▶ 0:21:05Chair Crapo: The hearing will come to order. Social security provides critical benefits to millions of seniors with disabilities and their families. Individuals as well. For many americans, it is the cornerstone of retirement security. It also provides final support to workers who can no longer earn a living due to severe injury or illness and to families who lost a loved one.
▶ 0:21:32Chair Crapo: For decades, the social security board of trustees has recommended that congress act quickly to address the program's long-term financial challenges. According to the trustees's latest projections, the old age and survivor insurance trust fund will be exhausted in late 2032. If congress fails to act before then, incoming program revenues be sufficient to pay only 78% of the promised benefits.
▶ 0:22:03Chair Crapo: Congress has a responsibility to protect and strengthen social security for current beneficiaries and future generations. The longer we wait, the more difficult this challenge will become. The last comprehensive effort to improve social security solvency took place over 40 years ago. And culminated in the social security amendment in 1983 -- amendments in 1983.
▶ 0:22:30Chair Crapo: Those reforms were received by bipartisan negotiations. What was known as the greenspan commission. That process demonstrated the value of creating a forum where policymakers could work through difficult issues and build consensus on a bipartisan basis.
▶ 0:22:53Chair Crapo: More than two decades later, I participated in another bipartisan effort to develop recommendations to address our nation's long-term fiscal challenges. Along with senator dick durbin antidemocratic co-author of one of the process bills that will be discussed today.
▶ 0:23:11Chair Crapo: As part of its work, the nashville -- the bull simpson commission developed a bipartisan social security solvency plan. While the commission's recommendations ultimately did not receive support necessary to move forward, its work has informed subsequent social security solvency discussions. Social security approaches a pivotal moment.
▶ 0:23:41Chair Crapo: Members of congress have proposed a variety of process reforms designed to facilitate bipartisan discussions and help develop lasting solutions, and that is part of the reason we are here today. Today's hearing will examine those approaches and consider what lessons can be drawn from past efforts. Before I turn to ranking member wyden, I will briefly lay out how the rest of the hearing will proceed.
▶ 0:24:05Chair Crapo: After ranking member wyden gives his opening remarks, generally I would go immediately to the witness, but today we will let other members of the committee, if they choose, to have the five minute opening statement. Some of these members will I am sure use these five minutes to talk about their ideals. Once members conclude his opening statements, we will turn to our witnesses for their opening remarks and then proceed to member questions.
▶ 0:24:34Chair Crapo: I want to thank our witnesses for being here today, and I look forward to your testimony. And now I turn to ranking member wyden for his opening remarks.
▶ 0:24:42Sen. Wyden: Thank you very much, Mr. chairman. I share your view that we got an excellent panel of witnesses and a good start to this issue. We are going to be discussing the future of social security as sacred an issue as there is in america. The trust fund is going to be completed before the end of the next presidential administration .
▶ 0:25:11Sen. Wyden: Several republican members of the panel will say that they have a solution. Some sort of unaccountable commission that rubberstamps benefit cuts like increasing the retirement age. It seems that every time some republicans get their hands on these sorts of ideas for social security, life gets worse for older people that count on the program to get by.
▶ 0:25:37Sen. Wyden: Thanks to donald trump and the big beautiful bill, the crisis is speeding up.senators elected this fall will be in office when social security becomes insolvent, and republicans started this fire. Now they are claiming they are the ones that can put it out. The consequences of insolvency are severe. Americans who paid into social security out of every paycheck during their working years would no longer receive full benefits.
▶ 0:26:08Sen. Wyden: One in four seniors rely on their earned social security benefits for virtually all of their income. That number is even higher for people receiving disability benefits orchids who lost a parent. Trump and the maga crowd give huge tax breaks to billionaires and massive corporations. That is what they did last year. That bill plundered social security by $168 billion.
▶ 0:26:40Sen. Wyden: You don't have to take my word for it. The number comes from the social security actuary office itself. So here is my bottom line. I want to work on a bipartisan basis to fix the problem and protect typical retirees from missing out on their earned benefits in a little more than six years.
▶ 0:27:01Sen. Wyden: That can be done by updating social security to reflect the economy of today and ask billionaires to pay their fair share through the payroll and income taxes. That said, so I wish the finance committee was here to make sure that we have a substantive debate.
▶ 0:27:24Sen. Wyden: Instead, the concept being discussed today would act as a shortcut for republicans to carry out their long-sought goal of slashing social security benefits for retirees and raising taxes on middle-class folks. In my view, supporting this kind of flawed idea would be a dereliction of duty. Something that I would never be part of. This is the work we were sent to congress to undertake. A quaint idea.
▶ 0:27:52Sen. Wyden: We do the work we are sent to congress to do. Handing off that responsibility to somebody else to me is just procrastinating. In the words of basketball great allen iverson, we are talking about practice, not a game. We are talking about practice. Instead of talking about talking, this body should get to work on finding a solution to the social security solvency challenge and having that debate in public view. Democrats on this committee have put forward their ideas.
▶ 0:28:23Sen. Wyden: Through our plan, social security can be secured indefinitely into the future without a single dime of cuts to a current or future retiree. That means no raising the retirement age, no cost-of-living haircuts, and no means testing benefits. But it does require the billionaires who have seen their wealth skyrocket over $9 trillion this year while working people suffer, those billionaires would pay their fair share.
▶ 0:28:50Sen. Wyden: Instead of having a public debate, the commission that is being discussed would smuggle in benefit cut plans with minimal public scrutiny or debate. I reject that approach. I'm going to oppose efforts to set up a plan like that. I've got faith that every member of this committee has the wherewithal to engage in an important debate here and now. Not a commission. But a debate here and now. That requires the courage to stand behind your ideas in full public view.
▶ 0:29:22Sen. Wyden: And the american people deserve no less. So I thank our witnesses for joining the committee. I look forward to the discussion. Mr. chairman, I would ask unanimous consent to enter into the record a statement from senator gillibrand. I would also ask unanimous consent to enter into the record a statement from the alliance for retired americans, and that is the request for book documents.
▶ 0:29:42Chair Crapo: Without objection.
▶ 0:29:44Sen. Wyden: Thank you, Mr. chairman.
▶ 0:29:46Chair Crapo: Before I go to members, I have to correct something senator wyden -- this hearing is not to push a specific proposal. This hearing is to talk about all the options on the table. That is why we have a broad array of witnesses and why I offered every member of this committee the opportunity to say something about their ideas if they want to. Then we can move forward and hopefully on a bipartisan basis build a solution.
▶ 0:30:11Sen. Wyden: Mr. chairman, I will continue this at length. What I indicated is I am very much interested in exactly the kind of bipartisan efforts people who worked on this committee know I pursue this. I don't think it is a serious bipartisan effort. I think it is ducking, and that is what the debate today also includes.
▶ 0:30:44Chair Crapo: I was going to go to senator grassley, but he stepped out. So next on my list would be senator cassidy. Senator cornyn, I believe you did not -- senator cassidy.
▶ 0:31:07Sen. Cassidy: Let us be clear we are talking today about setting up a process. Not a specific solution. A process that would be bipartisan, ideally involving the house to look at solutions. To have it mischaracterized and misrepresented as republicans cutting things is false. It is lying to the american people.
▶ 0:31:30Sen. Cassidy: This committee hearing is about setting up a process to listen to proposals about hitting billionaires and millionaires with lots of money or other proposals, however it is, to have something to present to us in this committee in normal order to either reject or accept. It is not one proposal. It could be two. It could be three.
▶ 0:31:54Sen. Cassidy: And any member here could put up a bill, an amendment in the nature of a substitute in replace of it all. That is what we are talking about here. If the other side of the aisle thinks they've got a great idea, they should want this process. They should want this process because that would give them the opportunity to present to the american people and to this committee and to the senate their particular perspective.
▶ 0:32:22Sen. Cassidy: To say that you don't even want a process, however you put all kinds of fancy words about and rhetoric about the site and that side, and you say you don't even want a process. It means you don't want to take it on, that you decided it is more important to be a politician and to have an issue, to divide our country than to be a senator who is looking for solutions. By the way, I have an idea. I will be honest about that.
▶ 0:32:52Sen. Cassidy: Bipartisan with multiple democrats supporting the idea. But that does not mean my idea will be the one that is accepted. We today are only talking about setting up a process where the american people have the opportunity to have input and at the end of that process would bring to this committee a product to be considered or rejected and replaced with another product. That is regular order.
▶ 0:33:20Sen. Cassidy: And to start saying it is partisan and we are cutting benefits, that is not true. Why am I so passionate? Guess what. You know what is really going to cut seniors? If we don't fix it and there will be by law a 22% to 28% cut in benefits for every senior currently receiving social security. Or it would increase taxes by 40%.
▶ 0:33:47Sen. Cassidy: That would got the ability -- gut the ability to save for retirement for the american people. Or we will just borrow a lot of and destroy our country's credit rating. Every year we wait, it gets worse. I have been told by bernie sanders and by lindsey graham, bill, I am quoting lindsey now, you are a lousy politician, but you are a good senator. I took that as a compliment.
▶ 0:34:15Sen. Cassidy: I challenge all of us to be lousy politicians but to be good senators. Because right now, the longer we wait, the harder it is for our country and the more that a senior is going to see their benefits go away, and the more the american people, more likely the american people will see their taxes go up, or our country will have to borrow so much money that we will go into oblivion. Let's be patriotic. Let's be good senators.
▶ 0:34:45Sen. Cassidy: Let's be here to make the hard decisions, not on a particular solution, because what we are considering today is only a process bill. It sets up not an independent commission which is isolated from the influence of the voters. It sets up something which ultimately comes to this committee. This committee. Everybody on this committee answerable to the voters. And everybody on this committee having to take a vote on either that which is produced or an amendment in the nature of a substitute.
