WASHINGTON – U.S. Senator Bill Cassidy, M.D. (R-LA) pressed Treasury Secretary Janet Yellen on the Biden administration’s lack of a plan to address Social Security insolvency a Senate Finance hearing on President Biden’s proposed budget for Fiscal Year 2024.
Cassidy opened by stating “when Social [Security] goes broke in nine years under current law, there’s a 24% cut in benefits for people who are currently receiving” Social Security.
Secretary Yellen responded affirmatively saying, “If we don’t do anything about it, I think that’s about right.”
He then pointed out that of the $4.5 trillion in new taxes in President Biden’s proposed budget, none are directed to address Social Security insolvency and the impending automatic benefit cuts.
“In the $4.5 trillion of taxes the President has proposed are any of those taxes going to shore up Social Security? The answer is of the $4.5 trillion in taxes he has proposed, not a dime is going to shore up Social Security,” said Dr. Cassidy.
Secretary Yellen repeated the hollow statement that President Biden stands ready to work with Congress.
“A bipartisan group of senators has repeatedly requested to meet with [Biden] about social so that somebody who is a current beneficiary will not see her benefits cut by 24%. We have not heard anything on our request. We’ve made multiple requests to meet with the president. Now you can’t comment on that. I realize that, but that is a fact. If you’ve been told to say ‘he stands ready to meet,’ I will tell you there’s absolutely no evidence because we have not gotten our meeting,” continued Dr. Cassidy.
Cassidy also focused on the Biden Administration’s sole response to the fiscal problems of this country: increasing taxes. He explained how this is not a realistic plan and would not solve the issues at hand.
“Of the $4.5 trillion, not a dime is going to Social [Security]. If you cannot tell me I presume that they’ve not actually modeled what those rates would have to be, which tells me that he’s actually not been developing his plan. Now, this is incredibly worrisome, from a president who should be sympathetic with someone who under current law is going to get a 24% cut,” added Dr. Cassidy.
Cassidy then asked Secretary Yellen—a former chair of the Federal Reserve—about the theoretical economic impact of doubling the country’s “debt-to-GDP ratio,” to which she immediately agreed it would have a negative effect of the economy.
“We’ve actually modeled this for the President to do nothing—let’s assume that we cast aside current law and we just double the national debt—it would have a devastating effect upon the economy. CBO says they cannot model the deleterious effects that would occur because of [doubling the national debt]. So we have a situation where the President has not proposed a single plan. He has turned down multiple requests for meetings with senators. Our options are a 24% cut on the person currently receiving [Social Security], doubling our national debt, which CBO says cannot be modeled and you agree that will be a deleterious effect. He’s not modeled the tax rates that would be required if he just wants to raise taxes,” concluded Dr. Cassidy.
In response to the President’s proposed budget, Cassidy lamented on the lack of a plan to address Social Security.
He also recently reacted to a new Congressional Budget Office (CBO) report saying Social Security is heading toward a financial cliff in less than a decade, highlighting the urgency of the issue.