By Alexander Bolton - 01/28/11 12:28 AM EST
Senate Democrats led by Sens. Charles Schumer (D-N.Y.) and Bernie Sanders (I-Vt.) are gearing up for a battle with House Republicans over Medicare and Social Security benefits.
Schumer and other Democratic strategists see Medicare and Social Security as winning political issues that can help them regain the momentum they lost over the last two years.
“They want to privatize Social Security,” Schumer said of Republicans. “Privatize equals end — no more.”
Senate Democrats have unified over the issue after President Obama stayed away from proposing a cut in Social Security benefits at Tuesday’s State of the Union address.
Democratic pollsters warned that if Obama called for raising the retirement age, it would create a schism in the party.
House Republicans have discussed advancing a proposal to privatize Medicare in the budget plan they expect to unveil in the next few weeks.
House GOP Conference Chairman Jeb Hensarling (Texas) said Wednesday that many Republicans would support a proposal floated by House Budget Committee Chairman Paul Ryan (R-Wis.) to convert Medicare into a voucher system in which beneficiaries would receive $11,000 on average to buy certified plans.
Ryan has also called for letting workers under the age of 55 invest a third of their Social Security taxes into personal retirement accounts.
Mike Steel, a spokesman for House Speaker John Boehner (R-Ohio), has pointed out that Obama has also signaled support for Social Security reform.
“President Obama and Republicans agree on the need to reform Social Security to protect benefits for future generations,” he said. “It seems like some of the president’s Democratic allies on Capitol Hill haven’t gotten the memo from the White House.”
On Tuesday, Obama told Congress: “We should also find a bipartisan solution to strengthen Social Security for future generations.”
The president said Thursday the solution should not slash benefits for future generations or subject benefits “to the whims of the stock market.”
Sanders said he would like to hear a stronger pledge from Obama.
“Jeb Hensarling of Texas said — and he’s the Republican Conference chairman — that they’re going to take Paul Ryan’s blueprint and use it,” said Schumer. “That’s privatizing Medicare. ... They’re going to do the same for Social Security.
“Their agenda: Privatize both programs, which means end them,” said Schumer.
Schumer, Sanders and several other Democrats have formed the Senate Social Security Caucus, which held its first meeting Thursday.
The meeting came a day after the Congressional Budget Office reported that Social Security would begin running deficits this year. The trust fund is projected to take in $130 billion less in payroll taxes than it will pay out in benefits.
Most of that deficit is due to a one-year payroll tax break that President Obama and congressional Republicans agreed to last year, which knocked the payroll tax rate from 6.2 percent to 4.2 percent for 2011.
Democrats note, however, that Social Security has a $2.6 trillion surplus that will increase to more than $4 trillion by 2039.
But Democrats also acknowledge that the trust fund will no longer be able to pay out 100 percent of benefits beginning in 2039.
Influential Republican senators have proposed raising the Social Security retirement age from 67 to 69, using a formula that Congress agreed to in the 1980s.
“We know what to do on Social Security. I put on the table [a proposal] adjusting the age from 67 to 69,” Sen. Lindsey Graham (R-S.C.) said Wednesday. “I don’t know how in the heck we save this country from bankruptcy if we don’t reform entitlements.
“Why can’t we do what Ronald Reagan and Tip O’Neill did?” Graham said in reference to the former Republican president and Democratic House Speaker.
Sanders accused Republicans of hyping the fiscal instability of the program, and the media of swallowing their spin.
“If it’s raining tomorrow, therefore Social Security is in trouble. What’s the surplus for Social Security?” he said.
Sanders said the trust fund is similar to businesses that take out loans from time to time to cover short-term costs but are fiscally sound over the long term.
The other members of the Social Security Caucus are Sens. Sherrod Brown (D-Ohio), Sheldon Whitehouse (D-R.I.), Daniel Akaka (D-Hawaii), Barbara Boxer (D-Calif.) and Debbie Stabenow (Mich.).
The lawmakers met at the same time that the Senate Tea Party Caucus held its first public meeting in the Senate Hart Office Building.
A fourth Republican senator, Jerry Moran (Kan.), joined the caucus, which also includes Sens. Jim DeMint (R-S.C.), Rand Paul (R-Ky.) and Mike Lee (R-Utah). A fifth GOP senator, Pat Toomey (Pa.), sat in on the meeting.
Democrats say the growing influence of the Tea Party in Congress poses a threat to entitlement programs.
“The fact that five senators are for privatizing Social Security shows we’re not crying wolf here,” Schumer said. “This is a serious movement to undo the most successful government program of the 20th century.”
Brown said: “If they have five senators already in the first month of January, it’s likely going to be a major thrust of the Republican effort.”