Dick Durbin’s new Social Security reform commission
Have you heard about Dick Durbin’s proposal for a new Social Security reform commission? It sounds remarkably like the failed Simpson-Bowles Catfood Commission, complete with special rules that allow its recommendations, if approved by the commission, to take the express route to the floor of Congress for a vote with no amendments and limited debate.
The number two Democrat in the Senate championing this bipartisan bill was asked if this new commission would be like the Greenspan commission of the 1980’s and he said that he prefers to refer to it as similar to Simpson-Bowles. One of the most interesting things about it is that this time, the commission won’t be dissolved after it finishes its work. It comes back to life every ten years.
So while we are very happy that the Senate rejected Chained CPI in the budget that they passed last week, the reason why it was rejected is most likely because a separate commission for “reforming” Social Security is on the way, and there are other reasons to use caution while considering the weight and effect of the Sanders amendment.
In a recent article, Dean Baker wonders why the media elites did not find the Sanders amendment to be newsworthy. I agree with his points about the national media corruption on the subject, and that they have been pushing their favorable opinion on cuts, and how the facts and arguments against the cuts have been curiously absent in their reporting and their programs.
This is why the vote on the Sanders amendment should have been newsworthy. Here was an opportunity for all the senators who have explicitly or implicitly supported the adoption of the chained CPI to step up and say why the switch to the chained CPI was a good and necessary measure. However, not one senator was prepared to stand up and argue the case. Not one member of the senate wanted to go on record in support of this cut to Social Security.
With all the Republicans who pronounce endlessly on the need to cut entitlement spending, there was not a single Republican senator who was prepared to say that switching the Social Security COLA to a chained CPI was a good idea. And even though President Obama has repeatedly stated as clearly as he could that he supported the switch to a chain CPI, there was not one Democratic senator who was prepared to stand up and speak in solidarity with the president.
But let’s not get complacent. There is nothing that the media elite and the proponents of Social Security cuts would like more than for us to let our guard down and say “phew, now we can relax because the Senate said they oppose chained CPI cuts to Social Security.” In fact, it would not surprise me at all if the reason that this amendment was allowed to the Senate floor by the Democratic leadership was that it might calm down the grassroots left and organizations like AARP and give us a false sense of security, resulting in less organizing, less protesting, while they form a new commission prepare the way for the cuts that they are clearly determined to impose.
The people in power who want to cut Social Security have been working at this for decades, with renewed fervor in recent years, some of them spending millions for astroturf groups, propaganda campaigns, and influence over elected officials. One non-binding amendment in the Senate is no hurdle for them and if anything, I believe they will try to use it to their advantage.
Some other cautions about the Sanders amendment:
1) The amendment was framed as opposition to using chained CPI for veterans benefits.
2) The amendment is non-binding.
3) While Sen. Sanders tried to get a roll call vote, he was persuaded by Sen. Murray to accept a voice vote, so none of the Senators, except the sponsors of the amendment, are on the record. The sponsors are: Sens. Bernie Sanders (I-Vt.), Tom Harkin (D-Iowa), Mazie Hirono (D-Hawaii) and Sheldon Whitehouse (D-R.I.). Four senators.
4) Sen. Burr of North Carolina is on the record as saying he “supported protecting veterans, but supported using chained CPI elsewhere”.
Durbin’s Announcement of the Commissions and Musings
On Wednesday morning (March 20), Dick Durbin was a guest at the Seib & Wessel breakfast hosted by the Wall Street Journal. The following are excerpts from a Federal News Service transcript available at this Wall Street Journal link.
For the purposes of this post, I will excerpt some things from the lengthy transcript that refer to Social Security cuts. I should mention though, that they talk about Social Security cuts in two contexts. Durbin is still talking about grand bargains, with cuts to Social Security and significant changes to Medicare, along with significant tax reform. Durbin says that he believes the only way they will get any revenue out of the Republicans is via tax reform.
But he also talks about taking Social Security separately, not as part of the debt/deficit deal, via this new commission. It would reconvene every ten years and presumably make more cuts if necessary to maintain a 75-year rolling solvency.
[…] We’ve done the revenue there. We’re not returning to the subject. It’s impossible for us to get the meaningful deficit reduction without putting everything on the table – hear that, Maya (ph) – everything on the table, which includes revenue, spending cuts and entitlement reform, which has been my position all along and I think is still the path to a substantial deficit (reduction ?).
