Social Security & Medicare: What’s at Stake as Congress Faces Debt Ceiling Deadline?
The fate of Social Security and Medicare hangs in the balance as the U.S. Congress faces a looming deadline to raise the debt limit and prevent a government default. With the U.S. hitting its debt ceiling of $31.4 trillion on Jan. 19, Republican lawmakers have begun to confirm their intention to cut spending on both Social Security and Medicare, a plan that Democrats have fiercely opposed.[0]
In a video released last week, Donald Trump, the former President of the United States, declared that no Republican should ever vote to reduce the amount of money allocated to either Medicare or Social Security.[1] One of the greatest divides between President Trump and the GOP is his aversion to reforming entitlement programs.[2] House Minority Leader Kevin McCarthy also said in an interview on CBS’s “Face the Nation” earlier Sunday that he wants to take cuts to Medicare and Social Security off the table in talks with Democrats over the debt ceiling.[3]
House Republicans have begun to weigh a series of legislative proposals targeting Social Security, Medicare and other entitlement programs, part of a broader campaign to slash federal spending.[4] The proposals include raising the Social Security retirement age to 70 and capping key federal agencies and programs.[5]
If Congress fails to raise the debt limit, the government is set to breach the threshold sometime this summer, which would trigger a historic, calamitous default that could thrust the economy into a recession.[6]
Of course, if Republicans insist on not touching benefits, they could address the Social Security and Medicare shortfalls with enormous tax hikes.[7] In order to maintain Social Security, the payroll tax would have to be raised by 25% from 12.4% to 15.64%.[7] The additional taxes necessary for Medicare need to be included, and this must be done repeatedly to compensate for the entirety of the deficit.[7]
Democrats have been unsparing in their criticisms, saying millions of Americans could see their benefits cut at the hands of the new House GOP majority.[8] As President Biden gets ready to talk about a variety of financial topics with McCarthy in the days ahead, he has made it clear that he will not make a deal with the Republicans.[9]
The Supreme Court ruled in 1960 that workers do not have a legally binding right to Social Security benefits, which means that Congress can cut benefits, even by 50 percent, no matter how much anyone has paid into the program.[7]
0. “House Republicans are planning to slash Social Security and Medicare” Business Insider, 25 Jan. 2023, https://www.businessinsider.com/house-republicans-social-security-and-medicare-medicaid-mccarthy-biden-debt-2023-1
1. “Speaker McCarthy: Cuts to Social Security, Medicare Are ‘Off the Table'” The Epoch Times, 29 Jan. 2023, https://www.theepochtimes.com/speaker-mccarthy-cuts-to-social-security-medicare-are-off-the-table_5018550.html
2. “Kevin McCarthy Says Republicans ‘Won't Touch' Medicare Or Social Security” Yahoo News, 27 Jan. 2023, https://news.yahoo.com/kevin-mccarthy-says-republicans-wont-214701940.html
3. “New Campaign Aims to Fight Off GOP Threat to Social Security and Medicare” Common Dreams, 30 Jan. 2023, https://www.commondreams.org/news/campaign-fight-gop-social-security
4. “McCarthy Vows GOP ‘Won't Touch' Social Security Amid Debt Ceiling Feud — Could Seniors Still Lose?” GOBankingRates, 30 Jan. 2023, https://www.gobankingrates.com/retirement/social-security/mccarthy-vows-gop-wont-touch-social-security-debt-ceiling-feud
5. “The GOP's MAGA Economic Agenda: Raise Taxes, Protect Tax Cheats, Attack Social Security and Medicare” Democrats.org, 26 Jan. 2023, https://democrats.org/news/the-gops-maga-economic-agenda-raise-taxes-protect-tax-cheats-attack-social-security-and-medicare
6. “McCarthy: ‘We won’t touch Medicare or Social Security’” The Hill, 27 Jan. 2023, https://thehill.com/homenews/house/3832705-mccarthy-we-wont-touch-medicare-or-social-security
7. “Is GOP Becoming Party of Fiscally Reckless Gov't?” Newsmax, 27 Jan. 2023, https://www.newsmax.com/veroniquederugy/gop-republicans-medicare/2023/01/27/id/1106166/
8. “Republicans eye cuts to Social Security and Medicare benefits as predicted—a promise Americans have invested in …” Northeast Valley News, 24 Jan. 2023, https://nevalleynews.org/17369/news/republicans-eye-cuts-to-social-security-and-medicare-benefits-as-predicted-a-promise-americans-have-invested-in-during-their-lifetime-democrats-pledge-fight-against-gop-plan
9. “House Republicans eye Social Security, Medicare in debt limit fight” The Washington Post, 24 Jan. 2023, https://www.washingtonpost.com/us-policy/2023/01/24/gop-social-security-medicare-debt-limit/