▶ 0:35:15Sen. Cassidy: That would again go to the floor of the senate where every senator would again have a chance to weigh in. This is the way the process is supposed to work. What we are considering today is basically a time agreement. Time agreements are how these are that how things are done around here -- how things are done around here. I am so frustrated. Let's be political. Let's just one more time use this as a wedge issue. No.
▶ 0:35:46Sen. Cassidy: Let's be good senators. Let's be good senators. Let's vote for a bill that sets up a process in which anybody's proposal can be heard, voted on, and chosen. This is not about a solution. This is about a process to arrive at a solution. If you care about the united states, if you care about seniors, we should be voting for this bill today.
▶ 0:36:07Chair Crapo: Thank you, senator cassidy. Senator warner.
▶ 0:36:10Sen. Warner: Thank you, Mr. chairman, and thank you for holding this hearing. Good to see folks like marc on the panel. I pushy and everybody is passion on this issue. You and I worked on this, Mr. chair.
▶ 0:36:26Chair Crapo: Yes.
▶ 0:36:29Sen. Warner: 2006. We did not obviously get it done or we would not be here today still debating this issue. I do believe the only way we will get this is through a bipartisan effort. We know social security is the most important committee our country makes to seniors and to surviving spouses and children, people with disabilities. And supports 70 million americans.
▶ 0:36:57Sen. Warner: It ensures another 239 million workers against the risk of aging, disability, or death of a spouse or parent. We also know in six years, one of the things, and his math -- it is math. We are going to hit this cliff. In the fourth quarter of 2032, the retirement fund is depleted and every beneficiary takes a cut about 22%. That is what happens if we do nothing.
▶ 0:37:22Sen. Warner: For virginians, it means nearly 1.5 million virginians who receive some form of social security benefits will have a cut in those benefits. And when the trust fund runs dry, the average retiree stands to lose more than $500 a month. In my state, that is close to $9 million in virginia. A typical couple would lose nearly $17,000 a year.
▶ 0:37:54Sen. Warner: You know, this is going to be a disaster. The thing that is also coming on top of this, I know the chairman and ranking member kn the hospitalow -- know the hospital insurance fund is about to go after that. That is a hit of 11%. For those of us who have been talking about this, we go way back in time in 2010 when we were starting some of these efforts.
▶ 0:38:24Sen. Warner: Social security, 75 year shortfall was $4 trillion in $2010. Now it is $30 trillion. I think we all know every year the math gets uglier. We can talk about processes. The one thing we looked at and I look forward to continuing, I laid out ideas, taking hits from both sides on some of the ideas I had.
▶ 0:38:49Sen. Warner: One thing I hope as we are forced to grapple with this, whatever situation around caps and age and benefits that we also set in process something where we do not wait another 30 or 40 years before we take it up again. One of the things, Mr. chairman, you and I worked on together was something that said every 10 years you would have an automatic reset to make the trust fund solvent for 50 years going forward.
▶ 0:39:20Sen. Warner: So you do not allow us to get into the ditch we are at this point. I am open to all ideas. Again, as somebody who has already taken hits, laying out controversial ideas, I think we will have to come back and address them again. But I do believe having these kinds of hearings at this stage, we know it is coming. We cannot pretend like we did not see this coming very directly.
▶ 0:39:51Sen. Warner: And obviously, as I think those of us -- it reverses medicare, which is a real challenge. This one starts with plain old math. I think people working on this can get it right. We may not even need to go to an ai based solution. We might be able senators to put our heads together and sort this out. Thank you for giving me the opportunity to make an opening statement.
▶ 0:40:19Chair Crapo: Thank you, senator warner. I too fondly remember our work together on the gang of six. I hope we can do under similar endeavor that puts it over the goal line this time. Senator johnson.
▶ 0:40:32Sen. Johnson: Mr. chairman, my 30 years in many fracturing saw an awful lot of problems, and you realize there is a process to solving a problem. First, I think we all admit we have a problem. The second step is even more crucial. You have to properly define it. The last step is solutions.
▶ 0:40:57Sen. Johnson: Around here, what seems to happen all the time is everybody has their piece of legislation. They already got the solution, but they have not properly defined the problem. So let me I guess throw out there the problem we have to deal with the fact that we are $40 trillion in debt, heading to $60 trillion. We need to agree on common facts. Ok?
▶ 0:41:28Sen. Johnson: One of the facts that we have to grapple with his benefits already exceed revenue -- is benefits already exceed revenue, but we are honoring us benefits, right? When the trust fund runs out, it should not be a calamity. We are just going to have to do something with the benefits, and we will do that. One factor we ought to recognize is the U.S. government bond in a government agency has no value. The trust fund is a fiction.
▶ 0:42:00Sen. Johnson: Another thing we ought to grapple with his social security is a legal ponzi scheme. I get criticized for saying it but that is exactly what it is. We extracted money from taxpayers, investors. We spent the money. It is gone. It got paid out to earlier investors. There is nothing in value. Have to recognize that reality. I often hear from constituents, that is my money.
▶ 0:42:32Sen. Johnson: Well, it is to a certain extent. But I want to enter into record table one, for hypothetical workers with various earning levels. Basically what this says is a social security recipient, what they received for each dollar they put in the fund. It ranges from a low of getting back $.59 on the dollar to a high of getting $4.78 on the dollar. It is a fiction.
▶ 0:43:02Sen. Johnson: It was not set up as an investment fund. You will not solve this problem if you are not willing to recognize how grossly mismanaged social security was for decades by politicians. By our predecessors. They squandered the money. There is nothing of value there.
▶ 0:43:22Sen. Johnson: And even worse than that, they have run up enormous deficits, $40 trillion in debt, so we may not have the financial wherewithal for benefits. Personally, I am amazed the debt bond has not already gone off. I guess we are the least worse in terms of governments around the world. We are still a safe haven. What I would suggest is let's agree on common facts.
▶ 0:43:52Sen. Johnson: Before we lead to solutions, let's agree on that. Held a budget hearing yesterday. The title was medicaid as a reality. I know my democrat colleagues, and must have gotten under their skin because they said you turn this into debate society. That is exacting what we are doing here. I thought this was the greatest deliberative body. But they did not like the fact when they would lie and say we wanted to cut and slash under the exact same words from the ranking member. Cut and slash social security.
▶ 0:44:23Sen. Johnson: That is a lie. We are not cutting and slashing medicaid. The facts on medicaid I kept having to repeat, 2014, we spent $300 billion, the start of etiquette expansion. 2019, before the pandemic, $400 billion. Last year, $668 billion. This year, probably $735 billion. I have now seen a projection where that number decreases. It is a lie. Quit lying. Start telling the truth.
▶ 0:44:54Sen. Johnson: Acknowledge reality. I am offer a process, but please, god, please, let's have a process go in the right order. Let's start to find the problem with facts. Let's agree on the facts. Stop lying about people. Stop saying that we want -- no, we want to preserve social security.
▶ 0:45:16Sen. Johnson: And the best way to do that is reduce the deficit so we do not run into this massive debt bomb that will blow up in our face and we will not have the wherewithal to plus up the benefits when the fiction of the social security trust fund runs out.
▶ 0:45:31Chair Crapo: Thank. Senator whitehouse.
▶ 0:45:35Sen. Whitehouse: This hearing is not about medicaid but let me point out there are $1 trillion in cuts coming to medicaid, and we know that is a fact because fact-based people out in the real world like hospitals and nursing homes and doctors practices are already planning their finances for the crash in revenue that is going to come from the republican built red tape bomb that will go off in medicaid to, basically, drive
▶ 0:46:07Sen. Whitehouse: People off of it because they will not be able to keep up with the redtape requirement. So that is where we are on that. I cannot let that go unrebutted. With respect to social security, well, the trust fund will be exhausted at your earlier than protected. A lot of that is thanks to the billionaires bill that the republicans jammed through. It hits in 2032, just six years from now. Democrats, we have been pretty out there. We've got bills. You can look at them. Kick the tires. Take your potshots.
▶ 0:46:37Sen. Whitehouse: We have legislation that will make social security solvent for as far as the eye can see. Where is the republican proposal? Where is it? It does not exist. They want to go to a back room and get deals done that allow for benefit cuts and things like that that they don't want to own so they don't want to put it out there. That is where we are. The first thing we should see is if republicans want to solve social security, put your plan on the table. Why hide it?what do you want to do ?
▶ 0:47:08Sen. Whitehouse: Put it out there. We have done that. So, while we are at it on social security, not only is it running out of trust fund, but we also have social security administration internal collapse, thanks to musk and his wretched little doggy boys going in and getting lots of people fired from their jobs.
▶ 0:47:31Sen. Whitehouse: We have reporting that is -- his doggy boys took data, planning to take social security private data and offering it to private employers. So there are a lot of problems with social security, but the big one is, how do we make sure that benefits do not get cut in 2032? And we have a plan. We are not ashamed of our plan. We put it out there. It is actually not complicated.
▶ 0:47:57Sen. Whitehouse: You actually make people who are making huge amount of income pay the same social security taxes as everyone else all the way up the rest of their income. If they are dodging their income because they are really fancy and they have been able to park it through various types of corporate obscuring, go hunt that down and actually make sure they got social security on that as well. You should not be able to hide your income through a corporate device and dodge social security that way. It is still income.
▶ 0:48:28Sen. Whitehouse: You are still spending it. That is the way your role works. We can do that. Remember the day when biden at the state of the union said no benefit cuts to social security? The whole room stood up. Standing o. Unanimous bipartisan applause. Well if we are still there, the matter is really simple. If you don't cut benefits, you got to add revenue. Where would you want to go for revenue?
▶ 0:48:58Sen. Whitehouse: Why not to the highest income people who are not paying into it now beyond what an ordinary nurse or plumber would? It does not make any sense. Why would you reward people for dodging their income through corporate screens so they don't have to count it as payroll. They bring it in other ways. This should not be hard. This should not be hard.
