Latest news with #HouseWaysandMeansCommittee
Miami Herald
4 hours ago
- Business
- Miami Herald
Michael Hiltzik: Social Security is still in good shape but faces challenges
The annual reports of the Social Security and Medicare trustees provide yearly opportunities for misunderstandings by politicians, the media, and the general public about the health of these programs. This year is no exception. A case in point is the response by House Budget Committee Chairman Jodey Arrington, R-Texas, to the Social Security and Medicare trustees' projections about the depletion of the programs' reserves: "Doing nothing to address the solvency of these programs will result in an immediate, automatic, and catastrophic cut to benefits for the nearly 70 million seniors who rely on them." The reports say nothing about an "immediate" cut to benefits. They talk about cuts that might happen in 2034 and 2033, when there still would be enough money coming in to pay 89% of scheduled Medicare benefits and 81% of scheduled Social Security benefits. House Ways and Means Committee chairman Jason Smith, R-Missouri, used the release of the reports to plump for the budget resolution that the House narrowly passed on orders from President Trump and that is currently being masticated by several Senate committees. The reports, Smith said, make clear "how much we need pro-growth tax and economic policies that unleash our nation's growth, increase wages, and create new jobs." The budget bill "would do just that," he said. Neither Arrington nor Smith mentioned the leading threats to the programs coming from the White House. In Social Security's case, that's Trump's immigration, taxation and tariff policies, which work directly against the program's solvency. For Medicare, the major threat is a rise in healthcare costs. But those have flattened out as a percentage of gross domestic product since 2010, when the enactment of the Affordable Care Act brought better access to medical care to millions of Americans. That trend is jeopardized by Republican healthcare proposals, which encompass throwing millions of Americans off Medicaid. Policy proposals by Health and Human Services Secretary Robert F. Kennedy Jr. such as discouraging vaccinations can only drive healthcare costs higher. Let's take a closer look. (The Social Security trustees are Kennedy, Treasury Secretary Scott Bessent, Labor Secretary Lori Chavez-DeRemer and newly confirmed Social Security Commissioner Frank Bisignano, all of whom serve ex officio; two seats for public trustees are vacant. The Medicare trustees are the same, plus Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services.) The trust funds are built up from payroll taxes paid by workers and employers, along with interest paid on the treasury bonds the programs hold. At the end of this year, the Medicare trust fund will hold about $245 billion, and the Social Security fund - actually two funds, consisting of reserves for the old-age and disability programs, but typically considered as one - more than $2.3 trillion. Trump has consistently promised that he won't touch Social Security and Medicare, but actions speak louder than words. "Trump's tariffs and mass deportation program will accelerate the depletion of the trust fund," Kathleen Romig of the Center on Budget and Policy priorities observed after the release of the trustees' reports this week. "The Trump administration's actions are weakening the country's economic outlook and Social Security's financial footing." Immigration benefits the program in several ways. Because "benefits paid out today are funded from payroll taxes collected from today's workers," notes CBPP's Kiran Rachamallu, "more workers paying into the system benefits the program's finances." In the U.S., he writes, "immigrants are more likely to be of working age and have higher rates of labor force participation, compared to U.S.-born individuals." The Social Security trustees' fiscal projections are based on average net immigration of about 1.2 million people per year. Higher immigration will help build the trust fund balances, and immigration lower than that will "increase the funding shortfall." All told, "the Trump administration's plans to drastically cut immigration and increase deportations would significantly worsen Social Security's financial outlook." A less uplifting aspect of immigration involves undocumented workers. To get jobs, they often submit false Social Security numbers to employers - so payroll taxes are deducted from their paychecks, but they're unlikely ever to be able to collect benefits. In 2022, Rachamallu noted, undocumented workers paid about $25.7 billion in Social Security taxes. Trump's tariffs, meanwhile, could affect Social Security by generating inflation and slowing the economy. Higher inflation means larger annual cost-of-living increases on benefits, raising the program's costs. If they provoke a recession, that would weigh further on Social Security's fiscal condition. Trump also has talked about eliminating taxes on Social Security benefits. But since at least half of those tax revenues flow directly into Social Security's reserves, they would need to be replaced somehow. Trump has never stated where the substitute revenues could be found. Major news organizations tend to focus on the depletion date of the trust funds without delving too deeply into their significance or, more important, their cause. It's not unusual for otherwise responsible news organizations to parrot right-wing tropes about Social Security running out of money or "going broke" in the near future, which is untrue but can unnecessarily unnerve workers and retirees. The question raised but largely unaddressed by the trustee reports is how to reduce the shortfall. The Republican answer generally involves cutting benefits, either by outright reductions or such options as raising the full retirement age, which is currently set between 66 and 67 for those born in 1952-1959 and 67 for everyone born in 1960 or later. As I've