Hearings to examine exploring process approaches for addressing Social Security solvency.

this 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 vital support to workers who can no longer earn a living due to severe injury or illness and to families who have lost a loved one. 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' latest projections, the Old Age and Survivors Insurance Trust Fund will be exhausted in late twenty-thirty-two. If Congress fails to act before then, incoming program revenues will be sufficient to pay only seventy-eight percent of the promised benefits. Congress has a responsibility to protect and strengthen social security for current beneficiaries The longer we wait, the more difficult this challenge will become. The last comprehensive effort to improve social security's solvency took place over forty years ago and culminated in the social security amendments of nineteen eighty-three. Those reforms were preceded by high-level bipartisan negotiations, informed and facilitated by the work of the National Commission on Social Security Reform. 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. More than two decades later, I participated in another bipartisan effort to develop recommendations to ass- to address our nation's long-term fiscal challenges, along with Senator Dick Durbin. the democratic co-author of one of the process bills that will be discussed today. As a part of its work, the National Commission on Fiscal Responsibility and Reform, often referred to as the Bold 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. As social security approaches a pivotal moment, members of Congress have proposed a variety of process reforms designed to facilitate bipartisan discussions and help develop lasting solutions. And that's 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'm gonna briefly lay out how the After ranking member Wyden gives his opening remarks, generally we go immediately to the witnesses, but today we're going to let other members of the committee, if they choose, to have a five minute opening statement. Some of these members will, I I'm sure, use this five minutes to talk about their ideas. It's it's three minutes faster. Once members conclude these opening statements, we will turn to our witnesses for their opening remarks and then proceed to member questions. I wanna 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.

Thank you very much uh Mister Chairman. And uh I sh I share your view that uh we've got an excellent panel of witnesses and a good start to this issue. We're gonna be discussing the future of social security as sacred an issue as there is in America. The trust fund is gonna be depleted before the end of the next presidential administration. Several Republican members of the panel will say that they have a solution, some sort of unaccountable commission that rubber stamps benefit cuts like increasing the retirement age. It seems that every time some Republicans get their hands on these sort of ideas for social security, life gets worse. for older people that count on the program to get by. Now 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, and now they're claiming they're 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. 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 or kids who lost a parent. Trump and the MAGA crowd give huge tax breaks to billionaires and massive corporations. That's what they did last year. And that bill plundered social security by a hundred and sixty eight billion dollars.

One million.

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 wanna 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. 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's it. So I wish that the finance committee was here to make sure that we have a substantive uh debate. Instead the concept being discussed today would act as a shortcut for Republicans to carry out their long-sought goal of slashing Social Security benefit 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 under undertake. Quaint idea. We do the work that we're sent to Congress to do. Handing off that responsibility to somebody else to me is just buck passing so in the words of basketball great Allen Iverson and I quote "we're talking about practice not a game we're 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 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've seen their wealth skyrocket to over nine trillion dollars this year while working, people suffer. Those billionaires would pay their fair share. Instead of having a public debate, the commission that's being discussed would smuggle in benefit cut plans with minimal public scrutiny or debate. I reject that approach. I'm gonna 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. But it requires the courage to stand behind your ideas in full public view, and the american people deserve no less so i thank our witnesses for joining the committee i look forward to discussion this chairman as we discussed i would ask unanimous consent to enter into the record a statement from senator gillibrand and i would also ask unanimous consent to enter in to the record a statement from the alliance for retired americans and uh that's a request for both documents

without objection

thank you mr. chairman

and before i go to the to members i just have to correct something uh senator wyden uh this hearing is not to push a specific proposal this hearing is to talk about all the options on the table that's why we have a broad array of witnesses and why i have offered every member of this committee the opportunity to to say something about their ideas if they want to then we can move forward and hopefully on a bipartisan basis build a solution

mr. chairman i won't continue this uh at length what i have indicated is that i'm very much interested in exactly the kind of bipartisan efforts people who worked on this committee know that i pursue this i don't think buck passing though is serious bipartisan effort i think it's ducking and that's what the debate today also includes

got a slide

is this the here mister i was going to go to senator grassley but i believe he stepped out

yep

so uh then next on my list would be senator cassidy and with senator cornyn i i believe you did not want to say anything senator cassidy

