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House GOP Quietly Drops Relaxation of Social Security Earnings Test

October 23, 1995

WASHINGTON (AP) _ House Republicans have quietly retreated from a key ``Contract With America″ plank that would have allowed working Social Security recipients to keep more of the money they earn from their jobs.

The provision, which sought to raise the limit on the money such retirees can earn without losing their benefits, was dropped from a massive tax- and spending-reduction measure scheduled for House action late this week, aides said Monday.

It was deleted because it faced a parliamentary roadblock in the Senate, said Ways and Means Committee spokesman Ari Fleischer. Procedural rules there bar the inclusion of Social Security revisions in budget legislation.

Sixty senators can vote to waive the rule, but House lawmakers believed that was unlikely. They feared the Senate would defeat the entire budget bill if the eventual House-Senate compromise version contained the Social Security provision.

The overall legislation, which is intended to cut taxes by $245 billion and balance the budget in seven years, is the centerpiece of the Republicans’ program.

But the earnings-limit provision also was much promoted as crucial to help needy senior citizens forced to work to supplement their retirement income.

Under current law, Social Security recipients aged 65 to 69 lose $1 in benefits for every $3 they earn above $11,280. Working seniors, in effect, have to pay higher taxes than anyone else and are thus discouraged from working and contributing their skills and talents to society, proponents of the provision argued at a Ways and Means hearing in January.

``We don’t want to just sit on the porch in a rocking chair,″ said Philip Semler, a 68-year-old salesman.

House Republicans had wanted to raise the earnings figure to $30,000 by 2000. That would have cost the treasury $12.4 billion over seven years.

The provision was dropped from the budget legislation without fanfare. The four-inch-thick bill, which has not been widely circulated, mentions the decision. However, a 162-page summary of the bill given to reporters and others makes no mention that the earnings-limit provision was dropped.

Ways and Means Chairman Bill Archer, R-Texas, and Social Security subcommittee chairman Jim Bunning, R-Ky., intend to reintroduce the provision as stand-alone legislation, Fleischer said.

Meanwhile, Sen. John J. McCain, R-Ariz., has vowed to force a Senate vote on the issue, said his spokeswoman, Deirdre Blackwood.

It is supported by the American Association of Retired Persons and smaller senior citizens groups. However, House aides say privately that stand-alone legislation will be difficult to pass because some way of paying for the cost would have to be found.

``I’m not happy about it. ... It would have been much easier to stick it in the big bill and let it go,″ said Rep. Dennis Hastert, R-Ill., a major backer of the provision.

Jake Hansen, vice president of the two-million-member Seniors Coalition, a conservative group, said he hoped the House and Senate, in compromising on a budget bill later this year, could include the earnings-limit provision. He said he was disappointed at lawmakers’ apparent unwillingness to get over the procedural hurdle.

``It seemed to us there was nothing in there that couldn’t be worked out. Where there’s a will there’s a way, and we’d like to make sure a way is found,″ he said.

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The bill is HR-2491.

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