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Compliance February 8, 2023
Biden “Won’t Let” Republicans Cut Social Security
In the State of the Union address, Biden commits to protecting Social Security and Medicare from cuts to address the debt ceiling.
Reported by Paul Mulholland
President Joe Biden called Social Security and Medicare a “lifeline for millions of seniors” and said he would protect both programs from what he said are Republican calls to cut them back to reduce the national debt during Tuesday night’s State of the Union address.
In his second such address, Biden spoke of the need to raise the U.S. federal debt ceiling without “preconditions or crisis.” He specifically called out some Republicans for proposing cuts to Social Security and Medicare or sunsetting the programs every five years, which drew chants of, “Liar!” from the Republican side of the audience.
“Instead of making the wealthy pay their fair share, some Republicans want Medicare and Social Security to sunset every five years,” Biden said, meaning Congress would have to reapprove the programs in five-year intervals. “Other Republicans say if we don’t cut Social Security and Medicare, they’ll let America default on its debt for the first time in our history. I won’t let that happen.”
House Speaker Kevin McCarthy, R-California, had made comments prior to the address that cuts to the programs are off the table following reports that House Republicans may use them as levers in negotiations over the debt ceiling.
The debt ceiling, currently set at $31.4 trillion, was reached earlier this year, and the Treasury Department is currently using “extraordinary measures” to avoid issuing new debt, which it expects will keep the government funded at least until early June.
Referencing taxes 17 times to an audience of members of Congress, his cabinet and invited guests in the televised address, Biden pointed to the legislative accomplishments of his first two years in office and repeatedly asked lawmakers to “finish the job” on additional priorities—including non-compete agreements and employment benefits like paid sick, family and medical leave.
Biden noted that the debt ceiling was raised three times during the administration of former President Donald Trump and accused Republicans of wanting to hold “the economy hostage” over the debt ceiling, unless he makes major policy concessions.
Regarding non-compete agreements, Biden referenced a proposed rule from the Federal Trade Commission which would ban the use of the agreements in employment. Biden said that “30 million workers had to sign non-compete agreements when they took a job. … Not anymore. We’re banning those agreements so companies have to compete for workers and pay them what they’re worth.”
Non-competes are contracts, often required as a condition of employment, which require a new employee to legally commit to not work for an economic competitor for a period of time after the end of their employment. The FTC estimates that such a ban could raise wages by $300 billion.
The proposal could also have implications for the registered investment adviser firms some retirement advisories are acquiring to broaden wealth management capabilities.
Labor Secretary Marty Walsh, who reportedly will resign his post to become the next executive director of the NHL Players’ Association, was the “designated survivor” from the Biden administration who did not attend the event.
