A Republican plan to rein in the rising cost of Social Security would
dramatically reduce retirement benefits for middle- and upper-income
Americans, especially those now younger than 25, according to an
analysis released Wednesday by the program's chief actuary.
Together, the two provisions would slice initial benefits by about a
quarter for middle-income Americans who turn 65 in 2050, according to
the analysis. Wealthier retirees would see even deeper cuts, losing
about a third of scheduled benefits in 2050 and more than half of
scheduled benefits if they turn 65 in 2080.
With congressional elections less than two weeks away, the Ryan plan has been a frequent target
for Democrats accusing the GOP of plotting to gut Social Security. But
the report by Stephen Goss, chief actuary for the Social Security
Administration, also examines other ideas for overhauling the program,
including several under discussion by a bipartisan deficit-reduction
commission appointed by President Obama. Leaders in both parties say
Social Security may present the best opportunity for compromise on the
commission, which is due to issue a report Dec. 1.
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Goss's analysis shows that those ideas may not be much more palatable
than Ryan's plan. For example, allowing the retirement age to continue
rising two months per year until it hits age 70 would cut initial
benefits by nearly 20 percent for anyone turning 65 in 2050. Meanwhile,
the commission is talking about trimming the cost-of-living increase
retirees receive each year, as well as cutting their initial benefits.
"There's been a lot of discussion about how easy it would be to cut
Social Security in order to save it," said Rep. Earl Pomeroy (D-N.D.),
who requested the report as chairman of the House Ways and Means
subcommittee on Social Security. "The new analysis reveals that these
proposals result in benefits cuts ranging from 10 percent to as high as
50 percent. . . . That's not what I'd call 'saving' Social Security."
Ryan spokesman Conor Sweeney said Goss did not analyze the full effect
of Ryan's plan to balance the federal budget and ignored Ryan's proposal
to guarantee a higher minimum benefit to low-income retirees. More to
the point, Sweeney said, failing to overhaul Social Security - which is
already paying out more than it collects from payroll taxes - will cause
more immediate harm.
"According to the Social Security Administration, Congressman Pomeroy's
do-nothing plan will impose painful, across-the-board benefit cuts on
current seniors and those nearing retirement," Sweeney said. "It is
deeply irresponsible for elected leaders to stand idle with icy
indifference as the social safety net collapses."