let us be clear we're talking today about setting up a process we're not talking about 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. 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 isn't one proposal. It could be two, it could be three. And any member here could put up a committee, uh put up a uh a bill in the nature, an amendment in the nature of a substitute and replace it all. That's what we're talking about here. If other side, if the other side of the aisle thinks that they've got a great idea, They should want this process. They should want this process, cuz that would give them the opportunity to present to the American people, and to this committee, and to the Senate, their particular perspective. To say that you don't even wanna process, however you kind of guy, you know, put all kinds of fancy words about it and rhetoric about that side and this side. If you say you don't even wanna process, it means you don't wanna take it on. That you've decided it's more important to be a politician and to have an issue to divide our country than to be a senator who's looking for solutions. By the way, I have an idea, I'll be honest about that, bipartisan, with multiple Democrats on the others, uh, multiple Democrats supporting the idea. But that doesn't mean my idea will be the one that's accepted. We today are only talking about setting up a process where the American people have the opportunity to have input. in order 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. And to start saying it's partisan and we're cutting benefits, that is not true. Why am I so passionate? Guess what? You know what's really gonna cut seniors? If we don't fix it and there's gonna be by law a twenty-two to twenty-eight percent cut in benefits for every senior currently receiving social security. Or, we'll increase taxes by forty percent. Boy, won't that gut the ability to save money for retirement for the American people. Or, we'll just borrow lots of money and destroy our country's credit rating. And every year we wait, it gets worse. Now, I have been told by Bernie Sanders and by Lindsey Graham, Bill, I'm quoting Lindsay now. You're a lousy politician, but you're a good senator. I took that as a compliment. 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 gonna 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 we will go into oblivion. Let's be patriotic. Let's be good senators. Let's be here to make the hard decisions. No, not on a particular solution, because what we're 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 with everybody on this committee answerable to the voters. And everybody on this committee then having to take a vote on either that which is produced or an amendment in the nature of a substitute. That would again go to the floor of the Senate. Where every senator who's answerable to the people of his state or her state would again have a chance to weigh in. This is the way the process is supposed to work. And what we're considering today is basically a time agreement. And time agreements are how things are done around here. I am so frustrated by this kind of, let's be political. Let's just one more time use this as a wedge issue. No, 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 considered, heard, and voted on, and chosen. This is not about a solution. This is about a process to arrive at the solution. If you care about the United States and if you care about seniors, we should be voting for this bill today.

Thank you, Senator Cassidy. Senator Warner.

Well, thank you, Mr. Chairman. And thank you for holding this hearing. Good to see some folks like Mark on the panel. Um, you know, this is something I appreciate everybody's passion on this issue, that you and I worked on, Mr. Chairman. Uh, we started

Yes.

I think our first gang.

Yeah. That's right.

Our gang was six. Um, we didn't obviously get it done or we wouldn't be here today still debating this issue. Um, I do believe the only way we're gonna get this solved though is through a bipartisan effort. Um, we know social security is the most important commitment our country makes to seniors and to surviving spouses and children, people with disabilities. It supports seventy million Americans it insures another two hundred and thirty nine million workers against the risk of aging disability and death of a spouse or a parent we also know that in six years and one of the things about this right maybe santa casita some of this is it's math we're gonna hit this cliff in the fourth quarter of twenty thirty two retirement trust fund is depleted and every beneficiary takes an automatic cut about twenty two percent that's what happens if we do nothing for virginians it means nearly one and a half million Virginians who receive some form of social security benefits um will have a dramatic cut in those benefits. And when the trust fund runs dry, the average Virginia retiree stands to lose more than five hundred bucks a month. In my state that's close to nine billion dollars, taken out of the pockets of Virginia seniors. A typical couple retiring in twenty thirty-three would lose nearly seventeen thousand dollars a year. you know the um this is gonna be a disaster and the thing that what's also coming on top of this is as i know the chairman of the ranking knows the medicare hospital insurance fund is about to go solvent a few months after after that that's another um hit of eleven percent so and for those of us who have been talking about this we go way way back in time in twenty ten when we were starting some of these efforts so social security's seven seventy five year shortfall was five point four trillion dollars in two thousand ten dollars. Now it's thirty trillion dollars. Um, and I think we all know every year the math gets uglier. We can talk about the processes. The one thing that we looked at and I look forward to continuing, I've laid out ideas, taken hits from both sides on on some of the ideas I had. One thing I hope, as we ha- are forced to grapple with this, whatever situation around caps and age and benefits, that we also set in process someplace, something where we don't wait another thirty or forty years before we take it up again. One of the things, Mister Chairman, you and I worked on together with something that said, you know, every ten years you'd have an automatic reset to make it the trust fund solvent for fifty years going forward. So you don't allow for us to get into the dig the the ditch we're at this point. Um, I'm open to all ideas. Um, again as somebody who's already taken the hits on laying out some controversial ideas, I think that we're gonna have to come back and uh address them again. But I do believe that uh having these kind of hearings to set up this stage um so that that we know it's coming, we can't pretend like it's uh we didn't see this coming very directly and obviously um as i think those of us who've wrestled with uh versus medicare which is a real challenge this one starts with just plain old math and um i think reasonable people uh working on this could maybe get it right we might not even need to go to a ai based solution uh we might be able to actually as senators put our heads together and sort this out so uh thank you for giving me the opportunity to make an opening statement i look forward to the hearing. Thank you.