▶ 0:49:23Sen. Whitehouse: And the first step frankly is going to be our republican colleagues put up or shut up. Give us a plan. If you don't have one, let's have a vote on hours and you can vote on that. Multiple democrat senators have put out plan after plan that will make social security solvent.
▶ 0:49:48Sen. Whitehouse: Might actually make social security and medicare solvent for 75 years, as far as the eye can see a cord into social security and the cms actuaries. We can do this. It is lying there right in front of us. It is just a question of political will. And some people not wanting to own what they want to do to social security. That is our problem. Thank you, chairman.
▶ 0:50:10Chair Crapo: Thank you, senator whitehouse. Before I go to the witnesses, I have to make one clarification. This notion that republicans have not got any ideas or have not put up any plans is just flatly false. And the reality is for you got here, senator whitehouse, senator warner and I were talking about a plan that I had put out with him and others before. We have done this over the years, and they are sitting here at this dais who put out plans. Let's not make this partisan.
▶ 0:50:40Chair Crapo: Let's get together and work on solutions. And then we can hopefully get to something we can put over the finish line and pass.
▶ 0:50:49Sen. Whitehouse: Mr. chairman, I am offer solutions, but I think they have to actually be solutions and not commissions and sort of work projects that don't actually have a solution in them. I think a lot of that stuff is just another way to hide what people want to do in terms of cutting benefits. >> Mr. chairman.
▶ 0:51:07Chair Crapo: The good news is since we are only voting on a bill today to get a process where senator whitehouse's bill could be the solution, I think he will endorse this. We are not voting on a solution today. We are putting on a process by which a bill such as senator whitehouse has offered or a bill like I and dick durbin offered can be considered. So that is a good thing, and I look forward to support for this bill.
▶ 0:51:34Chair Crapo: Thank you, senator cassidy. We can go on a lot up here. To our witnesses, it is time for you now. You can see there is a lot of emotion and intensity on both sides of the aisle here. I think that is actually a good thing because it shows that there is a lot of desire to get this issue addressed. We may still have our fights, but we want to get this fixed.
▶ 0:51:59Chair Crapo: That is why I'm holding this hearing and what I hope is coming out of this hearing, support from you with ideas and analytics and statistics to figure out what the plan should be. Let me -- before I ask you to begin give a brief introduction of our witnesses. Our first witness will be Mr. goldwein, the senior vice president and senior policy director at the committee for a responsible budget.
▶ 0:52:29Chair Crapo: Prior to joining the committee for a responsible federal budget, Mr. goldwein served as the associate director of the national commission on fiscal responsibility and reform known as the ball simpson commission, which I referenced and served on. And senior budget analyst on the committee on deficit reduction, also known as the super committee. Dr.
▶ 0:52:52Chair Crapo: Blahous is the fish and smith chair and senior research strategist at the mercatus center. Dr. blahous specializes in domestic economic policy and retirement security with an emphasis on social security. As well as federal fiscal policy, entitlements, and health care programs. He is the author of "social security, the unfinished work." Dr.
▶ 0:53:19Chair Crapo: Blahous worked as a public trustee for social security and medicare from 2010 through 2015. Miss leamond is the executive vice president and chief advocacy and engagement officer at aarp, where she has directed several notable advocacy campaigns for aarp among other achievements.
▶ 0:53:42Chair Crapo: She also oversees aarp's public outreach and education initiatives as well as state and local advocacy and community engagement across all 50 states, the district of columbia, puerto rico, and the U.S. virgin islands. Miss vallas serves as chief executive officer of the national academy of social insurance.
▶ 0:54:05Chair Crapo: Previously, she was a senior fellow at the century foundation where she founded the organization's disability economic justice work and launched a national campaign to modernize supplemental security income. We will begin with Mr. goldwein 's opening statement, followed by Dr. blahous, miss leamond, and then miss vallas. Mr. goldwein.
▶ 0:54:26Mr. Goldwein: Thank you. Members of the finance committee, thank you so much for inviting me to testify here on this incredibly important issue. Social security is the bedrock of america's retirement and disability support system, providing vital benefits to 70 million americans. But social security's retirement trust fund is in crisis. In just six years, the retirement program is projected to be insolvent. That is not far off.
▶ 0:54:52Mr. Goldwein: It is when today's youngest retirees turn 68 and when the next class of senators finish up their first term. At that point, the law calls for a 22% benefit cut, the equivalent of $500 per person each month. Congress could of course change the law using general funds to cover social security's financing gap, but that would entail borrowing an additional $190 trillion over the next 75 years. That is the equivalent of 165% of gdp on top of what we already owe.
▶ 0:55:22Mr. Goldwein: That additional borrowing would stifle economic growth, balloon interest rates, and very likely send the country into a dangerous death spiral. Paying out of the general fund would -- fortunately, there are a number of well-known solutions to secure social security without sparking a financial crisis. Proposals to enact progressive benefit reforms, increase the payroll tax maximum, or address the age should be part of any solvency package.
▶ 0:55:55Mr. Goldwein: My organization has been developing novel solutions including imposing a $100,000 cap on the amount of benefits a couple can collect, including broadening the employer payroll tax base, capping the rich seniors, and I could go on. The challenge before washington today is less about what to do to save social security and more about how.
▶ 0:56:17Mr. Goldwein: Based on my research and my personal experience, I hubba suggest you task a commission, council, or is s report to help facilitate an agreement on a solvency package before it is too late. This approach would not be new for social security. Actually, all major legislation, all of the major laws passed were helped with an outside commission or council. The original social security act came from a committee.
▶ 0:56:44Mr. Goldwein: Major legislation in 1939, 1950, 1972, 1977, they all came out of the work of social security advisory councils, the predecessor to today's social security advisory board. In the landmark 1983 reform which brought as 50 years of solvency. When it comes to social security, these processes are the regular order.
▶ 0:57:14Mr. Goldwein: Of course, they do not remove elected officials from their important roles and response abilities in the legislative process -- responsibilities in the legislative process. They established a safe space to develop and consider options, trade-offs, and compromises. Over the years, congress has established hundreds of commissions, advisory councils, and other groups focused on all sort of topics. Many fail, but many succeed. And success takes all different forms. In the case to consolidate military bases, congress enacted recommendations in full.
▶ 0:57:45Mr. Goldwein: For the greenspan condition, that served as a venue for negotiations between president reagan and speaker tip o'neill. The 9/11 commission meanwhile developed recommendations that congress and the president implement it piecemeal based on their own policy judgment. I was lucky enough to serve on two of these countries, including working with chairman crapo and your colleague senator durbin on the commission back in 2010. Our commission developed a plan to stem the growth of the debt and restore permanent solvency to social security.
▶ 0:58:14Mr. Goldwein: 11 of 18 of our members supported these recommendations. Even in this body, that would be if filibuster for a super majority. Unfortunately, our recommendations were not enacted in full into law as part fiscal policy and newly culminated in a bargain three different times. Members took the time and built shared trust and understanding.
▶ 0:58:41Mr. Goldwein: As chairman crapo cleared up before, the relationships built in that commission were a very big part of the success. Of course, all sides had to comprise, but they did so in the spirit of securing our nation's finances and saving social security for generations to come. I want to close real quick by quoting the late senator tom carper, who set this right before he voted for the recommendation, which he declared he hated half of it. All republics fail, he said. They all fail over fiscal issues.
▶ 0:59:11Mr. Goldwein: The way we cheat history is for all of us to give up something. He continued, so we create a future with a great sacrifice before us. Thank you.
▶ 0:59:21Chair Crapo: Thank you very much.
▶ 0:59:23Dr. Blahous: Thank you, chairman crapo, ranking member wyden, all the committee members. I would like to make four point in my oral remarks based on my written statement. First, social security solvency matters. There is a reason social security benefits are so reliable and that americans do not regard them as welfare. When you get a job, you pay social security payroll taxes.
▶ 0:59:48Dr. Blahous: These dedicated taxes are accredited to special trust funds whose sole purpose is to finance social security allegations. These funds cannot spend big the revenues they collect. Your benefit is a mathematical function of your earnings that were taxed. All of this enables workers to say to elected officials we earned these benefits, paid for these benefits. You cannot arbitrarily take them away. There is a price for that unique security and strength.
▶ 1:00:16Dr. Blahous: It only works as long as lawmakers align benefit schedules with that worker contributions can finance. This is sometimes -- this has sometimes meant increasing tax collections, modifying benefit growth. If we are no longer willing to do such things, we cannot have this type of social security system anymore. We can have a social security system but a very different one with benefit levels disconnected from individual contributions. Workers can no longer assert they paid for their benefits.
▶ 1:00:44Dr. Blahous: Social security's bipartisan advisory councils for decade repeatedly warned do not let that happen. Keep the system self financing and solvent for social security had to compete each year with the general budget, the unique liability of its benefits would be lost. Second, speed is essential. Just like a patient facing a potential lethal condition, the longer treatment is delayed, the weaker the prospects for success.
▶ 1:01:11Dr. Blahous: The current situation differs dramatically from the one in 1983. This time, there is not a luxury until waiting -- there is not the luxury of waiting until the trust fund is nearly depleted. The shortfall then equaled 19% of future benefit claims. Just 10 years later, this year's report found it equals 30% of future benefit claims. By the time the trust fund faces depletion in 2032, it is clearly too late. At that point, even if new teams were completely cut off, the trust fund would still run out.
▶ 1:01:43Dr. Blahous: We are rapidly passing the point of no return past which it becomes impossible social security's historical design can be retained. Third, whether a solution holds depends on the analysis done while developing it. The 1983 reforms were a huge achievement but began unraveling all must immediately. The 1985 report again shown a significant shortfall, which then more than quintupled and became bigger than the one just addressed, all within a decade.
▶ 1:02:11Dr. Blahous: This happened because the greenspan commission relied on estimates of how much each commission would approve things -- provision would approve things every five years. This problem was recognized as the reforms were going into effect but it was too late to go back and fix. Afterwards, social security's actuarial methods were improved. They now run two important tests, the average balance over 75 years and the average value through the end.
