Brady, Grassley Press Social Security Actuary to Correct Record on Misleading Claim on Average Wage Index

December 7, 2020 — Press Releases   

WASHINGTON — The top Republican on the House Ways and Means Committee Kevin Brady (R-TX) and Senate Finance Committee Chairman Chuck Grassley (R-IA) sent a letter to the Chief Actuary of the Social Security Administration Stephen Goss asking the Actuary to correct a misleading statement he made to Congress in a recent congressional hearing.

Before the House Ways and Means Committee, Mr. Goss asserted that lawmakers decided not to act in response to benefit effects of a 2009 decline in the National Average Wage Index (AWI), because they somehow knew that a future cost-of-living-adjustment would be relatively large.

Mr. Goss told the Committee that “policymakers did recognize” that the AWI had fallen in 2009, but Congress chose not to make any changes to the law “mainly because the reduction in the AWI and benefit levels was small and it was known that the first cost of living adjustment (COLA) applicable for those affected would be relatively large.”

The testimony was in connection to the possibility that the AWI could decline this year as a result of economic effects of responses to the COVID-19 pandemic, which would affect beneficiaries turning 60 this year. The extent to which the AWI as fallen in 2020, if at all, won’t be known until late 2021.

As Rep. Brady and Chairman Grassley told Mr. Goss in this letter, this was a “misleading” statement.

Given the importance of accurate representation of decisions by the 111th Congress, we are seeking clarification of this statement,” Brady and Grassley wrote.

The Republican tax writers asked Mr. Goss to answer three questions:

  1. What is the metric by which you ascertain whether a benefit reduction is “small” enough to justify lack of congressional action or large enough to justify action?
  2. Please explain what you meant by “it was known” what the 2011 COLA was going to be at the time the 2009 AWI reduction was announced on October 15, 2010.
  3. When it was identified to you prior to the hearing that your above quoted statement was misleading, you declined to correct your testimony. Please explain why you chose to present misleading testimony to Congress.

“The role of the Chief Actuary ought to be much like an umpire at a baseball game, whose job it is to call balls and strikes, and not like the broadcasters who provide commentary,” Brady and Grassley stressed. “It is not the job of anyone at the Social Security Administration to justify decisions made by Congress and we are concerned by your recent attempt to do so.”

CLICK HERE to read the full letter.

 

SUBCOMMITTEE: Social Security