Some Senators are reportedly eyeing divisions over the debt ceiling as an opportunity to introduce reforms to Social Security.
“A wise Senator said that whenever you see reforms shore up those kinds of programs, it usually takes a divided Congress,” Sen. Dan Sullivan (R-AK) told The Hill last week, adding, “So, maybe that historically bodes well for something that would make sure that Americans have a secure retirement system.”
His comments came as Sens. Bill Cassidy (R-LA and Angus King (I-MA), who generally caucuses with Democrats, were working toward a bipartisan compromise to help protect the program, unrelated to debt ceiling negotiations. First reported by Semafor, the pair are looking to create an investment fund whose profits could fund Social Security benefits.
Sen. Cynthia Lummis (R-WY) told The Hill on Monday that she plans to meet with Cassidy later this week about a proposal while Sen. Joe Manchin (D-WV) recently suggested raising the taxable wage cap for Social Security.
On January 19, the federal government reached its $31.4 trillion borrowing limit, prompting Treasury Secretary Janet Yellen to take what she called “certain extraordinary measures to prevent the United States from defaulting on its obligations.”
Yellen had warned in a letter to Congress those measures would allow the government to buy time so that Congress can negotiate and pass a debt limit increase—but that the purchased time would likely “be exhausted before early June.”
House Republicans, newly emboldened by their five-seat majority, had been positioning for a standoff, planning to leverage the need to avoid breaching the debt ceiling to extract major spending cuts, including to safety nets like Social Security and Medicare. House GOP lawmakers insist that past Congresses and Presidential Administrations have spent too much on social programs.
The Biden Administration has retorted that it will not negotiate on the debt ceiling, accusing House Republicans of using it as a “political football.”
On Tuesday afternoon, House Speaker Kevin McCarthy (R-CA) doubled down on his claim that cuts to Social Security and Medicare were off the table. On the Fox Business network, McCarthy claimed what he called “little White House weenies” were accusing him of considering spending cuts to the two programs, insisting, “none of that is true.”
Senate Minority Leader Mitch McConnell (R-KY) said Tuesday that any agreement to address the debt ceiling and avoid a first-ever default by Washington would have to come from Biden and McCarthy.
“In this current situation, the debt ceiling fix—if there is one, or how it’s to be dealt with—will have to come out of the House,” McConnell told reporters.
This follows comments last week by McConnell, who has played an integral role in debt ceiling negotiations in the past, when he told reporters in his home state that he was confident the ceiling would be raised—stressing, “America must never default on its debt. It never has, and it never will.”