Jake Johnson, Common Dreams
A group of House Democrats on Tuesday began rolling out legislation to strengthen and expand Social Security as their Republican counterparts’ debt ceiling brinkmanship threatens to disrupt the program’s monthly payments, which keep millions of seniors and children across the U.S. out of poverty each year.
During a press conference, the Social Security 2100 Act’s co-sponsors emphasized the potentially devastating impacts that a GOP-induced U.S. debt default would have on the nation’s tens of millions of Social Security recipients, many of whom rely on the program for their sole source of income.
“Today, the entire American economy is teetering on the edge of destruction by a manufactured crisis. I don’t think that’s hyperbole,” Rep. Bill Pascrell (D-N.J.) said Tuesday. “No corner of America is safe if the Republicans blow up our economy, and that starts with Social Security.”
The National Committee to Preserve Social Security and Medicare has warned that a U.S. default could jeopardize Social Security payments by leaving the Treasury Department without the money to fulfill its obligations.
“While the Social Security trust funds held $2.852 trillion in U.S. government securities at the end of 2021, the Treasury Department must have cash to pay benefits when they are due,” the group noted in a memo earlier this year. “Every month, the Treasury Department is required by law to make over $90 billion in payments to the 65 million retirees, disabled workers, widows, widowers, children, and spouses who receive Social Security benefits. The Treasury may not have enough incoming revenue to make those payments without the authority to cash in these securities.”
“Absent the legal authority to borrow beyond the current ceiling,” the group added, “Social Security, Medicare, Medicaid, and other payments will not be made on time and in full unless Congress approves an increase in the debt limit.”
Rep. John Larson (D-Conn.), the lead author of the latest version of the Social Security 2100 Act, said during Tuesday’s press conference that Social Security recipients are not “bargaining chips” and blasted Republican proposals to slash benefits.
“I think you have to give [former President Donald] Trump at least some credit for telling the Republicans, ‘Are you crazy holding Social Security and Medicare hostage?'” Larson said, referring to Trump’s criticism of the GOP’s approach to the debt ceiling standoff earlier this year.
“They’ve kind of done the Michael Jackson moonwalk backwards trying to explain why all of their legislation, their study committee, that calls for 21% across-the-board cuts still remains out there in print,” Larson added.
While it wouldn’t directly target Social Security benefits, the debt ceiling bill that House Republicans passed late last month would slash funding for the Social Security Administration.
In contrast to Republican proposals, Larson’s bill would increase benefits for all Social Security recipients by 2%—the first benefit enhancement in more than five decades—and adjust the current Cost-of-Living Adjustment (COLA) to better reflect the impacts of inflation, according to a summary provided by the Connecticut Democrat’s office.
The bill would fund benefit increases by applying the Social Security payroll tax to earnings above $400,000 and targeting a loophole that allows the rich to avoid the tax.
Watch the House Democrats’ press conference:
The new bill comes as the Treasury Department is reportedly scrambling to find ways to keep making payments as the June 1 “X-date” nears and as Republicans continue to oppose a clean debt limit increase.
“Without additional borrowing, a fresh burst of tax revenue, or new ways to slow spending, the federal government expects to miss a payment for the first time in modern history in early June,” The Washington Post reported Tuesday. “To put off the so-called ‘X-date’ when reserves run dry, Treasury officials have asked their counterparts at federal agencies about the flexibility of payments due before early June.”
Outside advocacy groups, meanwhile, are increasingly sounding the alarm about the impact that a default could have on vulnerable seniors.
Retired Americans PAC, a political arm of the Alliance for Retired Americans, launched an ad campaign on Tuesday warning that “politicians in Congress are putting our Social Security benefits at risk,” showing clips of House Speaker Kevin McCarthy (R-Calif.), Rep. Matt Gaetz (R-Fla.), and other Republican lawmakers.
“The Social Security payments that we’ve earned after a lifetime of work could be held up, hurting millions of seniors who depend on Social Security to cover the basics like food, gas, and prescriptions,” the ad warns.
Richard Fiesta, executive director of the Alliance for Retired Americans, said Tuesday that “seniors earned their Social Security benefits over a lifetime of work and rely on them to pay for food, prescriptions, and other necessities.”
“Older Americans will not support any politician who jeopardizes their benefits for partisan games,” he added.