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Kevin McCarthy. US House Speaker speaks to reporters on May 9.

Retirement Planning > Social Security > Social Security Funding

Social Security Cuts on the Table as McCarthy Assembles Commission

By John Manganaro

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House Speaker Kevin McCarthy is working to assemble a commission to look at potential cuts in spending across the entire federal government — including on key social insurance programs such as Social Security and Medicare.

McCarthy made that pledge during a live Fox News interview this week shortly following the passage of legislation that suspended the U.S. debt ceiling and imposed restraints on government spending through the 2024 election.

While the legislation ended the worst standoff over the U.S. debt in a dozen years, it also came at some political cost for President Joe Biden and McCarthy, who have both taken fire from lawmakers on their respective parties’ flanks who insist too much was given away in the negotiations.

Now, McCarthy is publicly pledging to push for more spending cuts, and he says nothing outside of defense spending is off the table.

“The majority driver of the federal budget is mandatory spending,” McCarthy told Fox News. “It comes from programs like Medicare, Social Security and interest on the debt.”

According to McCarthy, only about 11% of the federal budget was “in play” during the debt ceiling negotiations, because of the president’s bargaining position and technical issues related to the federal budget. Moving forward, he said, the entire budget will be under the scrutiny of a soon-to-be created commission that, according to McCarthy, will be bipartisan.

“Now we are focused on cutting,” McCarthy said. “I’m going to make some people uncomfortable by saying that — but I’m not going to give up on the American people. I’m going to create a commission that will look at the entire budget to find cuts.”

As of Tuesday, McCarthy has not released any further information about the structure of the commission or a potential timeline according to which it will operate, but he has previously endorsed legislation which would result in a sizable budget cut to the Social Security Administration and many other federal agencies.

A version of McCarthy’s bill that narrowly passed the House earlier this year would freeze nondiscretionary spending at fiscal 2022 levels for 2024, which would result in a 23% budget cut for most agencies. The legislation died in the U.S. Senate, however, prior to the successful debt ceiling negotiations.

Pictured: House Speaker Kevin McCarthy. (Image: Bloomberg)

John Manganaro

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