In keeping with efforts of the Senate to address budget concerns and debt reduction, this month the Finance Committee Republicans submitted a 21-page recommendation of reforms for the areas under their authority to the Joint Select Committee on Deficit Reduction (Joint Committee). This list of recommendations addresses taxation reform, Medicaid, Medicare, International Trade, welfare reform, repealing the Patient Protection and Affordable Care Act, and of course, Social Security.
Although the Social Security programs are currently on sounder financial footing than Medicaid and Medicare, the Finance Committee identify it’s reform as a necessary step in further improving the nation’s credit rating, which could stimulate the economy.
The reform principles which the Republicans recommend in the efforts to improve the Social Security program and reduce debt are as follows:
- Considering the hard fact that the current structure of the Social Security program has been projected to lead to a depletion of funds as early as the next decade, the Senate needs to make efforts to ensure the longevity and financial security of the Social Security system so that it is able to do what it was designed to do – support the elderly and disabled against the threat of poverty.
- Secondly, any changes to the structure of the Social Security program should apply to the younger, future retirees who will have plenty of time to react and adjust their financial planning accordingly, and not to the current generation of beneficiaries who are at this point dependent on their Social Security benefits.
- The third point recommends that as reforms are made to the system, those with the greatest need should be pinpointed to receive most of the available benefits.
- The fourth point stresses the importance of keeping the Social Security system a pay-as-you-go program, as it was designed to be. There is a direct correlation between what taxpayers are paying into the system and what benefits can be expected to be paid out of it.
- The fifth point warns of the dangers of using increased taxes and maximum taxable wage ceilings to fund the Social Security program, as it will in turn affect the spending power of the average worker, and negatively affect the job market and the economy.
- The last point specifically mentions the need for reformation of the Disability Insurance portion of the SSA’s Social Security program, as funding is now, and will increasingly be, limited.
Although Republicans and Democrats differed dramatically in their views of the recommendation’s call for drastic tax cuts, there has not been much controversy over recommendations on the usual hot topic of Social Security reform.
However, some Republicans think that the recommendations given are in no way specific enough to have any effect on the Joint Committee’s efforts at debt reduction as it pertains to the Social Security program. The Republicans gave general guidelines but no specific steps to take in following the guidelines, something necessary to move the reforms forward and accomplish the goals of both parties.