▶ 1:02:42Dr. Blahous: If you go through the ordeal of hammering out a solution, the lasting you want is for the next year's report to say the problem is back. To prevent that community to make sure your plan passes both test. While my testimony outlines why the trustees take a 75 year view, a 50 year view can work provided both of these tests are passed. Fourth, both the process and product need to be bipartisan.
▶ 1:03:04Dr. Blahous: Since the shortfall reemerged, there have been 50 different years where one party or the other has controlled both the legislative and executive branches. If either party can do this without the other, it would have been done by now. The 1983 experience is instructive about how key lawmakers can be brought into a bipartisan negotiation. Most influential senators from both sides were on the 1983 commission. House leadership was actively represented. And the white house participated in the negotiations.
▶ 1:03:32Dr. Blahous: The commission contained enough outside experts to provide substantive cover. The reasons we need cup or miser not just political. They are mathematical. There was once a time the shortfall was the size it could realistically be fixed solely with additional revenues, slowly by slowing down growth, or by changing l ability ages. That time has long passed.
▶ 1:03:53Dr. Blahous: Maybe there are members of congress willing to increase tax burdens by the necessary one third or to cut future benefit claims by 30% across-the-board, but until congressional leadership can deliver the votes to enact one extreme or another, we should assume a company should've of less extreme measures will be necessary. I will close by commending the committee for holding this hearing and exploring ways forward. The american public will be well served if this results in an extension of social security solvency. Thank you.
▶ 1:04:22Chair Crapo: Thank you very much. Miss leamond.
▶ 1:04:27Ms. Leamond: Members of the committee, thank you for the opportunity to testify today. Good morning. It is a pleasure to be with you, and I want to begin by applauding this committee for coming together across party lines to talk about social security's future.
▶ 1:04:43Ms. Leamond: Aarp probably represents republicans, democrats, and independents, all of whom see story after story about partisan division we know this work as hard, and already in congress, aarp has endorsed more than 130 bipartisan bills to support family caregivers, to lower prescription drug prices, to crack down on fraud, and to strengthen social security's customer service.
▶ 1:05:09Ms. Leamond: For nearly 91 years, social security has been one of the most enduring promises in american history. Work hard. Contribute throughout your career. And retire with a foundation of financial security. Today, that promise supports 71 million americans with nearly 185 million workers paying in with every paycheck. Our message today is simple.
▶ 1:05:37Ms. Leamond: Protect and strengthen social security without cutting the benefits americans have earned through a lifetime of work. And do this in congress through regular order in full view of the american people. Because social security is far too important to be rushed, outsourced, or decided behind closed doors. At aarp, we hear every single day what social security means to our members.
▶ 1:06:03Ms. Leamond: Members like lee from oregon, who worked his entire life, and then came his wife's medical crisis. Lee told us if it were not for social security, we would be homeless. Lee is not alone, and I know you hear from lees back home all the time. 43% of older households rely on social security for more than half of their income.
▶ 1:06:30Ms. Leamond: At a time when 37% of older adults say they feel financially insecure. Women in particular rely more on social security because they often spent fewer years in the workforce, earned her lifetime wages, and live longer. Put simply, when social security is secure, millions of families are more secure, and so was our economy. Social security supports $2.6 trillion in economic activity every year.
▶ 1:06:59Ms. Leamond: And many forget the benefit reductions enacted in 1983 are still being phased in today. To put those reductions in context for someone retiring today, those changes have already reduced their social security by an average of nearly 19%. All the while future generations are likely to rely on social security even more.
▶ 1:07:23Ms. Leamond: Private pensions have mostly vanished, and about half of our workforce has no employer-sponsored retirement plan. 42% of americans age 50 plus who are not yet retired have less than $50,000 in retirement savings. All of this means social security will remain essential for many years to come. That is why 81% of older americans across party lines reject cutting social security benefits to save it.
▶ 1:07:55Ms. Leamond: So our message is straightforward. Do not cut social security the people have earned. And to be clear, there is work to do. The question for us today is not whether to act. It is how congress acts. The history of special commissions is littered with very good intentions and failed results that typically lacked the clout, power, and jurisdiction to do this hard work. Social security's future belongs at this table before this committee.
▶ 1:08:26Ms. Leamond: This committee has the jurisdiction, clout, and a 90 year history of solving hard social security problems. And hearings like this one are exactly what will lead us from discussion to action. We are confident that congress can get the job done through regular order because you have done it before. Aarp does not oppose action. We want congress to act sooner rather than later.
▶ 1:08:52Ms. Leamond: And we bring with us the voice of a vast majority of americans who want this promise kept without cats. We want to partner with you in lifting these voices up. Many of you have joined us for tele townhouse or events. I hope we can do more of those with you and bring this vitally important dialogue to more americans in your states. We look forward to your committee -- we look forward to working with your committee through regular order to get this done. Thank you very much.
▶ 1:09:20Chair Crapo: Thank you. I appreciated working with you in the past and continue to appreciate working with you on this.
▶ 1:09:27Ms. Vallas: Members of the committee, thank you for the opportunity to testify today. I have the privilege of serving as the chief executive officer of the national academy of social insurance. This year as our nation celebrates 250 years of american democracy, we are celebrating the simple but profound idea that lies at its heart, that government exists to serve the people and that those entrusted with public office are stewards of institutions that belong not
▶ 1:09:58Ms. Vallas: To any one political party, but to the american people as a whole. Few institutions better embody that idea than social security. 91 years ago this month when president lincoln roosevelt signed the social security act into law, he called it a cornerstone in instruction which by no means is complete. I always loved the words of fdr's because it reminds us social security has never been a finished project.
▶ 1:10:28Ms. Vallas: It is a living excursion of our democracy and how we show up for one another when it matters most. I believe that is exactly the responsibility this committee today has and in the chapter ahead needs to work on together. I will offer three brief points today. First, social security is the cornerstone of economic security in america, as you heard from everyone who has already spoken.
▶ 1:10:53Ms. Vallas: And while social security is appropriately celebrated for reducing poverty, the academy's research fairings it is foundational -- finds it is foundational to retirement and disability security all the way across the income spectrum. Virtually all americans say social security will be important or very important to their retirement income. Just 4% of americans say it will not at all be important to them in retirement.
▶ 1:11:17Ms. Vallas: Likewise, just 2% say it would not be at all important if they experience work limiting disability. Second, at a time of great division on so many issues, the american people are remarkably united around what they want for social security's future.
▶ 1:11:34Ms. Vallas: The academy's national survey research which we conducted with aarp and others finds that more than three and four republicans, more than nine in 10 democrats, and more than eight in 10 independents want lawmakers to strengthen social security's revenue base to protect its critical benefits.
▶ 1:11:54Ms. Vallas: Americans across party lines, income, education, and generations support starting by reforming the payroll tax cap for higher earners and are also interested in looking to other sources of wealth and income that have increasingly escaped social security's financing structure as the economy has shifted. Critically, americans do not see solvency and benefit adequacy as competing goals.
▶ 1:12:20Ms. Vallas: 82% prefer a package that both closes the long-term financing gap and as my testimony notes makes targeted improvements that better reflect the realities of modern life. My third and final point is this. Social security belongs to the american people. That means the process this committee adopts to address social security's finances is just as important as the policy choices themselves.
▶ 1:12:50Ms. Vallas: Commissions and expedited legislative procedures are not inherently good or bad. But any process to shape the future of a program as important as social security should strengthen, not weaken the connection between congress and the will of the people it serves. A process that limits public debate or makes it easier for elected officials to distance themselves from the outcome risks doing the opposite. On many issues, democratic governance is difficult because the american people themselves are deeply divided.
▶ 1:13:21Ms. Vallas: But social security is different. The american people are remarkably united about what they want for the program's future. Strengthen its revenue base to protect benefits and expand protections for groups being left behind. In other words, on this issue, the american people have already answered many of the biggest questions. That means congress's task is not to find ways around the american people. It is to listen to them.
▶ 1:13:48Ms. Vallas: Social security is not just a government program, and it is not simply a math problem to solve. It is part of the fabric of american life relied upon today and counted on tomorrow by americans across income levels, party affiliations, and generations. As we celebrate 250 years of american democracy, there are few responsibilities of greater consequence than faithfully stewarding a program that belongs to the american people.
▶ 1:14:17Ms. Vallas: And the academy stands ready to support this committee as it undertakes this important bipartisan work. Thank you for having me as part of this critical conversation.
▶ 1:14:24Chair Crapo: Thank you, miss vallas
▶ 1:14:28Chair Crapo: Thank you for your testimony and to our entire committee. I'm going to start with Mr. gold wine. I want you to listen to this question if I don't get to you in my brief five minutes, because I would like you to respond to it in writing if I don't get to you. It gets to the core issues that has been discussed between my colleagues today and was discussed by each of you. It has been mentioned by me and Mr. gold wine -- Mr.
▶ 1:14:55Chair Crapo: Goldwein that I was part of the balls-simpson commission. I was also part of the gang of six. The bowl-simpson commission was appointed by president obama. The gang of six was a group of six senators who got together and said, we are going to help the commission get over the line.
▶ 1:15:24Chair Crapo: But there has been some very difficult issues raised here today. That is, what is the value of a commission? There are those on our panel who said, this is congress' responsibility. And I find myself the chairman of that committee that deals with it. I am a former member of a commission, but I am now the chairman of a committee that deals with it and has the jurisdiction to deal with it.
▶ 1:15:56Chair Crapo: I would say to you all, when we were trying to get the bowl -simpson commission past. , after we put forward a product, a lot of my colleagues said, that is great, but it wasn't a part of it and it wasn't done through the process we do to make law here in the united states.
▶ 1:16:20Chair Crapo: One of the issues we ran into was getting by and because they did not have a part in the process and thought they were elected to be part of that process. There is some competing pressures here, and I see it from both sides.
