regulatory recovery fee, ohio trs -- and then it has broadcast tv and sports programming, which is where the rsn is. and i don't think that's the right place for it because then people view that that that's a mandatory government fee like the other ones. so i would ask, ms. mayo, are you aware of that? and with regard to your legacy time warner customers, i understand you don't charge it separately, but with regard to your new customers you're now taking on, do you plan to keep this in the category of fees and other government charges or to have this in a more i think honest display where it's either by itself or with other fees? >> so i'm aware of it now. and yes, our intention is to overlay charter's business practices with time warner cable. and we don't charge an rsn fee. so hopefully that will be something that will be removed entirely from the bill. >> again, i appreciate the fact that we've been able to talk

about some of these very specific issues that i hear from my constituents about and you hear from your customers about. i appreciate the fact everybody has been very candid today in talking about this. let me also mention because senator mccaskill mentioned it with regard to the oversight responsibilities here, to the earlier comments made, the subcommittee has done significant oversight of exactly what senator paul was talking about. in other words, looking at government and looking at our economy, which is disappointingly weak. looking at government spending. specifically we have had a series of investigations and hearings on issues like tax reform. which goes directly to economic growth. we have had hearings on the affordable care act and a lot of the waste and taxpayer loss specifically as it relates to the co-ops. and we've done some great work on that. we have also looked into other issues like labor trafficking and hhs and how they allowed kids to get into the hands of traffickers.

certainly government oversight there. next month we will be combatting looking at the ways to combat isis propaganda and again looking at our government response to that for those who follow what we do, that will be something we'll be looking at next week. certainly a topical issue and one that everybody is concerned about is how do you stop this isis propaganda from taking more and more of our impressionable young people who feel alienated and radicalizing them. we're also going to look at this opioid abuse issue which is at epidemic levels. this is the heroin and prescription drug epidemic around the country and some specific issues we think this subcommittee can provide some additional insights on. we have done tough, significant, important oversight and will continue to. and again, i appreciate the witnesses coming here today and the fact that this process, not just the hearing today, but the investigation has improved some of your individual practices as it relates to the people that we represent.

i want to thank senator mccaskill for her work on this issue over the years. this is not as you can tell her first time dealing with this issue. i'm not on the commerce committee, but she's done a lot of work on this issue and focusing on consumers there. as we move forward, we're going to continue to look at the industry and look at this issue of consumer choice and competition. that's ultimately the answer is to give people a range of choices. we talked about there is competition but there's also some concerns about having more competition. i think innovation is going to be allowed to flourish and new products will come to market. and consumers are going to be better off when there is competition. so we'll be looking at some of those barriers to that. and we'll also be looking at other issues that might have come up today. i'll have some additional questions for the record. i appreciate the prompt responses you have given us to previous questions and specifically to the companies here today. i thank you for your willingness to cooperate with us in this investigation. again, what i think has been a

positive hearing to have an honest hearing of some of the concerns on the consumer side. the hearing will remain open for 15 days for additional comments or questions by any of the subcommittee members. and with that, this hearing is adjourned. [ room noise ]

♪ [ room noise ] ♪ c-span's "washington journalist," live every day with news and policy issues that impact you. coming up friday morning roll call's senior editor david hawkings will discuss this week's sit-in on the house floor by house democrats, calling for a vote on new gun legislation. also, lawrence hurley, thomson

reuters supreme court correspondent, examines thursday's high-profile decisions from the supreme court. be sure to watch c-span's "washington journal" beginning live at 7:00 eastern friday morning. join the discussion. with the political primary season over, c-span's "road to the white house" takes you to this summer's political conventions. watch the republican national convention starting july 18th with live coverage from cleveland. >> so we'll be going into the convention no matter what happens. and i think we're going to go in so strong. >> and watch the democratic national convention starting july 25th. with live coverage from philadelphia. >> let's go forward! let's win the nomination! and in july let's return as a unified party! >> and then we take our fight for social, economic, racial, and environmental justice to philadelphia, pennsylvania.

>> every minute of the republican and democratic parties' national conventions. on c-span, c-span radio, and c-span.org. on thursday the social security and medicare trustees board released its annual report on the financial condition of the government trust funds. two board members, treasury secretary jack lew and labor secretary thomas perez, discussed the report's findings in this 20-minute press briefing. >> good morning, everyone, and thank you for being here. the social security and medicare boards of trustees met earlier today to complete their annual financial review of

these two important programs and aproved their finality reports. it's been a privilege for me to serve as chair of this important body for nearly four years, and i want to thank the other members of the boards for their partnership and their many contributions on these critical issues. for decades social security and medicare have served as our nation's most successful social insurance programs. these important programs represent stability and economic security for millions of hard-working americans who contributed to the program during their working years and rely on the benefits into their older years. ensuring the long-term solvency of these programs for today's retirees and for retirees of future generations is among our nation's greatest responsibilities. today's report confirms that the bipartisan budget act of 2015 addressed the immediate fiscal challenge of the disability insurance program. social security and medicare remain secure in the medium term. nevertheless, future solvency

challenges for both programs remain. in last year's report the trustees projected a depletion in 2016 of the social security disability insurance trust fund. provisions in the bipartisan budget act of 2015 combined with updated pramtic demographic and economic information postponed the projected depletion of the ssdi trust fund by seven years, from 2016 to 2023. even though the old age and survivors insurance trust fund and the ssdi trust fund are legally separate, the trustees often consider the combined financial status of these two oasdi trust funds. the trustees project that the combined trust funds will be depleted in 2034, the same year projected in last year's report. the reports continue to reflect the positive impact of the affordable care act on our nation's health care system. since the law was passed, increases to health care costs have slowed substantially.

nevertheless, the projection suggests that the medicare trust fund will depleted in 2028, and medicare faces a substantial long-term shortfall that needs to be addressed. today's reports like those of recent years show we have some time to address the fiscal challenges faced by these trust fund programs. but reform will be needed. congress should not wait until the 11th hour to address the fiscal challenges given they represent the cornerstone of economic security for seniors in our country. in doing so, the first challenge is to ensure solvency for future generations of americans and at the same time we should expand and finance improved social security benefits particularly for the most vulnerable. thank you. and secretary tom perez will go next. >> thank you, secretary lew. thank you for your leadership. thank you, secretary burwell, who was here earlier and had to leave. and commissioner coleman, always a pleasure to be with you. and administrator slavitt as

well. we're celebrating some important milestones this year. next month it will be 50 years since the first medicare beneficiaries were enrolled in the program. in january of last year we marked 75 years since the first monthly social security check was issued. it's no accident that a portrait of an architect of social security, labor secretary francis perkins, hangs in my office right behind my desk. because she was the gold standard for all of us who've had the honor to serve in this position. and if secretary perkins could see her program today, she would marvel at its growth. in the decades since it was signed into law, social security as well as medicare have become the cornerstones of our retirement he security policy. they are the heart of the basic bargain in america. if you work hard and take responsibility, you can enjoy a secure and dignified retirement. over the years the american public has grown to rely on the trust that social security and medicare are the most stable and comprehensive social safety net programs available to almost all

of us. today over 60 million americans receive benefits from social security averaging over $1200 a month. as secretary lew correctly pointed out, we need to make sure we ensure the solvency. we need to make sure retirees can indeed retire with dignity. and we need to address these issues so that we can indeed uphold that basic bargain for the middle class. and the role of the department of labor is really to make sure that we continue to work and use all of our tools at our disposal to help grow jobs, to help make sure those jobs pay a decent wage, and to make sure that we work with people with disabilities to ensure that they can get in the workplace. there's not a lot of people that i meet that say, tom, i want to be a taxpayer. but the work that i do with people with disabilities i hear that all the time. tom, i want to be a taxpayer. that's why we work so hard in our office of disability

employment policy to make sure people with disabilities can realize their highest and best dreams. and we need to continue our efforts. the economy continues to move in the right direction. we have gone from 10% unemployment to unemployment now that is under 5%. but we can do more. we must do more. and one obvious way to increase labor force participation that would help sustain the health of these trust funds is to enact 21st century paid leave and child care policies. if we had simply kept pace, by way of example, with canada in terms of female labor force participation, we would have more than 5 million more additional women in the u.s. labor force. in 2000 our labor force participation rates of women between the ages of 25 and 54 were roughly identical to canada. now they are 8 points higher. and if we had simply kept pace, we'd have 5 million more additional women in the u.s. labor force. if it they brought home the

