Revisiting WEP And GPO

One of the most nagging criticisms of the U.S. Social Security program is found in the persistent outcries of unfairness from the people affected by two scorned sections of the program’s massive rulebook. Anyone following legislative activities involving Social Security will quickly know that we’re talking about the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO)—two program sections sometimes referred to as the “evil twins” and often subjected to harsh accounts of their detrimental effects.

WEP has existed since the 1983 Social Security Amendments were signed into law, and GPO goes back even further—to the 1977 Social Security Amendments. It’s fair to say both have been unpopular since they first appeared, and many unsuccessful attempts to either repeal or soften the provisions’ impact on Social Security benefits have surfaced in Congress. In fact, more than a dozen proposals have been introduced in the last three Congressional sessions, none resulting in legislative change.

Now, in the current Congressional session, H.R. 82 and S. 597—both carrying the title “Social Security Fairness Act–are gaining momentum as the latest incarnation of the campaign to eliminate WEP and GPO. Both bills have attracted considerable attention on behalf of those affected. Numerous articles have surfaced labeling WEP and GPO as unquestionably extreme in their punishing nature, and much testimony has been submitted in public hearings about the “unfair” and “unjust” impact they can have on retirees.

So, Are The Allegations Of Unfairness Warranted?

AMAC Foundation’s Social Security Advisory Service has handled hundreds of inquiries from WEP- and GPO-affected parties, prompting considerable research into the complaints expressed by callers. In all cases, we’ve taken care to explain the reason why these provisions were enacted decades ago, along with a recap of how they work.

Our Advisory Service’s research has led to a conclusion that—perceptions of equity and fairness aside—much of the displeasure is related to an unexpected impact on the retirement income assumed in financial plans. Arriving at retirement and facing a financial setback at a point where there is little time to adjust can clearly be jarring.

An article posted a few weeks ago on this site provided background on how these two provisions came into existence, and explained how they work to adjust benefits. The article also introduced a key element of the argument that needs to be understood in order to answer the fairness question, and announced the scheduling of a webinar to explore WEP and GPO in depth.

The webinar was held as planned March 13, 2024 and a recording of the material presented can be viewed on the “Videos” page of the AMAC Foundation’s website. We invite you to view the recording at your convenience, and we’d be interested in any feedback you might have on the WEP-GPO issue. You can reach us at [email protected].

Comments On This Topic

  1. I have a question regarding information that the feds publish on the cost of SS. Does the dollar amount reflect total liabilities before or after the evil twins are considered. From my view point it should be total liabilities before WEP/GPO are deducted. I say this because if anyone subject to these can go back to work or keep working and have the penalty reduced. So with that in mind the argument that when WEP/GPO are repealed the ss fund will be impacted is false. However after writing letters, emails and calls no body can tell me if this is true or not. Does anyone know the answer to this?

    • Jane:

      Thank you for contacting us Regarding your question on the “cost of SS,” I’m assuming you’re referring to the information published in the annual Social Security Trustees’ report to Congress on the operation and financial status of the program and its trust fund reserves. The costs of operating the program are detailed in those reports, along with the overall assessment of the program’s financial status at the end of each year. The “cost of SS” presented in the annual report reflects the actual and projected expenditures associated with Social Security benefits; these figures are point-in-time numbers.

      In a recent House Ways and Means Social Security Subcommittee hearing, expert witnesses reported that the cost of repealing WEP and GPO would be approximately $183 billion. Since Social Security is a zero-sum, closed system, any additional costs resulting from legislative changes (like repealing these provisions) would be borne by all other program participants. We do not have access to the math behind the $183 billion cost estimate, but it is likely that the impact of workers in covered employment on a path to mitigate the impact of these provisions on their benefits have been taken into account.

      The most recent WEP-GPO hearing, specifically addressing H.R. 82, focused on the WEP-GPO fairness issue, and testimony leaned heavily toward avoiding repeal in favor of formula changes that would make the current adjustment calculations more reflective of actual covered/noncovered work histories. This data was not available when the provisions were enacted decades ago, and could (if adopted) lead to changes in the adjustments for certain individuals currently affected by WEP and GPO. Some could benefit, others might see the reverse…additional study is needed to assess the overall affect. Again, though, Social Security is self-financed, so any net loss of revenue will affect all participants.

      Thanks again for the question. If you’d like to discuss this further, please feel free to contact me via the Foundation office (888-750-2622).

      Gerry Hafer
      AMAC Foundation

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