A Bipartisan Plan to 'Rescue' Social Security?

Plus, two takes on GOP debt hypocrisy By Yuval Rosenberg and Michael Rainey How Mitt Romney Wants to Save Social Security and Other Trust Funds A bipartisan group of lawmakers led by Utah Republican Sen. Mitt Romney introduced legislation Tuesday that would create new congressional committees focused on the fiscal health of federal trust funds, including Highway, Medicare Hospital Insurance, Social Security Disability Insurance and Social Security Old-Age and Survivors Insurance. The lawmakers — including Sens. Joe Manchin (D-WV), Todd Young (R-IN), Doug Jones (D-AL) and Kyrsten Sinema (D-AZ) as well as Reps. Mike Gallagher (R-WI), Ed Case (D-HI), William Timmons (R-SC) and Ben McAdams (D-UT) — warned that unless Congress acts, funding for these crucial government trust funds will run out within 13 years. Here’s how the legislation, called the Time to Rescue United States’ Trusts (TRUST) Act, would work, according to a [statement]( from Romney’s office: - Treasury would have 30 days upon passage of the legislation to deliver to Congress a report on the government’s major, endangered federal trust funds. - Congressional leaders would appoint members to serve on “Rescue Committees”— one per trust fund — with the mandate to draft legislation that restores solvency and otherwise improves each trust fund program. - Rescue Committees would ensure bipartisan consensus by requiring at least two members of each party to report legislation. - If a Rescue Committee reports a qualifying bill for its trust fund program, it would receive expedited consideration in both chambers. Romney [told]( Roll Call that while they may not be able to fix all of the existing problems, “we have a better shot of taking on the solvency of these trust funds by looking at them one by one, rather than by trying to create one mega piece of legislation that’s going to be troublesome in some way for almost everybody.” Mnuchin Pressed on ‘Alleged Rampant Corruption’ at Treasury Department Rep. Bill Pascrell, Jr. (D-NJ) on Tuesday asked Treasury Secretary Steve Mnuchin for more information related to a report in [The New York Times]( alleging that Mnuchin personally intervened to provide the financier Michael Milken with tax breaks through the federal “opportunity zone” program meant to direct investment to distressed neighborhoods. In a [letter]( to Mnuchin, Pascrell, a member of the House Ways and Means Committee, said he was writing regarding “alleged rampant corruption” at the Treasury Department and questioned how Mnuchin sees his role: “[D]o you see your job as protecting the interests of the entirety of the American people or a handful of plutocrats and personal friends? Do you think it is appropriate for the Secretary of the Treasury of the United States to seek special favors for one of the most prolific financial criminals in world history?” “It should go without saying that the United States government is not a piggy bank to be looted for the sole benefit of the President and his friends. Yet this is not only what is occurring in your department, but it is happening at your direct supervision. Please provide answers to my questions immediately.” A Treasury spokesperson said the Times story is “highly inaccurate and deeply misleading,” according to [The Hill]( and Mnuchin denies having knowledge of Milken's investments in the opportunity zone in question. Milken has also rejected the Times story, saying he had nothing to do with “changes in opportunity zone regulations.” Quote of the Day “Barring a miracle of the first order up here, I don’t see any way. Based on my experience here, I could see it going into late January, February. Might not. I hope it won’t.” – Sen. Richard C. Shelby (R-AL), chair of the Senate Appropriations Committee, [commenting]( on the chances of annual spending bills becoming law before short-term funding runs out on November 21. Number of the Day: $2.5 Trillion The opioid crisis cost more than $2.5 trillion from 2015 through 2018, including $696 billion last year, according to a [new report]( by the White House Council of Economic Advisers. Two Takes on Republican Debt Hypocrisy The federal deficit for fiscal 2019 was nearly $1 trillion, and the national debt is going to hit $23 trillion within a matter of days. President Trump once said he would eliminate the national debt within eight years, but it has continued to grow during his time in office and is now $3 trillion higher than when he first entered the White House. “In nearly three years, it rose 15% — from $19.9 trillion to $22.9 trillion, according to the latest numbers from the Treasury Department,” Caroline Cournoyer of CBS News [said]( Tuesday. Yet, as economist Paul Krugman notes in his latest New York Times