From Bloomberg Government:
Social Security and Medicare eligibility changes, spending caps, and safety-net work requirements are among the top priorities for key House Republicans who want to use next year’s debt-limit deadline to extract concessions from Democrats.
The four Republicans interested in serving as House Budget Committee chairman in the next Congress said in interviews that next year’s deadline to raise or suspend the debt ceiling is a point of leverage if their party can win control of the House in the November midterm elections. ...
A bipartisan negotiation on Social Security and Medicare would likely start with Democrats pushing for more revenue, while “Republicans have a list of eligibility reforms, and we don’t like the tax increases,” Arrington said. He said an increase in the eligibility age for both programs would be a commonsense change.
Reducing benefits for wealthier Americans could also cut costs, Smucker said.
“We should ensure that we keep the promises that were made to the people who really need it, the people who are relying on it,” Smucker said. “So some sort of means-testing potentially would help to ensure that we can do that.” ...
Republicans have this longstanding dream that they can force Democrats to accept major cuts in Social Security and then find a way to blame Democrats for those unpopular cuts. Jujitsu! That hasn't worked in the past and it's not going to work next year. Democrats will go to the mattresses over means testing Social Security or raising full retirement age. Republicans won't have the stomach to go to the mattresses themselves over obtaining the cuts.
The bigger fear is that Democrats will cave on some sort of discretionary budget caps the way they did back in 2011. The direct result of those budget caps has been SSA's chronic underfunding over the past decade.
ReplyDeleteSSA cannot survive another round of sequestration and strangulation.
AS a younger worker, I 100% believe that my retirement age will be raised and that my Medicare eligibility age will be raised most likely to match my FRA and that my taxes for those programs will be raised. I have said so here for a few years now. To pay for the Boomers, the next generation will be punished. The lack of foresight and a half century of can kicking have created this. There is no way to avoid it. You can lift the limit on high earners, but guess what, there are not enough of them to make the gap close. They will find ways to adjust the cash earnings to avoid additional taxes. They have to put the burden on the back of the average worker, there are just more of us and we cannot avoid the taxes.
ReplyDeleteBoomers had their FRA raised from age 65 to 67 but no increase in age for Medicare. I agree that the can has been kicked too many time but no one, Republican or Democrat, wants to vote for increased age or higher taxes.
DeleteIt seems reasonable that the middle class pay for what benefits them most. The well to do receive the lowest percentage return on their SSA taxes and some have to pay higher Medicare costs due to IRMAA.
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ReplyDeleteAs a younger worker, the trust fund balance for the first time in 40 years decreased in 2021, as an aftermath of the covid pandemic decreasing earnings in 2020-2021 and the concern younger workers feel about the solvency is due to the bipartisan commitment to using social security as a political football when in reality there is no reasonable basis for concluding the trust fund will be insolvent in 30+ years. But even if the trust funds do face insolvency at some point in the future, raising the cap on high earners would objectively cover the minimal shortfall. Or we could can kick as the prior generation did because literally there is nothing requiring the government not to do that.
https://www.ssa.gov/OACT/STATS/table4a3.html
Here is what they are going to do. They are going to move early retirement form 62 to 65. They can do this outright our by just making the penalty for filing before FRA an even larger reduction in benefits than it is now. They have set this up by moving FRA further out already. This forces people to work longer and pay in longer. They will move FRA to 70 and Medicare eligibility to 70 under the guise that people can work longer, supported by fewer people taking early retirement due to the increased penalty. With an average life expectancy of 78.79 years they dont have to pay you very long that way for retirement or Medicare.
ReplyDeleteThis will be done by both parties. Slowly, incrementally moving retirement out of the range of the average worker.
If you dont think it can happen, I will remind you half the country thinks that bigfoot is real, the election was stolen.
They want to be reelected more than they want to fix things. If they make any age changes it will be like the last time where it is far out in the future. It was close to 40 years ago and no one has yet retired at FRA at age 67. That's 5 years off in the future.
DeleteYou don't really help the funding of Medicare by raising the eligibility age a couple of years because by doing that you are basically removing some of the healthier people from Medicare, the people who are not costing the program much money.
ReplyDeleteOh I think keeping a couple million people off the rolls for 5 years would do a lot of savings.
ReplyDelete…or cause them to skip otherwise needed healthcare causing them to be more sick when they finally get it or die.
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