reported, raising the retirement age is a benefit cut by another name. It's also discriminatory, for average life expectancy is lower for some racial and ethnic groups than for others. For all Americans, average life expectancy at age 65 has risen since the 1930s by about 6.6 years, to about 84 and a half. The increase has been about the same for white workers. But for Black people in general, the gain is just over five years, to an average of a bit over 83, and for Black men it's less than four years and two months, to an average of about 81 and four months. Life expectancy is also related to income: Better-paid workers have longer average lifespans than lower-income workers. The other option, obviously, is to leave benefits alone but increase the programs' revenues. This is almost invariably dismissed by the GOP, but its power is compelling. The revenue shortfall experienced by Social Security is almost entirely the product of rising economic inequality in the U.S. At Social Security's inception, the payroll tax was set at a rate that would cover about 92% of taxable wage earnings. Today, rising income among the rich has reduced that ratio to only about 82%. That could mean hundreds of billions of dollars in lost revenues. The payroll tax is highly regressive. Those earning up to $176,100 this year pay the full tax of 12.4% on wage earnings (half deducted directly from their paychecks and half paid by their employers). Those earning more than that sum in wages pay nothing on the excess. To put it in perspective, the payroll tax bite on someone earning $500,000 in wages this year would pay not 12.4% in payroll tax (counting both halves of the levy), but about 4.4%. Eliminating the cap on wages, according to the Social Security actuaries, would eliminate half to three-quarters of the expected shortfall in revenues over the next 75 years, depending on whether benefits were raised for the highest earners. Taxing investment income - the source of at least half the income collected by the wealthiest Americans - at the 12.4% level rather than leaving it entirely untaxed for Social Security would reduce the shortfall by an additional 38%. Combining these two options would eliminate the entire shortfall. Social Security has already been hobbled by the Trump administration, Trump's promises notwithstanding. Elon Musk's DOGE vandals ran roughshod through the program, cutting staff and closing field offices, and generally instilling fears among workers and retirees that the program might not be around long enough to serve them. In moral terms, that's a crime. Those are the choices facing America: Cutting benefits is a dagger pointed directly at the neediest Americans. Social Security benefits account for 50% or more of the income nearly 42% of all beneficiaries, and 90% or more of the income of nearly 15% of beneficiaries. The wealthiest Americans, on the other hand, have been coasting along without paying their fair share of the program. Could the equities be any clearer than that? Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Los Angeles Times
12 hours ago
- Business
- Los Angeles Times
Social Security is still in good shape but faces challenges — from Trump
The annual reports of the Social Security and Medicare trustees provide yearly opportunities for misunderstandings by politicians, the media, and the general public about the health of these programs. This year is no exception. A case in point is the response by House Budget Committee Chairman Jodey Arrington (R-Tex.) to the Social Security and Medicare trustees' projections about the depletion of the programs' reserves: 'Doing nothing to address the solvency of these programs will result in an immediate, automatic, and catastrophic cut to benefits for the nearly 70 million seniors who rely on them.' The reports say nothing about an 'immediate' cut to benefits. They talk about cuts that might happen in 2034 and 2033, when there still would be enough money coming in to pay 89% of scheduled Medicare benefits and 81% of scheduled Social Security benefits. House Ways and Means Committee chairman Jason Smith (R-Mo.) used the release of the reports to plump for the budget resolution that the House narrowly passed on orders from President Trump and that is currently being masticated by several Senate committees. The reports, Smith said, make clear 'how much we need pro-growth tax and economic policies that unleash our nation's growth, increase wages, and create new jobs.' The budget bill 'would do just that,' he said. Neither Arrington nor Smith mentioned the leading threats to the programs coming from the White House. In Social Security's case, that's Trump's immigration, taxation and tariff policies, which work directly against the program's solvency. For Medicare, the major threat is a rise in healthcare costs. But those have flattened out as a percentage of gross domestic product since 2010, when the enactment of the Affordable Care Act brought better access to medical care to millions of Americans. That trend is jeopardized by Republican healthcare proposals, which encompass throwing millions of Americans off Medicaid. Policy proposals by Health and Human Services Secretary Robert F. Kennedy Jr. such as discouraging vaccinations can only drive healthcare costs higher. Let's take a closer look. (The Social Security trustees are Kennedy, Treasury Secretary Scott Bessent, Labor Secretary Lori Chavez-DeRemer and newly confirmed Social Security Commissioner Frank Bisignano, all of whom serve ex officio; two seats for public trustees are vacant. The Medicare trustees are the same, plus Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services.) The trust funds are built up from payroll taxes paid by workers and employers, along with interest paid on the treasury bonds the programs hold. At the end of this year, the Medicare trust fund will hold about $245 billion, and the Social Security fund — actually two funds, consisting of reserves for the old-age and disability programs, but typically considered as one — more than $2.3 trillion. Trump has consistently promised that he won't touch Social Security and Medicare, but actions speak louder than words. 