Retirement policy wasn’t on the ballot in last week’s midterm elections. But the new political landscape could threaten the retirement security of middle-class households.
With Republicans in full control of Congress, expect efforts to cut Social Security and Medicare benefits. And more Republican-controlled statehouses mean more efforts to curtail state and local workers’ pensions. One positive note: Congress and the White House could find common ground on some promising ideas to encourage retirement saving.
My Reuters column this week looks at five policy areas to watch that could affect your retirement security: Social Security, Medicare, the Affordable Care Act (ACA) and retirement saving.
The shifting political landscape in Washington boosts the odds of future cuts to Social Security and Medicare, including further privatization and voucherization of the program.
The New York Times reports today:
Congressional Republicans intend to present a plan to overhaul Medicare, calling for voucherlike “premium supports” to steer people 65 and over into buying commercial health insurance, and to transform Medicaid, which would be cut and turned into block grants to state governments. They also intend to set up a new commission to study options on Social Security, while relying on what one House Republican aide called “the solid foundation” of the Ryan budget plan.
And, with Republicans tightening their grip on statehouses, we can expect further efforts to undercut the ACA, which has extended coverage to older Americans still too young to sign up for Medicare.
Looming storm clouds aside, it’s disappointing that so few Democratic candidates campaigned on policy ideas that would help the middle class build economic – and retirement – security. Democrats could have – and should have – run on the ACA, and polls show that expanding Social Security and keeping Medicare strong are winning issues across partisan divides and demographic groups.
Some Democratic candidates went on the offensive this fall, calling for expansion of Social Security benefits, an increase in payroll tax rates and lifting the cap on the amount of income subject to the tax. But the national party did nothing to embrace and amplify the calls for expanded benefits, and most candidates calling for it lost.
“It’s not enough for individual candidates to talk about expanding benefits,” says Nancy Altman, co-director of Social Security Works campaign, which advocates for expansion of the program. “The message won’t get through unless we need to hear this from the party’s national leadership.”
Last week’s shellacking should convince Democrats to run as real Democrats next time around.