▶ 1:16:40Chair Crapo: The question I had is, I understand the notion that this committee and the appropriate committee in the house, and the congress and the president, are the ones who should make these decisions. This committee is the place where these decisions should be crafted. In the past partisan politics have stopped this. And so, the idea of, let's get a commission to do the job, has come up.
▶ 1:17:09Chair Crapo: There is some merit to that notion. If we won't do our work, then let's get some advisors out there to put public pressure on us with ideas. My question to you is, how do we address this competition of concerns?
▶ 1:17:28Chair Crapo: Is a commission simply a bad idea, or is the way a commission operates, does it need to be handled in a way that fully recognizes and involves the congress in the outcome of its proceedings?
▶ 1:17:46Mr. Goldwein: Thank you for your question. We call it the simpson-bowles commission. To avoid people calling it the bs commission.
▶ 1:17:55Chair Crapo: I will try to say that, but it is hard for me to change.
▶ 1:17:59Mr. Goldwein: Of course this is congress' job. With these committees, advisory -- advisories do, is help congress. That is what they have done through every major piece of legislation. These commissions create a single mission. The committee is dealing with all sorts of things. Our mission is to solve social security solvency, to get the deficit to a certain percentage of db's -- gdp.
▶ 1:18:30Mr. Goldwein: They create an opportunity for trust-building. And ultimately I think they engage the public. The simpson-bowles commission did more to engage the public on fiscal policy than all of the committee hearings done by the finance committee over the previous 10 years combined. I think these commissions are important not as a replacement of the committee's work, but to support it.
▶ 1:18:50Chair Crapo: Thank you. I've only got 35 seconds left, so I'm not going to ask each of the rest of you to respond in this meeting. But I would ask you to respond to me on this. You will get some questions from the record from other senators, and please take this as mine for you. How do we address this issue? In the end the reason simpson-bowles did not get over the finish line is this issue.
▶ 1:19:17Chair Crapo: The question of whether it was done in a way that got the buy-in from the rest of the elected officials in congress. Senator wyden?
▶ 1:19:28Sen. Wyden: Thank you, Mr. chairman. I have questions for this channel -- this panel across the board as well. Let me start with you, Ms. leamond. What you say is you are safeguarding social security for the next generation is not just dollars and cents, it is about ensuring americans can live independently and with dignity. Is that what your members are saying?
▶ 1:19:49Ms. Leamond: Absolutely, and I mentioned lee from oregon, and I referenced I'm sure all of you when you meet with constituents hear similar stories. Lee was someone who had good savings. His wife ended up with a very serious illness and was in a situation where they were living on their social security benefit. The average benefit is around $2000 a month. May be a maximum of $4000.
▶ 1:20:19Ms. Leamond: We hear this all the time and we are hearing it increasingly, particularly as we enjoy the miracle of longevity. But at the same time, as people live longer they live with chronic diseases and we are finding that caregiving is taking more and more time and attention. That was the experience lee had.
▶ 1:20:39Ms. Leamond: We know as we talk to our members that they are struggling right now, and are really looking to all of us to come to a solution, to find a way to preserve social security so they can count on it. It is, as you have all mentioned, the bedrock of retirement security in the united states.
▶ 1:20:59Sen. Wyden: Let me turn to you, Mr. goldwein, and talk about the way the underlying economics of social security works and how it figures into what we are talking about today. Now, today working americans pay into social security straight out of each paycheck. But if you are wealthy and you have accountants and lawyers and the like you can use a bunch of tricks and loopholes to get out of paying anything significant.
▶ 1:21:25Sen. Wyden: For example, as if the already-low cap on social security is not a giveaway to the wealthy to avoid paying the bare minimum into social security, it seems to me as we get into this issue fairness is just absolutely essential in order to move forward in a constructive and bipartisan way.
▶ 1:21:51Sen. Wyden: So, my question to you is, do you think that raising new revenue and ensuring that sophisticated taxpayers can't dodge their social security taxes should be an important component of achieving solvency?
▶ 1:22:06Mr. Goldwein: Thank you for asking that, senator wyden. Many high income business owners reclassify their labor income as business income to avoid the payroll tax. That is a big deal for medicare right now and if you raise the capital would be a big deal for social security. It is definitely something we ought to address.
▶ 1:22:26Sen. Wyden: Do you think raising new revenue and ensuring sophisticated taxpayers cannot dodge social security ought to be the component of achieving solvency?
▶ 1:22:39Mr. Goldwein: I think it ought to be part of achieving solvency, yes.
▶ 1:22:43Sen. Wyden: So, now we have something significant on the table. Because I think members of this committee know that I have introduced legislation -- not a commission, but legislation to try to move in the direction of working with democrats and republicans around something Mr. goldwein has said he thinks makes sense.
▶ 1:23:06Sen. Wyden: And that is my billionaire income tax, which is a piece of legislation, black-letter text, with 22 members of the united states senate on this compromise. My sense is that what we are going to have to do is work together on legislation -- not commissions -- in order to deal with this issue and ensure that the seniors Ms. leamond has talked about, that Mr.
▶ 1:23:34Sen. Wyden: Blahous has been eloquent about as well, we are going to have to find a way to deal with the revenue question, and I have introduced legislation that starts us in the right direction. Mr. goldwein has said -- and he comes from some different perspectives -- that that is going to be important. And I think we ought to get going and can -- going in terms of legislation, where we do at the finance committee has historically been all about.
▶ 1:24:04Sen. Wyden: The sooner we do it, the better. I yield back.
▶ 1:24:08Chair Crapo: Thank you, senator wyden. Next will be senator cassidy.
▶ 1:24:13Sen. Cassidy: Thank you all. Ms. leamond, do your 38 million members, would they like to have a social security system that was fully funded and without the threat of a 28% benefit cut?
▶ 1:24:31Ms. Leamond: No, they do not want to benefit cut.
▶ 1:24:35Sen. Cassidy: What I'm saying is, what they like to avoid that and would they like to have a social security program fully funded?
▶ 1:24:43Ms. Leamond: Yes.
▶ 1:24:44Sen. Cassidy: Is aarp developing a plan to do this?
▶ 1:24:49Ms. Leamond: Aarp has not endorsed --
▶ 1:24:52Sen. Cassidy: Are you developing a plan to do so? Is aarp developing a plan to address it?
▶ 1:24:59Ms. Leamond: We are not developing our own plan at this time.
▶ 1:25:02Sen. Cassidy: That said, let me ask you. The objection you seem to have with what we are considering today, which is merely setting up a process so that senator wyden's plan, senator whitehouse's plan, senator cassidy's plan would be considered. It doesn't say one of those is going to be the final solution, it just says we are going to consider them. We are setting up a process.
▶ 1:25:33Sen. Cassidy: Now, you object to this. It seems you object because we are bringing in the social security actuary boards. If the social security actuary board was not involved, but it was just a working group of representatives and senators, bipartisan, having open meetings in which the product or products would be brought back to this committee and ways and means to be rejected, accepted, or be
▶ 1:26:03Sen. Cassidy: Completely replaced with senator wyden's plan, for example, would you object to that process?
▶ 1:26:08Ms. Leamond: We would support any effort of groups of senators, bipartisan senators coming together to come up with a plan. We have had --
▶ 1:26:19Sen. Cassidy: So, if what we do is take out the social security actuary board and set up -- again, just to repeat this, because this is doable -- a bipartisan group of senators and representatives starting now to consider all of the plans -- and maybe bring senator whitehouse' is plan up, and maybe bring in cassidy and durbin for this committee to consider, aarp would support that?
▶ 1:26:44Ms. Leamond: We would certainly want to talk with you about --
▶ 1:26:47Sen. Cassidy: No. Because the rope a dope is, we want to talk to about it. I'm trying to meet you where you are. If you don't like the actuary board and we want to tell lee that she is not going to have a 28% benefit cut -- you spoke movingly of lee. Right now she is going to get a benefit cut if we do nothing.
▶ 1:27:12Sen. Cassidy: If you are objection is the involvement of the social security actuary board, and instead we have a group of public meetings bringing something that is -- to this table which would be accepted or rejected, would you accept that process bill?
▶ 1:27:24Ms. Leamond: We are seeking regular order, and what you have described sounds to me like regular order.
▶ 1:27:31Sen. Cassidy: That would be regular order. Bringing it back to the committee would be regular order and then it would be considered by this committee, and then on the senate floor. So, you could accept that?
▶ 1:27:42Ms. Leamond: If it is regular order, which is what it sounds like, yes. We object to a commission, and would very much like the senate finance committee, ways and means committee, bipartisan, bicameral to come together and both you, -- view the many proposals that exist -- many of which are bipartisan, some of which are not. As the chairman said, look at the various ideas that are out there, debate them.
▶ 1:28:11Sen. Cassidy: We may have common ground here after all. Really the point is, how do we review those proposals in a timely fashion? Because they have all been scored. In a timely fashion to bring them up here. Senator whitehouse wants a hearing and I want him to have a hearing. We are discussing today is a process. I would at some point move that we modify that which is before us, and I am willing to take out the social security actuary board, as people keep on objecting to commissions.
▶ 1:28:43Sen. Cassidy: And come together as bipartisan, bicameral to review the solutions. And, by the way, if the proposal they come up with is a stinky proposal -- I'm a gastroenterologist, he comes to mind -- we can do wide ends. -- wyden's. And they will get to have their day. There doesn't have to be benefit cuts. We are talking about a process by which to come up with a solution. There may be common ground here. Thank you, aarp.
▶ 1:29:14Sen. Cassidy: I yield.
▶ 1:29:15Chair Crapo: Next is senator whitehouse.
▶ 1:29:19Sen. Whitehouse: Thanks very much, chairman. Mr. goldwein, does my medicare and social security fair share act do the job? Of making social security actually solvent for as long as the actuaries can see?