Thank you, Senator Warner, and I too um fondly remember our work together on the gang of six, and I hope we can do another similar endeavor that's puts it over the goal line this time. Senator Johnson.

Hey, Mr. Chairman, you know, my thirty years in manufacturing solved an awful lot of problems. And you realize there's a process to solving a problem. You know, the first is to admit you have one, which I think we all admit we have the problem. The second step is even more crucial. So you have to properly define it. Uh, the last step is the solutions. And around here what all all, you know, what seems to happen all the time is everybody's got their piece of legislation, they're al- already got the solution, but they haven't properly defined the problem. So Let me, I guess throw out there, the problem we have to deal with is the fact we're forty trillion dollars in debt, heading to sixty trillion. We need to agree on common facts. OK? Um W- w- one of the facts that we have to grapple with is benefits already exceed revenue. But again, we're we're honoring those benefits, right? When the trust fund runs out, it shouldn't be a calamity. We're just gonna have to plus up those benefits, and we'll probably do that. One fact we ought to recognize is the US government bond held in the hands of a government agency has no value. The trust fund's a fiction. Another thing we ought to grapple with is social security is a legal Ponzi scheme. I get criticized for saying, but it, that's exactly where it is. We extracted money from, from taxpayers, investors. We spent the money, it's gone, it got paid out to earlier investors, and there's nothing in value. We have to recognize that reality. I I often hear from constituents who go, that's my money. Well, it is to a certain extent. But I I want to enter in the record table one, money's worth ratios for a hypothet hypothetical workers with various earnings levels so basically what this says is a social security recipient receives What they receive for each dollar they put into the fund. And it ranges from a low of getting back fifty nine cents on the dollar, to a high of getting four dollars and seventy eight cents on the dollar. So again this, you know, that's my it's it's a fiction. It's it's it it it wasn't set up as an investment fund. You'll not solve this problem if you're not willing to recognize how grossly mismanaged social security was for decades. By politicians. By our predecessors. They squandered the money. There's nothing in val of value there. And even worse than that, they have run up enormous deficits, forty trillion dollars in debt, so we will may not have the financial wherewithal to continue to plus up benefits. Personally, I'm I'm amazed that the debt bomb hasn't already gone off. But it hasn't, because I guess we're the the the least worst in terms of uh governments around the world. We're still in safe haven. But again, what I would suggest is let's agree on common facts. Before we leap to solutions, let's agree on that. Uh, you know, I had a held a budget hearing yesterday. The title was Medicaid, the reality. And I I know my democrat colleagues uh must have got under the skin because in the end they said you know you turned this into debate society well it's exactly what we're doing here. I I thought this was the greatest deliberative body. But they didn't like the fact when they would lie and say that we wanna cut and slash. I heard the exact same words from the ranking member today. We're gonna cut and slash social security. No, we're we're not. That's a lie. We're not cutting and slashing Medicaid. The facts on Medicaid, which I kept had having to repeat. Twenty fourteen, the start of Medicaid expansion, we spent three hundred billion dollars. Twenty nineteen, before the pandemic, four hundred billion dollars. Last year, six hundred sixty eight billion dollars. This year we'll probably spend seven hundred thirty five billion. I have not seen a projection where that number decreases. Where do you get cut and slash? It's a lie. Quit lying. Start telling the truth. Start acknowledge reality. So I'm all for a process, but please, God, please. Let's have the process go in the right order. Let's start defining the problem with facts. Let's agree on the facts. Stop lying about people. Stop saying that we wanna do, no, we wanna preserve social security. And the best way to do that is reduce the, reduce the deficits so we don't run into this massive debt bomb that's gonna blow up on our face, and we won't have the wherewithal to plus up the benefits when the fiction of the social security trust fund runs out. Thank you.

