Mitt Romney - Social Security

Last Updated: Dec 29, 2011

Summary

Governor Romney cites the need to reform social security often in his 2012 Presidential literature and statements. He asserts that driving down expenses in the primary items that needs to be addressed and entitlements such as social security is one of the key items in driving down expenses.

While Governor Romney has not put forth a specific plan to address social security, in 2007 he supported a number of measures. These measures included allowing a portion of people to hold their own money in private accounts, increasing the retirement age, and indexing the rate of inflation for the initial social security benefit being the CPI index rather than the wage index for people of higher incomes.

During the 2012 presidential campaign, Governor Romney has continued to state that there are a number of valid options on social security. In campaign rallies, he has noted the options of increasing the retirement age, means testing, using the CPI instead of wage inflation to adjust the social security COLA, and progressive indexing. He stated that he was leaning towards a combination of increasing the retirement age, means testing, and progressive indexing. The only item Governor Romney specifically opposed was raising taxes to make up the deficit in the social security system.

Des Moines Register Interview

In December of 2007, Governor Romney was interviewed by the Des Moines Register and spoke about social security. He states his dismay that Democrats opposed any reform when President Bush proposed reform, and stated that the issue needed to be addressed in the next one or two administrations. He offers an inflated rate for higher income earners, extension of retirement ages, and possibly allowing people to place a portion of their retirement in their own accounts.

We're gonna have to reform social security. I was honestly dismayed at the opposition party on this front. The President put a proposal on the table, he indicated a great deal of flexibility, he even put forward Bob Posens proposal on a ... if you will a graduated inflated rate for higher income people as a way to solve the problem. They laid that on the table and the Democratic party came back and said "There's no problem, why are you ... we don't need to solve this." Which I thought was not the answer he expected, and certainly not the answer America needed
We can reform our social security program. There are a number of levers that we can pull. I do not like the lever of raising taxes. I think that that should be eliminated as the possible course, but there are other suggestions.
One is the Posen proposal, which is having the rate of inflation for the initial social security benefit being the CPI index rather than the wage index for people of higher incomes. That goes a long way to solving the problem.
There are other levers as well. There's extending the retirement age, or putting in place individual accounts. Individual accounts, particularly being funded with the surplus that is being generated today, that has a lot of merit.
Those are the options that are on the table that we're gonna have to get Republicans and Democrats to sit in a room and acknowledge the degree of the problem and come up with a solution. And I think that that is something that can be done and I think has to be done by either this current administration or the next one.

Glenn Beck Appearance

In January of 2008, Governor Romney appeared on the Glenn Beck show and stated that social security could be fixed through the use of private accounts, extending the social security retirement age, and calculating the initiql benefit based on inflation for higher income people rather than the wage index.

GOVERNOR ROMNEY: Well, I think the best way I've been able to get it across, and it is in my view why I've been able to do as well as I have in the season so far is that I say quite bluntly and with a major sign that's standing up behind me says Washington is broken. We simply cannot keep on going the way we have gone. We have to deal with the challenges we have. The good news is Medicare, Medicaid and Social Security can be fixed so that they don't have to weigh down our entire economy. The annual spending is --
GLENN: How? How do you fix it?
GOVERNOR ROMNEY: Well, yeah. Well, Social Security's the easiest and that's because you can give people a personal account, you can extend the retirement age and you can calculate the initial benefit based on inflation for higher income people rather than the wage index which goes up so much higher. Those simple arithmetic changes will keep Social Security from bankrupt.

Des Moines Campaign Stop

In August of 2011, Governor Romney held a campaign stop in Des Moines and was heckled by left wing political activists. Those activists questioned Governor Romney's position on social security. Governor Romney stated that he would not raise taxes to cover promises made to the social security system.

Governor Romney: Do you know what the tax rate would have to be to honor the promises of social security and Medicaid, if we just raise taxes and leave the programs as they are? Right now, those programs combined take a payroll tax out of your earnings of 15.3%. That would have to rise to 44% We're not gonna do that.

New Hampshire Campaign Rally

In August of 2011, Governor Romney held a campaign rally in New Hampshire. He was asked if he would support removing the income cap to assist bringing social security into solvency.