typical earnings of women working today, that would add over $20 billion to the social security trust fund and nearly $5 billion to the medicare trust fund this year alone. and so those are the things that we need to continue doing at the department of labor. we're continuing to make sure that we also promote savings through our regulatory reforms to ensure that workers who are working to save for retirement can indeed enjoy that retirement supporting state efforts to promote retirement and continuing to work to make sure that all of those pillars of a successful and dignified retirement are indeed enjoyed. it's been an honor to serve on this panel. and we will continue to move forward. and with that let me turn it over to acting administrator slavitt. >> thank you, secretary perez and secretary lew. good morning. medicare is a cornerstone of american health care. it's provided financial security, accessible health care for our grandparents and our

parents' generation for more than five decades. when medicare was passed about half of our nation's seniors had no health insurance. today that number is less than 2%. and today with the medicare trustees report, we reaffirm our commitment to making sure that medicare is strong and secure for us, our children and for generations to come. i'd like to highlight a few items from the report today. first, total medicare expenditures are slightly lower than estimated last year. second, the medicare trust fund is projected to be funded through 2028. this is 11 years longer than projected before the passage of the affordable care act. and over the next decade, medicare per enrollee spending is projected to continue to grow slower than historical rates at 4.3%. lower than the growth in overall

per capita national health expenditures. some of this reduction in medicare spending is the direct result of payment reforms in the affordable care act. this continued slowdown in spending has helped keep medicare on a solid foundation in the near term and helped save hundreds of billions in taxpayer dollars. in fact, hhs recently announced that medicare spent about $473 billion less between 2009 and 2014 than would have been spent under pre-aca growth rates. for the long term we need to continue our broader efforts to a smarter payment system. efforts to pay for quality of care rather than quantity of services. the affordable care act jump-started this effort and the bipartisan macrolaw has given us an even greater opportunity to

drive efforts forward and faster. third, i want to address one of the report's findings. high-cost drugs are a major driver of medicare spending growth. for the second year in a row, we saw spending growth for prescription drugs dramatically outpace cost growth for other medical services. through 2025 medicare part d expenditures per enrolle are estimated to increase nearly 50% higher than the estimated increase in gdp per capita and higher than the combined per-enrolle growth rate of medicare part a and medicare part b combined. while we must continue to support innovation, this is why we proposed steps to address these costs and have recently proposed a pilot in part b to optimize beneficiary access to drugs while studying alternative payment models. there's more we can do and should do with congress's help. the president's budget proposes to allow hhs to negotiate the

price of high-cost specialty drugs in part d and will continue to look for ways we can better address the high cost of drugs. finally, let me address an early view of part b premiums for next year. first, it's too early to have a clear view. preliminary data suggests the hold harmless provisions that applied in 2016 may apply again. however, the situation is different from last year in the following ways. first, final cost of living adjustment data won't be out until the fall and there's more uncertainty regarding the update and whether the harmless provision will apply. second, the potential impact if it were to apply is smaller than last year. and third, thanks to the bipartisan action we saw last year, there are more protections for beneficiaries this year in certain scenarios. we will continue to monitor the data and explore administrative options as needed. in closing, i want to look forward.

medicare has been at the center of our nation's health care for more than half a century. today the medicare program is moving into the future with a focused effort at delivering quality care to seniors while spending our money smarter. our success here will ensure that medicare is strong for generations to come. thank you and with that i will now turn this over to acting administrator colvin. >> thank you, administrator slavitt. good morning. when franklin roosevelt signed the social security act 81 years ago, he envisioned social security as a bold new way to provide economic security to american workers and families through broad social insurance protections. with the support of lawmakers, scholars, advocates and business leaders over the years, social security is still evolving to fulfill fdr's vision. social securitition guaranteed income protection is the foundation of retirement security for almost all of the

nation's workers and families. it's also the main source of life insurance and disability protection for working families. few government agencies touch as many lives as we do at the social security administration. fdr envisioned social security as an earned benefit. workers pay for it through deductions from their paychecks. this year employees pay 6.2% of their earnings up to a cap of $118,500 and employers pay a matching amount. the money goes to the social security trust fund and is spent only for benefits. and the cost of running the program. in addition, about 4 in 10 beneficiaries pay income taxes from their benefits. and that money too goes into the social security and medicare trust funds. any trust fund money not needed for immediate benefits is invested in treasury securities and earns interest that helps pay future benefits.

our social security reserves now exceed $2.8 trillion and interest income on those reserves provided 10% of social security income last year. as trustees we report to congress and to the public on the status of the social security trust funds in the near term and over the next 75 years. today's report shows marked improvement in the near term. last year we projected that the disability insurance trust fund would run through it before the end of 2016. thanks to the successful work of people on both sides of the aisle, congress enacted and president obama signed into law the social security benefit protection and opportunity enhancement act last november and with that legislation today's report shows that the d.i. trust fund is now extended until 2023. for the long term the financial outlook for social security is very similar to what we reported last year. if no further legislative changes are made the best

estimate over the next 75 years is that the combined social security program is financed until 2034 but reserves would then be depleted. new contributions from workers and employers and income taxes from benefits would cover only about 79% of scheduled benefits. the long-term shortfall is 2.66% of the earnings subject to social security contributions, down slightly from last year's estimate of 2.86%. this means, for example, that social security would be fully financed over the next 75 years if workers and employers were to pay about 1.3% more than the current 2% earnings up to the cap. i want to emphasize lawmakers have many policy options to remedy the shortfall and our independent actuaries have analyzed more than 100 policy proposals from lawmakers and think tanks across the political spectrum. those results are available at our website.

at ssa.gov/oact. i believe we need to start a new national conversation about how to close social security's future financing gap, and we would be wise to do this soon to avoid drawing down the reserves that produce interest income to help pay for future benefits. president obama suggested a path forward earlier this month. he assessed the state of retirement security in the nation and concluded, and i quote, "fewer and fewer people have pensions they can really count on, which is why social security is more important than ever. we cannot afford to weaken social security. we should be strengthening social security. not only do we need to strengthen its long-term health, it's time we finally made social security more generous and increase this benefits so that today's retirees and future

generations get the dignified retirement they need. we can start paying for it by asking the wealthiest americans to contribute more. they can afford to and i can afford it." end of quote. i just want to close by saying today's report shows that social security's total benefit obligations are about 5% of the national economy, or gdp. that will increase to about 6% when all the baby boomers are retired and it will remain 6% for the rest of the 75 years. that one percentage point increase to sustain social security is surely manageable. it is less than 2.5% of the gdp increase in national spending for public education back when baby boomers were children. back in the 1950s and '60s, children showed up in record numbers to enroll in kindergarten and had very little time to prepare. now in the 21st century

population aging is not a surprise. we all know that we get one year older each year. i'm confident that we will be ready with a social security system where today's retirees and future generations get the dignified retirement that they've earned, as president obama has urged us to do. thank you very much. >> thank you acting commissioner colvin. >> before i take questions for the trustees to answer, i ask that if you're called on to please wait for the microphone to arrive to you. once you do have the mike please state your name and media outlet before asking your question. and finally we ask that all questions remain on topic. with that i will -- go ahead. >> mike. >> nick tomoroso, the "wall street journal." i guess my question is for you, secretary lew. the president said earlier this month benefits should be made more generous for current and future retirees in social security. and given how challenging it has been for the administration to

come up with a political solution on the solvency challenge, i wonder how the administration would justify pushing now for more generous benefits. wouldn't that push the goalposts on the solvency challenge further down the field? >> well, nick, i think the president was clear, as i was in my opening remarks, that our -- we need to make sure that the trust fund is solvent, that it's secure for the long term, and that as we do that we have the ability to look at benefits and to finance some changes in benefits at the same time. and this is not a new issue. we looked at these issues in 2011 and 2013. there have been discussioned about what you do about particularly the most vulnerable. but even broader discussions. and i think they are not at all inconsistent. we know what it takes to make social security sound. i was involved in 1983, so i remember very well what it took in 1983.