Thank you, Senator Whitehouse.

Well, this hearing is not about Medicaid, but let me just point out that there is in fact. around a trillion dollars in cuts that are 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's gonna come from the republican-built red tape bomb that's gonna go off in medicaid to basically drive people off it because they won't be able to keep up with the red tape requirement. So that's where we are on that. I can't let that go uh unrebutted. With respect to social security, well, trust funds are gonna be exhausted a year earlier than predicted. Lot of that's thanks to the billionaire's bill that the Republicans jammed through. It hits in twenty thirty-two, just six years from now. We're Democrats. We've been pretty out there. We've got bills. You can look at them. Kick the tires. Take your pot shots. We have legislation that will make social security solvent for as far as the actual real side eye can see without cutting benefits. Where's the Republican proposal? Where is it? It doesn't exist. They wanna go into a back room and get wheeler deals done that allow for benefit cuts and things like that that they don't wanna own so they don't wanna put it out there. That's where we are. The first thing that we should see is if Republicans wanna solve social security, put your plan on the table. Why hide it? What do you wanna do? Put it out there. We've done that. So, while we're at it on social security, not not only is it running out of trust fund, but we've also got social security administration internal collapse, thanks to Musk and his wretched little doggy boys going in and getting lots of people fired uh from their jobs. We've got reporting that uh his little doggy boys took data, planning to take social security private data and uh offer 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 don't get cut in twenty thirty two? And we've got a plan. We're not ashamed of our plan. We put it out there. It's actually not complicated. You actually make people who are making huge amounts of income pay the same social security taxes as everybody else, all the way up the rest of their income. And if they're dodging their income because they're really fancy, and they've been able to park it through various types of corporate, uh, obscuring, go hunt that down and actually make sure that they've gotta pay social security on that as well. You shouldn't be able to hide your income through a corporate device and dodge social security that way. It's still income, you're still spending it. That's still, you know, the way you're your world works. So we can do that. Remember the day when uh uh Biden at the State of the Union said, no benefit cuts to social security? And the whole room stood up, standing O, unanimous bipartisan applause. Well, if we're still there, the math is really simple. If you don't cut benefits, you gotta add revenue. Where would you wanna go for revenue? Why not to the highest income people who aren't paying into it now, beyond what an ordinary nurse or plumber would? It doesn't make any sense. Why would you reward people for dodging their income through corporate screens, so that they don't have to count it as payroll, they bring it in other ways. It just, this shouldn't be hard. This shouldn't be hard. 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 ours. And you can vote it down and own that. But we have been very clear. Multiple democrat senators have put out plan after plan that will make social security solvent. Mine actually makes social security and Medicare solvent. For seventy five years, as far as the actuarial eye can see, according to both the social security and the cms actuaries. So, we can do this. It's lying there right in front of us. It's just a question of political will and of some people not wanting to own what they want to do to social security. That's our problem. Thank you, Chairman.

Thank you, Senator Whitehouse. And and before I go to the witnesses, um, uh, I just wanna I have to make one clarification. Uh, this notion that Republicans haven't got any ideas or haven't put up any plans is just flatly false. And the reality is, uh, uh, before you got here, Senator Whitehouse, Senator Warner and I were talking about a plan that I had put out with him and others, before, and we've done this over the years and there are those sitting here at this dais who have put out plans. So let's not let's not make this partisan. Let's get together and work on solutions. And then we can hopefully get to something that we can put over the finish line and pass.

Um Mister Chairman, I'm all for solutions, but I think they actually have to be solutions and not commissions and uh 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.

Mister Mister Mister Chairman, the good news is, since we're voting only on a bill today to give a process where Senator Whitehouse's bill could be the solution, I think he will endorse this. We're not voting on a solution today. We're voting on a process by which a bill such as Senator Whitehouse's is offered, or a bill like I and Dick Durbin have offered, could be considered. And so that's a good thing, and I think that I, I look forward to his support for this bill.

