Social Security Fix Faces GOP Tax Roadblock
One of the most common questions Congressmen get asked in town halls is “Will Social Security be there for me?”
But the first in a series of Congressional hearings on how to make sure the answer is yes, started with a roadblock: taxes.
While Congressmen from both parties claim now is the time to find a way to keep Social Security solvent rather than wait until the trust fund runs out of money in 2034, the lead Republican on the Social Security unit of the House Ways and Means Committee, New York’s Tom Reed, said today that Republicans will not allow tax increases to become part of the fix.
Raising the payroll tax from 12.4 percent to 14.8 percent over the next 24 years and subjecting incomes over $400,000 to the levy are at the center of the Democrats’ reform proposal: The Social Security 2100 Act.
The bill, drafted by Ways and Means Social Security Chair John Larson, of Connecticut, would use the new money to pay for benefit increases for current and future recipients, a bigger minimum benefit and higher cost of living increases.
It also aims to prevent benefit decreases for 75 years.
Without changes, Social Security benefits are projected to be cut by 25 percent in 15 years.
At a hearing of his panel today, Larson stressed the economic pain that would happen if a fix is not found and agreed to.
“If …we didn’t do anything to strengthen the program, it could cost the economy about 2.3 million jobs and $349 billion in economic output,” he said.
Illinois Democrat Brendan Boyle cautioned the cuts could come much sooner it a recession hits.
A Republican proposal to keep the fund solvent longer by raising the full retirement age from 66 to 70 could reduce Social Security benefits to people in the lowest income range by a third because they’ve had physically demanding jobs that shorten their lives compared to the rest of the workforce, warned Illinois Democrat Bradley Schneider.
Larson said he thinks the chances of putting a Social Security reform bill on the desk of President Donald Trump this year are good because Trump has supported the program, 22 Republican Senators are up for re-election in 2020 and he has over 200 sponsors for his bill.
However, Reed did not express optimism a fix could be agreed to in 2019.