we're going to have to have a bipartisan discussion. it's i believe going to have to involve addressing the tax base. we don't put a social security tax on income above a certain level. that level is not very high. it's around $110,000 a year. and there are, as the president said, a lot of people who can afford to pay more, and social security is a program that i think has very much merit for being treated that way. so there's a big discussion to be had. but i don't think they're inconsistent. solvency is the foundation. you have to ensure solvency. but when you have that conversation, it can be a broader conversation. >> go ahead, ricardo. all you. >> thank you. ricardo alonzo saldovar with ap. for administrator slavitt, if there's a slowdown in medicare

costs and you're seeing that and it's factored into your assumptions, then why has the insolvency date of the trust fund moved up by two years? it's now 2028 versus 2030. could you explain that? >> sure, ricardo, thanks. i would remind us, just a short time ago before the aca we were looking at a date of 2017, which is next year. so we are substantially ahead thanks to the affordable care act. and i would also remind us that, as i said in my opening remarks, costs are actually lower than they were estimated to be this year. and they remain at historically low levels. i think there are two assumptions that drove the depletion date change that were i think quite modest. even modest assumptions sometimes have that level of impact. the first, there's a light reduction in the assumption of payroll taxes. and the second is a slower rate of reduction in inpatient utilization.

so the good news is, inpatient utilization is still declining. it's just declining at a slightly lower rate. >> our last question. go ahead. paul in the back. >> paul krauzak, "cq roll call." could you please explain what happens with the ipad trigger in this report compared to last year's report? >> i'm happy to take that. it's an easy answer, because there's really no change in the projection, and no change in the activity. obviously we'll be looking and watching and analyzing what next year's actuarial report says. next year's administration will have to take the appropriate action. >> that concludes the press conference portion of today. we are going to be moving to a technical briefing with senior administration officials. if you're interested, we welcome you to stay around and ask maybe more detailed questions for more of our administration folks. that will happen in about 15

minutes. thank you. [ room noise ] at a house hearing on the trustees' report the chief actuary for the social security administration discussed the fiscal state of the program and the projection that the social security trust fund would be depleted by 2034 unless congress aprof approves changes to the program. this hearing on the ways and means subcommittee is just over an hour.

[ room noise ] good afternoon and welcome. today the social security board of trustees finally released thisser's annual report on the financial health of social security.

and we all know social security's in trouble. and the first step to solving a problem is to know what you're up against. today we are going to hear from social security's chief actuary about the findings in this year's report, which was just released this morning. we all know how important social security is to the millions of americans receiving benefits. and given the challenges facing social security, you would think these annual reports would be released on time. unfortunately, that's not been the case. as you can see on the screens, for each year, and i guess we don't have them up. for each year of president obama's administration the trustees' report has never been released on time. on average they have been delivered around 75 days late, and this one is 82 days late. that's not the latest. let's be thankful that it's not

as late as the 2010 report which was 126 days late. the report is not a new thing. it was created as part of the 1939 amendments. its original due date was the first day of each regular session of the congress. in early '50s the congress extended the date to march the 1st. then in the mid '60s the congress shifted the deadline forward by one more month to give the trustees more time. the current april the 1st deadline has been in place since 1968. it's not a suggested deadline. it's a mandatory deadline. the american people have a right to expect that the deadline will be met, period. subcommittee oversees medicare. and i wrote to the secretary,

secretary lew, twice this year asking why this year's report was late. however, the secretary did not think it was necessarily to personally respond to our letters. and that's unacceptable. and the american people deserve better. it's clear this administration is not serious when it comes to social security. this year's budget did not even include the president's usual empty words about fixing social security. earlier this month the president spoke about his plan for social security the first rule when you are in a roll is to stop digging. during his recent speech in indiana the president suggested we should increase social security benefits and just ask the wealthiest americans to pay a little more. sounds easy, doesn't it?

even taxing every dollar of earnings wouldn't make social security solvent, let alone give the program enough money to pay higher benefits. president obama's tax hike rhetoric doesn't add up. and neither does his math. make no mistake. we should look to improve benefits for lower-income individuals who work their entire lives paying into social security and don't receive that much back in return. but we have to talk about this in the context of real social security reform. reform that gets the program on a sound and sustainable financial footing. that means making sure it's there for our children and our grandchildren. just like it's been there for seniors and individuals with disabilities today. look, i've said this before, and i'll say it again. the longer we wait the tougher it will be to get social security fixed. so the sooner we act, the better.

i thank our witness for being here today. thank you so much. and given the latest update on social security's finances, i now recognize mr. becerra for his opening statement. >> thank you, mr. chairman. today social security is strong and it continues to be critically important to the american public. in fact, the need to expand and improve social security is growing because fewer and fewer workers in america today have traditional pensions to count on. and it is increasingly difficult for the majority of americans to save adequately for retirement. in more than 80 years social security despite the worst recessions we've seen in this country since the great depression and certainly the one in 2008 was the worst. but in those 80 years social security has never failed to pay benefits in full and on time. so let's be clear. social security is not now and never will be broke.

social security currently has 2.8 trillion, not million, not billion, $2.8 trillion surplus in its trust fund. that exists because of working americans making contributions through their paychecks to the trust fund. even without the trust fund, social security's incoming payroll contributions from american workers would still cover about 3/4 of the benefits americans have earned and expect to receive. but no one wants to get 3/4 of what they expect. and that shortfall coming in the next decades is a challenge, one we need to address. let's be wary of scare tactics that make it seem like social security is broken or broke and that our only choice is therefore to cut americans' benefits. remember, last year we heard the claims that social security would have to cut benefits for disabled workers by 20%.

but many of us on the democratic side fought hard to prevent that kind of a cut and showed social security had the funds to pay those benefits those americans who earned those benefits were entitled to. so remember, social security has never added one dime to the debt or the deficit. and you can see from this chart, in the 80 years of social security, more than 80 years, how much we've collected from american workers and how much we paid out to those who are beneficiaries. you can see how we make up that $2.8 trillion surplus. let's put social security's challenge in perspective. some people will say you can't count the $2.8 trillion social security has in surplus and you can't count the money that everyday american workers are putting into social security through their payroll contributions. that it's all funny money. well, here's the truth. social security is one of the only programs in our federal government that pays for itself. and let's take a look at one

very important program of the federal government. the defense budget and all our military activities to protect the american people. we would all agree that is something we must do. this year our federal deficit in part is due to our military spending. about $114 billion of our federal budget right now is added to the national deficits and debt. and since the last time we had a balanced budget in the fiscal year 2000 we have added about $2.3 trillion in deficit spending for the military to our debt. by contrast, in those same 15, 16 years what has social security done? in that same time social security's surplus went from $1 trillion in fiscal year 2000 to the $2.8 trillion of today. so not only did social security not add one single penny to the national deficits over those 16 years, not only did it not add a

penny to the national debt over those 16 years, but it actually increased the size of its surplus in the trust fund by $1.8 trillion. that is why social security is on such secure footing, because american workers contribute to it separately and it is there for them for their benefits into the future. moving forward into the future, if someone wants to play the crystal ball game of forecasting what we'll spend on social security or the military or anything else, then social security with its independent source of funding from americans' paycheck contributions is in far better shape than any other segment of the federal government. we should not forget that. social security has an 80-year track record, as i said, of paying benefits on time and in full. its future we must work on to

make sure it's as solid as always. and i'll put my hat and my bet on social security over any other program public or private any time of the day. so mr. chairman, we know that social security will face challenges in the future. but let's not manufacture crises. let's make sure we move forward and take care of the real crises social security does face. that's a funding shortfall that has seen its budget cut by 10% since 2010 while it's seen a 15 million increase in the number of beneficiaries from the 45 million it had six years ago. that's the real problem, is underfunding the ability of social security to provide good service to the american public. so mr. chairman, i'm glad that mr. goss is here, look forward to his testimony and make sure we're all working to make social security sound and secure for the next generations of americans who can rely on it as well. i yield back. >> thank you. as is customary, any member is welcome to submit a statement

