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Roll Call
Laura Weiss

Government pensioners look to elbow into Social Security talks - Roll Call

Lawmakers backing a push from public sector workers to restore higher Social Security payouts are gearing up to capitalize on momentum in the last Congress and force action in the House this year.

The “windfall elimination provision” and “government pension offset,” enacted in 1983 and 1977 respectively, have vocal foes on Capitol Hill who argue both measures unfairly cut Social Security for public employees with pensions.

Efforts to strike the provisions have long faced cost barriers and political headwinds, but opponents see growing House support and the pressure of Social Security’s impending shortfall as opportunities to act. A bipartisan effort to shore up Social Security’s finances could be their chance.

“This has got to be fixed,” Rep. Garret Graves, R-La., said in a recent interview.

He described the issue as pervasive in his southern Louisiana district and one he saw firsthand working for a state coastal protection program. “It’s unjust. You’ve been robbing these people now for over four decades,” Graves said.

For about 2 million people, the windfall elimination provision applies a less generous formula for Social Security benefits to retirees with income from employment that didn’t pay into the Social Security system, including state and local government jobs, employers in foreign countries as well as federal agencies prior to 1984.

For about 735,000 people, the government pension offset cuts spousal, widow or widower benefits for those with their own pensions from work not covered by Social Security. That Carter-era change was intended to limit benefits for those who aren’t financially dependent on their spouse given their own employment.

Both provisions were aimed at reducing unfairly high payouts from Social Security. But many lawmakers, public workers and retiree groups now say the decades-old changes went too far and punish teachers, police officers, firefighters, government workers and others who’ve prioritized public service.

Graves is lead sponsor of a bill that would strike both provisions and grant higher Social Security benefits. His bill, whose lead Democratic sponsor is Rep. Abigail Spanberger of Virginia, topped 300 co-sponsors last year and had enough backing to force a House vote. But the Ways and Means Committee marked up the legislation in a procedural move that blocked it from going to the floor.

Graves’ bill has already racked up 180 House cosponsors this year, and he said his plan is to keep adding names, secure a House vote and use that momentum to put pressure on the Senate with as much time as possible before this Congress expires.

Sens. Sherrod Brown, D-Ohio, and Susan Collins, R-Maine, introduced the Senate version of the same bill Thursday with 23 co-sponsors, who are mostly Democrats.

‘We’re coming at you’

An ally of Speaker Kevin McCarthy who had a hand in negotiations that delivered him the gavel this year, Graves could be a powerful advocate for the cause in the chamber’s new Republican majority. He said he’s met with new Ways and Means Chairman Jason Smith, R-Mo., multiple times already and discussed the issue.

Graves said his message to Smith was, “I just want to be crystal clear: We’re coming at you.”

Smith said he’s worked with Graves and Rep. Julia Letlow, R-La., and is open to the discussion. But he noted that their bill lacks a replacement formula to avoid hastening Social Security’s financial shortfall, which is currently expected to hit in about a decade.

“You know me, I care about protecting Social Security,” Smith said. “So I challenge them to help us come up with, if you do repeal it, how do you pay for it so it’s not on the backs of seniors.”

Last year, the Congressional Budget Office estimated full repeal would have cost $88 billion over a decade for the windfall elimination provision and $107 billion for the government pension offset.

Graves said he wouldn’t be making the first move toward a solution short of full repeal, but that he’s open to talks.

“I’m not saying it’s our way or the highway,” Graves said. “Am I willing to take progress over perfection? Yeah, I would. But I’m also not stupid enough to negotiate with myself.”

In recent years, there’s been some movement in the Ways and Means Committee toward a new formula to replace the windfall elimination provision, but it failed to get over the finish line.

Former Rep. Kevin Brady, a Texas Republican who previously chaired the panel, led a bill last Congress to shift to a more generous calculation. Ways and Means’ top Democrat, Richard E. Neal of Massachusetts, had his own proposal.

Both measures would’ve introduced a “proportional formula” to base benefits on the share of earnings over a full work history that came from Social Security-covered employment, and offer current workers around $500 more per month when they retire.

But they hit a sticking point on a “hold harmless” provision to prevent benefit cuts for people who would see payouts shrink under the new calculation. Brady’s bill would’ve cut off that treatment after 40 years, while Neal would allow the higher of either formula indefinitely.

Along with challenges related to cost and the details of a legislative fix, the concentration of pensioners whose Social Security benefits are cut is uneven and higher in certain states like Louisiana, Texas and California. That makes it tougher to gin up enough support to pass, particularly in the Senate.

Neal said he hopes to get to a bipartisan agreement this Congress on a fix and that he’d like to be part of Graves’ bill if he thought it would work, but “it’s easier said than done.”

Neal could find his new negotiating partner in another Texas Republican and Ways and Means member, Budget Chairman Jodey C. Arrington, who said he’s hoping to take over Brady’s role as a leader of the effort.

Arrington said it’s a frequent topic at town hall meetings in his district, and he’s optimistic the time is right for movement.

“It’s been a disparity structurally for 20-some-odd years. It’s like, are you kidding me?” he said. “Hopefully, I think sometimes divided government is the best time to do that kind of stuff.”

Opportunity amid shortfall

Still, given the challenges of addressing the provisions, a broader Social Security package is likely the best chance to make a change.

Sens. Bill Cassidy, a Louisiana Republican, and Angus King, a Maine independent who caucuses with Democrats, are leading bipartisan talks on a plan to address Social Security’s imminent shortfall.

King, whose state has over 28,000 residents impacted, said he intends to include a full repeal of the windfall elimination provision and government pension offset — without replacement formulas — in any package the group agrees on.

Cassidy, another advocate, said repeal of both provisions will have to be part of a broader package addressing Social Security’s finances. He cited a roughly $7 trillion hit to the program’s trust funds over 75 years from full repeal.

Cassidy believes that if a bill to fully fund Social Security benefits comes together, senators can get on board with including the pensioners’ fix.

“We’re not asking for a windfall, we’re asking for fairness,” he said.

Cassidy could consider other approaches and said he’s “very open” to Brady’s proposal using a replacement formula. He emphasized the difficulty of passing legislation on Social Security in the first place.

Graves said he’s interested in a broader Social Security bill as the path for action if it gets done in the near term, but less so in the likelihood the issue lingers.

Still, he’d view addressing both provisions limiting pensioners’ benefits as a must if that legislation comes together and fears that missing the opportunity of a broader package would set the effort back for decades more.

“Social Security is very much in the headlines right now and so I think it’s important to, you know, if we’re talking about Social Security, we’re talking about Social Security,” Graves said. “We’re going to talk about the good, bad, the ugly.”

The post Government pensioners look to elbow into Social Security talks appeared first on Roll Call.

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