▶ 1:29:37Mr. Goldwein: The social security and medicare actuaries score your plans solvent. Pretty darn close, at least.
▶ 1:29:45Sen. Whitehouse: Against the existing baseline?
▶ 1:29:48Mr. Goldwein: You are very close, I think.
▶ 1:29:51Sen. Whitehouse: Good to know that it actually will work. Ms. leamond, does aarp believe that benefits need to be cut in order to protect social security solvency?
▶ 1:30:01Ms. Leamond: No.
▶ 1:30:02Sen. Whitehouse: Say again?
▶ 1:30:04Ms. Leamond: Aarp does not believe benefits should be cut.
▶ 1:30:09Sen. Whitehouse: Ms. vallas, you have taken a look at my bill? How would you comment on the fairness of the tax proposals that raise the revenue that allow social security the solvency that Mr. goldwein mentioned, without the benefit cuts that Ms. leamond opposed?
▶ 1:30:33Ms. Vallas: It is important to also understand the economy that we have today is not the economy we had in 1983, and certainly not the economy we had in 1935. Or of high earners' and now comes from sources that are outside of social security's traditional financing structure, as you mentioned in your statement.
▶ 1:30:59Ms. Vallas: Investment income, pass-through income, all of these are escaping social security, if you will. Along with reforms to the payroll tax cap, which have also been mentioned today, there is a strong economic case in addition to it being part of what the american people are interested in this body exploring, for starting to look at other types of revenue options and broadening that revenue base, and I think it is important for this committee to start having that conversation.
▶ 1:31:24Sen. Whitehouse: So, you would approve of it as a revenue proposal?
▶ 1:31:28Ms. Vallas: The academy does not take positions on individual pieces of legislation, but the american people are interested in you starting to explore that idea.
▶ 1:31:37Sen. Whitehouse: Thank you very much.
▶ 1:31:39Chair Crapo: Senator hassan. Senator johnson. Support johnson Mr. blahous --
▶ 1:31:52Sen. Jones: And -- Sen. johnson: Mr. blahous, have you seen table one? >> my issue is that it assumes we pay full schedule benefits without collecting the payroll taxes to do it. It exaggerates the actual rates of return from social security. The one that is figured on the basis of what social security would pay is table three. The basic qualitative story is the same.
▶ 1:32:23Sen. Johnson: There is 220 different income levels. When you are born. People get hosed most, they get $.59 on the dollar and people who benefit most get $4.78 on the dollar.
▶ 1:32:41Sen. Johnson: In your testimony you are talking about the grand design of social security was we are going to force you to save for your retirement and then invest that money and get returns on it, then return to you, you know, your savings and retirement, correct? It was not a welfare program, it was literally savings returned to you, we will hold it in our care, custody, and control, correct?
▶ 1:33:05Mr. Blahous: Correct. I think there is a really important story to tell, qualitative point to make based on that table and your previous remarks, which is that the earliest recipients of social security did not pay for benefits. They were given benefits they didn't pay for.
▶ 1:33:24Sen. Johnson: I'm trying to define the problem here, because we just mystify it all the time. The problem is $40 trillion in debt. I don't know where you get your $190 trillion, but, ok. If you don't take it out of the general fund you are going to have to increase people's taxes 190 trillion dollars in these scoring's. In these actuaries, do they consider the dynamic impact of that? The dynamic economic impact?
▶ 1:33:54Sen. Johnson: >> you are asking me?
▶ 1:33:56Mr. Goldwein: 190 trillion dollars is what we would have to borrow if we wanted to close the entire gap.
▶ 1:34:02Sen. Johnson: Which means you would have to tax people.
▶ 1:34:04Mr. Goldwein: All we could adjust benefits.
▶ 1:34:07Sen. Johnson: Do they consider the dynamic impact of that? Also the fairness? If you have high income earners getting $.59 on the dollar, you left cap on her earnings to raise $190 trillion, first of all that is the golden goose. Those people that take that money -- they didn't put it under a massive cash mattress, they invested and grow the economy, which is the number one component of a solution for all of these problems, particularly social security. We have to grow our economy.
▶ 1:34:38Sen. Johnson: So, let's not do anything that harms economic growth. Massive tax increases violates the premise of social security, right? Now all of a sudden for a dollar those individuals pay into the social security system they are going to get even a penny? So, you are turning it -- by doing it you are turning it into a welfare system, by and large. >> I would urge extreme caution before severing that connection.
▶ 1:35:04Sen. Johnson: That is the solution. The solution is, left the caps, completely violate the original premise of the social security system, and turn it into a welfare system. That is what they are talking about. Doing great economic harm.
▶ 1:35:19Mr. Blahous: And I would say change the political dynamics around the program. You have some people paying into the system without getting benefits and other people getting benefits they didn't pay for you are going to change.
▶ 1:35:32Sen. Johnson: I want to honor those promises. Here is the simple solution. Why don't we just get rid of that law that forced us to cut benefits and recognize the reality of what the true problem is? We are running to trillion dollars-plus deficits. You're going to be $62 trillion in 10 years. Start addressing that problem, because that is the problem that has to be -- we can come up with all of these half-baked ideas. The actuaries, this solves the problem. It doesn't solve the problem.
▶ 1:36:02Sen. Johnson: Until you address the fact that we are $40 trillion in debt and that is going to go off in our faces -- and also, you also have to recognize too, the gross mismanagement. Do you know -- have you ever done a calculation if we would have taken those surpluses and invested that in something that has value, like stocks? Have you ever done a calculation of how much money we would have in the trust fund right now?
▶ 1:36:28Mr. Blahous: Certainly there have been calculations done.
▶ 1:36:31Sen. Johnson: I want to redo that calculation. Last time it was a trillion dollars. Do you agree with me that a government bond in the hands of a government organization has no value?
▶ 1:36:42Mr. Blahous: It is internally held.
▶ 1:36:44Sen. Johnson: It is worthless, because when the trustees return that bond to the treasury to pay off those benefits the treasury has to float a new bond. I know I have run out of time, but if we are going to go through this process, let's recognize the reality of the situation. It's recognize how grossly mismanaged, how the american people work literally sold a bill of goods and now we are going to fix it.
▶ 1:37:12Sen. Johnson: And the fixing it is not going to be axing the crap -- taxing the crap out of high earners.
▶ 1:37:21Chair Crapo: Senator hassan.
▶ 1:37:23Sen. Hassan: Thank you for having today's hearing. Mr. goldwein, I want to start with a question to you about one in four granite staters who count on their social security benefits to make ends meet. Have to protect and strengthen social security for current beneficiaries and for future generations. And I want to be clear that I do not support cuts to social security.
▶ 1:37:54Sen. Hassan: Now, one way to strengthen social security -- and I have a different view on this, obviously, then senator johnson does, is to make sure americans contribute the same share of their income as working americans do. The payroll tax only applies to earnings up to around $185,000. So, how would raising or eliminating the tax cap strengthen the solvency of social security?
▶ 1:38:22Mr. Goldwein: Thank you for your question, senator hassan. Obviously the answer depends on how much you raise it and whether you pay benefits. If you were to eliminate the cap you could close in the neighborhood up half of the 75 year shortfall and 40% of the long-term shortfall.
▶ 1:38:39Sen. Hassan: At a time when our deficit has been drawn up -- driven up by extraordinary tax cuts to the wealthy this is one way to address the solvency issue without harming the benefits for recipients?
▶ 1:38:57Mr. Goldwein: It is one way to help get the solvency, yes.
▶ 1:39:00Sen. Hassan: Thank you. This le monde, scammers are becoming more sophisticated in using technology to steal people's hard earned retirement savings. According to the fbi in 2025 scammers stole about 7.7 billion dollars from seniors, a 30% increase from 2024 just in one year.
▶ 1:39:24Sen. Hassan: I have appreciated aarp's support for improving social security's victims of identity theft act, which is a mouthful. We are trying to do is make sure when a social security recipient's identity has been stolen they have a single office to go to and the social security administration has dedicated somebody to this work.
▶ 1:39:47Sen. Hassan: So, this is a bipartisan bill that I co-lead with senator grassley to get victims help in difficult situations. In addition to getting the bill across the finish line, what steps should congress take to support beneficiaries who become led -- who become victims of identity theft?
▶ 1:40:05Ms. Leamond: Thanks to you and senator grassley for your leadership on this important issue. Unfortunately, my portfolio on fraud and scams is the fastest-growing I have. They are simply on ending, and we want to be sure that social security administration is able to provide the kind of support you have described. As you probably know, we have a fraud watch network line where people call in. We have hundreds of calls every week from people who have been victims of scams.
▶ 1:40:36Ms. Leamond: And we want to provide the kind of support we are giving, but also have federal agencies, the social security administration provides similar kinds of support. I mentioned in the beginning we have supported a number of bipartisan bills in the congress this year to deal with this tremendous problem of scams and fraud, and we appreciate the leadership.
▶ 1:40:58Sen. Hassan: I look forward to continuing to work with aarp on some of those efforts and seeing what we need to do to support them. Last question is to you, Ms. vallas. Can't talk about retirement security in a vacuum. Seniors are having a harder time today affording everyday expenses. Between soaring information -- inflation and the president's failed economic agenda social security benefits are not going as far as they used to.
▶ 1:41:29Sen. Hassan: How are increased costs impacting retirement security?
▶ 1:41:30Ms. Vallas: It is such an important question, and thank you for connecting those dots. Social security is part of that. For most americans retirement security is not some abstract concept. It is about whether they can afford the basics. Their housing, their groceries, their prescription drugs, their health care, their long-term care.
▶ 1:41:54Ms. Vallas: These are the things we hear when people say what social security makes it possible to be able to afford, but also how social security does not go as far as it might need to. It is not just why social security is so important, but part of why it was unsurprising in the academy's survey research we found huge popularity for having a more accurate cost adjustment and huge unpopularity for a slower cost-of-living adjustment that would make that affordability crisis harder for seniors.
