Republican presidential candidate Nikki Haley continues to be one of the few politicians who want to take action now to address Social Security’s looming solvency crisis.
During the fifth Republican Party presidential debate of the 2024 election season on Wednesday, the former United Nations Ambassador and South Carolina governor once again said she would raise the age at which younger Americans would become eligible for Social Security benefits if she wins the presidency.
When the topic of Social Security was brought up by debate co-moderator Jake Tapper of CNN, DeSantis, who the question was first directed to, said he was against raising the retirement age because life expectancy has been declining in recent years.
“On the retirement age, it used to be people would say, ‘well, life expectancy is going up, shouldn’t it mirror that?’ Well, the problem now is that in the last 5 years is life expectancy is going down,” DeSantis said during the debate. “I don’t see how you can raise the retirement age when our life expectancy is collapsing in this country. That’s a huge problem in and of itself.”
The Florida governor added, “We’ll work on something for the long-term strengthening, but I am not going to mess with seniors’ benefits. I think seniors should know that a promise made will be a promise kept. I would never raise the retirement age in the face of declining life expectancy.”
“They should plan on their retirement age being increased, yes. We’re going to change it to reflect more of what life expectancy should be.”
Nikki Haley
According to CDC’s National Center for Health Statistics, U.S. life expectancy has dropped from 78.8 years in 2019 to 76.1 in 2022 (largely due to excess deaths during the Covid pandemic).
When it was Haley’s turn to talk about Social Security, she began by citing the issue of solvency as defined by the Social Security Board of Trustees in its latest annual report released in March 2023, which revealed that the Old-Age and Survivors Insurance and Disability Insurance (OASI) trust fund, which currently pays benefits to about 57 million Americans, will become depleted by 2033 unless changes are made.
“What I’ll tell you, Social Security’s going to go bankrupt in 10 years. Medicare’s going to go bankrupt in 8,” Haley said during the debate. “We have to keep our promises to seniors, but we also can’t put our head in the sand. For those like Ron saying we’re not going to touch Social Security, that means they’re going to leave after 4 or 8 years and leave it bankrupt? No. What we do is we go to those in their 20s and say we’re going to change the retirement age to reflect life expectancy.”
During her response, Haley also briefly floated changing the way Social Security COLAs are determined, limiting Social Security benefits for the wealthy, and expanding Medicare Advantage plans. But the focus remained on whether or not she would raise the Social Security full retirement age—currently at 67—and what she would raise it to. When Tapper asked whether voters in their 20s should plan on working until they are 70, Haley responded with:
“We’re going to be responsible with it and we’re going to go to those in our 20s. When I said the retirement age was too low… I said it’s too low for those in their 20s. We have to go and start looking at what we can do to get out of this. We want to make sure that everybody who was promised gets it, but we also want to make sure our kids have something when they get it, too.”
Further pressed about whether voters in their 20s should plan on having to work until 70 before being eligible for full Social Security benefits, Haley added: “They should plan on their retirement age being increased, yes. We’re going to change it to reflect more of what life expectancy should be.”
Trump attacks Haley’s stance
Meanwhile, Republican frontrunner Donald Trump has steadfastly advocated keeping the programs as they are in any recent campaign trail references to Social Security, despite expressing support in the past for raising the retirement age to 70.
The Hill notes in an article today that the Trump campaign even unveiled a new attack ad Thursday targeting Haley over her call for a raising the retirement age.
“Americans were promised a secure retirement. Nikki Haley’s plan ends that,” a narrator says in the ad, airing as Haley gains ground on Trump in New Hampshire.
Notably, each of Trump’s White House budget proposals for FY 2018-2021 included billions of dollars in cuts to Social Security and Medicare programs.
Impact of raising age to 70
Raising the Social Security full retirement age to 70 would ultimately cut average lifetime benefits for new retirees by nearly 20% according to an April 2023 report from the Center on Budget and Policy Priorities, which points out that if Social Security’s reserves are depleted, congressional inaction would force a 23% cut for all beneficiaries.
The full retirement age was 65 for most of Social Security’s history. The last major Social Security overhaul, in 1983, gradually raised the age to 67 (which it reached in 2022 for those born in 1960 or later), effectively cutting benefits by 13% as compared to benefits if the retirement age had remained at 65.
The Republican Study Committee budget, put forward by House leaders in 2023, has called for Social Security’s full retirement age to gradually go up until it is increased by three years. Based on their proposal, people born in 1978 or later would have a full retirement age of 70.
The Congressional Budget Office (CBO) calculates that incrementally raising the FRA to age 70 by 2048 would save $121 billion over the next 10 years, and savings would grow substantially in subsequent years.
SEE ALSO:
• Nikki Haley Again Calls for Raising the Retirement Age
• Chris Christie: Politicians ‘Liars and Cowards’ for Not Addressing Social Security Crisis
• 7 Key Social Security Metrics for 2024
• Social Security Taxes vs. Benefits: Americans Take Far More Out Than They Pay In
• 3 Proposals to ‘Fix’ Social Security
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.