for the hearing record. and before we move to testimony today i want to limit our witness to please limit your statement to five minutes. however. without objection all the written testimony will be made a part of the hearing record. we have one witness today seated at the table, is steven goss, chief actuary social security administrati administration. please proceed. >> thank you very much, chairman janis, mr. becerra, members of the committee for the opportunity to come talk to you about this, the 76th consecutive annual report from the board of trustees about the finances of this program. closer. sorry. okay. the statements by the chairman and the ranking member have already done a great job talking about what this program is. the 60 million people that it's currently serving. that's 1 in 6 americans are receiving a benefit from this program. 49 million of them from the old

age survivors insurance. 11 million of them from the disability insurance. in 2015 the program paid out $866 billion in benefits to americans. 743 billion of that to the oesi side and 143 billion on the d.i. side. the asset reserves as mentioned are at $2.81 trillion now for the combined oesi and d.i. trust funds. that's an increase of $23 billion over what they had been at the beginning of the year, 2015. those asset reserves now stand at three times the cost of the program, which is actually above what has oftentimes been thought to be sort of a contingency reserve level of at least one year's worth. so social security in the near term is in good shape at the moment. based on intermedia assumptions, let me share with you in the trustees' report. and i apologize you have not had more time before this hearing to get to look at this carefully.

but where we had a 2.68% of payroll, 75-year long-term deficit in last year's trustees report we have a 2.66% of payroll deficit in this year's trustees report. that's a little better. it's a little bit more better than it sounds because just by the passage of time, change in valuation year we would have expected the 2.68 to rise to 2.74% of payroll deficit. but in fact it declined a little bit for a number of reasons that we can go into. the bipartisan budget act that you all participated in making happen, all who paid attention to social security, and much appreciative of that, was really a big reason why the disability insurance program has been extended. it's been extended wonderfully by six years, we estimate, as a result of the enactment of that act. and in fact, you see in this report we estimate that the reserve depletion date will be extended an additional year on the basis of what's happened in

the economy and other aspects of social security. in fact, i'm happy to say that on the disability insurance side the number of applications for disability has continued to decline as it has since 2010. it's declined more than we had expected. and that is one of the components that has contributed toward our having one extra year beyond 22 that we reported to speaker boehner back in november. and so that's a very, very positive sign. i would also want to report to you, this is not included in the trustees' report obviously but even more recent developments are that our applications for social security disability benefits have continued to be lower than we had expected. so we hope a year from now to have more good news from you. beginning in 2020, however, we are expecting the projected oasdi annual cost to exceed its total current income, which will mean at that point in time our total dollar amount of asset

reserves in the trust fund will start to decline sxweer projecting they will deplete their reserves in 2034. that's the same year that was estimated last year. so the changes are not dramatic. the improvement is not dramatic. but it's always have to have some improvement. over the last 20 years the depletion date for the combined funds has ranged between 2049 and 2042. we're at 2034 now. and that really speaks to the very ability that can occur in the economy and the implications for what the trust funds are and how long they will sustain us to be able to pay the full scheduled benefits on a timely basis in the absence of actions by you all in the president and change in the law. in 2034 as i think mr. becerra already indicated we are projecting now that if the reserves were allowed to deplete we'd still have 79 cents of revenue coming in for every one dollar of scheduled benefits but

that will decline to about 74% by 2090. so action clearly is going to be needed. as described in the actuarial opinion and as you all have stated and will understand, should we reach a point of reserve depletion without congressional action we simply will not be able to pay the benefits on a timely basis. we have not reached that point before and we have -- maybe i shouldn't say this. we have absolute confidence and you all will not allow that to happen. after reserve depletion the continuing income for disability if we were to reach reserve depletion in 2023 we would still have 89 cents for every dollar coming in of continuing income in 2023 for the disability insurance program. and that would change to 82 cents for every dollar of scheduled benefits by the time we got out to -- by the time we got out to 2090 for d.i. one other thing i want to say is all of the changes that we've seen happen over the last 20

years for disability insurance costs rising and in the next 20 years for retirement costs under social security rising is really a matter of the changing age distribution of our population determined by the changing birth rates that we had after the baby boom generation and the lower birth rates that we expect in the future. we do need some changes in the future upcoming. we're looking forward to the proposals you all will be developing, and we will be working with you in scoring to be able to make the changes necessary to keep social security in shape for the future. thank you very much. >> thank you for your testimony. we'll now turn to questions. as is customary for each round, the questions, i will limit my time to five minutes and ask my colleagues also to limit their time as well. mr. goss, welcome. this year's report happens to be 82 days late. can you tell us what caused the delay this year?

>> first of all, i would give you my apologies and apologies from my office on not having gotten this through earlier. as you all know, whether we have four trustees as we had involved in this year's report, because we did not have public trustees engaged, or six trustees, there's a lot to be done in putting together not only the social security report but also medicare reports. since 1969 we've had both reports to deal with and the trustees deemed to have both reports come out at the same time. there's a lot of complexities in both of these laws. lots of changes. and it just takes time for the trustees and their staffs to get together and make the decisions, which sometimes are difficult. when people get together and they have slightly different views on things, they have to work it out. they have to devote their consensus. and it takes time. the final point that oftentimes occurs and can delay the timing of the trustees' report is to

find a time when all four or six trustees can all get in the same room at the same time. that's not always easy. and i believe earlier today we had all four of our trustees, were there and that's not always easy. >> were they going in the same direction? i'll tell you, i had to send two let's to secretary lew before a member of his staff could be bothered to respond asking about the delay with the trustees' report. and i ask unanimous consent to place these three letters into the record. hearing none in response, treasury staff noted that this year's trustee report process was without the benefit of public trustees. mr. goss, briefly what is a public trustee and how do they differ from others? >> of course our four ex-o'fisio trustees are those by nature of

the job they have within the current administration. the two public trustees who are put forth from the president but with advice and con sernt from congress. they're supposed to be of two different parties representing two different views and they do bring a broader perspective to the trustees than might otherwise be the case. the law requires that. and when the president does propose public trustees and they get confirmed by the senate, then we have them in place. we simply were not in that position this year. >> well, some of our democrats have argued that one of the most recent public trustees, dr. blahaus managed to take over the process and overstate social security's trouble. is that true? >> i would confess i've known chuck bahaus for some time and i respect him much. but in the time i have spent working with trustees over the past years i've never seen

anybody capable of overwhelming five others. and when the trustees work together they work toward consensus. they all have signed the reports each year. so what you see i think we really have to take and i would suggest it represents the consensus of all the members of the board. >> thank you for the answer. in the time remaining i'd like to shift gears and ask you about social security and taxes. earnings up to a certain amount called a taxable maximum are subject to social security payroll taxes. this year what is that amount? >> $118,500. >> some have suggested we should raise that taxable maximum to cover 90% of earnings. if that were the case, what would this year's taxable maximum be? >> it would be a little bit more than double that level in order to get it back to the same share of all earnings being taxed as we had -- >> would that be enough to make social security solvent, though?