'Trump's tariffs and mass deportation program will accelerate the depletion of the trust fund,' Kathleen Romig of the Center on Budget and Policy priorities observed after the release of the trustees' reports this week. 'The Trump administration's actions are weakening the country's economic outlook and Social Security's financial footing.' Immigration benefits the program in several ways. Because 'benefits paid out today are funded from payroll taxes collected from today's workers,' notes CBPP's Kiran Rachamallu, 'more workers paying into the system benefits the program's finances.' In the U.S., he writes, 'immigrants are more likely to be of working age and have higher rates of labor force participation, compared to U.S.-born individuals.' The Social Security trustees' fiscal projections are based on average net immigration of about 1.2 million people per year. Higher immigration will help build the trust fund balances, and immigration lower than that will 'increase the funding shortfall.' All told, 'the Trump administration's plans to drastically cut immigration and increase deportations would significantly worsen Social Security's financial outlook.' A less uplifting aspect of immigration involves undocumented workers. To get jobs, they often submit false Social Security numbers to employers — so payroll taxes are deducted from their paychecks, but they're unlikely ever to be able to collect benefits. In 2022, Rachamallu noted, undocumented workers paid about $25.7 billion in Social Security taxes. Trump's tariffs, meanwhile, could affect Social Security by generating inflation and slowing the economy. Higher inflation means larger annual cost-of-living increases on benefits, raising the program's costs. If they provoke a recession, that would weigh further on Social Security's fiscal condition. Trump also has talked about eliminating taxes on Social Security benefits. But since at least half of those tax revenues flow directly into Social Security's reserves, they would need to be replaced somehow. Trump has never stated where the substitute revenues could be found. Major news organizations tend to focus on the depletion date of the trust funds without delving too deeply into their significance or, more important, their cause. It's not unusual for otherwise responsible news organizations to parrot right-wing tropes about Social Security running out of money or 'going broke' in the near future, which is untrue but can unnecessarily unnerve workers and retirees. The question raised but largely unaddressed by the trustee reports is how to reduce the shortfall. The Republican answer generally involves cutting benefits, either by outright reductions or such options as raising the full retirement age, which is currently set between 66 and 67 for those born in 1952-1959 and 67 for everyone born in 1960 or later. As I've reported, raising the retirement age is a benefit cut by another name. It's also discriminatory, for average life expectancy is lower for some racial and ethnic groups than for others. For all Americans, average life expectancy at age 65 has risen since the 1930s by about 6.6 years, to about 84 and a half. The increase has been about the same for white workers. But for Black people in general, the gain is just over five years, to an average of a bit over 83, and for Black men it's less than four years and two months, to an average of about 81 and four months. Life expectancy is also related to income: Better-paid workers have longer average lifespans than lower-income workers. The other option, obviously, is to leave benefits alone but increase the programs' revenues. This is almost invariably dismissed by the GOP, but its power is compelling. The revenue shortfall experienced by Social Security is almost entirely the product of rising economic inequality in the U.S. At Social Security's inception, the payroll tax was set at a rate that would cover about 92% of taxable wage earnings. Today, rising income among the rich has reduced that ratio to only about 82%. That could mean hundreds of billions of dollars in lost revenues. The payroll tax is highly regressive. Those earning up to $176,100 this year pay the full tax of 12.4% on wage earnings (half deducted directly from their paychecks and half paid by their employers). Those earning more than that sum in wages pay nothing on the excess. To put it in perspective, the payroll tax bite on someone earning $500,000 in wages this year would pay not 12.4% in payroll tax (counting both halves of the levy), but about 4.4%. Eliminating the cap on wages, according to the Social Security actuaries, would eliminate half to three-quarters of the expected shortfall in revenues over the next 75 years, depending on whether benefits were raised for the highest earners. Taxing investment income — the source of at least half the income collected by the wealthiest Americans — at the 12.4% level rather than leaving it entirely untaxed for Social Security would reduce the shortfall by an additional 38%. Combining these two options would eliminate the entire shortfall. Social Security has already been hobbled by the Trump administration, Trump's promises notwithstanding. Elon Musk's DOGE vandals ran roughshod through the program, cutting staff and closing field offices, and generally instilling fears among workers and retirees that the program might not be around long enough to serve them. In moral terms, that's a crime. Those are the choices facing America: Cutting benefits is a dagger pointed directly at the neediest Americans. Social Security benefits account for 50% or more of the income nearly 42% of all beneficiaries, and 90% or more of the income of nearly 15% of beneficiaries. The wealthiest Americans, on the other hand, have been coasting along without paying their fair share of the program. Could the equities be any clearer than that?
