Hearing of the Social Security Subcommittee of the House Ways and Means Committee - Social Security Trustees Report

Hearing

Mr. Chairman, before I begin my opening statement, I want to again register my concern that we will be discussing the Social Security Trustees Report, which was released yesterday, without hearing from the author of that report, Social Security's Chief Actuary, Steve Goss.

As the Chief Actuary and author of that report, Mr. Goss is the nation's foremost expert on the report and Social Security's actuarial status. He has a long-established and well-earned reputation for neutrality and non-partisanship.

Instead, the only person testifying today with some level of involvement in the development of the report is the Republican Public Trustee. He and a number of other witnesses are proponents of Social Security privatization, guaranteed benefit cuts, and cuts to current seniors' COLAs using the chained CPI -- but we are not getting the facts from the Actuary.

While Republicans and Democrats have different policy views on Social Security, Americans regardless of political affiliation rely on it.

I would like to insert into the record this letter that I sent on behalf of Subcommittee Democrats registering my concern that Chief Actuary Goss was not invited to testify at our hearing to provide a neutral, non-partisan explanation of the facts before we are presented with partisan policy recommendations.

It is timely for us to talk about retirement security today, since the Trustees Report provides important information about Social Security's status.

For most Americans, Social Security is the heart of retirement security.

Six out of ten seniors rely on Social Security for more than half their income and nearly a third essentially live on Social Security alone, even though the average retiree benefit is a modest $1,200 a month.

Social Security provides uniquely secure retirement protection -- an income that is adjusted annually to keep up with inflation and cannot be outlived.

As people age and begin to outlive their other retirement savings, they rely increasingly on their Social Security paychecks. For almost half of Americans over 80, nearly all their income comes from Social Security.

Social Security keeps more than 22 million Americans out of poverty. Without Social Security, nearly half of women over age 65 would be poor.

Americans have earned that vital retirement security. Over 160 million Americans pay into Social Security with their paychecks every week in exchange for economic security for themselves and their families.

Over its lifetime, Social Security has raised $17.2 trillion and paid out $14.4 trillion, accumulating a surplus of $2.8 trillion for future benefit payments.

Retirement planning tools -- which some of our witnesses will discuss -- can be helpful, especially for workers with the ability to control when they retire and enough income to pay their bills, save for their children's education, and still put some money aside for retirement.

But according to the National Institute for Retirement Security, only the highest-income 25 percent of retirees receive any significant income from non-Social Security sources like an IRA or a work-based retirement plan, despite substantial subsidies for retirement savings in the tax code.

Future retirees may be even less likely to have non-Social Security retirement income -- the percent of older Americans who have guaranteed pension income from work is declining steadily, and less than half of Americans have any kind of retirement plan at work.

Security from benefit cuts and making sure it is as strong for future generations as it was for their parents and grandparents. The best way for Congress to improve retirement security is by protecting Social

I am deeply concerned, for example, about the proposals several of our witnesses have put forth to cut Social Security's annual Cost-of-Living-Adjustment for current seniors -- Americans who have already retired after a lifetime of work. I would urge them and my colleagues to look carefully at Joan Entmacher's analysis, which shows that the so-called "chained CPI" would result in deep benefit cuts for those who need them the most -- the oldest and poorest seniors.

I also disagree with the proposals four of our witnesses have made to privatize Social Security, cutting its guaranteed benefits.

Mr. Chairman, I know I've said this before -- in fact, I said it at our hearing on the Social Security Trustees Report back in June of 2011: the biggest challenge facing Social Security right now is Republican budget cuts.

At our hearing in 2011, I and the other Democrats on the Subcommittee asked you to hold hearings to find out how Americans were affected by a $622 million cut to the Social Security Administration (SSA)'s budget.

We never had that hearing, even though prior to 2011, our Committee had a bipartisan tradition of holding oversight hearings on SSA's budget and its ability to serve the American public.

The cuts continued. Since the beginning of 2011, the number of Americans receiving Social Security has grown by almost 4 million people, but SSA's budget is still lower today than it was four years ago, in 2010.

We now know some of the ways the cuts are affecting Americans who rely on Social Security.

Social Security has lost 11,000 employees as a result of these cuts -- almost 15 percent of their workforce. Some local Social Security offices are operating with staff shortages of more than 25 percent.

Budget cuts forced Social Security to reduce the number of hours their offices are open to the public by one-fifth, including closing offices completely on Wednesday afternoons.

Disabled workers today are waiting longer and longer to receive their earned benefits.

14 percent of Americans who try to call Social Security's 800 number get a busy signal, and those who get through are put on hold.

Seniors who need help are waiting in long lines that stretch out the door of the Social Security office, sometimes in the hot sun or icy cold.

Mr. Chairman, I again urge you to schedule a hearing on SSA's budget so that we can examine these budget cuts and make sure Social Security can continue its long tradition of providing Americans with the service they paid for. I would like to enter into the record a letter that Subcommittee Democrats sent you today reiterating our concern and requesting that we act before the situation gets even worse.

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