Democrat Hillary Clinton and Republican Donald Trump‘s opposition to any benefit cuts in the Social Security retirement program have turned Washington’s politics of deficit reduction upside down.
Social Security reductions had long been the key building block deployed by fiscal hawks with plans to curb the federal budget deficit. Indeed, they were a central feature of the failed “grand bargain” talks in 2011 between President Barack Obama and top Republicans. And as recently as the 2012 election, Obama remained open to such a compromise while GOP nominee Mitt Romney campaigned on raising the program’s eligibility age and cutting benefits for upper-income retirees.
This year, Trump has steadfastly opposed Social Security cuts, breaking from his party’s leaders. Clinton, who faced pressure from Democratic primary rival Bernie Sanders, proposes higher benefits for widows and workers who took time off to take care of a family member. In June, Obama came out in favor of expanding Social Security, and the following month the Democratic Party formally adopted it in its platform. These policy shifts came in the wake of a deficit that has plunged since the depths of the Great Recession, falling two-thirds since Obama came into office.
“This is just a dramatic shift — to have the Republican nominee saying we’re not going to touch the program,” said Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, a nonpartisan group that supports entitlement spending cuts. “And on the Democratic side, to have moved where we’re talking about expanding the system, which would of course worsen any shortfall.”
“It’s troubling for those of us who care about fixing the problem,” MacGuineas said.
Senator Sherrod Brown, a progressive Democrat from Ohio, said it’s “obviously a great thing” that grand bargains like the one Obama attempted in 2011 are now off the table.
“It’s attributable to the fact that people running for elections are actually listening for what voters have been saying for 10 years about,” Brown said. “I don’t think anything has changed among the voters. Things have changed in the politics of it.”
Democrats press for expansion
Last week, sensing advantage, a swath of Democratic Senate candidates on the ballot in November endorsed Social Security expansion in statements distributed by the Progressive Change Campaign Committee, a liberal pressure group. They included Democrats in competitive races such as Wisconsin’s Russ Feingold, Arizona’s Ann Kirkpatrick, Illinois’s Tammy Duckworth, Ohio’s Ted Strickland, North Carolina’s Deborah Ross and Iowa’s Patty Judge.
They joined 42 Democratic senators who voted for a Social Security increase in a nonbinding resolution in 2015, and 120 House Democrats who have cosponsored a resolution for expansion. Democrats support financing it by lifting the Social Security payroll tax exemption that currently applies to earnings above $118,500.
Not all Democrats are on board. Senator Dianne Feinstein of California told Bloomberg Politics that the “political talk” around expanding Social Security “has been exclusive of reality” given the program’s long-term problems.
Adam Green, co-founder of the PCCC, said opponents of expanding Social Security “are generally yelping from the sidelines and are completely out of touch” with seniors who need higher growth in benefits.
“In 2016, the center of gravity has shifted in the Democratic Party, as evidenced by Hillary Clinton and Democrats all the way down the ballot campaigning on expanding benefits and not cutting them,” he said.
Surveys show Americans strongly oppose Social Security cuts when given a binary choice. A March 2016 Pew Research survey found that 71 percent of Americans (including 72 percent of Democrats and 68 percent of Republicans) believe benefits “should not be reduced,” while 26 percent say cuts “need to be considered.”
But large numbers of citizens are concerned benefits won’t be there when they retire, and some polls show evidence of an appetite for modest reductions when framed from the standpoint of fiscal necessity, such as reducing cost-of-living increases and lowering benefits for wealthy people.