Where the exhaustive House Ways & Means Committee hearing was long on data points across diverse issues, it was refreshingly short on demagoguery. Here are some highlights from the discussion on Social Security reform. (Photo: Mike Scarcella/ALM)

A four-hour hearing on retirement income security before the full House Ways and Means Committee broadly focused on options for making Social Security actuarially sound, expanding savings vehicles in the private sector retirement system, and rescuing the roughly 130 collectively bargained multiemployer pension plans that face impending insolvency.

For retirees and their advocates, private sector retirement industry stakeholders, and policy experts across the ideological spectrum who fear retirement reforms may not be prioritized under divided government, the hearing was a strong start. As was noted by Rep. Earl Blumenauer, D-OR, it was “the first real” hearing held by the Ways and Means Committee in the 116th Congress.

The hearing was marked by pledges for bipartisanship from both Democrats in the majority and Republican minority members. While the routine expressions of comity were a decided departure from the acrimony marking other policy debates on Capitol Hill, the hearing did reveal clear ideological divisions that have obstructed reform in the past, particularly with Social Security and previous proposals to rescue failing multiemployer plans.

Rep. Richard Neal, D-MA, Chair of the Ways and Means Committee, has already reintroduced legislation that would rescue failing multiemployer plans without enacting benefits cuts on retired union workers in the private sector.

The Retirement Enhancement and Savings Act, a comprehensive retirement package designed to address the access gap to retirement plans in the private sector, is slated to be reintroduced in the House this week.

And last week, Rep. John Larson, D-CT, chair of the Ways and Means Subcommittee on Social Security, reintroduced the Social Security 2100 Act.

Where the exhaustive hearing was long on data points across diverse issues, it was refreshingly short on demagoguery. Here are some highlights from the discussion on Social Security reform:

  “We've got to get away from the platitudes and actually put real plans on the table.  I think we have the makings on this committee, as we have on historic Congresses, where we can come together and move forward.”  — Rep. John Larson, D-CT, chair of the Subcommittee on Social Security.

Larson has reintroduced the Social Security 2100 Act, which expands benefits, raises taxes, makes Social Security Solvent, but does not raise the retirement age.

In the 114^th Congress, Republicans introduced legislation that would make Social Security solvent by phasing in an increase in the retirement age. “That's the kind of conversation we are going to have to have,” said Larson.

  “The biggest problem facing retirees is that Social Security is not solvent.  I'm proud of my friend Mr. Larson for attacking this problem.  Because it takes a lot of political courage to do it.  You've got to raise taxes or cut benefits.  Any time you do that you're going to infuriate masses of people on either side.” — Rep. Tom Rice, R-SC

Despite his admiration, Rice said Larson's bill “is simply a tax increase,” noting the difficulty it will be to reach a bipartisan solution to Social Security.

“It's not going to get solved on one side or the other. There's probably going to have to be both,” said Rice.

  “The American people are polarized over many things, but not Social Security.” — Nancy Altman, president, Social Security Works

Social Security's reserve funds are scheduled to be depleted by 2034, at which time all beneficiaries would see a 23 percent cut in benefits. At several points during the hearing, Altman advocated against raising the retirement age, arguing that would disproportionately and negatively impact lower-wage earners, minorities, and women.

  “I have serious concerns about some of the approaches being considered in this hearing.” — Rep. Adrian Smith, R-NE.

Smith said Rep. Larson's 2100 Act “deviates” from bipartisan tradition on Social Security reform. The bill would phase in a 2 percent increase in the payroll tax over 23 years for all Americans. Smith said that under the Tax Cuts and Jobs Act, a single mother with two children does not pay federal income taxes until her income hits $53,000. Larson's bill would amount to a $1,200 tax increase for her, said Smith.

  “Employers and the government have reduced their contribution to retirement security, and shifted responsibility to individuals to make up the difference.  I would argue Social Security benefits should be expanded.  Rep. Larson's bill does that in a responsible way.” — Rep. Bill Pascrell, D-NJ.

In response to questioning from Rep. Pascrell, Diane Oakley, executive director, National Institute on Retirement Security, testified that widening economic inequality has made the lowest wage earners too dependent on Social Security, which provides too little under existing benefit schedules.

“Inequality has been growing to historic levels—the President did not mention that in his speech last night,” said Pascrell.

  “Impact on low income folks is not at all clearly positive.” — Andrew Biggs, resident scholar, American Enterprise Institute

A former economist at the Social Security Administration, Biggs testified that the Social Security payroll tax is the largest tax for most Americans.

Biggs commended Rep. Larson for advancing the 2100 Act, though said he is not in complete agreement with all of its provisions. The bill would increase the payroll tax on low-income households.

Some research shows that low-income households would try to maintain their lifestyle in the face of lower take-home pay by borrowing more. Biggs advocated for solutions that would increase benefits for the lowest wage earners, but questioned the wisdom of increasing benefits for middle income and the highest wage earners.

“This is the start of a conversation, not the end of one,” Biggs said of the 2100 Act.

  “This conversation should have happened 20 years ago.  Our greatest fragility as a country right now is keeping our promises.” — Rep. David Schweikert, R-AZ

Schweikert cited data from the most recent Congressional Budget Office budget report showing 50 percent of all non-interest government spending will go to those age 65 and older by 2028.

He raised the question of how to design incentives throughout social safety nets that incentivize people to work.

“This is a huge complex issue,” he said of Social Security, and will require “taking on a lot of incumbent interests and making a lot of people cranky.”

  “I often get calls from women whose husbands have died.  They are too young for Social Security.  Too young for Medicare.  They are perplexed.  They don't know what to do.  I don't know what to do either.” — Rep. Danny Davis, D-IL

African American males have the lowest life expectancy in the country, said Davis. One argument for raising the retirement age is that life expectancy has dramatically increased since Social Security was created in 1935, and last reformed in 1983.

But “not everyone is living longer,” said Social Security Works' Altman, in response to questioning from Rep. Davis.

  “I share a commitment with Mr. Larson to make sure Social Security is solvent to make sure every benefit promised is there, and is there for generations to come.” — Rep. Tom Reed, R-NY

Reed, the ranking member on the Subcommittee for Social Security, is the youngest of 12 children, and was two when his father died. His family was able to survive because of Social Security.

“My partner from Connecticut is a true gentleman,” Reed said of Rep. Larson. “But we do need to recognize there will be a difference of opinion.”