yes or no? >> no. in and of itself it would not. >> if every dollar of earnings were subject to the payroll tax, would it be enough to make social security solvent? yes or no? >> in and of itself it would not be sufficient. >> so we can't tax our way out of -- to solvency. well, thank you. i appreciate your testimony. and testimony. let me have you refer to the chart that's on the screen gist to be sure we do the simple math on social security. this chart covers the 80 plus years of social security had been in existence. on the left is the amount of money that american workers have paid into the system. as you can see the gray bar represents the contributions people's taxpayer contributions. the dark blue bar above it is the interest that's been earned on all the money americans have

put into the trust fund. the red part of it reflects what we've paid out. the social security administration has paid out to millions of americans who have received their benefits. 60 million americans today have receiving social security benefits. you can't really see it but there's a little bar, dark bar right on top of the red bar. that represents the administrative cost, the over head for social security to do its business. less than 1%. you've been doing this business for a long time. are you aware of any business in america that does insurance that operates at a over head of less than 1%? >> unfortunately, no. >> yeah. >> we're unique. >> i -- and whether it's your retirement plan, your savings accounts, i know of no business that can tell me of the money i put in, that company's going to

take less than 1% to operate the business and charge me for their over head. and as we can see, there is a surplus there and what's being collected and what we've had to pay out. i just said that over the 80 plus years social security has never run a deficit. has never contributed a penny to the nation's debt. is that an accurate statement? >> i would agree with that certainly in the sense that social security, it actually, in effect absorbs debt from the rest of the government. it actually makes loans to the treasury. we look at roughly $19 million of total federal debt. that's comprised in part what the treasury owes to social security. my view is that it would be accurate to say social security does not contribute the debt and actually helps finance some of

the debt that otherwise would have to be borrowed from the public. >> let's not try to deceive anyone. that surplus but over the years because there's lot of americans are going to be calling on that money that's in reserve and by 2034, if the estimates are accurate, we've have exhausted all of the reserve. that means the only money coming in is the money amaerican workes are paying. no american wants 79 cents of what today americans are getting at dollar pace. so, clearly we want to do something. so, we have the next 20 years or so to resolve that in a bipartisan basis. you work with social security. you're -- american taxpayers are

paying into the social security system through their pay roll taxes, contributing to the trust fund. the rest of the federal budget, or most of it doesn't operate that way. we have a deficit in our federal operating budget. about -- that deficit that comes from our operating budget is attribia attribiatable to what we're spendong the military and if you look at the last time we had a balanced budget in the federal government, we have added about $2.3 trillion in deficit to that national debt as a result of what we've spent on military. i don't think anyone here is going to say don't spend that money on our troops but we have to recognize we're deficit spending. at the same time we've never added to the deficits through

social security. as we start to talk about long-term projections, isn't it important to know if you have a source of funding whether it's national defense or social security? i pose that as a question. >> i would absolutely agree. the difficulty with this and of course there are budgets, congressico congressions but as far as social security is concerned, one of the hospital insurance trust funds do stand different from other programs. as he indicated, they are really not allowed to borrow in any meaningful sense, so we are always in a position of having a positive accumulated balance from the start of time. >> in the last six years has your operation been impacted by the cuts to the social security budget? the operating budget for social security. have you been impacted?

>> social security as a whole certainly has. and we've gone through hiring freezes and restrictions on ability to hire the number of people we would like to have to serve you in every way we possibly can. so, certainly there are issues . >> thank you very much. >> the time of the gentleman has expired. >> thank you, mr. chairman for holding this important hearing to discuss the my constituents talking about the need to preserve social security and as a father of three, i believe we have a responsibility to leave our grandchildren and children a country that's financially stronger but washington calls things

surpluses when they are truly liability. as you can see from the slide that is shown on the screen over the next 75 years, social security unfunded liability is equal to $11.4 trillion. that is a 700 billion increase from last year's report. this represents the present value of the shortfall in the amount of revenue of what the trust fund will collect compares to what it owes to trust fund beneficiaries. the out look continues to get worse. in fact, since 2009, the shortfall has more than doubled from 5.3 trillion to currently 11.4 trillion today. this is a serious problem that will require difficult decisions to be made. we need to start by fully understanding the financial challenges we face. not only in social but all unfunded liabilities in the

united states. in the next few day as bipartisan group will bring legislation to bring the unfunded obligations that our country owes to on all our social insurance programs. too often, i believe that many here in washington want to ignore those issues. this bipartisan legislation will require the controller general to present it to the joint session of the house and senate. to insure that law makers receive the information in an accurate and timely manner. we can't just look at social security. we have to look at everything and i think that's important. you heard a couple words, one of them was unfunded liability. can you explain the definition of unfunded liability. >> thank you for the opportunity.

actually, yes. in the liabilities that you described, we actually refer to per the federal economy standards as unfunded obligations and the distinction really there is important. you have the legal, contractal basis. and there's a limitation. we can only pay what we have money to pay. so, those amounts of future benefits are referred to as obligations. in the unfunded portion of scheduled benefits, we refer toed a unfunded obligation. 7 trillion through 75 years in the 2015 trustees report. just by the simple passage of time, when we start with 2016 for the then next 75 years that number would have gone up to 11.2 trillion. that's mainly because we're

calculatoring them on a present value discounted basis. it basically just increases the amount by the interest rate for one year. as it happens, changes that were made in the experience and as p assumpti assumptions. would have taken it down to 10.5 trillion. and the one that caused it to be larger than last year was the change in the long-term ultimate interest rate from 2.9 down to 2.7%. >> and i appreciate that. i understand you take assumptions. but basically you show an unfunded obligation, as you call it. out of this report. so, we can't keep talking about social security surpluses when the report issued today reflects a growing unfunded obligation.

i'll use your word. i believe we have a responsibility to work to find a way to address the sustainability of soecial security so our grandchildren and children don't need to make difficult choices in the future. >> mr. rice, you're recognized. >> thank you, mr. chairman. everybody agrees that -- could you put the slide back up with the surplus that we have right now. everybody agrees that that surplus is over time will expire unless we do something. is that correct, sir? >> absolutely. these are our projections. no question. that is the accumulated amount of reserves we have. >> those reserves will be gone in what year? >> our current estimate is assuming we work on a combined basis, 2034.

>> and that is not long-term solvency, is it? that's 17 years away. >> exactly. >> and many, many people who are currently eve. already retired, it will have a dramatic effect on their retirement income, correct? >> if we do not collectively make changes. >> how would you define lon long-term solvency. how long do you think we should be planning for in advance for expiration of these reserves? >> that's a really good question. the nature of the way the program has been financed virtually from the beginning is not an advanced funded system. generally what the trustees and past advisory couels over decades have said is have a contingency reserve equal to at least one year -- >> so, you don't look for

something that will be maintained for 75 years or 50 years. those aren't objectives for you? >> we really do. of the three things required by the congress one is the status of the program. that's been intrp erpreted as a that we're able to pay in full through the next 75 years. >> you say we're solvent for the next 17 years but not after th. >> we're not achieving full solvency. >> and the problem is this demographic wave. >> exactly. >> do you have any projections on when? >> many people have thought in the past that the baby boom generation being large will come and cause this first disability

increase cost, which they already have, now they're move nothing to increased cost in retirement. one might think they'll move through and go away. actually, that is not the case. the reason we call it a baby boom generation is because the birth rates dropped after -- and it sta -- >> so you don't see this wave reseeding in the 75-year window. >> it's the reason -- >> i have verier limited time. i hate to rush you. what specific proposals has theed a min strathe ed a m ad ministration given to the solvency of the trust fund for the next 75 years? >> the administration, many members of congress have looked at various different options. >> what specific proposals has the president made? >> we saw early on a proposal

relative to the cost of living adjustment -- >> change cpi. >> that was early on. >> that was a specific proposal. what others? >> proposals relative to comprehension immigration reform and i think those have been the primary ones that have been specific. >> that doesn't really deal with social security. that deals with immigration. so, the only proposal he has made is to cut the cost of living adjustment. that's it? let me ask you this. how long would that make social security trust fund solvent? how many years would that add? >> we have that available up on our website. it would probably add two or three or four years -- >> so instead of 16 years from now that the trust fund goes broke, we're talking about 20. that's not exactly long-term

solvency of the program, is it? >> but we know that a full comprehensive fix is going to include lots of moving parts. >> but we haven't seen any proposals other than that one of cutting the cost of living adjustment. is that right? >> well, there have been otherer things like the claiming strategies that were addressed in one of the budgets. >> all right. what would you suggest? do you have any suggestions for us on how we fix this? it gets more expensive every year to fix it. you have limited options because you've got revenues doing like this and expenses doing like this and the expenses are going to past the revenues 2020. so, you've either got to increase revenue or decrease expense. so, what specific, specific ways would you suggest fixing social security, besides change cpi?

