Social Security Crisis

Floor Speech

Date: Jan. 26, 2023
Location: Washington, DC


Mr. SCHWEIKERT. Mr. Speaker pro-tem, we are going to do a couple things tonight, but first, just every once in a while, when we get behind these mics, and you have got to get something sort of off your chest because it really annoys you.

If I see one more headline from the scribes who are basically the Democrat propagandas--and I am sorry to be that mean. I have tried to treat the press respectfully over these years, but, you know, the Republicans want to cut Social Security and Medicare.

Okay. Up until a few hours ago, I was the senior Republican over Social Security in Ways and Means Committee. No one has asked me.

I talk about Social Security every single day when I am here. I have never met a Republican Member ever, ever, talk about cutting Social Security.

So yesterday, I grabbed one of the reporters out here who had it in their story but had no names. I walked up and said, okay, tell me who this is because I really need to talk to them.

I can't tell you. It is a reporter thing. I can't explain that to you. No, no. You need to tell me who is telling you to write stories that the Republicans intend to cut Social Security.

I am the ranking Republican--I was up until a few hours ago--over Social Security. I have spent the last year of my life working on it. No, no. I can't tell you who.

If you are going to make crap up, stop doing it in a way that you hurt people.

You know, for my Democrat colleagues, I know power. I know you desperately want to be back in charge, but the fact of the matter is, the math is the math.

You all saw the CBO numbers from a couple days ago. Social Security runs out of money in 10 years.

Do you care?

The fact that CBO is saying there is going to be a 23 percent cut in Social Security recipients' checks in 10 years, we will double senior poverty. Do you care, or is the politics of weaponizing it more important than saving retirement security? This is perverse.

This is called reporting around here? If you want to weaponize something, weaponize something that doesn't crush people.

I feel better getting that off my chest.

All right. I want to do a little something I consider a bit amusing and maybe a little sadistic.

A week ago or so when we were here, I did a presentation on structural deficit. I was trying to talk to the new Members of Congress, you know, my friend from Oklahoma, others. What is actually going on? Where does the debt come from?

The fact that 10 years from now, you have almost a $2 trillion structural deficit. That $2 trillion is functionally interest, a trillion bucks, and the growth in Medicare and a little bit of Medicaid.

I did something I almost never do. I actually read the comments. Look, I am appreciative. Almost 600-some-thousand people watched the YouTube video.

You get these comments like, well, cut foreign aid. That will balance the budget. Just don't pay Members of Congress and Senate, and that will balance the budget.

So we had a conversation in our office. How do I explain the scale?

Look, if you are not used to 12 zeros, or in this case, the current deficit, 14--if we are at 31 trillion, that is 14 zeros.

If you are not comfortable with the math, maybe I can find an easy way to discuss this. If this comes across a bit sarcastic, I mean it to.

So we actually built a little calendar, and we thought this would be sort of fun because we have too many people out there--they hear the political class get behind the microphone and say, we have a spending problem.

Then they come up with stupid--excuse me--ideas that really don't save us. So let's actually walk through these.

Let's start with the one I consider most amusing. A number of the comments were, just don't pay Members of Congress and the Senate. Okay. Great.

So this is a calendar of the year; 12 months, 365 days. If I said this is just the borrowing, so this is a calendar every day we borrow the equal amount, and we are going to base it on last year's borrowing, so it is a real number.

If you didn't pay any Member of Congress--and maybe we shouldn't get paid for the quality of our work; I am not going to argue about that-- how much of the debt deficit would it take care of?

Well, it turns out it is this little, tiny sliver down here. We calculate it is about 28 minutes for an entire year. That is all. You got a whole 28 minutes.

What would you like to do with the other 365 days, you know, 364 days, 23 hours or 23 and a half hours? You get the point.

I know it may make you feel better. I lashed out. I was mad. But you have a country that structurally is going to be buried in a scale of debt where you are starting to flirt with a debt crisis and a failed bond option in a decade or so. This is not a game. This level of debt takes down a republic.

So let's do a couple of the others here just for the fun of it. I will explain with these colors.

So whatever color that is--I guess that is like a turquoise--foreign aid. Every dime of foreign aid, if you removed it, hey, functionally, you just got rid of maybe 17 days, and we threw everything into it.

So you got rid of 17 days of borrowing. What would you like to do with the rest of the year? Well, if we got rid of the 2017 tax reform and played the fake scoring that every dime would come in, and you didn't lose the growth effects that we got from the tax reform and all those other things, you basically get 2 weeks of borrowing. Okay. Well, this obviously isn't working.

