It is Time to Act on Social Security

Floor Speech

Date: May 12, 2022
Location: Washington, DC

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Mr. LARSON of Connecticut. Madam Speaker, I am here this morning to talk about Social Security.

Madam Speaker, I include in the Record two articles: The first is entitled, ``It's time for U.S. Congress to debate Social Security reform in the light of day'' by The New York Times reporter Mark Miller.

The second is ``The Early Impact of COVID-19 on Job Losses among Black Women in the United States'' submitted by Michelle Holder.

It's Time For U.S. Congress to Debate Social Security Reform in the Light of Day (By Mark Miller, May 5, 2022)

(Reuters).--Social Security has never failed to make its benefit payments since the mailing of monthly checks began in 1940, but most Americans these days are worried about the future of the program.

Who can blame them? Social Security's two trust funds are projected to run dry in 2034, and the program would be able to pay only 80 percent of its obligations to retirees and disabled workers at that point. Politicians don't exactly generate confidence when they make irresponsible--and wrong-- comments claiming that Social Security is going bankrupt or running out of money.

The result is public skepticism and concern. Forty-two percent of working Americans tell Pew Research Center pollsters that they doubt they will receive any benefits from Social Security. An equal share thinks they will receive a benefit, but at a reduced level.

The Social Security trustees have been projecting this shortfall since the early 1990s, but the U.S. Congress has failed to act. What we need is a full, public debate on reform legislation--and an actual vote by lawmakers. The window is open for that to happen this year--the Democratic Party has developed an internal consensus on legislation that addresses the solvency problem, and also expands benefits modestly. It controls both legislative chambers--at least for now. The Social Security 2100 Act is supported by 202 House Democrats--in other words, nearly the entire party caucus. The bill probably cannot jump the hurdle of a Republican filibuster in the U.S. Senate, but it is imperative to get everyone in Congress on the record with a vote on this issue.

``People have got to know where you stand,'' said U.S. Representative John Larson, a Connecticut Democrat and chief sponsor of the legislation. EXPANDED BENEFITS

The Social Security 2100 legislation would close 52 percent of the long-term shortfall, according to an analysis by the Social Security actuaries. It would push the trust fund depletion date back to 2038 by adding new payroll taxes to wages over $400,000--currently, taxation stops at $147,000. Earlier versions of the bill restored solvency for 75 years by also gradually increasing payroll tax rates, but that has been eliminated to reflect President Joe Biden's campaign pledge not to raise taxes on people with incomes below $400,000 per year.

The bill does recognize the need to expand benefits, which can help address rising income inequality, and racial and gender gaps in retirement security. The COVID-19 pandemic has widened those gaps. What's more, Gen-Xers and Millennials are likely to fare even worse than boomers and today's seniors when they reach retirement. This is the result of factors including escalating higher-education costs, staggering student debt burdens, wage stagnation, soaring housing costs and the decline of traditional defined benefit pensions.

Social Security 2100 includes a modest 2 percent across- the-board boost in benefits, and it would shift the annual cost-of-living increase to a more generous formula. It also includes targeted benefit increases such as a new minimum benefit level for very low income seniors, and improved benefits for widows and widowers. It also would provide caregiver credits that increase benefits for people who take time out of the workforce to care for dependent family members. And it would repeal the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO), which currently penalize many people who work in the public sector.

What would Republicans do to solve the Social Security problem if they take control of Congress next year?

Earlier versions of Republican reform plans have called for benefit cuts in the form of higher retirement ages and means testing. U.S. Senator Rick Scott, a Florida Republican, recently set off a small firestorm with a proposal to sunset all federal legislation every five years--an idea that at least in theory would require regular reauthorization of Social Security and Medicare. He also wants every American to pay income taxes--no matter their level of income.

Republicans have also made clear that they prefer to handle Social Security reform behind closed doors. Senator Mitt Romney, a Utah Republican, has proposed the ironically named TRUST Act, which would create a closed process for legislators to propose changes to the Social Security and Medicare trust funds, culminating in an up or down vote process.

This approach is a favorite play for lawmakers looking to keep their fingerprints off unpopular legislation--bills emerge from faceless, bipartisan committees. The last time it was attempted for Social Security was the unsuccessful Bowles-Simpson commission, which proposed a range of unpopular benefit cuts in 2011 that would have impacted middle-class seniors.

Fighting to improve Social Security would fulfill a promise that Biden made as a presidential candidate, and it could energize voters. Public opinion polling has consistently shown strong public support for maintaining current benefit levels, even if new taxes are needed.

New polling by Data for Progress shows that increasing benefits would make a large chunk of independent voters more likely to support Democratic candidates for Congress this fall. The idea of shoring up Social Security polls extremely well with middle-class Americans: 63 percent of those without a college degree tell Pew pollsters that Social Security finances should a top priority for Congress and the president.

