEP and GPO provisions, though we would have preferred that Congress take up the more comprehensive improvements in Rep. John Larson’s Social Security 2100 Act,” Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, said in a statement.
Larson’s proposal, which has 188 House co-sponsors, would also repeal the WEP and GPO, while also implementing other temporary benefit increases. To help pay for those changes, it would require people with more than $400,000 in income to pay more Social Security payroll taxes.
On Tuesday, Larson voted against the Social Security Fairness Act, as well as another bill, the Equal Treatment of Public Servants Act. The latter bill would use a new formula for Social Security retirement and disability benefits for pensioners rather than eliminate the WEP. It would not change the GPO.
The bill, which was proposed by Rep. Jodey Arrington, R-Texas, failed when it was brought up for a vote.
“I could not vote for the bills on the floor tonight because they are not paid for and therefore put Americans’ hard-earned benefits at risk,” Larson said in a statement. “It would hurt most deeply the five million of our fellow Americans who receive below poverty checks, and almost half of all Social Security recipients who rely on their earned benefits for the majority of their income.”
Critics say the bill will weaken Social Security
The Social Security Fairness Act would add an estimated $196 billion to deficits over the next decade, the Congressional Budget Office has estimated. It would also move Social Security’s trust fund depletion dates closer by an estimated six months, according to the Committee for a Responsible Federal Budget.
“The long-term solvency of Social Security is an issue that Congress must address,” Spanberger said on the House floor on Tuesday.
“But that is a separate issue from allowing Americans who did their part, who contributed their earnings, for them to retire with dignity,” she said.
However, critics say Social Security’s funding woes should be a priority for Congress now. The program’s actuaries project the trust fund used to pay retirement benefits may be depleted in 2033, at which point 79% of benefits will be payable.
“This is not the right policy,” said Romina Boccia, director of budget and entitlement policy at the Cato Institute. “It’s what special interests were pushing, and politicians are responsive to their demands.”
Though the alternative bill proposed by Arrington would not address the GPO, it would provide a “fairer formula” for the WEP, Boccia said. However, broader changes are needed to shore up the program’s finances.
“We should reform Social Security so that it provides basic income security to the most vulnerable Americans in old age without adding to the debt or tax burden that younger workers face,” Boccia said.
The Department of Homeland Security restored the legal status of thousands of international students who had their visas revoked, according to reports Friday.
College experts largely applauded the move, which was prompted by court challenges and lawsuits filed by affected students and their lawyers, as a win for students and higher education overall, but the gains could be short lived.
The Trump Administration’s sudden change in policy, however, is causing some international college applicants to rethink their plans for next year and whether they want to study in the U.S. at all, college experts now say.
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“Overall, this is a very positive development,” according to Robert Franek, editor-in-chief of The Princeton Review. It provides needed clarity for international students who have until Thursday, May 1, which is National College Decision Day — the deadline most schools set to choose which institution they will attend in the fall, he said.
For colleges and universities, “international enrollment is an incredible value in the classroom,” Franek said. To that end, college administrators remain highly focused on “having students with different experiences and a number of different voices represented,” he said.
But international student enrollment is also an important source of revenue for U.S. colleges and universities, which is why schools need a contingent of foreign students, who typically pay full tuition, Franek added. This financial reliance makes them a critical component of the higher education system, experts say.
However, because of the U.S. government’s recent changes to the student visa policy, which deactivated and then reactivated the immigration status of thousands of students, “there are a number of international students admitted to great colleges and really skeptical about whether they will come,” Franek said of plans for the fall of 2025.
‘Uncertainty is not good for long-term planning’
One private college consultant, who works with a large share of families from abroad, said he has already seen a shift in priorities among college-bound clients, fueled by nervousness about further policy changes.
“There’s so much uncertainty and uncertainty is not good for long-term planning,” said Hafeez Lakhani, founder and president of Lakhani Coaching in New York.
Lakhani explained that he is working with families to “evaluate the risk” ahead of the enrollment deadline. Other high schoolers a year or more away from applying to college are rethinking their plans altogether, he said.
“We are already seeing some international students showing more interest in Canada and the U.K. — and it’s to those other countries’ benefit in terms of recruiting talent and tuition dollars,” Lakhani said.
International students are ‘economically advantageous’
There are more than 1.1 million international undergraduate and graduate students in the U.S., mostly from India and China, making up slightly less than 6% of the total U.S. higher education population, according to the latest Open Doors data, released by the U.S. Department of State and the Institute of International Education.