Thank you, Senator Cassidy. And we could go on a lot up here. Uh To our witnesses, it's time for you now. You can see there's a lot of emotion and intensity on both sides of the aisle here. And I think that's actually a good thing. because it shows that there's a lot of it desire to get this issue addressed. We may still have our fights, but um we want to get this fixed. And that's why I'm holding this hearing, and that's what I hope will come out of this hearing, is support from you with ideas and an analytics and assistance to help us figure out what the plan should be. Um Let me, before I uh ask you to begin give a brief introduction of each of our witnesses. Our first witness will be Mister Goldwein. He's the Senior Vice President and Senior Policy Director at the Committee for a Responsible Budget. Prior to joining the Committee for a Responsible Federal Budget, Mister Goldwein served as the Associate Director of the National Commission on Fiscal Responsibility and Reform known as the Bull Simpson Commission which I have referenced and served on. And Senior Budget Analyst on the Joint Committee on Deficit Reduction, also known as the Super Committee. Doctor Blahouse is the J. Fish and Lillian F. Smith Chair and Senior Research Strategist at the Mercatus Center. Doctor Blahouse 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's the author of Social Security, the Unfinished Work. Doctor Blahouse also served as a public trustee for social security and Medicare from twenty ten through twenty fifteen. Ms. Lamont 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. She also oversees AARP's public outreach and education initiatives, as well as state and local advocacy and community engagement across all fifty states, the District of Columbia, Puerto Rico, and the US Virgin Islands. Ms. Vallis serves as Chief Executive Officer of the National Academy of Social Insurance. 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 Mister Goldwine's opening statement, followed by Doctor Blahouse, Miss Lamont, and then Miss Vallis. Mister Goldwine.

Thank you. Uh, Chairman Crapo, Ranking Member Wyden, 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 seventy 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's not far off. It's when today's youngest retirees turn sixty-eight, and when the next class of senators finish up their first term. At that point, the law calls for a twenty-two percent benefit cut, the equivalent of five hundred dollars 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 a hundred and ninety trillion dollars over the next seventy-five years. That's the equivalent of a hundred and sixty-five percent of GDP on top of what we already owe. That additional borrowing would stifle economic and income growth, balloon interest rates, and very likely send the country into a dangerous debt spiral. Paying out of the general fund would also end social security as we know it, as a self-financed contributary social insurance program. 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 of maximum, or gradually adjust the retirement age have been well vetted and should be considered as part of any solvency package. My organization has also been developing novel solutions, including imposing a hundred thousand dollar cap on the amount of benefits that a couple can collect including broadening the employer payroll tax base, to cover all compensation, capping the cola for rich seniors, reforming the taxation of benefits, and I could go on. The challenge before Washington today, though, is less about what to do to save social security and more about how. Based on my my research and my personal experience, I humbly suggest you task a commission, counsel, or advisory board to help facilitate agreement on a solvency package before it's too late. This approach would not be new for social security. Actually, all major legislation, all of the most significant social security laws ever passed, were developed with the help of an outside commission or council. The original Social Security Act came from Prince Perkins' Committee on Economic Security. Major legislation in nineteen thirty-nine, nineteen fifty, nineteen fifty-six, nineteen seventy-two, nineteen seventy-seven, they all came out of the work of social security advisory councils, the predecessor, today's Social Security Advisory Board. And the landmark nineteen eighty-three reform, which bought us fifty years of sovereignty, was developed and negotiated in part through the Greenspan Commission. When it comes to social security, these special processes are the regular order. Uh, of course these processes don't remove elected officials from their important roles and responsibilities in the legislative process. Rather, they help facilitate bipartisan agreement by setting forth a specific mission, and establishing a space, 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 sorts of topics. Many fail, but many succeed, and success takes all different forms. In the case of the BRAC commissions to consolidate military bases, Congress enacted the recommendations in full. For the Greenspan commission, um, that served really as a venue for negotiations between President uh Reagan and Speaker Tip O'Neill. The nine eleven commission meanwhile developed recommendations that Congress and the President implemented piecemeal based on their own policy uh, judgment. I was lucky enough to serve on two of these special committees, including working with Chairman Crapo and your colleague, Senator Jurbin, on the Simpson-Bowles fiscal commission back in two thousand ten. Our commission developed a plan to both stem the growth of the debt and restore permanent sovereignty to social security. Eleven out of eighteen of our members spanning the ideological spectrum supported these recommendations. Even in this body, that would be a filibuster-proof supermajority. Unfortunately, our recommendations were not enacted in full into law. But they did spark a national conversation on fiscal policy and nearly culminated in a grand bargain between President Obama and Speaker Boehner, actually three different times. Uh, the commission was able to reach agreement because members took the time to agree on a common set of facts and they worked to build shared trust and understanding. Um, as Chairman Krapos pointed out before, the relationships built on that commission were a very big part of its success. Of course, all sides had to compromise, but they did so in the spirit of securing our nation's finances and saving social security for generations to come. Um, I wanna close real quick by quoting the late Senator Tom Coburn, who who who said this right before he voted for that Simpson-Bowles recommendation so which he declared he hated half of it. Um, " All republics failed", he said. "They all fail over fiscal issues. The way we cheat history is for all of us to give up something", he continued, "so we create a future that is honoring the tremendous sacrifice that came before us." Thank you again to the members of this committee for your important work.