SEN. DURBIN: Well, first, it is a serious problem. And you know the numbers. Social Security untouched, unamended, will make its payments for 20 years. That’s pretty good by federal standards but not good enough, because a lot of people plan on being on Social Security 20 years from now.
I want to credit Mark Warner for giving what I think ought to be our standard for Social Security. And this came up in the Gang of Eight discussions. He said 75-year solvency reviewable every 10 years, which I think is a thoughtful approach, […] So yes, Social Security should be addressed, could be addressed, and I think under the right circumstances, we can come up with a good bipartisan approach.
[…] So let’s seize this opportunity. Here’s a president who’s serious about it, who’s on our side philosophically, and now we can sit down with the Republicans and be in a stronger bargaining position.
[…] But one tea party Republican senator came up to me after the dinner and said, you know, for the first time I think we can talk; I really think he’s honest about this. […] They want to get into Medicare, I think for good and sinister reasons, depending on your point of view. But the president clearly does not want to put Medicare and his proposals on Medicare on the table until there’s clearly a negotiating position, and it has to be a position that says everything’s on the table, including revenue. And that’s where things are stalling at the moment.
My political experience around here goes back to 1983, […] And I voted for it. And I got re-elected. And there wasn’t anyone who lost the election over that issue. Why? It was bipartisan. […] I think that is how this place should work. If we’re going to seriously take on these entitlement programs, we need buy-in from both political parties. Paul Ryan has taken it to one extreme. I can name names that take it to others. There’s a path in the middle here, and I think it’s a lot wider than people think.
SEN. DURBIN: I think it’s – that chained CPI is a real possibility, and only if it is crafted in the right way. […] Now, you could play that number out, as my critics do, to thousands of dollars 20 years from now. And I’m sure they’re right in their calculations. But if you said to the average Social Security recipient, the cost is $3.50 a month, and the dividend is 50 more years of solvency – and I’m not saying doing this alone would reach that, but it’s an important part.
We need to raise the lowest quintile of Social Security payments to the poverty level, and we can do that as part of this calculation.
I want to stress — this is not part of deficit reduction. Social Security does not add to the deficit. But it is still our responsibility to make sure that it’s there. And I honestly believe, if you sit down with most people and said, for example, let’s extend the Social Security retirement age to age 68 – what we said in Simpson-Bowles, let’s do it over 40 years – 40 years. One year of eligibility over 40 years. […] This morning’s Wall Street Journal talked about people not saving enough for retirement. For goodness sakes, let’s assure them that Social Security is going to be there. And I think most of them will say, if it’s $3.50 a month for the average recipient, that’s not too heavy a price.
Q: Thank you, Jim Kessler from Third Way. Let — I’d like to go back to Social Security for a second because in about ’83 came together the Greenspan Commission and those recommendations and it was bipartisan. And I was wondering, is there any thought, since I think the likelihood of making grand, grand bargains is smaller now and then these things that we’ve done in the — (inaudible) — is there any thought to creating a Social Security commission that would — that would demand an up-or-down vote, let’s say, by 2015 or something like that?
And the reason why I think it’s potentially attractive is that there’s widespread agreement that something needs to be done; it’s easier to fix than the other things. But also for Democrats, it’s certain you’re going to get revenue out of some commission recommendation. For Republicans, it’s certain that there’s going to be a narrowing between what is spent by the federal government and what is raised by the federal government. So there seems to be something there for everybody. And then while this is happening, it’s too hard to get something done on Medicare; we should see how the ACA is affecting Medicare payments in the next year or two and it allows – I’m not saying we should pause on these things but, you know, I think realistically, I mean, I don’t know how much is going to be done on it.
SEN. DURBIN: Here’s what I’m working on, and it’s a Social Security commission like Simpson-Bowles. And it would basically say to a commission with a very limited timeframe — within a very limited timeframe to come up with a proposal for 75-year solvency of Social Security. And then — and this is important, it would be referred to both chambers and on an expedited procedure, allowing any members to offer substitutes to the commission proposal — substitute amendments as long as they meet the same test — 75-year solvency.
Now, in the end of — at the end of the day, we may not agree on anything and we may not be able to push one from the Senate to the House or vice versa. But that, to me, is a thoughtful way, a sensible way to do it, and say it is separate from the deficit/debt debate but still we’re going to do it.
And going back to Mark Warner’s template — 75 years, 10 years — each 10 years, another review. I’d like to do that. I’ve proposed that to a number of people and they’ve been receptive to it on both sides of the aisle. I think we can move forward with it. And –
Q: Has that been introduced already or are you –
SEN. DURBIN: Getting ready to introduce it.