>> what i would have to say -- and the way we have to do our job is never really to answer that question. and i appaologize for that becae we're going to work for people on both sides of the aisle on all of the ideas they have to make changes to either increase revenue or alter revenue. >> but you're -- you can do this on the back of your hand. have you seen the aarp marketing about telling the presidential candidates to take a stand? >> no, i haven't. >> it says tell the candidates to take a stand. i want to know what specific proposals you would make for long-term solvency? 75 years. >> first of all, whenever we have dealt over the decades i have been around with members of congress in private or any other form, we always ask what precisely is your goal? >> 75 year solvency. >> then the question is do we want to do that by lowering the

scheduled benefits, staying within the 12.4%er tax rate or do we want to maintain the benefits and find more revenue? >> here is what the american people are upset about. we keep telling them what the problem is but we're not offering solutions. the administration's offered one. i'm asking you for solutions. >> we fortunately have on our web page over 100 individual provisions not that we have come up with but that members of congress have. and i gave you a couple of copies. all your staff have ready access to this. well over 100 different provisions that effect social security in almost every way you can imagine. so, what we really need is for a collective judgment to get together and pick which of these different provisions we want.

>>. >> you're waist deep in the swamp. >> i want to go back to what the chairman started with and a question about mr. blahaus being on the commission and a question came up with senator schumer, warren and senator whitehouse, something that says it's kind of curious -- let me see how they said it. i'm more or less that it was curious. there was curiously incorporated number of assumptions. and it had to do with mr mr. blahaus. there's nothing he's done in that time period that would make you think this is politically motivated and that him being appointed, even though the president nominated him, that there's ea problem? are you in agreement that

there's nothing he's done that could have influenced the outcomes? >> i've worked all the way back to our first trustees. >> so, you don't look at him as the problem. >> i'm curious about his behavior as being one of the trustees. what i would say is really what i take to be wonderful about this process is that we get four and generally six different trustees involved with different views -- >> but none of the trustees that has an overwhelming influence. >> that's right -- one or two can control. >> and i'd like to submit this for the record if i could. out of the huffington post and the three senators seem to be alarmed that somehow mr. blahaus would be appointed. we live in such a political environment try to do these

things. all of the things that we talked about, and i'm -- i come from the private sector and usually deadlines actually mean something and there's a penalty if you don't reach the deadline. as in that is the end line, the end time. why so late? >> well, again as mentioned earlier, we deal -- my office is not in complete control at developing these reports. we really are doing our work for the board of trustees. and the board of trustees, the members -- >> but the whole purpose of the report is that we can get an early indication where we're going with this and i think the earlier you learn about something, the better to respond to it. you can changing the direction of something or start to move in a different direction so it doesn't actually crash on you. i'm trying to understand.

so, but the number of days, 118 days, 82 days, 60 days, 128 days. that seems way beyond the pale. somebody say i know you missed a deadline but you only mwnly mis by a couple hours. but when we go into the months, what would cause that to happen? >> it's the process of developing a consensus model. >> i'm just trying to understand how in the world you would fix something. they seem pretty self evident to me. i know where the actual revenue comes from. this comes out of people who were working. they're called wage taxes. so, all the revenue we collect comes out of working people. we have fewer people working which means fewer funds going in. i know we could play around with the numbers but it's capped at a certain level.

this program that we say is solvent, we don't have to worry about it and over 80 years we've built some type of a surplus, it's a paper surplus. you don't really have a sense -- at least i don't, that there is some stability in this are program, that we can go forward knowing this is going to be okay. i don't care what line of business it is. you're calling out things on the horizon of we're not going to be able to sustain this type of a program unless we do something soon. >> one is the 2.8 trillion we have now, it is required by law that any reserves that social security have be invested in interest baring securities backed by the full faith and credit of the united states government. which is probably as secure as it gets anywhere. i would say that 2.8 trillion we can fully count on.

is social security fully funded? it is not at this point. we have an estimated $11.4 trillion of unfunded obligation. which is a smaller number of gdp than the value in the last report. it's .89% of the gdp over the same 75-year period. last year it was .91%. because remember, $11.4 trillion sounds like an awful lot of money but we have to look at it with the 75 window. we do need to either increase revenue or reduce the scheduled benefits on the order of 1/4 relative to current law by the time we get to 2044. and we're incredibly eager to work with you all and your wonderful staff. >> and i appreciate this.

but long term, there's only twoing thes you can look at. when you indulge in deficit spending, there's no bright light at the end of the tunnel, other than a freight train coming at you. we need to get ba people back to work where it's steam rolling along. thanks so much for being here but this is a great concern for every single american. >> the gentleman's time has expired. mr. smith, you're regnized. >> thank you mr. chairman. i think it's important to note that the longer we wait to make changes, the more difficult it will get but just to clarify, you just said that social security is not fully funded. and yet we heard earlier and there was graph that suggests a

surplus. that to me doesn't level. would you characterize that as a surplus? >> it's an accumulated surplus we have up to this point. we have $2.8 trillion iveavaila now. if we want to put our child through college for four years and we have enough money for the first year but not the ladder three, then we have a nice piece of money here ready to cover one year -- >> would you call that a surplus given the suggestion of obligation for a four-year degree? >> it's certainly a surplus where we have since the inception of the program, 1937, we have accumulated more tax revenue than we have paid out to date. looking at it as a pay as you go system, which it is, in that sense, we have a surplus.

>> but perhaps a better approach would be to suggest that it's not fully funded as i heard from you. >> to say it's not fully advanced funded over the long term, there's no question about that. >> now, is there any way to quantify perhaps that delaying a decisi decision, that the cost of delay is "x"? have you sorted that out? when i talked -- especially younger folks pay nothiing intol security and we tell them those dollars won't be there long term unless those changes are made, is there any way to quantify that? >> we do know that working on a trust fund basis, we have about -- we can pay about 79 cents on the dollar. so, we're about 25% short on benefits. >> on the continuum of time.

the longer we wait, it only gets worse. >> if we were to enact a prop e proposal today that would raise revenue by 1/3 as of 2034, that's exactly the same 2034 problem as if we enacted five or 10 years from now. the real difference in taking longer to consoldate on to the decision that you all will make about how we ought to change things is that if we wait longer, we'll probably limit the options we have available, give people less advance warning and we may be able to phase in changes less gradually. the beauty of the 1933 social security amendments, it didn't start to raise it until 17 years later. it's wonderful to give the american people that kind of advanced warning. everyone's been urging you to give us legislation sooner than

later. >> i can appreciate that. even if not a single dollar were paid to new beneficiaries, once the trust funds are exhausted, there still wouldn't be enough money to pay for benefits for those already receiving them. >> that's true. that's a rather interesting notion of saying every year we have the number of people who start to receive benefits is roughly 5% of the total number of people who receive benefits. so, not sure anybody would seriously consider saying let's pay full unaltered benefits. but now people coming in will get nothing. >> but it helps us reflect the obligations that there there and i think it is very advisable for us, both sides of the isle to acknowledge the realities that there out there. i cannot suggest that there's a surplus given all the obligations long term and

believe me, we need to think longer term, about especially this issue, given what has been promised over the past and hopefully well into the future. thank you. i yield back. >> mr. buchanan. >> thank you, mr. gross for coming. we all apprec quaiate it. 217,000 people in my district that count on social security. but i want to go back the gentleman's point from california about the surplus. i mean, really as you mentioned, there's no money there. it's an iou from the federal government. is that right? >> to the extent that any treasury bond or savings bond that any of us might hold is an iou from the government, that would be true. >> you have 2.7 trillion or whatever that number is is treasuries from the federal government? >> and it represents the excess

funds that have been accumulated by having taxes more than what we spent by interest. >> my concern and when i ran for congress, i was concerned about the $130 billion deficit in 2007. back then it was with about 130 billion that year. we went from 8 trillion in change to 8 to 9 trillion in that range. we've accumulated in 10 years 10 trillion there in debt. so, i ask you do you look at the viability of -- when you're counting on the government in a sense for their ability to pay? as they accumulate debt and there's plenty of blame to go around. when you look at health, the

lender or the borrower, how do you factor that in? or do you factor that in? the fact that they're almost $20 trillion in debt. and it's been over the last 40 years, you could have interest 7, $8 billion on that debt if it got backed up to what it's historically been. so when you look at this, you look at your ability to get repaid to 3 trillion. you got to look at the u.s. government and their ability to pay. are you confident that 10 years from now if we keep going down this track you're going to ever see your 3 trillion? >> if we ever get to the point where the federal government on a whole is unable to repay the gradual amounts of annual shortfalls that social security is drawing from its trust funds, we'll probably have much more severe problems than social security. >> i was born in detroit. great city.