This is a battle worth fighting in 2022. ____

[From Levy Economics Institute of Bard College, July 2020] Working Paper No. 963

The Early Impact of COVID-19 on Job Losses Among Black Women in the United States By (Michelle Holder, John Jay College, City University of New York) (Janelle Jones, Groundwork Collaborative)

(Thomas Masterson, Levy Economics Institute of Bard College) INTRODUCTION

The COVID-19 pandemic seemingly appeared out of nowhere but changed nearly everything. Until February of 2020, the American economy had been at what is considered full employment levels--3.5 percent overall. Even African Americans, who traditionally occupy a less favorable position in the labor market (as measured by unemployment and wage disparities) were experiencing historically low levels of unemployment. However, the first signs of the massive job losses that were to come appeared when initial claims filed for unemployment insurance rose to unprecedented levels in March, leaping from approximately 220,000 new claims filed each week since the start of the year to an astonishing 3.3 million by the third week in March, then more than doubling the following week to 6.9 million. While this pace slowed down in May, new claims for unemployment insurance in the United States still numbered in the millions each week. With shelter-in-place orders implemented across the country in February and March, along with state-by-state mandatory shutdowns of ``nonessential'' businesses, aggregate demand for many goods and services ground to a halt, leaving tens of millions of American workers jobless.

As the pandemic unfolded, industries deemed nonessential, such as leisure, hospitality, and retail trade, were leveled. Many occupations in these industries are low-wage, and women constitute a greater share of the low-wage labor force in the United States than men (Holder 2018, 689). Moreover, the largest share of minimum wage workers in America is female (Holder 2017, 12). Thus, when the US Department of Labor's Bureau of Labor Statistics (BLS) released their monthly ``Employment Situation'' report for April on May 8 (a week later than it normally would have) it was met with only modest surprise that the April unemployment rate for women exceeded the unemployment rate for men--16.2 percent versus 13.2 percent, respectively (US DOL 2020). The pattern of higher unemployment for women as compared to men is also true in the Black community, along with the US's long-standing pattern of an unemployment rate for Blacks that routinely exceeds that of Whites--16.7 percent and 14.2 percent, respectively (US DOL 2020).

As COVID-19 deaths began to mount, it became clear that African Americans were disparately affected not only with regard to their livelihoods, but also their very lives; while the Black community is 13 percent of the US population, given inequitable access to healthcare as well as other structural inequalities, they accounted for roughly one-quarter of all deaths in the country as of May 28, 2020 (US CDC 2020). Moreover, as some American workers were able to do their jobs from the comfort of their homes, a high proportion of ``essential'' workers (somewhat loosely defined as those who work in supermarkets, public transportation, pharmacies, grocery stores, nursing homes, hospitals, and correctional facilities, among other industries) were African American, other people of color, women, and an intersection of the these groups--women of color. The goal of this paper is to closely examine the contours, depth, and causes of COVID-l9's impact on Black women's employment in the United States. Because the early job loss numbers indicate that women in the United States have thus far borne the brunt of the COVID-19- inspired downturn, most demographic comparisons we make in this text will be between female demographic groups, primarily Black and White women, using the lenses of both feminist economic theory and stratification economics. GENDER AND RACE IN THE COVID-19 DOWNTURN

The recession of the early 1980s, as well as the Great Recession, were downturns in which men, Black workers, and Latinx workers experienced disproportionate job loss, mostly attributable to the industrial distribution of these groups-- they tend to be employed in industries that are more vulnerable to cyclical downturns (Hoynes, Miller, and Schaller 2012). Although there were across-the-board job losses among all major demographic groups during the Great Recession, according to Haynes, Miller, and Schaller (2012) the smallest absolute increase in unemployment during that downturn occurred among White women. Those researchers attributed this to the industrial distribution of women whom, they posited, tend to be employed in industries less vulnerable to cyclicality than industries in which men are concentrated. Women of color, however, were more vulnerable than women overall, given the roles of race and ethnicity in that group's industrial distribution.

