Social Security: Romney Asks Why 25% Drop in Funds Isn’t in Biden’s Budget

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Much of the current political debate over Social Security comes down to wording — who said what about how to reform the program, and what those statements ultimately mean in terms of benefits for Social Security recipients.

For example, President Joe Biden made headlines during his recent State of the Union speech by saying he will “stop” any attempts to cut Social Security. Republicans have responded by saying nobody has proposed any cuts to the program.

One of those Republicans, Sen. Mitt Romney of Utah, pressed that point home during a hearing on Wednesday, March 15. As The Hill reported, Romney got into a tense exchange over Social Security with Shalanda Young, director of the White House Office of Management and Budget (OMB), in discussions centering on Biden’s fiscal 2024 budget proposal. 

Romney grilled Young about whether she knew of any cuts to Social Security proposed by lawmakers — something Biden has accused Republicans of trying to do.

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“You’ve heard of proposals from a current senator or congressman currently proposing to cut benefits to Social Security?” Romney asked Young during the hearing. 

Young answered that yes, she has heard of lawmakers proposing cuts, but then added that they might have changed their positions. Romney then asked if any lawmakers have proposed cuts “in the last several months or the last year.”

Young replied that “current members have well-known policies out there to cut Social Security and Medicare.”

“That is simply wrong, and it’s not honest to say that to members of Congress,” Romney responded. “That is simply wrong.”

Many Republican leaders, including House Speaker Kevin McCarthy and Senate Minority Leader Mitch McConnell, have publicly opposed cuts to Social Security. At the same time, many also want to address the impending insolvency of the Old-Age and Survivors Insurance (OASI) Trust Fund, which funds about 25% of Social Security benefits. That fund is expected to run out of money as early as 2032, leaving Social Security solely reliant on payroll taxes for funding.

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When Romney asked Young whether she was aware of the trust fund’s coming insolvency, she replied that she was.

“Well, why is it then that in the president’s budget there’s no effort to address that whatsoever?” Romney asked. 

The exchange between Romney and Young underscores differences between Republicans and Democrats over how and whether to reform Social Security as the trust fund gets further depleted. It also underscores different perceptions of what represents “cuts” to the program.

As previously reported by GOBankingRates, some lawmakers have proposed raising Social Security’s full retirement age to 70 from 67. While this proposal has bipartisan support, it has mainly been pushed by Republicans. And although it does not technically “cut” benefits, some Social Security advocates say that for all practical purposes, a higher FRA will result in lower benefits for many recipients.

Pushing FRA to 70 would “significantly cut benefits for anyone retiring before their new full retirement age,” according to the National Committee to Preserve Social Security and Medicare (NCPSSM), a nonprofit advocacy group.

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The NCPSSM noted that when the full retirement age was 65, workers retiring at age 62 received an initial benefit that was 20% less than their full benefit amount. When the FRA rises to 67, workers retiring at age 62 will receive a 30% cut in benefits. If the age were increased to 70, a worker claiming retirement benefits at age 62 would have their benefits reduced by nearly half, according to the NCPSSM.

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See: 10 Places in Florida Where You Can Live Only on Social Security

Meanwhile, a recent proposal by U.S. Sen. Rick Scott (R-Fla.) to sunset Medicare and Social Security in five years would allow Congress to either pare the programs down or completely gut them, Social Security advocates say.

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