Obama Un-“chained”? His Latest Pledge To Defend Social Security

Isaiah J. Poole

President Obama’s 2016 budget proposal includes language that directly confronts a Republican House maneuver to force a debate on potential Social Security benefit cuts.

It also includes a promise that the administration will “oppose any measures that privatize or weaken the Social Security system and will not accept an approach that slashes benefits for future generations or reduces basic benefits for current beneficiaries.”

That language certainly makes it sound as if the Obama administration is closer in its sympathies to people like Sens. Sherrod Brown (D-Ohio) and Elizabeth Warren (D-Mass.) who want to strengthen Social Security than he is to the austerity lobby that insists that the only way to save Social Security is to either adopt schemes that will reduce benefits or turn it into some sort of private stock brokerage account.

There is a caveat. But before that, let’s give the administration praise where it is due.

The disability portion of the Social Security trust fund is expected to run out of money to pay full benefits late next year unless it gets an infusion of cash from the old age and survivors’ portion of the program. Such transfers have been authorized with little fuss from Congress periodically over the years. But this year, House Republicans chose to forbid such a transfer from taking place unless there was a larger deal to address the long-term solvency of the entire Social Security system.

What Republicans mean when they say that is that they want the Obama administration to sign on to a deal that would cut benefits for future Social Security recipients through a combination of raising the retirement age and reducing the inflation adjustment for benefits by using a technique called the “chained CPI,” which would make benefit checks worth less over time.

The administration in its budget today announced that it is not going to stand for holding disability benefits hostage to that debate. The 2016 budget proposes to “reallocate existing payroll tax collections between the Old-Age and Survivors Insurance (OASI) and DI [disability insurance] trust funds while a longer term solution to overall Social Security solvency is developed with the Congress.”

The administration says that such a transfer would “have no effect on the … trust funds on a combined basis.”

This is a fight with the Republican Congress that is worth picking, both to protect the benefits of people with disabilities and to ensure that the debate over the future of Social Security is done with all of the options on the table – including such progressive reforms as ensuring that wealthy wage-earners pay the same percentage of their income in payroll taxes as working-class people.

The caveat is that we’ve seen that “will not accept an approach that slashes benefits” language before from the White House – at the same time the administration was offering the “chained CPI” and an increased retirement age as olive branches in fiscal negotiations with congressional conservatives.

It took loud and persistent protest from progressives to block momentum toward that approach – and that has given space for progressive lawmakers to argue that we need to be expanding Social Security, not cutting it. Those allies need more political wind in their backs in 2015. Perhaps we can use the administration’s language, in the context of its willingness to confront the House Republicans over disability benefits, to keep them on the right side of this issue.

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