WASHINGTON – Campaign for America’s Future co-director Robert Borosage today said that House Majority Leader Steny Hoyer will get burned if he insists on stepping on Social Security, the “third rail of American politics.” .
Rep. Hoyer said on Wednesday that Congress should change the Social Security system to “bring in more revenues,” “restrain the growth of benefits” and possibly “raise the retirement age,” Rep. Hoyer proposed the creation of a special commission to develop Social Security legislation detailing cuts which would receive fast track treatment – an up-or-down vote in both chambers of Congress with no amendments.
Rep. Hoyer wants to put cuts in Social Security benefits on the table. He argues that cutting Social Security benefits will help address America’s long term deficits. This is bad policy and worse politics.
In reality, America does not have an entitlements problem. It has a broken health care system. The entirety of our long term debt problem is caused by soaring health care costs.
Social Security has a surplus. That means today’s workers have already prepaid their retirement. The Congressional Budget Office projects that Social Security, by drawing down its trust fund, will be able to pay benefits until the year 2049 with no changes whatsoever. Fixing health care means taking on the insurance companies, no easy task. But that is no reason to go after Social Security which is not the cause of the problem and cannot provide the solution.
American workers have paid a regressive Social Security payroll tax throughout their lives with the understanding that they’d get a secure floor for their retirement. The payroll tax was increased in 1983 with the understanding that a surplus would be built up and then paid down to pay for the boomers. A deal is a deal. It would be a gross injustice for the nation to break its contract with workers by increasing the payroll tax on average Americans or cutting their Social Security benefits. Congress may have squandered that money on tax cuts to the wealthy or bailouts of the banks. That may require progressive tax reform. It does not require shafting the workers who played by the rules.
This is also ruinous politics. Americans have lost more than $15 trillion in housing and stock wealth, with the great bulk of the losses being incurred by people age 45 and older. At a time when Americans are shattered by the loss in their retirement savings, Rep. Hoyer would add to their insecurity by calling for cutting the one benefit that is backed by the full faith and credit of the U.S. government – Social Security.
To suggest that the retirement age be lifted suggests Rep. Hoyer simply is out of touch. Most people will now have to work far past retirement age simply to make ends meet. What Rep. Hoyer is suggesting is that he will deprive them of any retirement support during that period. It is hard to imagine anything more destructive of Democrats’ claim to be the party of working Americans than to propose pushing that reform through the Congress on a fast track.
Retirement security is an essential part of the American Dream. Today, less than half of workers participate in any retirement plan at work; only a fraction of them have access to a traditional kind of pension that guarantees income in retirement. The rest have savings in their homes and retirement accounts that have just been devastated in the Great Recession. Democrats should be talking about increasing Social Security payments to help lift the economy out of its decline, not reducing them to pay off long term deficits that are caused by our broken health care system. Keep on this track, Rep. Hoyer, and you will get badly burned