The current economic downturn in the United States, however, is quite unlike business cycle downturns of the past. The normal predictions and expectations of where job losses were going to occur have not closely followed past patterns. Industries such as leisure and hospitality, retail trade, construction, manufacturing, and ``other services'' (including personal care services) were labeled as ``nonessential,'' and companies operating in these industries were ordered, state by state, to temporarily cease or slow down operations. Industries operating in the sphere of ``essential services'' were allowed to continue, but with significant restrictions, resulting in significant declines in economic activity. With much of the US population sheltering in place during the early phases of the pandemic-- including those employees who were able to work from home-- other industries still considered essential, like transportation, experienced a massive slowdown m activity. Unlike the Great Recession and the recession of the early 1980s, women, particularly women of color, were bearing the brunt of early job losses given the extraordinary nature in which economic activity was deliberately, not organically, slowed down or halted. Rising unemployment among women, given their overrepresentation in service industries and occupations, became pervasive (see Boushey and Sanchez Cumming 2020). While jobholding by Black women in services deemed essential (like hospitals and supermarkets) offered some insulation against job loss, this was not enough to offset large job losses in other sectors. CHANGES IN LABOR FORCE INDICATORS FOR WOMEN DURING THE EARLY PANDEMIC

The seasonally adjusted US unemployment rate for April 2020 climbed by slightly more than 10 percentage points, to 14.7 percent from 4.4 percent in March. This increase was the largest month-to-month change in over 70 years. Moreover, the April unemployment rate was nearly 50 percent higher than the average US unemployment rate during the 18-month period of the Great Recession. This was clearly an astonishing rate of job loss. Drilling down the numbers by gender and race, Latinas appear to have experienced the highest unemployment rate in April--20.2 percent--followed by African American women at 16.2 percent; White women's unemployment rate reached 15 percent (US DOL 2020). However, the change in the rate of unemployment only captures part of the story; after averaging approximately 63 percent for the first quarter of 2020, the overall labor force participation rate declined to just over 60 percent in April, signaling the start of an exodus from the American labor force. The official unemployment rate does not capture individuals who are not in the labor force, and that number swelled by about 8 million in April, with nearly half of this increase attributable to persons who wanted to work but who could not find employment.

Among major female demographic groups for whom the BLS provides monthly data, Black women possessed both the highest labor force participation rate as well as employment- population ratio, leaving this group especially vulnerable to the COVID-19-inspired downturn, given their strong attachment to the workforce. Black women's unemployment rate for April shot up to 16.4 percent, higher than that for Black men, whose unemployment rate reached 16.2 percent that month. Unlike the Great Recession of 2007-9, where the unemployment rate for Black men significantly exceeded that of Black women, the early impact of COVID-19 on unemployment has clearly been ``gendered,'' with more intense ramifications for African American women.

In comparing Black and White women, in February of this year, prior to the initial impact of COVID-19 on US employment, Black women not only had a higher unemployment rate than White women (4.8 percent versus 2.8 percent, respectively), but also a higher labor force participation rate (63.8 percent versus 58.2 percent, respectively). Feminist economists such as Nina Banks (2019), Cecilia Conrad (2005), and Randy Albelda (1985) have long highlighted the historically higher labor force participation rate of Black women compared to White women in the United States. As noted in the preceding paragraph, this attachment to the labor force also makes Black women more vulnerable during economic downturns. In examining table 1, while there appears to be little difference in the increase in the unemployment rate from February to April for Black women compared to White women, because of Black women's more entrenched--and, at the same time, more precarious attachment to the American workforce (evidenced by historically higher unemployment rates than White women)--the impact of COVID-19 on Black women's position in the labor force has been somewhat deeper than that for White women, with slightly larger (and statistically significant) declines for Black women than White women in both the labor force participation rate and the employment-population ratio. DISCUSSION AND CONCLUSION

The early job losses during the COVID-19 pandemic were characterized by gender and racial disparities. With regard to job losses by industry, the ``healthcare and social services'' industry accounted for nearly 14 percent of all workers in the United States but 28 percent of employed Black women and 22 percent of employed White women; the 17 percent decline in employment in this industry, therefore, was bound to have an outsized impact on women. Feminist economic theory has explored the role that discrimination plays in occupational crowding by gender, notably the historical exclusion of women from jobs that are deemed more appropriate for men (see Beller 1982). In addition, Black women, along with Black men, suffered disproportionately staggering losses in the ``accommodation and food services'' industry, an industry leveled during the pandemic, where the overrepresentation of Black female and Black male workers exceeds that of their White counterparts. This industry offers notoriously low wages and stratification economic theory suggests that privileged groups have a material interest in maintaining sexism and racism--as well as other forms of oppression--because benefits accrue to advantaged groups as a whole (see Darity et. al. 2017). This is true even though the benefits do not necessarily accrue to all individual members of the privileged group at all times. Thus, discrimination can and does persist in market-based economies. The crowding of Black workers in low-wage industries is suggestive of opportunity hoarding by White workers, consistent with stratification economic theory.

Occupationally, the roles of both gender and race proved to be disastrous for employment losses for Black women. The only two major occupational categories that experienced employment declines greater than 50 percent--``food preparation and serving'' (which accounts for just over 5 percent of all workers) and ``personal care and services'' (which accounts for nearly 3 percent of all workers)--are two occupations where, among Black and White employees, Black women are the only demographic group overrepresented in both.

