Social Security: Where Newly Elected Speaker of the House Stands on Program Cuts, Retirement Age and COLA
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Vance Cariaga
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Daria Uhlig
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The U.S. House on Wednesday ended a three-week stalemate over who should lead the chamber, electing Rep. Mike Johnson (R-La.) as speaker in a vote that went strictly along party lines. While many of the early headlines focused on Johnson’s politics — including helping former President Donald Trump try to overturn the 2020 election — Social Security advocates zeroed in on Johnson’s support of policies to reform the program.
In a blistering press release issued soon after Johnson’s election, the left-leaning advocacy group Social Security Works called the incoming speaker an “enemy” of Social Security.
“Rep. Mike Johnson has a long history of hostility towards Social Security and Medicare,” Alex Lawson, executive director of Social Security Works, said in a statement. “As Chair of the Republican Study Committee from 2019-2021, Johnson released budgets that included $2 trillion in cuts to Medicare and $750 billion in cuts to Social Security.”
Bobby Kogan, senior director of federal budget policy at American Progress, backed that claim, writing in a post on X (formerly Twitter) that as chair of the RSC, Johnson “spearheaded budgets resolutions that called for ~$2 trillion in cuts to Medicare, $3 trillion in cuts to Medicaid+ACA, & ~$750 billion in cuts to Social Security.”
Also joining in the chorus was the MeidasTouch Network news site, which cited a 2018 speech Johnson gave to the American Enterprise Institute. In that speech, MTN reported, Johnson said he believed Social Security, Medicare and Medicaid “need to be cut” and would push for those cuts as the incoming chair of the Republican Study Committee.
According to MTN, Johnson “further revealed he believes the government may cease to exist if these programs continue to go on fully funded. After specifically naming Social Security, Medicare and Medicaid, Johnson said spending on entitlements is “absolutely a threat to our whole form of government.”
Johnson’s official website doesn’t include much about his specific policy positions concerning Social Security. However, the site does include a link to the Republican Study Committee’s fiscal 2020 budget, which Johnson spearheaded.
One of the chapters in the budget, titled “Make Social Security Solvent Again,” included a number of proposals to reform the program, which the committee said is “unsustainable in its current form.”
That latter statement was based on the fact that the Social Security Old Age and Survivors Insurance (OASI) Trust Fund is expected to run out of money in about a decade. When that happens, the program will be solely reliant on payroll taxes, which currently cover about 77% of benefits.
Among the reforms that the RSC proposed and Johnson supported are the following:
Raise the Full Retirement Age To Reflect ‘Longevity’
The current Social Security full retirement age is either 66 or 67, depending on your birth year. For anyone born in 1960 or later, the FRA is 67. The RSC budget proposes a gradual increase of the normal retirement age “at a rate of three months per year until it reaches 69 for those reaching age 62 in 2030.” It also said the increase “would need to be extended, likely to age 70, to achieve long-range sustainable solvency.”
Change the Way the Annual COLA Is Determined
Almost every year the Social Security Administration provides a cost-of-living adjustment (COLA) to account for inflation. The current formula is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which the RSC claims “overstates the true effects of inflation” and “contributes to the current program’s impending bankruptcy.”
The RSC recommends switching to what it says is a “more accurate index” called chained CPI-U, which it said “tracks the effects of inflation and consumer choice more accurately.” Doing so would put Social Security “on sounder financial footing and ensure that beneficiaries do not see their benefits eroded by inflation,” according to the RSC.
To be fair, even Social Security advocates recommend changing the COLA — but not to the chained CPI-U. As previously reported by GOBankingRates, The Senior Citizens League proposes basing the COLA on the Consumer Price Index for the Elderly (CPI-E), which puts a bigger emphasis on healthcare and other costs that impact older Americans.
Allow for Privatization of Retirement Benefits
In a section titled “Support Retirement Freedom,” the RSC budget “urges lawmakers to consider legislative options that allow employers and employees to reduce their payroll tax liability in order to use those savings to invest in private retirement options. Requiring all young workers to participate in a one-size-fits-all government-run retirement program does not make economic sense for the long-term savings of our citizens and our nation.”
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