▶ 1:42:24Sen. Hassan: Thank you very much for your expertise and testimony.
▶ 1:42:27Chair Crapo: Senator warren. You are up. [laughter]
▶ 1:42:36Sen. Warren: All right. So, thank you, Mr. chairman. Social security is a promise. You pay in, year after year, and then when you needed at the end it will always, always be there for you. But we have got six years now and have us before the social security trust fund faces insolvency. Meaning that retirees could see their benefits slashed by 22%.
▶ 1:43:08Sen. Warren: Congress needs to act to make sure that doesn't happen. This is why democrats are fighting to protect and expand social security benefits. Funded by the wealthiest americans paying their fair share. But so far congressional republicans like to pretend that the only solution is benefit cuts. And when they see how unpopular that is, they then try to pivot and say, let's set up a commission to make the cuts, because then maybe the voters won't blame the republicans for it.
▶ 1:43:38Sen. Warren: Now, Ms. leamond, your organization, aarp, represents millions of seniors. Right now they are seeing skyrocketing prices for everything from health care, to gas, to groceries. Ms. leamond, if social security checks already aren't keeping up with inflation, what happens if they are cut by 22%?
▶ 1:44:00Ms. Leamond: Well, senator, thank you for the question, and of course it would be devastating to our constituency. That 22% cut, if you get the minimum benefit, it is already $400. Think about that in terms of people and their daily expenses.
▶ 1:44:21Ms. Leamond: We are hearing more and more from our members not only about the kind of cost-of-living kitchen table economics right now, but also long-term as they think about social security.
▶ 1:44:31Sen. Warren: Look, here is a better idea. How about we make the wealthy pay into social security at the same rate that working families pay into social security? Right now the social security payroll tax is capped at $184,500. If you are a nurse or construction worker, you are paying social security on 100% of your income.
▶ 1:44:58Sen. Warren: If you are a corporate lawyer raking in millions, you are only paying social security on a tiny fruit -- tiny fraction of your income. That is not right. That is why senator moreno and I have called for congress to scrap the caps on payroll taxes.
▶ 1:45:14Sen. Warren: That one reform alone would impact about 6% of all households, the highest-earning americans, and would protect social security benefits for at least two decades. So, Ms. leamond, do you agree that securing benefits by scrapping the cap on payroll taxes would help seniors?
▶ 1:45:37Ms. Leamond: Well, you have described what we hear a great deal from our seniors, and in our position, which is, please don't cut benefits, we know we have to look for sources of revenue, and we hear all the time from people about, is it fair that I am paying on all of my wages, and somebody down the street isn't? Sometimes they use examples of people that work in nonprofits, even.
▶ 1:46:05Sen. Warren: There you go. That is not all we could do. While working-class families pay into social security every paycheck, wealthy investors take advantage of loopholes to avoid paying into the trust fund. For example, if you are an investor in a hedge fund you can pay yourself millions of dollars in profits each year without paying anything into social security. Ms.
▶ 1:46:34Sen. Warren: Vallas, you are an expert in social security and disability policy. Do you agree that securing benefits by closing these loopholes that are available pretty much for only wealthy investors would help seniors and americans with disabilities who rely on social security?
▶ 1:46:50Ms. Vallas: If those forms of revenue end up being looked at as solvency options we will see huge protection for people whose benefits would not be cut, including seniors and people with disabilities. Just to note, depending on how you structure it you could also end up seeing sufficient revenues to strengthen benefits from some of those folks who are not well-served. Something you and others have proposed as well.
▶ 1:47:17Sen. Warren: I really appreciate -- look, congress has a choice to make. Either we can decide to protect the top 6% of all earners in america and let the social security trust fund get into trouble, cut benefits for seniors, throw more seniors into poverty, war we can decide that everybody pays the same share and protect social security forever into the future. Thank you all for being here. Thank you, Mr. chairman.
▶ 1:47:51Sen. Wyden: Thank you, senator warden -- senator warren. Next up is senator grassley. We will get everybody in. We want to get senator sanders and senator cortez masto. We can do it all before the break. Senator grassley.
▶ 1:48:11Sen. Grassley: I apologize. I was across the hall with the judiciary committee nominees. So, I'm going to start with Mr. goldwein. For any social security reform proposal to succeed it will require the support of at least 60 senators. So, that means both parties working together to find a solution.
▶ 1:48:40Sen. Grassley: Outside of the 1983 commission are there examples of a commission or other special process that successfully sparked bipartisan cooperation and action?
▶ 1:48:52Mr. Goldwein: Thank you for that question. Committees often sparked bipartisan action. Every piece of social security legislation, the largest pieces, have been based on one of these committees. Most of them bipartisan. The 9/11 commission, bipartisan results I will also say simpson-bowles, although we did not get to the finish line, sparked a bipartisan conversation.
▶ 1:49:17Mr. Goldwein: 45 senators called for legislation based on simpson-bowles, including senator wyden, senator johnson, and many others who have since left. Absolutely, yes.
▶ 1:49:26Sen. Grassley: And Ms. leamond and Ms. vallas, based in your testimony I understand you both opposed any sort of commission-based process and instead you contend congress should address social security through regular committee and floor processes. I respect that view. I am open to any process that will facilitate the bipartisan cooperation that is necessary with an emphasis upon the word bipartisan.
▶ 1:49:56Sen. Grassley: What are some actions your groups are taking war plan to take to foster bipartisan cooperation and discussion of social security?
▶ 1:50:06Ms. Leamond: Thank you, senator grassley, and thank you for your leadership. We know you did a hearing in june. We hope we will see more and more discussion in the senate finance committee. As you know from our testimony, we believe the senate finance committee is where this should be debated, should be concerned, and where action should be taken. On our part we, as you know, have been very active across the country. We do town halls with our members.
▶ 1:50:37Ms. Leamond: You want to offer that to members of the committee. As you deliberate various proposals, we think that is going to be hugely important in terms of bringing people to the table. And not just our constituency. But, why don't we reach out to younger people? You know they have a tremendous stake in the future of social security. You want to work with you to bring people together, talk about various approaches, and move ahead. We do not support a commission.
▶ 1:51:05Ms. Leamond: Do support action by bipartisan leaders in the congress, the senate finance committee, house ways and means committee, and you can count on us being an honest partner all the way, both in our outreach to our constituency, and also in our deliberations about various policy approaches.
▶ 1:51:26Ms. Vallas: I will echo Ms. leamond in thanking you, senator, for the question, and your leadership. To answer on behalf of the academy, the national academy of social insurance does not take official positions on legislative procedures or individual pieces of legislation. We are not opposing or supporting the idea of a commission. But what we are doing to try to resource this committee in this important bipartisan work is asking the american people what they want this committee to do.
▶ 1:51:57Ms. Vallas: As I mentioned and as I lay out in my written testimony as well, democratic governance can be difficult on certain issues where the american people don't agree, but on this issue -- on social security -- the american people are very united and clear about what they want. So, our message to this committee would be, start by listening to the american people. They have done a lot of the hard work for you.
▶ 1:52:21Sen. Grassley: I see a lot of aarp ads on television. I've got a little bit of advice for you. But you are no different than a candidate trumpet and a president biden. They all ran on a platform, were not going to do anything about social security. And your tv advertisements are saying we are not going to cut social security.
▶ 1:52:49Sen. Grassley: I don't blame you for defending the program that way, but we've got to wake this entire nation up to fact that there is going to be a 20% -- 22% cuts if we do not do something right now. And you ought to spend some of your money waking up people to the fact that there is a crisis down the line and you say don't cut social security, but it is going to be cut automatically if you don't like the people of
▶ 1:53:19Sen. Grassley: This country up, and that is what I would advise you to do, because you've got a big voice.
▶ 1:53:24Sen. Wyden: Thank you, Mr. chairman. Senator lankford would be next, and then senator sanders, and we are going to be done.
▶ 1:53:33Sen. Lankford: Wherewith that be difficult?
▶ 1:53:36Sen. Wyden: Everybody is juggling.
▶ 1:53:39Sen. Lankford: Thanks for being here. This is a moment that we should talk about stabilizing the program, and the concern is that we all know in six years we have an insolvency issue. That red light on the -- has been -- on the dash has been flashing.
▶ 1:54:08Sen. Lankford: We have a conversation it becomes an issue of fear mongering that this is about taking benefits away. We are trying to get to a point that no one loses benefits. In fact, we stabilize the program long-term is the goal of this. But it is a real challenge to have a grown-up conversation to figure out, how do we resolve this? I am supportive of this committee to being able to pull together a nonpartisan commission made up of members to be able to make recommendations.
▶ 1:54:39Sen. Lankford: There are some members that spend a lot of time digging in on the issues of social security, and some that do not. I think it is beneficial to do that and allow their group to do the work, bring it back to the body, and have a vote. That is the way often these difficult challenges happen.
▶ 1:55:05Sen. Lankford: I was part of a small group that met with president obama years ago when the house changed over, and it was a republican house, democratic senate, and democratic president. It is well-known that hard issues are done when there is bipartisan differences in the white house -- house, senate, and white house pick -- house.
▶ 1:55:30Sen. Lankford: I sat down and said, this would be an ideal time to talk about some of these hard issues like this. His response to me in that private conversation, which I have talked about since then, was, I didn't campaign on this. This is not what I campaigned on, we are not going to work on this. It takes two to tango on this. You've got to have a white house income -- in congress that are willing to do this.
▶ 1:55:59Sen. Lankford: We need outside groups to contribute to this. Ms. leamond, thank you for the work you have done. If I could raise something to you, we need to have good, honest dialogue that the -- doesn't start with people being afraid that I'm going to go attack seniors. If I go on the aarp's website today, it says, tell congress, don't cut our social security.