lived in detroit area, my wife and myself. fourth largest city in america. very viable. went bankrupt. and you know what, all the firefighters, the police officers, a lot of my family members in the detroit area, i've heard all the stories. i live in florida now. but they took a haircut all of them. i never would have imagined that would hapen to detroit. obviously, it took -- everybody got a haircut and not paying attention to the debt and the other liabilities are out there, we're kidding ourself, frankly and that's why the sooner the better we work on a bipartisan basis to deal with this. and let me just ask you cost of living. they want to know -- they didn't get cost of living the last year or two. what's your thoughts on that? and next year, where do you see

that going? >> the cpi that determined last year's cost of living adjustment, which turned out to be zero, we had the cpi going down by i think 4/10ths. we have to make that up by the rules of the way the cost of living adjustments work and go above our current projection in the new trustees report as if we'll have 2/10th of 1% of the cost of living adjustment. it depends on lost of factors in the economy. we've all seen the price of gasoline going up some. we're expecting we could be on the order of 2/10ths. >> so, you thought there might be something next go around? >> our projection is that we will have a positive cost of living adjustment next time. >> thank you. >> you're recognized. >> thank you, mr. chairman. we certainly appreciate you coming and testifying before us

today. i tink the common theme is that we're trying to figure out in a bipartisan way to move forward. 75 years. so, when you say what do we want, we want something solvent for 75 years and as we look out there, you say we're not really responsible for coming up with ideas. frankly you're the ones living it each and every day. and so let me put you back on the hot seat just a little bit. out of the 100 proposals you've seen, there have to be a couple that have risen to the top. and i'm sure he's interested also in ways that we can try to make this solvent because the one thing we do know is life expectancy was significantly lower than it is today. you know what it was when social security was enacted, roughly? >> life expectancy at birth or 65?

>> when social security actually came into the fold? >> life expectancy at 65 was considerably less than it is now. >> so, we're longer lives and it puts additional pressure on us because we have a labor force participation rate, which as mr. kelly pointed out, that's the economic engine that's funding social security today. back in the 10th district in illinois, we have about 105,000 on social security. and is there a way that we can be focusing as opposed to an across the board increase, ones we can help, perhaps those that need to most? some of the low-income earners. >> of course, we have a lot of proposals that would operate at different lifetime earnings levels. we have one proposal that

suggests our benefit formula. which has a waiting for give a higher rate of return to make that tilt stronger. we've had proposals that would increase the special minimum benefit because it was only cpi indexed and so in effect disappeared to restore a minimum benefit. we've seen proposals and they can be done in such a way that they have an overall savings by lowering the rate of return for the highest earnings. so, we have lots of lots of different approaches. and there's not only the pay roll tax but a former -- although fairly brief chairman of this kmety had it a point in some of the stuff we scored, health insurance premiums

subject to the tax that contributes to the social security trust fund. so, we have lots of different potential ways for generating income, some would reduce higher earners more than lower earners. so, we have a great variety. there are some we have probably seen more often than other. increase our taxable maximum from 118,500 to something a little more than double that, to restore where we were in 1983, where we had had 90% of all wage income falling below our taxable maximum. the changing distribution of earnings in our economy has altered that. many people have looked at the retirement age increased from 65 to 67.

we'll be at sdpra67 for full retirement age. and if i may mention very briefly. i believe it was the simpson bulls commission suggested indexing the retirement age but in such a way that long-career low earners would not be subject togy of the increase in retirement age. so, there's an incredible amount of possibilities. >> you mentioned before in terms of raising that age from 67 in 2022. what does raising the age by an additional year do to expanding it from what it is in solvency at 2034? >> for 2034, it would do very little because we would be talking about effecting people after the year 2022 to effect them by having some lower level

of benefit or asking them to wait another couple years to receive their full benefits. it really speak for the notion that we need a whole market basket put together for the next conference. >> we certainly look forward to working with you because we know the longer we wait, the fewer options we have. we have too many people relying on social security for a vast majority of their income in retirement. thank you. yield back. >> i want to thank all the members who are here, including my democrat cohort. and social security faces serious challenges and neesds solutions, not empty plans that don't add up. i look forward to working with all my colleagues and you too, mr. goss to find ways social security is a program that our children and grandchildren can can't on, just as seniors and

individuals with disabilities do today. i want to thank you again for our witness, for his testimony and also thank all the members for being here today. god bless you all. with that, the subcommittee stands adjourned. [ room noise]

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on friday, the aspen erkse institute hold as discussion. you can watch our live coverage here on c-span beginning at 9:30 eastern. book tv has 48 hours of nonfiction books and authors every weekend. here are some programs coming up this weekend. saturday at 1:00 p.m. eastern, the annual roosevelt reading

festival takes place at the fdr presidential library and museum in hyde park new york. roosevelt politics as well as histories of the oval office. featured authors include paul brandus. "under this roof, 21 presidents, 21 rooms, 21 inside stories." and walter borneman. david priess. the untold story from kennedy to obama. marlene trestman. supreme court advocate. marc wortman, his book is "1941" fighting the shadow war. and alonzo hamby, with "the man

of destiny." then at 10:00 p.m. eastern afterwards, historian pam ela haag goes through the history of guns. in her book "the gunning of america business and the making of gun culture" and she looks that business and manufacturing of selling arms. she's interviewed by "author of american hunter how legendary hunters shaped america." >> the element of our gun culture that had the very most to gain by selling and promoting and celebrating their product is the very most invisible, when we think about guns. instead much of the political talk today is exclusively about interpreting the second amendment. the gun industry has become almost invisible in that

history. >> at sunday 10:30 p.m. eastern, marshau clark weighs in on the legal system. she's the author of the book "blood defense." we spoke with ms. clark at the book expo america in chicago. go to book tv.org for the complete weekend schedule. at a senate conformation hearing, the nominee that had the africa command discussed libya civil war and u.s. strategy in the reason and committee members questioned the burr burrow chief nominee. this is an hour and 50 minutes. good morning, the senate arm services committee meets this morning to consider to be

command of u.s. africa command and joseph lingel to be chief of the national guard bureau. i thank them for their continued willingness to serve our nation. general, africa has reemerged as an active front in the global war on terror with isil, al qaeda, boko haram and al-shabaab, launching successful attacks throughout the continent. and threatening the nrts of those of our allies. libya, they command an army of over 5,000 fighters. while recent is encouraging, the country -- unity government is unable to exercise control outside of libya.

outside of triply and to date has failed to secure the support of important blocks within the population. the failure of the united states and the internation community to put forth a comprehensive strategy following the falloff gaddafi in 2011 has contributed to the current crisis and isis's ability to expand in libya is a troubling warning about the price of the ministration's reaction to directing this enemy. until this changes, i fear libya will continue to deteriorate. compounding the rising terror threat, africa remains plagued by weak governance that divide large displacements of people into stability. while the threat in africa continues to metastasize, our military commanders are being forced to do more with less and

denied timely and flexibilile authorities and halt the advance of extremism and other drivers of instability. general, i look forward to your thoughts today on how you intend to approach both the enormous challenges and opportunities within the africa area of responsibility. the role of the chief of the national guard bureau has evolved over the last 10 years. it now sits on the joint chiefs of staff, serves an advisor to the president on policy and security matters, and manages a are relationship with a 54 agnkt generals. this committee is followed closely the recommendations of both the national commission on

the structure of the air force and the national commissions on the fucher of the army. both commissions reported out recommendations for reinventing the total force. i hope you will address the commission recommendations in your testimony here today. another area we're watching is the mobilization and demobilization cycle and proseepr procedures for the national guard. guard members and their families write to me often to discuss the stresses. i hope you intend to promote family readiness in the national guard. we're interested in working with the next chief of the national guard bureau on reforms to address the unique needs of our national guard and reserve service members and their families. as is our tradition before proceeding with opening statements, i would invite them to invite any family members

joining them this morning. senator reed. >> thank you very much, mr. chairman. and let me join in welcoming our nominees. they have been nominated challenging duties you have outlined. lieutenant general who has been nominated in the united states africa command, currently serves the j-7. his commanding general first marine division and as the commander in the united states marine corps forces central command. notab notably, he has the qualification that probably makes him without doubt the imminently qualified. he's a united states ranger school graduate. so, congratulations.