Thank you very much. Mister Blahos.

Thank you, Chairman Crapo, Ranking Member Wyden, uh, all the committee members. Uh, I'd like to make four points in my oral remarks based on my written statement. First, social security solvency matters. This is not just an abstract accounting exercise. There's 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. These dedicated taxes are credited to special trust funds, whose sole purpose is to finance social security obligations. These funds cannot spend beyond 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, we paid for these benefits, you can't arbitrarily take them away. But there's a price for that unique security and political strength. It only works as long as lawmakers' aligned benefit schedules with what worker contributions can finance. This is sometimes meant increasing tax collections, moderating benefit growth, and adjusting eligibility ages. If we're no longer willing to do such things, we can't have this type of social security system anymore. We could have a social security system, but a very different one, with benefit levels disconnected from individual contributions. Workers could no longer assert they paid for their benefits. Social security's bipartisan advisory councils for decades have repeatedly warned, Do not let that happen. Keep the system self-financing and solvent, for if social security had to compete for funding each year within the general budget, the unique reliability of its benefits would be lost. Second, speed is essential. Just like a patient facing a potentially lethal condition, the longer treatment is delayed, the weaker the prospects for success. The current situation differs dramatically from the ones successfully confronted in nineteen eighty-three. This time, there isn't the luxury of waiting until the trust funds are nearly Consider this, the two thousand sixteen trustees report found that the shortfall then equaled nineteen percent of future benefit claims. Just ten years later, this year's report found it equals thirty percent of future benefit claims. And by the time the old age trust fund faces depletion in twenty thirty-two, it is clearly too late. At that point, even if new claims were completely cut off, the trust fund would still run out. We are rapidly passing the point of no return, past which it becomes implausible, social security's historical design can be retained. Third, whether a solution holds depends on the analysis done while developing it. The nineteen eighty-three reforms were a major achievement, but began unraveling almost immediately. The nineteen eighty-five report, again, showed a significant shortfall, which then more than quintupled and became bigger than the one just addressed, all within a decade. This happened because the Greenspan Commission relied on estimates of how much each provision would improve things on, average over seventy-five years rather than how each provision would affect annual operations in different 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 to prevent a recurrence of this mistake. They now run two important tests, the average balance over seventy-five years and the annual cash balances through the end of the valuation period. If you go through the ordeal of hammering out a solution, the last thing you want is for the very next year's report to say the problem is back. To prevent that, you just need to make sure your plan passes both tests. Now, while my testimony outlines why the trustees take a seventy-five year view, a fifty year view can work, provided both of these tests are passed. Fourth, both the process and product need to be bipartisan. Since the shortfall reemerged, there have been fifteen different years when one party or the other has controlled both the legislative and executive branches. If either party could do this without the other, it would have been done by now. The nineteen eighty-three experience is instructive about how key lawmakers can be brought into a bipartisan negotiation. The most influential senators from both sides were on the eighty-three commission, House leadership was effectively represented, and the White House participated in the negotiations. The commission also contained enough outside experts to provide substantive cover. The reasons we need bipartisan compromise aren't just political. They are mathematical. There was once a time when the shortfall was of a size that it could realistically be fixed, solely with additional revenues, solely by slowing benefit growth, or solely by adjusting eligibility ages. That time is long past. Maybe there are individual members of Congress willing to increase Americans' payroll tax burdens overnight by the necessary one third, or to cut future benefit claims by thirty percent across the board. But until congressional leadership can deliver the votes to enact one extreme or the other, we should assume a combination of less extreme measures will be necessary. I'll close by commending the committee for holding this hearing and exploring ways forward. The American public will be well served if this leadership results in a significant extension of social security solvency. Thank you.

Thank you very much. Ms. Lamont.