So if we went to a marginal 50 percent tax rate, a 50 percent tax rate, which some of the Democrats have actually proposed, you basically take care of 6 weeks of borrowing. Now, you slow down the economy, but let's just pretend the money keeps coming in.

You walk through, hey, how about a 35 percent marginal tax rate on corporations? Well, you got rid of maybe--you maybe could get another month and a half of borrowing, just borrowing coverage. That is assuming that you get all the revenues in, and you haven't slowed down the economy, slowed down GDP, which is pretend.

Okay. Let's do one of my others. You know, you take out itemized deductions. Okay. You got rid of a week.

To understand almost all the ideas that are out there, really, on the scale of it, if you threw them all in, you can't even get rid of half the year's borrowing, and that is for last year.

Understand, this year, we are going to probably borrow a little less than a trillion dollars. In 10 years, we have doubled it.

I beg of our brothers and sisters here. If the Democrats don't want to help, don't want to play, don't want to tell truth about the math-- and the math will always win--I beg my Republican brothers and sisters: Let's be the truth tellers.

Yes, there is waste and fraud. As of a couple hours ago, I just became the chairman of the Oversight Committee in Ways and Means, and there is waste and fraud we are going to grind into.

There is a chance unemployment fraud and some of the pandemic fraud may be the largest fraud in human history. We are going to find out what happened.

But I need you to think of our world and our government. We functionally have become an insurance company with an Army.

So I want to walk through a couple of the other comments you get just so I can get them off my chest.

When you look around the House here, you notice there are no people here. These are what we call the special orders. It is a chance for Members to come to the mic and walk through something, tell a story.

We are on probably a thousand televisions around Capitol Hill. So sometimes when I do this, I am not actually talking to my constituents at home in Arizona.

I am actually talking to the staff. I am talking to the new Members of Congress to help them understand here are the numbers I see.

I am the senior Republican in the House on something called the Joint Economic Committee, so I have a handful of economists who are just freaky smart who are in my office pounding information into my head every single day.

I know it is not the shiny objects. We want to talk about a laptop with secret documents, and a Chinese spy and this and that. Those are shiny objects that you can see on cable television tonight. I will argue, these numbers are what take out the Republic.

So let's actually go over some of the other comments I get over and over and over, particularly when I have talked about Social Security; and this is back to the cruelty the Democrats and the press have been doing this last 2 weeks, trying to light people's hair on fire with basically, what's the proper term, oh, yeah, lies.

For the average American who is going into Social Security today-- remember, I keep seeing these comments: If I could just get all my money back. Okay. If you are willing to make a deal with the Republic saying if I gave you back all your money on Social Security and Medicare, would you sign up for that deal? Because we would take it in a moment because when you see what you get back, you realize this is actually where much of the structural deficit comes from.

When people say, well, the money--there is no lock box. You don't want it in a lock box. You want it in T bills so you get interest back.

Social Security for years ran a surplus. That was building the trust fund because we had this demographic bubble coming called baby boomers. We saved and saved and saved.

Then, a couple of years ago, we started having more people move into retirement than functionally what they were paying, workers were paying. So every month, when the check goes out, you take the FICA income that is associated with the old-age, survivor's system, the Social Security system, send that out. But we needed a little bit more, so Social Security would take its Treasury bill, present it to the Treasury; Treasury would give them cash plus some interest.

For many years the interest rate was actually a spiff over--higher what you would get on the market T bill. The money wasn't stolen. It was put into T bills, just like you might do with your extra savings. Stop making stuff up.

So the average American, the typical retiring couple--let's do it that way because it is easier math, will receive--well, let's not do the Medicare number. Let's first do the Social Security.

That couple, the average, over a lifetime of work--so this is 35-plus quarters, sometimes 40 quarters--will put in $625,000 in FICA on the Social Security portion of that tax, and they are going to get back a little under $700,000. So they make a little bit of money.

Now the reality, if you had put that money in your IRA or something like that, it would have been multiples of this.

If you remember, George Bush tried to have the conversation of taking particularly young people, allowing them to take a sliver and put it in private accounts because it would have a much higher rate of return, and the Democrats and the unions went berserk on that. But now we can look back 25, 30 years and it would have been a hell of a lot better today for Americans if we had done it. But the politics of it is the control freaks wanting control of your money.

This in inflation-adjusted dollars, so it is like for like. You get your money back, plus a small spiff on Social Security. You could have had a lot more if you put it in markets and in other places, but you get your money back, inflation adjusted. Okay.

That is not what drives the debt. Our problem with Social Security is our number of workers. It is Medicare, and this is hard to talk about, but math is math.

I know many people will come up to me, Schweikert you can't talk about that. You are going to get unelected.

