This week, negotiations to fund the federal government past September 30th continued on Capitol Hill. In addition, one House subcommittee met to discuss Social Security’s solvency challenge.
Budget Negotiations Continue
Negotiations to fund the federal government past September 30th – the end of the fiscal year – continued to move slowly this week. On Tuesday, with a vote of 89-7, lawmakers in the Senate advanced legislation that will eventually include a continuing resolution (CR) to fund operations through December 9th. However, at the time of writing this update on Thursday, September 21st, that language had not yet been finalized.
Senator Jerry Moran (KS), who voted in favor of the bill, told reporters: “There are negotiations that are ongoing, and this bill in my view just sets the stage for an agreement that we hope occurs sooner rather than later.” Lawmakers in the House have been told to clear their schedules for a possible rare weekend vote on Saturday, September 24th. House Appropriations Chairman Hal Rogers (KY-5) told reporters, “We’ll be ready.”
However, it is more likely that votes on the short-term CR will take place next week, just days before the looming deadline. Senator Roy Blunt (MO) said: “I’ll be safe by saying we’ll be here next week, and probably well into next week.”
Negotiations to keep the federal government operating will likely come down to the wire once again. Lawmakers have exactly one week – until September 30th – to negotiate the details of the funding package. Should they fail to meet the deadline, the federal government will shut down just weeks before the November elections, and Social Security beneficiaries could see delays in their monthly benefits. TSCL will keep a close eye on the evolving negotiations, and we will post updates here in the Legislative News section of our website.
Subcommittee Discusses Social Security Insolvency
On Wednesday, lawmakers on the House Ways and Means Social Security Subcommittee held a hearing titled “Understanding Social Security’s Solvency Challenge.” Members of the subcommittee heard from two expert witnesses – Stephen Goss (Chief Actuary of the Social Security Administration (SSA)) and Keith Hall (Director of the Congressional Budget Office (CBO)).
In his opening statement, Chairman Sam Johnson (TX-3) explained that earlier this year, he asked the two witnesses to examine the long-term Social Security projections put forth by their agencies and to reconcile the differences. He said, “Today, the Trustees and CBO paint very different pictures of just how much trouble Social Security is in.”
For example, the annual report released by the Trustees earlier this year estimated that Social Security’s trust funds will face exhaustion in 2034. However, the most recent report released by CBO projected exhaustion to occur five years earlier, in 2029. In his opening statement, Chairman Johnson stressed the need for accurate estimates. He said, “I know we’ve all looked at ideas on ways to fix Social Security. And while we may not agree on the best way to do it, we should at least agree that we need an as accurate as possible picture of Social Security’s financial health.”
Chief Actuary Goss and CBO Director Hall agreed with Chairman Johnson, and they presented several possible explanations to account for the difference. In their reports, CBO recently began assuming a lower birth rate than the Trustees, a higher net immigration rate, a lower projected labor force participation rate, a lower interest rate for trust fund reserve investments, and a much higher concentration of earnings for the wealthiest individuals in the future.
Meanwhile, the Trustees have committed to making only incremental, evidence-based changes to the formulas that their projections are based upon. In his statement, Chief Actuary Goss told the subcommittee, “It should be rare that new experience or insight from one annual report to the next would make a substantial change in the actuarial status … We have seen many cases where a measure appears to be moving in a new and different direction, only for that change to be reversed after a short time.”
The explanations laid out by Chief Actuary Goss and CBO Director Hall likely account for most of the difference between the two long-term projections. As several lawmakers at Wednesday’s hearing pointed out, it is impossible to know which estimate is more accurate, but it is imperative that Congress begin addressing the shortfall in the near future. One member of the subcommittee – Rep. Earl Blumenauer (OR-3) – suggested the creation of a “National Save Social Security Day,” where lawmakers would hold serious, bipartisan discussions about the challenges facing Social Security.
TSCL agrees that whether Social Security becomes insolvent in 2034 or 2029, Members of Congress must commit to addressing the problem as soon as possible so that any necessary changes can be phased in gradually and with very little impact on beneficiaries. In the months ahead, our legislative team will continue to advocate for policies that would strengthen and modernize the Social Security program responsibly, without harsh benefit cuts for seniors. For progress updates, follow TSCL on Facebook and Twitter.