Mar 17, 2023

Sound And Fury, Signifying Nothing

     From Reuters:

A Republican U.S. senator's accusation on Thursday that Treasury Secretary Janet Yellen had lied during a tussle over the future of the Social Security program obscured behind-the-scenes talks between the White House and lawmakers that have been underway for months, according to sources. 

The war of words came in a Senate Finance Committee hearing when Republican Senator Bill Cassidy asked Yellen if Democratic President Joe Biden was aware that Social Security funds will run out within the next decade unless Congress shores up the popular retirement program with 66 million beneficiaries.

When Yellen responded that Biden "stands ready to work" with lawmakers, Cassidy shot back, "That's a lie because when a bipartisan group of senators has repeatedly requested to meet with him about Social (Security) ... we have not heard anything on our requests."

For several months now, Cassidy and independent Senator Angus King, who caucuses with Democrats, have tried to address Social Security underfunding as approximately 10,000 baby boomers retire every day. ...

 Cassidy and King are leading a group of workhorse senators that include Republican Mike Rounds, Democrat Tim Kaine and independent Kyrsten Sinema. ...

"It's going to be tough. I don't think we should sugarcoat it. But there are serious conversations in the Senate ... on a package that would improve Social Security's finances," said Shai Akabas, economic policy director at the Bipartisan Policy Center, a centrist think tank in Washington. ...

    The Republican plan is to have a very few Republicans work with a very few Democrats to come up with a wildly unpopular plan that includes an increase in full retirement age. Republicans will provide only a few votes to pass the plan. It will only be passed if Biden strong arms Democrats and probably not even then. Republicans will then run against Democrats on the issue.

    Biden won't fall for this.

    By the way, I'm sure that the Democrats involved with these negotiations are well intentioned but they're fools. This is a dead end.

14 comments:

Anonymous said...

They will raise the wage cap some to appease one base

They will raise taxes, it has to be done, for at least the last 60 or so years.

They will move retirement age, because it is still a system that requires more going in than going out and there is the largest group drawing than ever in history.

They will move Medicare age out, got to happen it is in a far scarier place than retirement and disability. Going to have to pay more for it somehow.

I dont know what people expect, but there is going to have to be changes and all those changes include screwing the young to pay for the old, even if you remove the cap completely. Then when we get the old people that have made this mess for decades out of the way, the new generation will come in and make the material changes needed to save the program. Or not.

Anonymous said...

Raising the retirement age has not proved very popular in France. My suspicion is that the GOP has finally hit upon a sure fire plan to end Social Security, Medicare & Medicaid: do nothing and all social programs will die a natural death eventually.

Anonymous said...

@9:45AM: None of what you said is actually inevitable or necessary, unless you believe it’s actually necessary for over 90% of the nation’s wealth to be concentrated in the hands of a tiny few oligarchs.

They tried this crap in France, and the masses took up torches. But I don’t doubt what you outlined will happen here, because as was well demonstrated in November 2016, this country is bursting at the seams with rubes far too stupid to realize when they’re being served up a heaping plate of horses**t.

Anonymous said...

We have already upped the retirement age once. People got mad, guess what, the retirement age still went up.

You guys realize that France upped the age, just did it without a vote. Protest stop nothing and the retirement age is still two years and a few months below most retirees in the future in the US?

There isnt enough money to give away anymore! You either have to get more money, taxes increase age, or pay less, increase age and cut current benefits.


Drew C said...

Ironically, a raise in retirement age would benefit SSD attorneys. But I still would not support raising to 70. A true compromise position would be raising retirement age by 1/2 to 1 year, and raising the income cap on FICA taxes. But it is entirely feasible to to extend the trust fund 50 years by fairly moderate revenue/tax increases alone. These GOP senators pretend that benefit cuts are the only solution. So much for trying to pivot to a more populist economic platform. Trump understood that GOP voters do not buy into fiscal conservatism, but the rest of the party wants to have it both ways. Astounding there are still people that believe the GOP is the party of fiscal responsibility.

Play around with this tool if you doubt this problem is easy to solve via revenue increases: https://www.crfb.org/socialsecurityreformer/

The GOP is making a huge mistake if they think screwing over their blue collar base will be popular. Democrats are now the party of the college educated white collar workers who have longer working careers. This proposal hurts the GOPs base much worse.

Anonymous said...

@10:36AM: You totally nailed it! Excellent comment.

Anonymous said...

There was little chatter back on 1983 when the retirement age went up. Those that had their retirement age raised to age 67 (born in 1960 and later) haven't even reached full retirement age yet.
Raising Medicare age may save some money but they'd be giving up premiums from healthy 65 and perhaps 66 year olds so that may not actually save much at all.
The SSA tax rate hasn't gone up on ages. Raise it to 8.65% and all who benefit will pay for it.

Anonymous said...

Every year increase in the retirement age is in effect a benefit cut of 6%.

There would be a way to appease the raise the retirement crowd by simultaneously increasing the benefit by that same 6% but weight it for the lowest earners. That would involve increasing the benefit to the first bend point by that 6% and then extending the first pend point to increase the benefit for those with up to average earnings.

You then need to remove the earnings cap completely so that even very high earners pay the same FICA tax as everyone else. Then, introduce another lower benefit rate above the highest bend point of 5% instead of the current rate of 15% and cap benefits altogether at some figure now above what anyone gets, say $10,000 per month. This would be necessary since a removal of the cap on earnings could in some cases produce a benefit over that amount. Think paralyzed football player with an annual income of over a million dollars.

Actually part of the SS 2100 Act does much of this. It can be done with some creativity.

Anonymous said...

An increase in the retirement age is a 6-7% benefit cut for each year raised.

That can be done if at the same time the PIA formula is adjusted to increase the benefits for the lowest earnings by that amount cut and keep benefits the same up to the average earner.

Then, do away with the cap on earnings subject to tax. You also need to put a lower return on higher earrings below the current rate of 15% and an overall cap to take into account a million dollar plus earner becoming disabled. Think paralyzed football player.

It can be done and the 2100 act does much of this. Just need to be a little creative.

Tim said...

Cassidy says they have requested meetings with Biden. Yellin says Biden is willing to have meetings. Cassidy says Biden has ignored requests. Is Biden really willing to have meetings? If so, why not just have meetings? My impression is Biden wants to CLAIM he wants to have meetings, while not doing anything to have them. Why not have the meetings? Trump would! Doesn't mean you have to agree to anything!

Anonymous said...

Raising Medicare age may have a greater effect on forcing people to remain in the workforce than raising the Social Security retirement age because people can't retire if they may lose their health insurance. However, raising Medicare eligibility age may remove the healthiest cohort from Medicare coverage so it may not really help the Medicare funding issue that much.

Anonymous said...

Republicans will not approve any tax hikes to shore up SS. They want to increase FRA. Why not repeal the 2017 Passage Act which enrichened corporations at the expense of the taxpayer.

Anonymous said...

Amend the Social Security Act to eliminate the regressive payroll tax and fund it on a pay as you go basis from income tax. Problem solved.

Jim said...

One posting with choices revealed that if they (1) increased the tax by 1%, and (2) taxed income over $400k (inflation adjusted), they would solve the problems for decades.

For those of you advocating raising the full retirement age, I can tell you that as a 65 year old:
(a) Just as a physical laborer's body wears out, a knowledge worker is acutely aware that cognitive abilities are now waning. There are limits, and we have to ask what kind of life do we want?
(b) While you may contemplate requiring folks to work to age 70, how much has been done to fix discrimination against hiring older workers. Answer: NOTHING.