Question: Would you support raising the salary cap to protect social security for our children and grandchildren.
Governor Romney: There is no reason why anyone who is retired or near retirement should worry about their social security. Let's make sure that people understand that. And I don't think that either party would be interested in making changes to social security those that are retired or near retirement. The question is, what are we gonna do for those in their 20s, 30s, 40s, and early 50s. And how do we make sure that the promises that we are making to them are promises that we can keep? Because we don't want to have social security disappear or go bankrupt. We want to protect it.
In my view, there are a number of options that have potential. One is to increase the retirement age. That's what they did in Great Britian, they added one year to the retirement age. Another option is to means test the benefits to some degree. Again, they did a similar thing like that in Great Britain where instead of using the wage index to calculate the inflation rate, they used the consumer price index and that lowered the cost somewhat.
There's something called progressive indexing which is for people of higher incomes the inflater is lowered and for people of lower incomes, it is higher. That also has some merit.
Then, finally you can raise taxes. I'm not in favor of raising taxes. I again think that government takes enough from the American people and I don't want to raise taxes. The places that I think that we're gonna look to find solutions are with the age of retirement and with some form of means testing or progressive indexing.

Believe in America Plan

As part of his 2012 Presidential campain, Governor Romney proposed a plan called the "Believe in America Plan." In this plan he cites the need for entitlement reform to reign in government spending. He cites that with respect to social security, there are a number of options, but he does not commit to any specific one.

Enact Entitlement Reform
Any serious attempt to rein in spending will have to include entitlement reform. This issue is among the most complex facing policymakers, but some basic principles guide Mitt Romney’s position. First, we must keep the promises made to our current retirees: their Social Security and Medicare benefits should not be affected. But second, we should ensure that the promises that we make to younger generations are promises we can keep.
With respect to Social Security, there are a number of options that can be pursued to keep the system solvent—from raising the eligibility age to changing the way benefits are indexed to inflation for high-income retirees. One option that should not be on the table is raising the payroll tax or expanding the base of income to which the tax is applied. Similarly, with respect to Medicare, the plan put forward by Congressman Paul Ryan makes important strides in the right direction by keeping the system solvent and introducing market-based dynamics. As president, Romney’s own plan will differ, but it will share those objectives.

Reagan Debate

In September of 2011, Governor Romney participated in the Republican debate at the Reagan debate. He states that social security is not a failure and that he will strengthen social security if elected.

(APPLAUSE) HARRIS: Governor Romney, let's be blunt. Let's be blunt. Democrats are itching to use that kind of provocative language against Republicans, yet you acknowledge yourself that Social Security has funding problems.
How do you have a candid question about Social Security without scaring seniors?
ROMNEY: Well, the issue is not the funding of Social Security. We all agree and have for years that the funding program of Social Security is not working, and Congress has been raiding the dollars from Social Security to pay for annual government expenditures. That's wrong. The funding, however, is not the issue.
The issue in the book "Fed Up," Governor, is you say that by any measure, Social Security is a failure. You can't say that to tens of millions of Americans who live on Social Security and those who have lived on it.
The governor says look, states ought to be able to opt out of Social Security. Our nominee has to be someone who isn't committed to abolishing Social Security, but who is committed to saving Social Security.
We have always had, at the heart of our party, a recognition that we want to care for those in need, and our seniors have the need of Social Security. I will make sure that we keep the program and we make it financially secure. We save Social Security.
And under no circumstances would I ever say by any measure it's a failure. It is working for millions of Americans, and I'll keep it working for millions of Americans. And we've got to do that as a party.

Fox News - Op Ed

On September 22, 2011 Governor Romney wrote an op-ed for the AP that was published on Fox News and dealt with social security. The article was critical of Governor Perry's plan for social security and discusses the complexities of leaving social security to the states.