Yahoo
13-06-2025
- Business
- Yahoo
Trump's Treasury Sec Admits It's Another TACO Day With China
President Donald Trump is 'highly likely' to extend the 90-day tariff pause for countries negotiating with the U.S. in 'good faith,' Treasury Secretary Scott Bessent said Wednesday. During a House Ways and Means Committee hearing, Virginia Rep. Don Beyer asked Bessent if Americans should prepare for a 'Liberation Day 2.0,' referencing the early April ceremony where Trump unveiled his market-crashing tariffs. Bessent said the Trump administration was working to secure deals with '18 important trading partners' ahead of the July 9 deadline. 'We are working toward deals on those and it is highly likely that those countries that are... negotiating in good faith, we will roll the date forward to continue good faith negotiations,' he said. 'If someone is not negotiating, then we will not.' 'It will be up to President Trump, but it is my belief that if someone is negotiating in good faith, that an extension will be possible,' Bessent added. Earlier on Wednesday, Trump announced in a Truth Social post that U.S. officials had struck a preliminary deal with China, pending approval from both him and Chinese President Xi Jinping, following two days of talks in London. Under the fresh truce, China will supply the U.S. with rare earths, and the Trump administration will allow Chinese students into American universities. There will also be a 55 percent tariff on Chinese goods. A White House official told NBC News that the figure is nothing new, explaining that it reflects the 30 percent tariffs that Trump earlier added to preexisting 25 percent levies. 'President Xi and I are going to work closely together to open up China to American Trade,' Trump said. 'This would be a great WIN for both countries!!!' Trump declared America's 'liberation' from unfair trading policies on April 2, sending the stock market into a nosedive with his announcement of sweeping levies on most of the country's trading partners. Days later, as stocks continued to tank, Trump hit pause on his trade war and declared a 90-day reprieve on tariffs for most countries, just as he backed off his tariffs on Canadian goods and lowered his sky-high duties on Chinese imports. The on-again, off-again tariff rollout has earned an acronym on Wall Street: TACO, for Trump Always Chickens Out. Financial Times columnist Robert Armstrong first coined the term 'TACO trade,' which quickly became popular among stockbrokers. The president had a meltdown last month when a reporter asked him about the term. 'I chicken out?' he asked. 'I've never heard that… It's called negotiation!' 'Don't ever say what you said. That's a nasty question,' he told the reporter, later adding: 'I usually have the opposite problem. They say I am too tough.'
