Johnson on Social Security Reform: “…the longer we wait, the harder it gets.”
The House Ways and Means Social Security Subcommittee kicked off its Hearing on Examining Social Security’s Solvency Challenge: The Status of Social Security’s Trust Funds at 11:00 this morning. Chairman Sam Johnson (R-TX) deliveredthe following opening statement: .
“Good morning and welcome to today’s hearing on the status of the Social Security’s Trust Funds. Today, we will hear from Social Security’s Chief Actuary about the findings in this year’s Trustees Report.
“I first became Chairman of the Social Security Subcommittee in 2011 and have held this hearing many times. At every one, I’ve said that Social Security is in trouble and that its problems will only get worse.
“Back in 2011, the Trustees told us that the Social Security Trust Funds would be exhausted in 2036. This year’s report says that date is now 2034 – two years earlier.
“If Congress doesn’t act by 2034 Social Security will only be able to pay 79 percent of promised benefits.
“Also back in 2011, the Trustees also told us that it would take $6.5 trillion to make Social Security solvent over the next 75 years. This year, the Trustees tell us that it would take $13.2 trillion, more than double that amount.
“And as you all know, Social Security has been paying out more in benefits than it receives in tax revenue. To make up the difference, Social Security would use the interest earned by the Trust Funds from the assets they hold.
“However, those days are now over. According to the Trustees, Social Security is now paying out more than in benefits than it receives from all of it’s income for the first time since 1982. This means we must now tap into the Trust Funds principal itself to pay benefits.
“Colleagues, this is a big deal and is an important signal that time is not on our side.
“The Trustees Report is critical to providing Congress the information it needs to address Social Security’s challenges. However, in 12 of the last 15 years it has been late. Further, this Subcommittee has looked into how the report is developed at past hearings.
“In addition, I know many were surprised to see the report not reflect the benefits of pro-growth tax reform that we see every day – more jobs, higher wages, and a booming economy. While historically the Trustees have been more rosy than others in their outlook on these areas, it is important to understand how and when the Trustees make economic projections that are the key to the findings in the report.
“It is clear that the Public Trustees play an important role in the development of the report. And these positions were created to make sure there weren’t any concerns with the objectivity and integrity of the report. Yet, we haven’t had the benefit of the Public Trustees insights since July 2015 when their positions became vacant.
“That’s why I, along with my good friend Peter Roskam, Chairman of the Health Subcommittee, have asked GAO to look at how these reports are developed and why they are almost always late. Since we do not have Public Trustees, GAO’s work can bring much needed transparency and insights into what changes need to be made to improve the process. Congress must be able to count on these reports and have them available so it can do what it takes to fix Social Security.
“Previously, I introduced my plan to fix Social Security permanently. My good friend from Connecticut, Mr. Larson, also has a plan that would fix Social Security permanently. Our plans are very different, but we both agree that we need to act to fix Social Security for good. Workers and their families deserve the certainty that we’ve gotten Social Security on the right track.
“I know that fixing Social Security will require tough choices that will affect the lives of millions of Americans. Congress has a responsibility to the American people to make these choices. And the longer we wait, the harder it gets. If we wait until the Trust Funds are exhausted, some options won’t even be available anymore. We must take this responsibility seriously. Americans want, need, and deserve nothing less.”