By Richard Cowan
WASHINGTON (Reuters) – An allegation by a U.S. Republican senator on Thursday that Treasury Secretary Janet Yellen lied during a row over the future of the Social Security program shrouded behind-the-scenes talks between the White House and lawmakers that have been going on for months. according to sources.
The war of words erupted at a Senate Finance Committee hearing when Republican Senator Bill Cassidy asked Yellen if Democratic President Joe Biden knew the Social Security funds would be phased out within the next decade unless Congress helped support the popular pension program 66 million beneficiaries.
When Yellen responded that Biden “is willing to work with lawmakers,” Cassidy shot back, “That’s a lie because if a bipartisan group of senators has repeatedly asked to meet with him on social (security) … we have.” nothing above that hears our pleas.”
For several months, Cassidy and independent Democrat-leaning Senator Angus King have been trying to tackle underfunding of Social Security as about 10,000 baby boomers retire every day.
Within a decade, tax revenues and an additional trust fund will not be enough to pay out payouts for what is often viewed as the most successful program the federal government has administered since Social Security began in 1935.
At the heart of Cassidy-King’s bipartisan efforts is the possible creation of a second trust that would, for the first time, allow money to be put into the stock market rather than traditional government bonds, which yield lower yields.
It would be modeled on a railroad pension fund investing in stocks.
However, last week’s bank failures and worries of a broader crisis could raise concerns for lawmakers about investing Social Security money in stocks.
Cassidy and King lead a group of workhorse senators that includes Republican Mike Rounds, Democrat Tim Kaine and independent Kyrsten Sinema.
While no meetings between the senators and Biden are scheduled, a source familiar with the discussions said White House officials are holding talks with the Senate. However, no formalized plan has yet been drawn up to present to Biden, the source added.
White House officials did not respond to a request for comment.
“It’s going to be tough. I don’t think we should sugarcoat it. But there are serious talks in the Senate … about a package that would improve Social Security finances,” said Shai Akabas, economic policy director at the bipartisan Policy Center, a centrist think tank in Washington.
The senators’ efforts are not the only Social Security bailout plan being developed.
Congressional Democrats could rally around a bill that Rep. John Larson will introduce by early April that would increase benefits across the board along with other changes, with a focus on helping those who receive the least .
“There are nearly 5 million Americans screened below the poverty line by Social Security,” Larson said. His bill would create a new benefit floor at 125% of the poverty line “to ensure no one can ever retreat into poverty”.
To succeed, any proposal would need the support of Democrats, who control the Senate, and Republicans, who control the House of Representatives.
Several House Republicans have pushed for an outside commission to recommend reforms under an expedited approval process, similar to one that was part of a successful 1983 effort.
“If someone has a better idea of what they can do, that’s great. I’m more conservative and say this worked once, let’s try again,” Republican Representative Tom Cole told Reuters.
“It’s really just a way to cut (benefits) without leaving fingerprints on it,” said Nancy Altman, president of Social Security Works and leader of a coalition of unions and other liberal groups.
(Reporting by Richard Cowan; Editing by Scott Malone and Josie Kao)
Source : news.yahoo.com