It is undisputed that the trust funds for the two big entitlement programs will be depleted in the foreseeable future, which means the programs will be cut significantly unless Congress takes action. Biden’s solution to the problem is sensible, if incomplete–impose the FICA tax on earnings over $400,000 per years. The two principal GOP contenders, one of whom has advocated for Social Security cuts in the past, have no plan other than to avoid benefit cuts. Biden figures to make a big issue of this during the general election campaign. What happens if he wins?
That will be up to the Republicans, who are badly split on the issue; the PBPs and CLs want benefit cuts and reject any tax increases, while the Reactionaries strongly support entitlements that are primarily earned by white Christian workers. In light of this, I suspect the GOP playbook will look something like this:
- Support the creation of a bipartisan committee to study entitlement reform in the hope it will recommend cuts instead of tax increases, and the Democrats will be blamed for them;
- If that doesn’t work, put off any action until the last minute, agree to fill in the gap with general revenues, and demand massive spending cuts in other programs to avoid an increase in the deficit. When the Democrats refuse, blame them for the entitlement cuts that follow.