The pandemic has catalyzed a public health and economic crisis on a scale not seen since the Great Depression. In one month, the unemployment rate increased by 10 percentage points, the largest month-to-month increase in more than a generation. While the devastation has been widespread, it is not shared equitably across race and gender. There are two main reasons why Black women are disproportionately impacted by the COVID-19 recession. First, Black women in the labor market face high levels of occupational and industrial segregation. Second, Black women's strong attachment to the labor market, as measured by their labor force participation rate and employment-to-population ratio, makes them more vulnerable to economic downturns, and this current recession is no exception.

Unlike previous economic downturns, industries once thought immune to recessions were ordered by government officials to stop or significantly slow their activity. Between February and April, when the economy shed millions of jobs, Black women experienced larger-than-overall declines in employment due to their concentration in parts of the economy. Black women are overrepresented in ``essential'' jobs, like nursing assistants and cashiers, while at the same time also overrepresented in occupations and industries that are shedding workers by the millions, such as hotels, restaurants, and retail trade. In responding to this economic crisis, policymakers must firmly commit to a policy agenda that provides immediate relief to those who need it and make our economy more stable and equitable in the future. In the short term, we should continue to give direct support to families through cash payments and an expansion of unemployment benefits. In the long term, we can enact policies that fix the structural flaws of our system, including using economic measures tied directly to the position and status of Black women in order to more accurately determine when an economy has reached those often left behind.

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Mr. LARSON of Connecticut. Madam Speaker, I think as Martin Luther King would say, it is the ``fierce urgency of now'' that we are dealing with, and by that I mean the fierce urgency being the pandemic that this country is currently going through.

That pandemic has taken more than 740,000 Americans over the age of 65. That same group over the age of 65 is the group that is hurt most by inflation. Why? Because they are on fixed incomes. They are Social Security recipients. And they need our help now.

The good news, thanks to the efforts of Chairman Neal and the Ways and Means Committee, we have established a Racial Equity Task Force. The gentlewoman from Alabama (Ms. Sewell), the gentleman from Nevada (Mr. Horsford), and the gentleman from California (Mr. Gomez) have all put together extensive reporting that talks about the inequality that exists in what our colleague John Lewis said was the next civil rights movement, and that is to make sure we uplift everybody in this country who has worked all their lives, paid into a system, and receives below- poverty-level checks from their government.

That is about to end with the passage of Social Security 2100: A Sacred Trust, called the sacred trust by President Biden because it is. We no longer have to go back to the Great Depression to talk about the impact of Social Security and why it came into prominence. You only have to go back as far as 2008-2009 to understand that during that recession, people saw their 401(k) become a 101(k).

During that same time period, Social Security never missed a payment, not a spousal, not a dependent coverage payment, not a pension payment, and not a disability payment.

With Memorial Day approaching, it was good listening to the Members come and talk about honoring our veterans on Memorial Day. Several came down this week honoring National Police Week as well, talking about police officers who need help. Millions of police officers and their spouses across this country, because of WEP and GPO, are penalized and don't receive the Social Security benefits that they richly deserve. President Biden has put an end to that.

Richard Neal has also introduced legislation as well with respect to that. So has Mr. Davis and Mr. Brady on the Republican side. It is long overdue. If you want to help police officers, if you want to help our veterans, so many of whom rely more on Social Security Disability than they do on the VA, we need to reform Social Security. Congress has not enhanced Social Security in more than 51 years. A gallon of milk in 1971 cost 72 cents. Look at the cost now, not only of milk but of bread and butter and gas and rent, and understand the absolute necessity to help out the people who during this pandemic need it the most.

Congress can no longer kick the can down the road. This is our responsibility on our watch; and on Memorial Day, every citizen in this country ought to be asking Congress what it is going to do. What do we have to do? A very simple thing that we take an oath of office and raise our hands and pledge allegiance to the Constitution, and that is vote. Vote on an issue that will help the people of this great Nation out: People who have been neglected, more than 3 million who have paid in all their lives and get below-poverty-level checks; millennials and Gen Xers, who are going to need Social Security even more than the 10,000 baby boomers a day who become eligible for Social Security. The time to act is now.

Let's heed the words of Martin Luther King and understand the ``fierce urgency of now'' so that people won't have to put food back on the shelves that they can't afford or be turned back from the drugs that they need to purchase and that they have a quality of life that they richly deserve in the wealthiest nation in the world.

We can pay for this all by just simply raising the cap on people over $400,000. Those wealthy people can afford to pay the same level that people making $50,000. It is long overdue. The time to act is now.

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