In the 2023-24 academic year, the U.S. hosted a record number of students from abroad, marking a 7% increase from the previous year. India surpassed China as the top sending country, with India sending more than 330,000 students.
Altogether, international student enrollment contributed $43.8 billion to the U.S. economy in 2023-24, according to a separate report by NAFSA: Association of International Educators.
“Foreign students present a unique challenge for the Trump administration’s hardline immigration policy efforts,” said Christopher Rim, president and CEO of college consulting firm Command Education.
“On the one hand, international students account for a large portion of foreign residents in the U.S., and some of the most politically outspoken,” Rims said. “However, they are among the most economically advantageous, as well.”
But according to Rim, who also works with clients all over the world, the U.S. is still the main choice among college-bound students applying to top-ranked institutions, and that is unlikely to change overnight.
“I was in Hong Kong last week speaking to a packed audience of hundreds of students and parents about Ivy League and top-tier U.S. college admissions for expat and international families,” Rim said Monday.
“Despite global shifts, distinct and affluent families remain deeply eager to send their children to the United States for higher education,” he explained. “They continue to recognize the U.S. as home to the world’s leading universities.”
US President Donald Trump holds letter to the UN stating the US withdrawal from the Paris Agreement during the inaugural parade inside Capital One Arena, in Washington, DC, on January 20, 2025.
Jim Watson | Afp | Getty Images
Investors have continued to pull money from so-called ESG funds in early 2025 amid an “intensifying” backlash fueled by President Trump’s “anti-climate agenda” and his administration’s policies targeting diversity, equity and inclusion initiatives, according to a new Morningstar report.
Also known as socially responsible, sustainable, impact or values-based investing, “environmental, social and governance” funds let people invest according to certain values like climate change or corporate diversity.
Investors withdrew $6.1 billion from ESG funds in the first three months of 2025, after yanking out $4.3 billion in Q4 2024, according to Morningstar.
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The exodus in Q1 marked the 10th consecutive quarter of outflows.
“The continued loss of appetite among US investors for sustainable funds can be partly attributed to an anti-ESG backlash, which has intensified since the return of President Trump to the White House,” according to the report.
As of the end of Q1, U.S. investors held $330 billion in ESG funds, about 10% of the global total.
Pushback against climate, DEI policies
Yaorusheng | Moment | Getty Images
Even before Trump took office, persistently high interest rates weighed on performance in segments of the ESG market, like clean energy and other “green” stocks, according to Morningstar. Higher borrowing costs burden the renewables sector because the projects can be capital-intensive.
But Trump added additional pressure.
Within days of his inauguration, Trump announced the U.S. would withdraw from the Paris agreement, blocked subsidies for electric vehicles, pushed for more fossil-fuel production and started a “huge pushback” against DEI policies, Diana Iovanel, a senior markets economist at Capital Economics, wrote in a research note in March.
In late March, the Republican-led Securities and Exchange Commission stopped defending a climate-change disclosure rule in court. There’s also uncertainty about the fate of the Inflation Reduction Act, a historic climate change mitigation law signed by President Joe Biden.
Even before Trump’s second term began, at least 18 Republican-led states had adopted “anti-ESG legislation,” prompting some large asset managers to “pare back” their ESG efforts, Iovanel wrote.
Trump also signed an executive order to eliminate all DEI-related mandates and programs within the federal government, prompting major corporations like Walmart (WMT), Lowe’s (LOW) and Meta (META) to begin “scaling back their DEI commitments,” Morningstar wrote.
Why Trump isn’t ‘game over’ for ESG
Despite the headwinds, Trump’s agenda “isn’t ‘game over’ for ESG investing,” Iovanel wrote.
Demand for ESG investments “is here to stay” even in the face of political pressure, she wrote.
For one, despite Republican antipathy for ESG investing, it also has ample support, Iovanel wrote. States such as California have implemented pro-ESG regulations, and surveys indicate most large asset managers (including ones in the U.S.) invest in ESG assets despite the apparent controversy, she wrote.
Demand among individual investors also appears relatively high, especially among younger investors, analysts said.
About 84% of individual investors in the U.S. are interested in sustainable investing, according to a 2024 Morgan Stanley survey. Roughly two thirds, 65%, of respondents said their interest had increased in the prior two years.
While critics deride it as “woke” capitalism, advocates say there’s a strong investment thesis for ESG.
Specifically, they argue that ESG investing positions investors for higher long-term returns because companies that adopt such practices are poised to be more resilient, and therefore more successful, than peers.
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