Major COLA Cuts In House Social Security Overhaul Bill

Major COLA Cuts In House Social Security Overhaul Bill

During the presidential campaign, Donald Trump repeatedly promised that, as president, he would not touch Social Security.  But will he keep his word?  In December of last year, legislation was introduced by a House Republican leader that would mandate massive cuts to Social Security benefits.

Representative Sam Johnson of Texas, Chairman of the House Ways and Means Subcommittee on Social Security, introduced the Social Security Reform Act of 2016 — a bill that he said would “permanently save” the program.  Social Security beneficiaries currently face across – the - board benefit cuts of as much as 31% when the Trust Fund runs dry in 2029 according to a new report from the Congressional Budget Office.

But Johnson’s legislation would also lead to $13.9 trillion in benefit cuts for both current and future retirees without including any new sources of revenue to shore up the system.  Almost half of the cuts would come from cutting COLAs for middle - to low - income beneficiaries and eliminating COLAs altogether for retirees with incomes of $85,000 and up.

Because a new Congress has started, the Social Security Reform Act of 2016 would need to be re-introduced, and TSCL is closely monitoring the situation. According to TSCL surveys and polls, there is no public support among older Americans for proposals that would cut benefits and COLAs.  TSCL surveys instead indicate that 79% of older voters support raising the amount of wages that are taxable for Social Security (currently capped at $127,200 in 2017).

What do you think about proposals to change Social Security?  Take TSCL’s annual Senior Survey at seniorsleague.org/2017survey.

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