If cutting Social Security is a scandal, then Biden did it first
President Biden and his fellow Democrats are accusing Republicans of wanting to cut Social Security benefits. But in 1983, then-Sen. Biden (D-Del.) and 25 other Senate Democrats, along with 163 House Democrats, provided the large majority of votes to pass the last cut to Social Security benefits. If cutting Social Security benefits is a scandal, then Biden’s guilty.
After a rowdy and entertaining exchange at the recent State of the Union (SOTU) address – in which Biden claimed Republicans wanted to cut Social Security and Medicare benefits and Republicans vociferously disagreed – the president has doubled down on his claim.
“I know that a lot of Republicans, their dream is to cut Social Security and Medicare,” Biden said in Florida two days after the SOTU. “Well, let me say this: If that’s your dream, I’m your nightmare.”
You’ll get no argument from me about Biden being a nightmare. But his claims are at best strained, and are certainly hypocritical.
Biden’s first target was Sen. Rick Scott’s (R-Fla.) 12-point “Rescue America” plan, one part of which says, “All federal legislation sunsets in 5 years. If a law is worth keeping, Congress can pass it again.”
Such “sunset laws” are fairly common at the state level. The right-leaning Mercatus Center, located at George Mason University, published a 2015 study identifying 10 states with comprehensive sunset laws, which include a review of both laws and regulatory provisions, and eight states that review only regulatory provisions.
The more important point is that while many Republicans likely support the basic idea of state-level sunset provisions (though not for Social Security and Medicare), very few backed Scott’s “Rescue America” plan. Indeed, Senate Minority Leader Mitch McConnell (R-Ky.) publicly criticized it, especially a provision that would increase taxes on many low-and middle-income Americans. “Rescue America” may have been part of Scott’s agenda, but it was never the Republican agenda.
And that’s why Republicans loudly rejected Biden’s claim.
Undaunted, the White House released a memo intended to show Republican support for cutting Social Security benefits. One suggestion is to raise Social Security’s retirement age to 70. Another proposes a means- (i.e., income-related) test on Social Security benefits.
However, in 1983 a large majority of Democrats, including Biden, voted to gradually phase in an increase in Social Security’s retirement age from 65 to 67. Based on that Biden-supported law, for those born in 1960 or after the full-retirement age is 67.
Now, a case can be made that delaying Social Security’s full-retirement age isn’t actually a cut in benefits, since a senior can begin taking Social Security benefits at age 62. But seniors will receive a larger monthly benefit (about 8 percent) for every year they wait to enroll, up to age 70. That’s why most financial advisers recommend seniors wait as long as they can to enroll.
The problem with taking Social Security before the full-retirement age is that there’s an “earnings penalty” imposed on those who continue to earn income above a certain amount, which is only $21,240 in 2023.
But if raising the retirement age is a cut in Social Security benefits, as Biden says it is, then he did it first.
Biden and Democrats imposed another cut to Social Security benefits in the 1983 amendments. The legislation made a portion of Social Security benefits subject to income taxes. Currently, if a senior continues to work and makes more than $34,000 a year ($44,000 for a couple), up to 85 percent of their Social Security benefits may be taxable.
Taxing Social Security benefits is an indirect way to means-test benefits. The more income seniors make, the more taxes they must pay on their Social Security benefits, effectively reducing the net amount they receive.
So, if some Republicans have suggested a type of means-test for Social Security, be assured that Joe Biden beat them to it by 40 years.
Social Security and Medicare are facing serious financial problems today, just as they were in the early 1980s. Back then, Democrats and Republicans took a close look at the programs’ challenges and tried to address them. Today, hypocrisy and demagoguery come before statesmanship.
Merrill Matthews is a resident scholar with the Institute for Policy Innovation in Dallas, Texas. Follow him on Twitter @MerrillMatthews.
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