I am in one of the most competitive districts in America, but at least I am in one of the best-educated, smarter districts in America, and understand whether you like me or not, I am telling you the truth on the math.

Here is the substantial portion that drives about three-quarters of all U.S. sovereign debt. The average couple, in their lifetime of working, will put in $161,000 into Medicare.

Remember, the Medicare tax you pay as part of your FICA, your payroll tax, is just for the part A, the hospital portion. The rest of the healthcare spending you get when you become 65 and are on Medicare comes out of the general fund.

The average taxpaying couple put in that $161,000, and they are going to get back $522,000. This number is based on sort of before the inflation cycle.

We are working on some math but I wasn't able to vet it; that the amount of money we expect in medical costs for our brothers and sisters on Medicare actually has gone up rather substantially which, that means when you say 161, 500 plus, that gap, now multiply that toward how many; 70 million Americans 65 and up, and the number grows with baby boomers because, what, just the baby boom population is what, 76 million?

You see the driver of U.S. sovereign debt. The solution is not cutting. The solution is having a revolution of the cost.

ObamaCare was a financing bill. It is who had to pay and who got subsidized. Actually, it was mostly about subsidizing. The Republican alternative actually spread out the actual numbers so you got some efficiency but it was still about who had to pay and who got subsidized.

Medicare for all is all about subsidies. But those are financing bills. They don't touch the problem.

The real problem is the cost of delivering healthcare services.

For people who might say, well, he is not giving us a solution; go look at the probably 70 hours I have over the last few years on the floor here. Half those were bringing solutions. Most of my solutions are uncomfortable because they require disruption. It is technology. It is a thing you can blow into that knows you have the flu and allowing it to prescribe. Taking on the big things, curing diseases.

It turns out cures are remarkable at crashing the price of healthcare and just the basic morality of it. If diabetes is 33 percent of all healthcare spending, and there is a chance out there that there is being some success in curing Type 1 with a CRISPR-altered stem cell treatment, maybe it works, maybe it doesn't, but the literature right now says there are about six people who have been cured of Type 1. We need to know this. We need to find out over the next decade could it be for Type 2.

What do we do on the farm bill, on nutrition support and everything else. Is that a possibility? Because if you could disrupt that cost--do you realize if you could disrupt half, just half of the diabetics' cost in this country, you would actually wipe out the substantial portion of the next 30 years debt.

These are moral, but they are also financial ideas, and we run away from them. It is almost easier for Members of Congress to talk about cuts than it is competition to disrupt business models.

So understand, the next time you have someone saying well, if I could just get all my money I paid back in FICA taxes, we will make that deal, because you are getting--that couple is getting hundreds and hundreds and hundreds of thousands of dollars more than they put in.

It is the math. Whether you feel that way or not, it is the math, and that is the primary driver of U.S. sovereign debt.

Now, we made this deal. This is a societal contract. People worked their hearts out. They paid into FICA. We made a deal as a society.

Our job, as the brain trust here, as Members of Congress, we have got to figure out how to make this work.

You start to look at how fast these numbers are eroding. I have already said this a couple of times; maybe seeing it on a board makes it easier; and I am trying--one of the criticisms was too many of my boards had too many numbers on them. I am trying to make them easier to read. Let me know if I am succeeding, but I am trying.

This is a really simple chart. It basically says, here is where we are today. In a decade, structurally, just functionally, Medicare and Medicaid, and then if I add in interest, then there is another, functionally, just my cost there I am heading toward a trillion-plus dollars just from my Medicare.

Medicaid adds another quarter trillion dollars of borrowing; and then somewhere in there I have almost $1 trillion of interest. That is what I look like a decade from now.

So people run around here and say, I am going to cut and give you a 10-year balanced budget. Okay. Tell me what part of paying our bonds you are going to cut. That is $1 trillion of the deficit 10 years from now. You have got to do that.

All the people--you are going to default if you don't raise the debt ceiling. No, you are not, and I will do another presentation in the coming weeks on, stop making crap up.

The United States has plenty of cash flow to cover our sovereign debts and the majority of our earned entitlements. It is a lot of the discretionary we don't have enough cash for.

These are big, complicated, and then to have, as I started with, the trite Democrats and wanting an edge in the press, making it really hard to do something that has got to happen bipartisan.

Mr. Speaker, I know we are up against time.

The last one I am going to show very quickly. This is your 10-year chart. It is very simple. This is Social Security. This is the healthcare entitlements. This is everything else. This is what we are up against.

Mr. Speaker, I appreciate the tolerance from everyone. If I hurt your feelings, I am sorry. It may be too much caffeine and just being too damn cranky around here.