▶ 1:56:26Sen. Lankford: Social security didn't cause the nation's debt, we paid for social security through our paychecks. Ever, some are calling for a commission that could cut social security in order to reduce our country's debt. This is outrageous. We won't let the lawmakers take the money we have earned over our lifetime. Contact your member of congress. What we are trying to do is have a conversation about how we stabilize this program. But what your entity is doing is telling people to call my office and say, stop talking about this. We should talk about this.
▶ 1:56:59Sen. Lankford: I should listen to senator sanders and his ideas on this. I should listen to senator wyden and his ideas on this. They should listen to mine. We've got to figure this out. But this is a message that says, don't let them talk about this. Six years from now we go insolvent. I have a great relationship with the aarp leaders in my stay. He keeps me informed. A terrific advocate for seniors and cash seniors in my stay.
▶ 1:57:26Sen. Lankford: But we need outside entities that say, please tell congress to sit down and have hard conversations to solve this, not don't talk. That is my concern on this. I would love to have a national ally on this as well, to say, let's figure this out. This committee is another way to do it. At the end congress still has to vote. The american people are going to be able to hear this out. Is that an unfair request?
▶ 1:57:52Ms. Leamond: We will meet you with that request. I believe that communication was geared toward a commission, which we do not support. We support the kind of bipartisan discussions to have in the finance committee and elsewhere, and work individual -- individually.
▶ 1:58:09Sen. Lankford: A commission would have bipartisan members. Including numbers of this committee. It is the way hard things have been done in the past.
▶ 1:58:18Ms. Leamond: We haven't supported commissions over a period of time, and also the fast track authority involved in that, believe -- believing that this is such an important issue it should be dealt with through regular order.
▶ 1:58:31Sen. Lankford: What is funny to me is, most pieces of legislation in the time I have been in congress, when the commission is at work I have to call somebody in one of the outside organizations because they see the text for idea -- before I do. There is a lot of outside conversations, so any work like that would not happen in a dark back room that is smoke-filled. I don't like smoke anyway.
▶ 1:59:01Sen. Lankford: It's going to be in conversation with outside groups. In order for people to being -- to be engaged. Let's solve this, not just discourage anyone from talking about it.
▶ 1:59:10Sen. Wyden: Senator sanders.
▶ 1:59:13Sen. Sanders: Thank you, Mr. chairman, and thank you, panelists, for being here. Senator lankford is right, we should work together and talk to each other, but I think in that we have to take a broad look at what is happening in our country today. What is the reality of american society today? I don't have to tell and betting on the panel that we have millions of seniors who are struggling.
▶ 1:59:42Sen. Sanders: We have about half of seniors trying to make it on $30,000 a year or less. One out of three are struggling economically. Unbelievably, senator lankford, something like 20% of seniors in america are trying to make it on $15,000 a year. That is unbelievable. I don't know how anybody survives on that. But in that reality of so many of our seniors struggling there is another reality that has to be placed on the table.
▶ 2:00:11Sen. Sanders: And that is, today we have more wealth inequality than we have had in the history of the united states of america. Remember the gilded age? Much worse right now. If you are going to talk about saving social security, you've got to throw that into the hopper. As senator warren was saying, legislation I have called the social security expansion act is not complicated. You want bipartisanship?
▶ 2:00:37Sen. Sanders: Republicans supported outside of -- support it outside of here, in the real world. Should elon musk pay the same percentage of his income -- he doesn't pay any -- into the social security trust fund as a fireman or nurse? Anybody think that doesn't make sense? Nobody does. The bottom line here is the people on top have never had it so good and seniors are struggling.
▶ 2:01:05Sen. Sanders: We've got to do what senior advocates for years have said. Lift that cap. Mr. chairman, if we do that, in 2023 the chief actuary of the social security and -- administration found we could extend the life of social security for 75 years. That is pretty good, senator lankford. We couldn't -- we could increase benefits by 2400 -- $2400 a year. So, we are doing two things.
▶ 2:01:37Sen. Sanders: And we do that without raising taxes by one penny on the 90% of americans who earn less than $250,000 it -- a year. That has got to be thrown into the hopper. You can't just talk about social security in isolation. Let me take a moment to ask a few questions to some of our panelists here. Please come a brief answer. I don't have a lot of time. Do you believe we should increase the retirement age? Ms. vallas?
▶ 2:02:05Ms. Vallas: Our research finds americans strongly oppose raising the retirement age.
▶ 2:02:11Ms. Leamond: No.
▶ 2:02:13Mr. Blahous: Yes.
▶ 2:02:15Mr. Goldwein: Yes, americans are living longer and raising the ages part of it conference a package to help people build more wealth.
▶ 2:02:24Sen. Sanders: I would just say in response to that, half of all the workers today have nothing in savings as they face retirement. Second question is, do you believe we should consider capping or reducing social security?
▶ 2:02:39Ms. Vallas: Our research finds that americans strongly oppose doing that.
▶ 2:02:43Ms. Leamond: We would oppose as well.
▶ 2:02:45Mr. Blahous: I am open to it.
▶ 2:02:47Mr. Goldwein: If the current inflation -- if we cap for the highest honors it is a smart -- idea that can extend solvency.
▶ 2:02:58Sen. Sanders: Ms. vallas, do you believe it is appropriate that elon musk, the wealthiest map -- man alive, pays the same amount of taxes in social security as someone who makes an hundred $84,000 a year?
▶ 2:03:12Ms. Vallas: Americans across party lines things that doesn't make a lot of sense, and I have in-laws in my family who supported this current president and the first thing they asked me when they found out when I do is, why hasn't congress dealt with the payroll tax cap yet?
▶ 2:03:29Ms. Leamond: We support looking at raising the payroll tax -- payroll tax.
▶ 2:03:38Mr. Blahous: I think a comprehensive bipartisan solution would require raising the cap.
▶ 2:03:44Mr. Goldwein: I think we should look at raising cap and also capping benefits.
▶ 2:03:50Sen. Sanders: Thank you all very much. Thank you, Mr. chairman.
▶ 2:03:54Chair Crapo: Thank you, senator.
▶ 2:03:58Sen. Cortez Masto: Thank you all for being here. The discussion tends to focus on two things. Cost savings and program efficiency. While it were not directly impact the trust fund company on proposal -- fund, one proposal is reforming the asset limits that prevent low income seniors and people with disabilities from building even modest savings.
▶ 2:04:27Sen. Cortez Masto: That is why I introduced with my good friend over there, senator cassidy, the ssi savings penalty illumination act. It would empower ssi recipients to work, save, and better plant -- plan for their future. Ms. vallas, can you explain how the act would improve the administration of the ssi program, and why it is important to include ssi in the broader conversation about strengthening social security?
▶ 2:04:55Ms. Vallas: Thank you so much for your leadership on this issue and I also want to say, everyone on this committee who has supported that piece of legislation, thank you for your leadership. The last time that ssi's asset limits were raised were 1984. That is the year I was born. It has been a minute. People are not able to save even modest amounts of saving, even $2000 for an end -- individual.
▶ 2:05:23Ms. Vallas: It is trapping people at a level where dignity is now within reach. That legislation would do -- and I should note our polling finds that more than two -- two thirds of americans across party lines support raising more eliminating ssi's savings penalties. When it would do is address what my colleague, jason fick near, who helped lead social security under president bush, has called the most progressive anti-savings policy in federal law.
▶ 2:05:51Ms. Vallas: It would be a win for the social security administration, because it would remove a burdensome role for them to actually run. This is a common sense thing that needs to be part of this conversation, as well as other long-out it'd rules in ssi that need to be updated, and I'm glad to see this committee start to pay attention.
▶ 2:06:14Sen. Cortez Masto: Ms. leamond, you would agree with that?
▶ 2:06:17Ms. Leamond: We support that as well.
▶ 2:06:18Sen. Cortez Masto: Congress has not acted on recommendations of a presidential commission since 1983. 1980 three. Americans want to know they can depend on the social security program, yet we have gone 43 years without solutions. What barriers have prevented congress from acting on solutions provided by commissions?
▶ 2:06:44Ms. Leamond: I think it is a very challenging issue and very hard to come together in a bipartisan way to address it. We are now at a point where I think we'll -- we all agreed that the time has come when it must be addressed. And our preference is not a commission.
▶ 2:07:06Ms. Leamond: It is to come with regular order to the senate finance committee, house ways and means committee, debates, review all of the perp -- the proposals. There are many proposals to make social security more secure.
▶ 2:07:20Sen. Cortez Masto: Those proposals are bipartisan, correct?
▶ 2:07:24Ms. Leamond: Pardon me?
▶ 2:07:25Sen. Cortez Masto: The proposals are bipartisan, correct?
▶ 2:07:30Ms. Leamond: Many of them are bipartisan within the congress. Some are not, but many are bipartisan.
▶ 2:07:36Sen. Cortez Masto: Thank you. Mr. goldwein, this year's trustee report cited hr one as one of three factors that increase to the actuarial deficit of the social security trust fund. This law accounts for 25% of this increase. The largest single-year change in actuarial balance in over 30 years. Mr.
▶ 2:08:04Sen. Cortez Masto: Goldwein, can you tell us what hr one has done to accelerate social security insolvency?
▶ 2:08:08Mr. Goldwein: One source of revenue for social security is the income taxation of benefits. I believe aarp supported a provision in the one big, beautiful bill that reduced taxation benefits by expanding the senior deduction. That means we are getting less money coming into the trust fund, which brings that crisis state even sooner.
▶ 2:08:32Sen. Cortez Masto: I thank you again. We need bipartisan solutions here. We've got to fix this, and that means working together. I know working to cap -- together, there is a lot of great ideas if we would just make this a focus and priority. I think you all for staying. I appreciate it.
▶ 2:08:53Chair Crapo: Thank you, senator cortez masto. We have a vote underway. I don't expect any other senators to show up before I wrap up the committee. I want to thank our witnesses for appearing today. With that in mind, I remind my colleagues that the deadline for submitting any questions for the record is 5:00 p.m. On wednesday, august 12. With that, the committee is adjourned.