The Future of Social Security
By Mitt Romney
Published September 22, 2011
What should we do about Social Security? Unfortunately, the issue is becoming contentious among my fellow Republicans in destructive ways.
Social Security is our country’s fundamental safety net for Americans facing old age and disability. The program was hotly contested at the time it was passed, but has long come to be accepted by both Democrats and Republicans alike as a vitally important form of financial protection for millions of Americans. “I believe in the Social Security system,” said Ronald Reagan in 1981 as he worked to shore up “for all time” what he called “our nation's ironclad commitment to Social Security.”
The Social Security program faces significant problems, including, first of all, how to pay for it in future years. As the generation of baby boomers retires, the Social Security Trust Fund will run out of cash by 2040 unless the program is adjusted. This is a serious worry that deserves a serious response. We need to reform and strengthen the program so that our children and grandchildren can count on it.
Governor Rick Perry of Texas, now seeking the Republican presidential nomination, has a very different idea. He agrees with me that Social Security’s financing is in trouble, but from that point forward we sharply diverge. Instead of repairing the program as I aim to do, he wants to dismantle it.
In his 2010 book, "Fed Up," Perry calls Social Security “a crumbling monument to the failure of the New Deal.” It is a program, he writes, that “we have been forced to accept for more than 70 years” and was enacted “at the expense of respect for the Constitution.” An absolute failure based upon “fiscal insanity,” the program, he says flatly, should be dismantled and turned over to the states.
But this proposal raises many more questions than it answers. For example: Does Governor Perry believe Social Security is unconstitutional, or is he advocating its elimination because he believes fifty separate programs would be better public policy?
Given that the Social Security system has future unfunded liabilities, how would these liabilities be managed by the states?
Would the Social Security Trust Fund, the interest it generates, and the tax revenues from existing benefits that flow into it be divided between the states?
How would Governor Perry’s plan treat the millions of Americans who move from state to state, what kinds of records would be kept for them, and by whom?
Would some states be allowed to forego a pension or disability program altogether?
Who would pay the added costs associated with administering this proliferation of state-level systems?
These and numerous other questions about Governor Perry’s proposal cry out for answers. Thus far, we have none.
In my recently released plan for jobs and economic growth, I present various measures to reform and strengthen Social Security, including raising the eligibility age and changing the way benefits are calculated for high-income retirees. At no point should tax increases be on the table. And none of these changes should affect current retirees. These policy options together will enable Social Security to remain financially sound beyond the next 75 years.
That is a significant improvement over the status quo. It is an even more significant improvement over Governor Perry’s ill-thought out plan to dismantle Social Security and turn its core functions over to the states with consequences for seniors and for state finances that are certain to be dire.
It would be a moral wrong to renege on the “iron-clad commitment” we have made as a society to our nation’s elderly and vulnerable. The American people are looking to keep Social Security alive and well, and I believe the Republican Party should be committed to doing just that.
If I am fortunate enough to be my party’s nominee, I will advocate for solutions that keep Social Security strong for seniors now and in the future.

TEA Party Debate

In September of 2011, Governor Romney participated in the Republican TEA party debate. He stated that he supported social security and challenged Governor Perry's statements that social security was not constitutional.

