Among the package of bills being belatedly offered by Senate Republicans, dubbed the Heals Act, for the next round of coronavirus pandemic relief is one that has not received much attention in press reports.
It is Senator Mitt Romney’s attempt to revive President Obama’s National Commission on Fiscal Responsibility and Reform aka the “Simpson-Bowles Commission” on reducing the deficit from 2010, which made a series of proposals that included reducing social security benefits, which were never enacted because of strong public opposition.
Sen. Romney’s bill is the Time to Rescue United States’ Trusts (TRUST) Act of 2020, bipartisan bill to address looming funding shortfalls in several government trust funds. Romney, Manchin want new rescue committees to address trust fund solvency:
[A] bipartisan contingent led by the Utah Republican wants to establish “Rescue Committees” to write legislation providing 75 years of solvency for trust funds identified in a report to Congress from the Treasury Department. Examples of funds that would likely qualify include Social Security and the Highway Trust Fund.
As drafted, there would be a separate joint House-Senate rescue committee for each fund.
Backing the effort in the Senate are three of the most moderate members of the Democratic caucus: Sens. Joe Manchin III of West Virginia, Kyrsten Sinema of Arizona and Doug Jones of Alabama, along with Republican Sen. Todd Young of Indiana.
Companion legislation in the House is being led by Wisconsin GOP Rep. Mike Gallagher and Hawaii Democratic Rep. Ed Case, according to Romney’s office.
I smell the Pete Peterson Foundation aka Fix The Debt lurking behind this, just as it was with the Simpson-Bowles Commission.
We don’t need yet another commission to solve what is easily remedied.
For Social Security and Medicare, simply eliminate the $137,700 salary cap (2020) on wages, and impose a financial transactions tax (FTT) “on stock trades at 0.5 percent (50 basis points) and bond trades at 0.1 percent (10 basis points)” and “derivatives transactions taxed at 0.005 percent (5 basis points),” as Sen. Bernie Sanders has proposed. This would secure the solvency of Social Security and Medicare well beyond 75 years, and even allow for expansion of benefits.
The Highway Trust Fund is more problematic. It relies on the gasoline tax, currently levied at 18.4 cent per gallon, at a time when auto manufacturers are all converting their fleets to battery powered electric vehicles as they go green.
It is time to adopt a mileage tax based on the number of miles a vehicle owner drives. The so-called Vehicle Miles Traveled, or VMT fee, is being tested in states such as Oregon and Utah. Is a tax-by-mile system ready to replace fuel taxes? “The problem? Even its biggest backers say the federal government isn’t ready to rely on a VMT.” So this will take further study, I will concede, Mittens.
Bloomberg reports today, Stimulus Talks Could Snag on Social Security Review Panels:
The $1 trillion Republican stimulus proposal comes with a measure that could curb federal spending in the future by reducing costs tied to Social Security, Medicare and highway trust funds.
Among the bills that make up the GOP plan is one that would establish congressional review boards to examine the long-term solvency of the three trust funds, a topic that long has been politically fraught.
The Highway Trust Fund faces some of the most urgent shortfalls, with the Congressional Budget Office projecting it could run out of money by late 2021 or early 2022. Social Security could also face an inability to pay retirees in a timely manner starting in 2034, according to the Social Security trustees annual report.
Proponents of the measure, which include some Democrats, say that addressing the projected shortfalls now would prevent draconian cuts or tax hikes later. The legislation would create congressional panels mandated to draft bipartisan legislation that restores solvency of the trust funds, and the bills would receive fast-track consideration in each chamber.
“This is the right time to act. Our trust funds are approaching insolvency even more quickly because of the pandemic,” Senator Mitt Romney, a Utah Republican who is leading the effort, said Monday on the Senate floor. “It is far better to prepare and hopefully prevent a crisis than wait for a crisis to fall upon us.”
Hmmm, then maybe Republicans should not have been giving serious consideration to Donald trump’s proposed payroll tax holiday, which would have taken money from the Social Security and Medicare Trust Funds and not helped a single unemployed person in America.
The measure has bipartisan backing in the Senate, as well as support from some moderate House Democrats. However, it is facing opposition from House leaders who say the legislation is a roundabout way to cut Social Security benefits.
See the Simpson-Bowles Commission fiasco for context.
“The last thing struggling Americans need right now is a secret panel designed to slash their earned benefits and further undermine their economic security,” House Ways and Means Chairman Richard Neal, a Massachusetts Democrat, said in a statement. “I wholeheartedly object to the TRUST Act and will fight against its nefarious inclusion in any upcoming relief package.”
The measure’s inclusion in the stimulus is likely to be a point of contention between Republicans and Democrats as they hash out a compromise in the coming weeks that will address state and local funding, money for schools and extending expiring unemployment payments.
This bill is DOA in the House in the current coronavirus stimulus negotiations, but expect to see this bill again next year in response to the deficit spending currently being incurred as a result of the coronavirus pandemic. Republicans only find religion on deficit spending when a Democrat is in the White House.