Third Rail Politics: Social Security Reform
Policy + Politics

Third Rail Politics: Social Security Reform

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Rep., Cynthia Lummis, R-Wyo., has just taken the biggest chance of her career:  as the sole sponsor of a bill to gradually raise the Social Security retirement age from 66 to 70, she says she may be a “poor fool” for sticking her neck out with a proposal that most lawmakers wouldn’t touch with a ten foot pole. 

Tampering with Social Security has always been considered political suicide because of the political clout of seniors and social activists. But back home in conservative Wyoming, where registered Republicans outnumber Democrats by a more than 2-to-1 margin, her lonely campaign in the House could earn her major accolades.

“My constituents are more afraid of Congress kicking the can down the road, doing nothing [about the debt] and America ending up like Greece with better plumbing,” Lummis told The Fiscal Times. “And that fear is driving people to have the adult conversation that America has needed to have for years, but was not ready for up to this point.” 

According to Gene Leone, a retired Air Force member, voters will reward Congresswoman Lummis with reelection because of this bill. “Most people here have come to the realization that this country is broke and, from where I sit, people here would be for it,” he said. “But given our debt problem, I think we ought to raise the retirement age long before 2024.”

Meanwhile,  at least two blue-ribbon Congressional commissions and a growing number of Senate Republicans and Democrats have endorsed the notion of raising the
retirement age as one way of dealing with the long-term deficit, lending extra credibility to the Lummis’s campaign. 

This year, Social Security will pay out more in retirement, disability and survivors’ benefits than it recoups in payroll taxes for the first time since 1983.  Though positive cash flow will return in 2012, the program will fall permanently back into debt starting in 2015, according to the program’s 2010 trustees report.  And by 2037, the program’s currently $2.5 billion trust fund will hit zero after years of consistent shortfalls eat up the cash. 

“We can pussyfoot around and use phrases like ‘everything should be on the table,’ and ‘we need to discuss a variety of options’, but we don’t know what the public is going to understand and accept, or understand and reject,” Lummis said.

“If we don’t make these tough decisions,
our children and our grandchildren will suffer.”


A lawyer, former state legislator and treasurer, Lummis was elected to an open seat in the House in 2008. She joined the Republican Study Committee, a group of the most conservative members of the House. As a new member of the House Budget Committee, she called for reform of spending earmarks and pledged not to seek them for her state.

She then turned her attention to long term budget problems, including what many are describing as the unsustainable rising cost of entitlement programs--Medicare, Medicaid and Social Security. While many defenders of the Social Security status quo argue that the retirement program is not contributing to the debt and will continue to generate sufficient revenues to meet payments through 2037, Lummis says the point is to make these changes now so that Social Security benefits will still exist for today’s twenty-somethings when they retire. “If we don’t make these tough decisions, our children and our grandchildren will suffer.”

Under her proposed Social Security measure, the retirement age would gradually increase in stages starting in 2024, in order to insulate workers nearing retirement from immediate shocks.  People who are currently 50-years of age and older would see no change. But a 49-year-old would see their retirement age increased by one month, a 35-year-old by one year, a 19-year-old by two years, and a four-year-old by three years. By the time the plan was fully phased in, seniors could retire as early as age 65 or wait until age 70 to claim maximum benefits.

House Republicans say their fiscal 2012 budget proposal, which they plan to release sometime this spring, will set future-year cost-containment goals for Social Security, Medicare, and Medicaid—programs which collectively account for about 41 percent of the federal budget, according to the Congressional Budget Office. But Speaker John Boehner, R-Ohio, has emphasized that the GOP has no plans to outline entitlement cost controls—especially without political cover from the President who avoided the issue both in his State of the Union Address and his 2012 budget proposal.  

Lummis’ proposal may also be right in line with what voters want according to results from a recent Wall Street Journal/NBC News poll. It found that while a majority of respondents would not support any cuts to Social Security or Medicare to reduce the nation’s $1.6 trillion deficit, more than half favored increasing the retirement age to 69 by 2075. The current age to receive full retirement benefits is 66, but it is scheduled to rise to 67 in 2027. 

The bill’s 2024 implementation date could help it escape major opposition, at least among those most immediately affected by Social Security, who will dodge any impact, said James King, head of the University of Wyoming political science department. Moreover, even though the bill is a political gamble, he too says it’s unlikely to damage her reelection prospects. “You’ll hear discussion that the electorally secure are the ones who can make the boldest moves—she’s in that position,” he said. “And at the end of the day, I think she’ll be given credit for trying to do something about a serious problem, even if it doesn’t go very far.”

The slow phase-in time might even prod some local retirement groups to accept Lummis’s proposal. For Dwayne Trembly, a former president of the Wyoming Retired Education Personnel--a partner of AARP--ensuring that full benefits will be available to Wyoming’s retirees is of chief concern. But data show that Social Security paid out more than it brought in in payroll tax revenue last year—a statistic senior’s groups don’t deny. “We know that they’re going to change the [Social Security retirement] age—it just shouldn’t be drastically, which most of us here recognize,” said Trembly, who now volunteers with the group.  He added that this bill would be an ‘OK’ option. 

But buy-in won’t come easy everywhere. “People aren’t likely to go for that idea around here,” said Patricia Smith, mayor of Lusk, Wyo., a 1500-resident town near the southeastern border of the state, which boasts three women residents who are over 100-years old. “This is a small town with a large elderly population that is very pleased with what they have, and they certainly don’t want to see any of their programs cut or changed,” she said. 

Related Links
Social Security : 5 Enduring Myths That Must Go (The Fiscal Times)
Social Security, Spewing Red Ink, Will Go Bush by 2037 (The Fiscal Times)
Even Liberals Can’t Agree on Social Security (The Fiscal Times)