column, the reaction to the dramatic rise in the deficit, on the whole, has been decidedly undramatic: “Were there fiery speeches in Congress, denouncing fiscal irresponsibility? No. Was there intense media coverage? No — the story was tucked deep inside major newspapers. Was there severe market reaction? No — interest rates are substantially [lower]( than they were before the deficit surge.” So how big a threat is the rapidly rising deficit? Two pieces in Tuesday’s New York Times lay out very different answers — though the one thing they agree on is the sad state of fiscal conservatives. Here’s a quick summary. From the Left: Krugman has long argued that the deficit wasn’t a crisis in the aftermath of the financial crisis and it isn’t one now. “In fact,” he writes in his latest column, “[leading economists]( are now telling us that concerns about government debt have been greatly exaggerated all along. The Very Serious People were completely wrong, and those who opposed austerity have been vindicated.” But the conspicuous current silence of many Republicans who emphatically warned about the dangers of the deficit several years ago — and then proceeded to inflate the deficit in order to pass their tax cuts — highlights a media double standard, Krugman says: “When progressives propose new or expanded social programs, they face intense media scrutiny bordering on harassment over how they intend to pay for these programs. Republicans proposing tax cuts don’t face anything like the same scrutiny; they are seemingly able to get away with blithe assertions that tax cuts will pay for themselves by boosting economic growth, even though every single piece of evidence we have says that this is nonsense.” From the Right: The national debt is heading toward unprecedented levels, and the Congressional Budget Office has warned that our current trajectory raises the risk of a future crisis. Philip Klein, executive editor of The Washington Examiner, [writes]( in the Times that ignoring those warnings would be a potentially costly mistake: “Skeptics argue that persistently low interest rates and consistent demand for domestic bonds in the past decade of rising debt have disproved old economic assumptions and have instead shown that extraordinarily high levels of federal debt do not matter. But making policy on the basis of this new assumption requires taking a leap of faith that this will continue to be true after decades of record-shattering debt — thus gambling with the futures of younger generations.” Yet Republicans have gone from “sanctimonious outrage” about the deficit during Barack Obama’s presidency to silence under Trump. “In some senses,” Klein writes, “the Trump era is emblematic of a long-running tendency of Republicans to rail against spending during Democratic administrations only to abandon fiscal restraint when one of their own is in power. Even still, Mr. Trump’s ascendance points to a broader shift on the right. Republicans are increasingly dependent on older voters to win elections, who in turn don’t want to see changes to Social Security and Medicare.” The result is that small-government conservatism has largely been brushed aside, replaced by escalating Trumpian culture wars. The GOP may come to lament that fiscally reckless turn. “Republicans may convince themselves that they can cut taxes every time they take power,” Klein writes, “but the reality is that if the long-term debt is not put on a manageable trajectory through reasonable reforms, it will require enormous, crushing tax increases just to sustain existing government programs.” How are we doing? Send your tips and feedback to yrosenberg@thefiscaltimes.com. Follow us on Twitter: [@yuvalrosenberg]( [@mdrainey]( and [@TheFiscalTimes](. And if you enjoy this newsletter, please tell your friends they can [sign up here]( for their own copy. 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Smith, Bloomberg - [Fed Wants a Break From Rate Cuts. Will Bond Traders Allow It?]( – Brian Chappatta, Bloomberg - [Part D Reform Shouldn’t Come at the Expense of New Treatments for Seniors]( – Joseph Panetta, Morning Consult - [The Hidden Tax We Pay for Being Polarized]( – Adam Blumenthal, Washington Post - [The White House Touts Trump’s Deregulation. It’s Actually Been a Bust.]( – Catherine Rampell, Washington Post [Like Us on Facebook]( [Like Us on Facebook]( [Read Us On the Web]( [Read Us On the Web]( Copyright © 2019 The Fiscal Times, All rights reserved. You are receiving this newsletter because you subscribed at our website, thefiscaltimes.com, or through Facebook. Our mailing address is: The Fiscal Times 399 Park AvenueNew York, NY 10022 [Add us to your address book]( Want to change how you receive these emails? [Update your preferences]( or [unsubscribe](.