and vice chairman of the national guard bureau and vast experience as an air force pilot. the chief of the national guard bureau is a member of the joint chiefs of staff and chief advisor to the joint chief of defense. in support of homeland defense and civil missions. in this case he play as critical role with the corporate mission and as we've seen several times through the years in hearings before this committee, this is a tough job and takes a talented individual to fill it. they will fulfill these difficult jobs. i want to extend a special thanks to your family. i understand your wife and son have joined your day and your wife sally and katy have joined you. without them, you wouldn't be here today, literally.

again, thank you, mr. chairman. >> before we proceed, i want to note this is presence of distinguished senator from texas who i know would provide important words of wisdom and instruction to all members of the committee. senator cornm . >> i'm honored to be here to introduce one of the nominees. as the nominee to serve as the next chief of the national guard bureau. citizen soldiers of course have been part of our country's fab i since the beginning and in the 21st century their role continues to evolve to help safeguard our nation and in addition to insuring they're able and willing to do their job, they must be able to provide sage military advice to the secretary of defense and the president of the united states.

he's the right man for this critical position and the depth of his experience make him exceptionally well qualified. after completing his undergraduate pilot training, he cut his teeth in the cockpit of an f-16. his 34 years of service include an array of command assignments as well as desert storm, provide comfort, southern watch and enduring freedom and served as a defense at asha. and both of you have noted, both chairman and the ranking member his wife of 24 years, sally and his daughter, katy are both here as has already been pointed out. but i'd like to mention his two sons who could not be here today. michael, because he's following in his dad's foot steps as one of the air force's newest f-16

pilots and joe whos attending college. he hails from a proud military family and knows first hand what it means to service and sacrifice. his father and monther couldn't be here today but are certainly watching on tv. he shares some history with our distinguished chairman, senator mccain. he was shot down while flying over vietnam in august of 1967 and held as a prisoner of war until march of 1973. in 1975, he returned to vietnam to fly missions being one of only two former pow pilots to return after 1973 to fly missions. during his dad's captivity, his mother raised him along with his brothers, greg and dan and his sister, taugoty. and his younger brother carried the family tradition and

currently serves as a major general in the air force. once confirmed his experience and leadership will be instrumental to the national guard as it face as myriad of challenges both at home and abroad. thank you for giving me a few moments to introduce him and recommend his confirmation. >> thank you, senator corner and -- i know you have important obligations but i thank you for being here to introduce this highly qualified general langal. i hope the number of landings have matched the number of take offs. so, i have a standard questions for the nominees that need to be answered and then we will proceed. in order to just answer yes or no to the following questions.

in order to exercise its legislative and oversight responsibilities important that this committee and other approp ret committees of the congress are able to receive information. have you ad hered to applicable law snz. >> yes. >> do you ask even if your views differ from views in administration of power? >> yes. >> have you taken any actions that would presume to assume the outcome of this process? >> no. >> questions for the record in hearings. >> yes, sir. >> will you cooperate in providing witnesses to congressional requests? >> yes, senator. >> will they be protected from their reprisal or briefings? >> yes. >> do you agree if called to

testify before this committee? >> yes. >> do you agree to provide documents in a timely manner when requested by a dually kaun constituted committee. as i mentioned f you'd like to introduce your family to the committee, members that are here, please proceed. >> thank you, senator. senator, mccain and distinguished members of the committee, good morning and thank you for the opportunity to appear before you today. i am truly honored to be nominated as the commander u.s. africa command. i want to thank them for their confidence in me and would like to recognize the current general and his wife for their service

to the country and men and women in uniform. joining me is my wife gale, and our son, mark. gale has been a great mother and superb advocate for military families over the years. she taught middle school for many years where a large number of students were military families in the communities we were stationed. since the stand up of africa, they have made interests on the continent. there are challenges in the area of responsibility. terrorist activities conducted by groups as such al-shabaab are present across the continent. mass atrocities and elicit trafficking threaten stability

and economic growth, particularly in nations with weak governments. consequently, africom must work to disrupt these transnational threats and in the region and ultimately to our homeland. additional, it must continue to work with african partners to create an environment where these partners are willing and capable to address their security concerns. if confirmed, i will work with not only the u.s. military components but my commanders as well to foster an environment where they're not just from a particular geographic area of responsibility. and also have confirmed i will provide my best military advice to this committee when requested. finally, and most importantly, i will do everything i can to

properly lead, respect and keep the faith with those in uniform and the civilian work force who voluntarily serve our nation. thank you again for allowing me to appear before this committee this morning and i'm prepared to answer your questions. >> thank you. >> ranking member reed, it is a pleasure to be here today. like to thank senator cormyn. he mentioned my wife sally and daughter katy are here. she grew up in an air force family. she remains my most trusted advisor and love of my life. katy is spending her summer interning at the peace core here at washington d.c. we're very proud all of three of our children and without their love and support, i certainly would not be here today. i would like to acknowledge my fellow nominee and his

distinguished service. riit's a privilege to be here wh him today. i'm humbled by both the great leaders who have served in this position in the past and if k l confirmed by the incredible leaders i will join on the joint chiefs of staff. i have been able to witness first hand the visionary leadership of general frank grass. they have left an indelible mark, resulting in the finest national guard in our nation's history. a proud force that has been helping secure our nation for more than 380 years. we're living with incredible advancements that give great cause for optimism and hope for the future. yet this optimism is tempered by unprecedented challenges in our global security environment. transregional, multifunctional threats including near pure

competitors and violent extremists organizations require a greater inclusion of all elements of national power. since 9/11, the operational national guard has mobilized roughly 180,000 times in support-air force fight. if confirmed i will see that we work seamlessly to help bring security around the globe. our security overseas enables us to protect the homeland and work with our generals to answer a call when disaster sfri eer str home. we have between 3 to 4,000 guardsman conducting operations. and they remain at the forefront in creating lasting relationships with local partners. the guard's evolution is a chapter in our nation's security at home and abroad that is britn

on the incredible skill of our soldiers and airman. and our most important asset, people will b our foremost task. i will strive to grow and train leaders. we must insure that ethical behavior goes from the top down. acts such as sexual assault can never be tolerated. we want to be the most inclusive force we can be. i look forward to working with the congress, the governors and all stake holders to insure that we maintain the most capable accessible and ready national guard possible. i look forward to your questions. >> thank you, general. there's an old saying about chickens come home to roost. as a person who had been to libya on numerous occasions,

including in benghazi when chris stevens was living there in a hotel, we watched gaddafi being taken out without the loss of a single american aircraft or person and then walked away. we walked away when, despite the repeated pleas of those of us who saw the situation deteriorating, we did nothing to help the libyans, not to treat their wounded, secure weapons cashes, not border security and most of all, help a nation that had never known democracy to achieve it. now we're paying the price for it. now we're paying a heavy price. we have american troops in libya, according to a published report. is that true? >> we have a small number of troops on the ground. >> so, we have american troops on the ground which never would have been required if we had done the things necessary that we did after korea, world war

ii, bosnia instead of walking away from it. an total disgraceful failure on the part of this administration and this president. so, now you're handed frankly a can of worms because i don't have a lot of confidence. i've seen them in action before. i don't have a lot of confidence in general haftar who has his own agenda and isis has established approximately, according to published report about 5,000 people in libya. so -- and not to mention boko haram, the other challenges in afric africa-com. how are you going to make chicken salad out of this situation? >> the situation in libya is very complex. we have two significant

objectives for the united states. one is it to get the government of national accord up and running and second is disrupt isil inside libya. the government of national accord has been on station in triply since march. it has shown very basic progress. moreover -- >> does that government include general haftar? >> it does not. he's in charge of the libyan national army. they have pledged their allegeance to the dna. >> does the government include them or they just pledged their allegiance? >> they pledged their allegiance with regards to includement. i don't have a lot of information on that topic. they are working on taking down isil in cert. again, very complex. the government