Chairman Crapo, Ranking Member Wyden, and members of the committee, thank you for the opportunity to testify today and good morning. It's 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. AARP proudly represents Republicans, Democrats and Independents, all of whom see story after story about partisan division. We know this work is hard, and already in Congress, AARP has endorsed more than a hundred and thirty bipartisan bills to support family caregivers, to lower prescription drug prices, to crack down on fraud, and to strengthen social security's customer service. For nearly ninety-one years, social security has been one of the most enduring promises in American history. Minus. Mm-hmm. Work hard, I think it's true. contribute throughout your career, It's true. and retire with the foundation of financial security. It's really true.

The foundation.

Today, that promise supports seventy-one million Americans with nearly Oh, this is not the answer. one hundred and eighty-five million workers paying in with every paycheck. I can't even see it. We can get our question. Our message message today is simple. 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. Members like Lee from Oregon, who worked his entire life. And then came his wife's medical crisis. Lee told us that were it not for social security, we would be homeless. And Lee is not alone, and I know you hear from Lees back home all the time. Forty-three percent of older households rely on social security for more than half of their income, at a time when thirty-seven percent of older adults say they feel financially insecure. Women in particular rely more on social security because they often spend fewer years in the workforce, earn lower lifetime wages, and live longer. Put simply, when social security is secure, millions of families are more secure, and so is our economy. Social security supports two point six trillion dollars in economic activity every year. And many forget that benefit reductions enacted in nineteen eighty-three 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 nineteen percent. All the while, future generations are likely to reti- rely on social security even more. Private pensions have mostly vanished, and around half of our workforce has no employer-sponsored retirement plan. Forty-two percent of Americans age fifty plus, who are not yet retired, have less than fifty thousand dollars in retirement savings. All of this means social security will remain essential for many years to come. That is why eighty-one percent of older Americans across party lines reject cutting social security benefits to save it. So our message is straightforward. Do not cut social security that people have earned. And to be clear, there is work to do. The question for us today is not whether to act, it's how Congress acts. The history of special commissions is littered with very good intentions and failed results. They typically lack the clout, the power, and the jurisdiction to do this hard work. Social Security's future belongs at this table before this committee. This committee has jurisdiction, the clout, and a ninety 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've done it before. AARP does not oppose action. We want Congress to act sooner rather than later, and we bring with us the voice of the vast majority of Americans who want this promise kept without cuts. We wanna partner with you in lifting these voices up. Many of you have joined us for teletown halls or events. I hope we can continue to do more of those with you and bring this vitally important dialogue to more Americans in your states. We look forward to working with the committee through regular order to get this done. Thank you very much.

Thank you, Ms. Lamont. I've appreciated working with you over in the past and will continue to appreciate working with you on this. Ms. Vallis.

Chairman Crapo, Ranking Member Wyden, and members of the committee, thank you for the opportunity to testify today. My name is Rebecca Vallis and I have the privilege of serving as the Chief Executive Officer of the National Academy of Social Insurance. This year, as our nation celebrates two hundred and fifty years of American democracy, we are celebrating this 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 to any one political party, but to the American people as a whole. Few institutions better embody that idea than social security. Ninety-one years ago this month, when President Franklin Roosevelt signed the Social Security Act into law, he called it a cornerstone in a structure which is by no means complete. I've always loved those words of FDR's because they remind us that social security has never been a finished project. It is a living expression of our democracy and of how we show up for one another, when it matters most. And I believe that's exactly the responsibility this committee today has and in the chapter ahead needs to work on together. I'll offer three brief points today. First, social security is the cornerstone of economic security in America, as you've heard from everyone who's already spoken. And while social security appropriately celebrated for reducing poverty, the academy's research 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 four percent of Americans say it will be not at all important to them in retirement. Likewise, just two percent 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. The Academy's national survey research, which we conducted with AARP and others, finds that more than three in four Republicans, more than nine in ten Democrats, and more than eight in ten Independents want lawmakers to strengthen social security's revenue base, to protect its critical benefits. 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 don't see solvency and benefit adequacy as competing goals. Eighty-two percent 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. 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 thems themselves from the outcome, risks doing the opposite. On many issues, democratic governance is difficult. because the American people themselves are deeply divided. 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's to listen to them. Social security isn't just a government program, and it isn't simply a math problem to solve. It's 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 two hundred and fifty years of American democracy, there are few responsibilities of greater consequence than faithfully stewarding a program that belongs to the American people. 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.