Discussion · Senate
Chuck Grassley Republican
“Social Security will run out of extra money in about six years. If Congress does not fix this, retirees will see their benefits cut by 22 percent in 2032. Both parties need to work together now to protect Social Security and prevent a major economic crisis.”
“Mr. President, I come to the floor today as a member of the Senate Finance Committee, which has jurisdiction over Social Security, and to remind everybody--because everybody knows or better know--that the Social Security primary trust fund will be depleted in just 6 years. As a result, come late 2032, the program will only have enough income from the payroll taxes to pay 78 percent of benefits due. That surplus was built up since a Republican, President Reagan, and a Democrat, then-Speaker Tip O’Neill, sat down and said: We can’t let anything bad happen to Social Security. So they put a plan together that passed almost unanimously in this U.S. Senate. I presume those two gentlemen--bipartisan they were--they thought it may only extend the program for 20 years or something. But as we see now, they had a plan that built up the surplus for the next 50 years, and that runs out in 2032. In other words, to emphasize, unless Congress acts quickly, retirees will see a 22-percent cut in their benefits, about the same as what Reagan and O’Neill saw happening in 1983. So this statistic alone should motivate the Congress to act expeditiously to ensure no disruption of benefits occur. Unfortunately, Congress has a tendency to put off action until too late and at the last moment. This is never the best approach. But with respect to addressing the Social Security funding shortfall, it poses a serious risk not only to the tens of millions of retirees but also a risk to the national economy. As a recent Mercatus Center paper documents, waiting until the last minute to act on Social Security puts this vital program on a collision course with the Nation’s growing fiscal crisis. The longer Congress waits to act, the more likely it is that any solution to Social Security will lean heavily on debt financing to bridge the funding gap. And that is how it is tied to the entire national economy. So come 2032, the Nation will already have outstanding debt larger than at any time in the Nation’s history relative to the size of our economy. Flooding the bond market with trillions of dollars in new debt, in short order, then risks setting off a chain of events leading to a fiscal crisis. Bond markets are likely to demand higher interest rates to absorb all the national debt. In other words, Congress needs to act in the same way that Reagan and Tip O’Neill acted in a bipartisan fashion, in 1983, to preserve Social Security. A bigger problem faces us today, and we should have a bipartisan agreement in this town, including a President who wants to get Social Security on a financially sound basis. I yield the floor. I suggest the absence of a quorum.”
Mr. President, I come to the floor today as a member of the Senate Finance Committee, which has jurisdiction over Social Security, and to remind everybody--because everybody knows or better know--that the Social Security primary trust fund will be depleted in just 6 years. As a result, come late 2032, the program will only have enough income from the payroll taxes to pay 78 percent of benefits due. That surplus was built up since a Republican, President Reagan, and a Democrat, then-Speaker Tip O’Neill, sat down and said: We can’t let anything bad happen to Social Security. So they put a plan together that passed almost unanimously in this U.S. Senate. I presume those two gentlemen--bipartisan they were--they thought it may only extend the program for 20 years or something. But as we see now, they had a plan that built up the surplus for the next 50 years, and that runs out in 2032. In other words, to emphasize, unless Congress acts quickly, retirees will see a 22-percent cut in their benefits, about the same as what Reagan and O’Neill saw happening in 1983. So this statistic alone should motivate the Congress to act expeditiously to ensure no disruption of benefits occur. Unfortunately, Congress has a tendency to put off action until too late and at the last moment. This is never the best approach. But with respect to addressing the Social Security funding shortfall, it poses a serious risk not only to the tens of millions of retirees but also a risk to the national economy. As a recent Mercatus Center paper documents, waiting until the last minute to act on Social Security puts this vital program on a collision course with the Nation’s growing fiscal crisis. The longer Congress waits to act, the more likely it is that any solution to Social Security will lean heavily on debt financing to bridge the funding gap. And that is how it is tied to the entire national economy. So come 2032, the Nation will already have outstanding debt larger than at any time in the Nation’s history relative to the size of our economy. Flooding the bond market with trillions of dollars in new debt, in short order, then risks setting off a chain of events leading to a fiscal crisis. Bond markets are likely to demand higher interest rates to absorb all the national debt. In other words, Congress needs to act in the same way that Reagan and Tip O’Neill acted in a bipartisan fashion, in 1983, to preserve Social Security. A bigger problem faces us today, and we should have a bipartisan agreement in this town, including a President who wants to get Social Security on a financially sound basis. I yield the floor. I suggest the absence of a quorum.