Hearing of the House Budget Committee - "Medicare and Social Security: The Fiscal Facts"
Statement
Today Maryland Congressman Chris Van Hollen, Ranking Member of the House Budget Committee, made opening remarks at the House Budget Committee hearing, "Medicare and Social Security: The Fiscal Facts." Below are his remarks as delivered.
"Thank you Mr. Chairman, and I want to thank our witnesses for joining us today, and I look forward to your testimony on what is a very important subject. I would note, Mr. Chairman, that this will be what I believe is the fourth hearing devoted to either Medicare or Social Security solvency, including yesterday's hearing where we had an extensive discussion on this issue with Secretary Sebelius and the other witnesses. And I think that's entirely appropriate. But I want to note that we have not yet had a single hearing devoted to the issue of tax expenditures and revenue. And we all know that the President's bipartisan fiscal commission, on which you served Mr. Chairman, said that you can look at the tax expenditures in the tax code and find about $1 trillion every year in savings. We have had four hearings on this issue, and we should have many more on this issue, but again -- we have not yet had one on a hugely important part of our budget.
"There is no doubt that we need to make reforms in Medicare and Social Security to ensure the long term strength and viability of those programs, and we have very different views on how to do it. But, Mr. Chairman, if we're talking about the facts, let's also be clear about this point: the Congressional Budget Office (CBO) analysis shows the primary recent policy decision that is driving the need to raise the debt ceiling were the decisions in 2001 and 2003 to provide tax breaks that disproportionately benefit the very wealthy. That is what is driving the current debt ceiling debate. We're talking about bills -- past bills due -- and our ability to pay them. And as we all know, we have a very important conversation going on as to whether and how we take a balanced approach to that decision. One that includes important and difficult cuts in discretionary spending. One that looks at mandatory programs. One that looks at things we can do to strengthen Medicare, and again we have different views on how to do that. But one, that we would urge, also looks at closing corporate tax loopholes and dealing with tax preferences for the folks at the very top. So, again I'm glad we're having, by what our account is the fourth hearing on this subject, but if we're going to take a balanced approach to the long-term challenges let's include that conversation about tax expenditures.
"Now, with respect to Medicare and Social Security -- again, we heard a lot of testimony yesterday from Secretary Sebelius and others. We believe that we have to make very important reforms to Medicare. We believe that we have to change the incentive structure so that we reward value of care and quality of care instead of volume of care and quantity of care. And Secretary Sebelius talked about some very important initiatives that she's taking with respect to improved coordination of care for dual-eligibles -- people on Medicare and Medicaid, people with chronic diseases -- where we send a whole lot of the Medicare program. We need to look at those sorts of things, and we are open to other ideas. What we are not open to is transferring all of those costs simply to seniors on Medicare without dealing with the underlying costs driving the entire healthcare system, not just Medicare, but the entire health care system of which Medicare is a very important part. And so yes, we do object to the approach that was taken in the Republican budget which the CBO says will not decrease health care costs, but actually increase total health care costs and push a much larger part of the cost burden onto Medicare beneficiaries.
"With respect to Social Security we believe that reforms need to be made to make sure that we strengthen the solvency of Social Security beyond the year 2036. We all know that if we do nothing to act now then Social Security beneficiaries would get 77 cents on the dollar that they were expecting to receive. Yes, we need to act sooner rather than later to address those issues. And again, we have differences of opinion on how best to do that, but we have no difference in opinion regarding the fact that we do indeed need to strengthen those programs.
"We are in fundamental agreement that Medicare and Social Security require some reforms so that we can strengthen them, but we have some very big differences as to how to do it. And apparently we continue to be in significant disagreement over taking a balanced approach to the overall budget, one that says "Let's not make the same kind of mistakes that we made which are now driving the budget deficits at this particular moment. Let's deal with tax expenditures. Let's close some of those corporate loopholes -- whether it's for the jets or for the oil and gas companies. Let's look at the tax preferences for the folks at the very top of the income scale.' So, Mr. Chairman, again I'd like to have a lot more hearings on this particular issue, but I'd like also for us also to address the very important issue of tax expenditures as part of the overall budget discussion. Thank you."
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