Yahoo
12-06-2025
- Business
- Yahoo
Dem lashes out at Bessent during heated committee hearing exchange: 'Excuse me'
Del. Stacey Plaskett, D-Virgin Islands, lashed out at Treasury Secretary Scott Bessent during a tense House Ways and Means Committee hearing on Wednesday. "Ma'am, that's incorrect," Bessent said in a response to a chart displayed by Plaskett, which was referencing the cost of living, but the chart only went until February of this year. "Excuse me. Let me get something straight with you first here. I've seen you interrupt everyone. When you come to someone's house, you respect their rules. And in this house, we don't interrupt individuals. And you're not going to interrupt my time," Plaskett said. "I'm going to give you time to respond. You may want to jot down some notes about things you don't agree with me on so you can respond to them at that time. But while I'm speaking, as the person holding this time, you will refrain from speaking, sir, until I'm done, until I'm done, then I will give you time to speak, OK?" she continued. Democrat Congresswoman Draws Boos Over 'Shameful' Sexism Remark In Committee Hearing With Treasury Secretary "I look forward to facts," Bessent replied. Read On The Fox News App "Thank you. I'll look forward to your response whether they're factual or incorrect either," Plaskett replied. Later on, Rep. Nathaniel Moran, R-Texas, asked Bessent, "Where did [Plaskett] go wrong in her statement?" "Well, first of all, I would fire the staffer who did that chart, because it stopped in February 2025 and prices are down substantially since then. But that's an inconvenient truth. Secondly, the S&P, if the congresswoman would care to check Bloomberg. The stock market is judged by the S&P, which is the most widely held index by American 401ks is up on the air, up," Bessent said. Treasury Secretary Scott Bessent Denies That Tariff Pause Is Due To Market Declines When Plaskett attempts to interject, Moran says, "Excuse me, ma'am, it's my time." "And we don't interrupt, excuse me, we don't interrupt is what I learned," Bessent clapped back. "Since Jan. 1, it is my business for 40 years to know what the stock market does, and it is up in the air." After the hearing, Plaskett received a range of criticism, including a remark from an X user saying, "Do all these twats have their PMS cycle synced? Someone needs to ship a case of Midol to the Capitol this afternoon." Small Businesses Barely Survived Biden. They Can't Wait For Tariffs To Fix Things Plaskett replied to the user's response with an explicit comment. "Excuse you!! This twat, [c--t], pum pum whatever you want to call it represents an organ that gives LIFE and is resilienr [sic] so thanks for the compliment. I can take one interruption but Bessent was out of control. And…. I know I look good for my age but baby I'm post menopausal and it still works," she replied, with emojis of cherries and a drop of water. The primary focus of the committee hearing was on trade and tax policies, both of which have sparked serious debate as Congress works through the reconciliation bill, and as the administration negotiates trade deals with other nations. As for Bessent, he'll be on Capitol Hill again on Thursday testifying before the Senate Finance article source: Dem lashes out at Bessent during heated committee hearing exchange: 'Excuse me'
Fox News
12-06-2025
- Business
- Fox News
Dem lashes out at Bessent during heated committee hearing exchange: 'Excuse me'
Del. Stacey Plaskett, D-Virgin Islands, lashed out at Treasury Secretary Scott Bessent during a tense House Ways and Means Committee hearing on Wednesday. "Ma'am, that's incorrect," Bessent said in a response to a chart displayed by Plaskett, which was referencing the cost of living, but the chart only went until February of this year. "Excuse me. Let me get something straight with you first here. I've seen you interrupt everyone. When you come to someone's house, you respect their rules. And in this house, we don't interrupt individuals. And you're not going to interrupt my time," Plaskett said. "I'm going to give you time to respond. You may want to jot down some notes about things you don't agree with me on so you can respond to them at that time. But while I'm speaking, as the person holding this time, you will refrain from speaking, sir, until I'm done, until I'm done, then I will give you time to speak, OK?" she continued. "I look forward to facts," Bessent replied. "Thank you. I'll look forward to your response whether they're factual or incorrect either," Plaskett replied. Later on, Rep. Nathaniel Moran, R-Texas, asked Bessent, "Where did [Plaskett] go wrong in her statement?" "Well, first of all, I would fire the staffer who did that chart, because it stopped in February 2025 and prices are down substantially since then. But that's an inconvenient truth. Secondly, the S&P, if the congresswoman would care to check Bloomberg. The stock market is judged by the S&P, which is the most widely held index by American 401ks is up on the air, up," Bessent said. When Plaskett attempts to interject, Moran says, "Excuse me, ma'am, it's my time." "And we don't interrupt, excuse me, we don't interrupt is what I learned," Bessent clapped back. "Since Jan. 1, it is my business for 40 years to know what the stock market does, and it is up in the air." After the hearing, Plaskett received a range of criticism, including a remark from an X user saying, "Do all these twats have their PMS cycle synced? Someone needs to ship a case of Midol to the Capitol this afternoon." Plaskett replied to the user's response with an explicit comment. "Excuse you!! This twat, [c--t], pum pum whatever you want to call it represents an organ that gives LIFE and is resilienr [sic] so thanks for the compliment. I can take one interruption but Bessent was out of control. And…. I know I look good for my age but baby I'm post menopausal and it still works," she replied, with emojis of cherries and a drop of water. The primary focus of the committee hearing was on trade and tax policies, both of which have sparked serious debate as Congress works through the reconciliation bill, and as the administration negotiates trade deals with other nations. As for Bessent, he'll be on Capitol Hill again on Thursday testifying before the Senate Finance Committee.