MODERATOR: Is it a bicameral –
SEN. DURBIN: Yes.
MODERATOR: So it will be very much like the Greenspan commission.
SEN. DURBIN: Well, I’d –to bring it to contemporary times, Simpson-Bowles.
Bipartisan Task Force for Social Security Solvency Act of 2013
Here is some more source material about the new commission. The following was produced by Durbin’s office, and can be found in this Scribd document.
Bipartisan Task Force for Social Security Solvency Act of 2013
The Bipartisan Task Force for Social Security Solvency Act of 2013 establishes a Bowles-Simpson style commission to develop a bipartisan plan to achieve 75 years of solvency for the Social Security Trust Fund.
The Commission would be made up of 18 members, 6 appointed by the President, and 6 from each House of Congress, equally divided between Democrats and Republicans.
After 180 days, the Task Force would be required to vote on a plan that achieves 75 years of solvency for the Social Security Trust Funds. If 14 or more members of the Task Force voted for the plan, it would be sent to the Congress for expedited consideration, with limited debate and amendments.
In the Congress, the plan would be considered with limited debate time. Only full substitute amendments that achieved 75 years of solvency would be in order. Amendments will be scored by JCT and CBO to determine solvency.
If the Task Force plan were adopted, the solvency of the trust funds would be subject to decennial review. Every 10 years, the Social Security Trustees would report to Congress on the solvency of the trust funds. If the trust funds do not have 75 years of solvency at that time, the Task Force would be constituted in that year.
Greenspan Commission – In 1981 Congress created the Greenspan Commission after the Actuaries determined the OASDI trust fund could run out of money as early as August 1983. The Commission’s report served as the basis of the 1983 Social Security Amendments Act. Among its provisions, the law raised the normal retirement age to 67, taxed Social Security annuities above a certain threshold and increased the FICA tax.
Bowles Simpson – The Bowles Simpson Commission’s Social Security plan increases the normal retirement age to 69, increased the wage base, changed the initial benefit formula which would reduce benefits for a majority of Americans and called for using the chained-CPI to calculate cost-of-living adjustments
This has not received very much attention so far. There have been some news articles, but not much fuss. Presumably it will get more attention when Durbin introduces the bill in the Senate. He says it will be a bipartisan bill, so there must be a Republican Senator who has helped to craft the terms, or maybe a Republican who will introduce it in the House.
But I think it’s very clear that the Simpson-Bowles proposals for cutting Social Security (in multiple ways) are still very much on the table. Durbin, and the Democratic party leadership, are very serious about making them happen. Durbin says that he will introduce the legislation to form the commission soon. It is currently structured to spend six months crafting the recommendations and legislation, presumably with a goal of bringing all of it to the floors of Congress for a vote by the end of the year. The Simpson-Bowles commission could not garner the necessary votes to send their recommendations directly to Congress. My guess is that the members of this commission will be chosen more carefully so that there is less chance of failure.
This is an 18-member panel. Six members are chosen by the president, who has made it clear that he wants cuts to Social Security. The remaining members are from Congress, split evenly between the parties and most likely will be chosen by the respective party leaders.
Fourteen members must agree to the plan before it can be fast-tracked to the floors of Congress where no amendments would be allowed and debate time would be limited. The only things that would be considered are full alternative plans for making changes to Social Security and they must achieve solvency for 75 years. Presumably there would be some assumptions, calculations, projections, etc. set forth that the alternative plans would have to use. An “up or down” vote is mentioned in the transcript above, so this probably means not only no amendments, but no filibuster allowed.
One of the key features buried in the legislation that forms the commission is that once the commission is formed, it is not dissolved after it finishes its work this year. Every ten years, it is rises from the dead and does another assessment of the Social Security program to see if it is solvent for the next 75 years. If not, then the commission goes to work again with further changes and/or cuts.
I used to joke about the zombie catfood commission because the president tried so many times to form Simpson-Bowles before he finally gave up on Congress and did it by executive order. And after it was formed and failed, the chairmen produced their own report that lived on and was called the Simpson-Bowles plan even though the Simpson-Bowles commission itself produced no approved plan.
Well if I am interpreting all of this source material correctly, this new commission, if Durbin is able to pass this bill (and it is not repealed in the future), will truly be a zombie catfood commission that comes back every ten years for more potential cuts, to “strengthen” Social Security.