House Speaker John Boehner told The Daily Caller in December that spending reductions should pay for a yearlong payroll tax cut extension. However, the bill that passed the GOP-controlled House Friday would add to the deficit by not funding the payroll tax cut.
On December 15 TheDC asked Boehner and House Minority Leader Nancy Pelosi if they agreed with Social Security Trustee Charles Blahous, who said that the two percent payroll tax cut would hurt Social Security.
“One person may have said that,” Pelosi told TheDC during her weekly press briefing.
“Others have said that a second year extension would not have an impact, in the regard that you explained, it would not hurt Social Security. I don’t think this should be endless, but I think one more year in an economy of this kind.”
Boehner said, “I do not agree with it and I believe that offsetting the Social Security tax break for next year, offsetting it with reductions in spending that will be used to transfer to the Social Security Trust Fund, is a responsible way to proceed.”
Following the passage of a bill that does not include any spending reductions to fund the tax cut for the rest of the year, TheDC asked Boehner’s spokesman Michael Steel the following: “The Speaker has said it is ‘responsible’ to pass a bill with spending cuts to pay for the payroll tax cut. Why did he decide to support a bill that does not fund the payroll tax cut?”
Steel responded via email, “He decided we couldn’t let Senate Democrats’ obstructionism cause a tax hike for 160 million Americans.”
Bloomberg reports that the extension will cost $93.2 billion.
Blahous, appointed by President Obama, predicted that the payroll tax cut extension would be a “major step toward” moving Social Security from an “earned” benefit to “welfare” because less money would be directly paid from workers into the program. (RELATED: Pelosi: Payroll tax cut shouldn’t be endless, but one more year won’t hurt Social Security [VIDEO])
He told National Public Radio that the full year payroll tax cut extension “could be the beginning of the end of the idea that this is an earned benefit, [and] where benefits enjoy a certain amount of political protection because of a notion that they have been paid for in the past by the beneficiaries.”