QUESTION: (OFF-MIKE) Tea Party, Jacksonville, Florida. My question: How will you convince senior citizens that Social Security and Medicare need to be changed and get their vote?
BLITZER: Good question. Let me begin with Michele Bachmann. Congresswoman, how do you do that? How do you go ahead and change, reform Social Security, Medicare, while at the same time getting votes?
BACHMANN: Well, one thing that we need to let senior citizens know is, for those who are currently on the Social Security system, the United States government made a promise to senior citizens, and we have to keep that promise to them.
But we also need to know that for those who are not yet on the system, the system simply has to be reformed in order for it to work. The same goes with Medicare. We know that President Obama stole over $500 billion out of Medicare to switch it over to Obamacare. We also know that Medicare hospital trust fund will be bankrupt within nine years. These are programs that need to be saved to serve people, and in their current form, they can't.
So we need to have someone who understands these programs, who -- who understands the solutions to these programs. I'm a person that's had feet in the private sector and a foot in the federal government. I've been there long enough to know the problems, but not long enough to become a part of the system. I know what to do, and I have the core of conviction to be able to make the changes that senior citizens can count on.
BLITZER: Governor Perry, speaking of Social Security, you've said in the past it's a Ponzi scheme, an absolute failure, unconstitutional, but today you wrote an article in USA Today saying it must be saved and reformed, very different tone. Why?
PERRY: Well, first off, the people who are on Social Security today need to understand something. Slam-dunk guaranteed, that program is going to be there in place for those. Those individuals that are moving towards being on Social Security, that program's going to be there for them when they arrive there.
But the idea that we have not had the courage to stand up and look Americans in the face, young mid-career professionals or kids that are my children's age and look them in the eye and said, listen, this is a broken system. It has been called a ponzi scheme by many people long before me. But no one's had the courage to stand up and say, here is how we're going to reform it.
We're going to transform it for those in those mid-career ages, but we're going to fix it so that our young Americans that are going out into the workforce today will know without a doubt that there were some people who came along that didn't lie to them, that didn't try to go around the edges and told them the truth.
BLITZER: Governor Romney, you said that Governor Perry's position on Social Security is, quote, unacceptable and could even obliterate the Republican Party. Are you saying he could not, as Republican nominee, beat Barack Obama?
ROMNEY: No, what I'm saying is that what he just said, I think most people agree with, although the term ponzi scheme I think is over the top and unnecessary and frightful to many people. But the real issue is in writing his book, Governor Perry pointed out that in his view that Social Security is unconstitutional, that this is not something the federal government ought to be involved in, that instead it should be given back to the states.
And I think that view, and the view that somehow Social Security has been forced on us over the past 70 years that by any measure, again quoting book, by any measure Social Security has been a failure, this is after 70 years of tens of millions of people relying on Social Security, that's a very different matter.
So the financing of Social Security, we've all talked about at great length. In the last campaign four years around, John McCain said it was bankrupt. I put in my book a series of proposals on how to get it on sound financial footing so that our kids can count on it not just our current seniors.
But the real question is does Governor Perry continue to believe that Social Security should not be a federal program, that it's unconstitutional and it should be returned to the states or is he going to retreat from that view?
BLITZER: Let's let Governor Perry respond. You have 30 seconds.
PERRY: If what you're trying to say is that back in the '30s and the '40s that the federal government made all the right decision, I disagree with you. And it's time for us to get back to the constitution and a program that's been there 70 or 80 years, obviously we're not going to take that program away. But for people to stand up and support what they did in the '30s or what they're doing in the 2010s is not appropriate for America.
ROMNEY: But the question is, do you still believe that Social Security should be ended as a federal program as you did six months ago when your book came out and returned to the states or do you want to retreat from taht?
PERRY: I think we ought to have a conversation.
ROMNEY: We're having that right now, governor. We're running for president.
PERRY: And I'll finish this conversation. But the issue is, are there ways to move the states into Social Security for state employees or for retirees? We did in the state of Texas back in the 1980s. I think those types of thoughtful conversations with America, rather than trying to scare seniors like you're doing and other people, it's time to have a legitimate conversation in this country about how to fix that program where it's not bankrupt and our children actually know that there's going to be a retirement program there for them.
ROMNEY: Governor, the term ponzi scheme is what scared seniors, number one. And number two, suggesting that Social Security should no longer be a federal program and returned to the states and unconstitutional is likewise frightening.
Look, there are a lot of bright people who agree with you. And that's your view. I happen to have a different one. I think that Social Security is an essential program that we should change the way we're funding it. You called it a criminal...
PERRY: You said if people did it in the private sector it would be called criminal. That's in your book.
ROMNEY: Yeah, what I said was...
(APPLAUSE)
ROMNEY: Governor Perry you've got to quote me correctly. You said it's criminal. What I said was congress taking money out of the Social Security trust fund is like criminal and that is and it's wrong.

2012 Campaign Website Statements

ENTITLEMENT SPENDING
Reform entitlement programs to keep them solvent and put America on a path to prosperity.
Federal spending on entitlement programs like Medicaid, Medicare, and Social Security has not only spiraled out of control, but has placed their very solvency in danger. Unfortunately, President Obama has failed in his fundamental responsibility to articulate a serious vision and plan for the future of these programs. At present, the total cost of U.S. entitlement programs accounts for more than half of all federal spending. Combined with interest payments on the national debt, so-called “mandatory” spending is over 60 percent of all federal spending.
Many of our fellow citizens have no idea that our growing entitlement spending has created a looming crisis. This is because politicians have a habit of hiding our country’s long-term liabilities. Mitt Romney believes that the federal government should publish a balance sheet each year—just as it requires public companies to do—so that Americans can understand the burden that future entitlement spending will place on our budget and economy. Over the course of his campaign, Mitt will propose the specific steps he will take as President to ensure the long-term solvency of Medicare and Social Security. While reforms are needed, Mitt also believes that these changes should not reduce benefits for current seniors or break the promises they have relied upon for their economic security in retirement.
Mitt knows that our economic future—along with the future of entitlement programs—depends on fundamental reform. If we wisely begin to reform entitlements and commit to live within our means, we can bestow on the next generation an America that is stronger and even more prosperous than the one we know today.