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Sullivan, Begich spar over Social Security in U.S. Senate race

Both of Alaska's candidates for U.S. Senate know that the country's Social Security system needs reform -- its trustees say the system will start running short on money in about 20 years without a fix.

But Republican challenger Dan Sullivan and incumbent Democratic U.S. Sen. Mark Begich differ sharply on how they'd solve the problem.

Begich has introduced legislation that would raise tax revenue for the system by removing a provision that exempts income above $115,000 from Social Security taxes. Getting rid of the $115,000 cap would keep the program solvent through 2085.

Sullivan, meanwhile, hasn't endorsed specific legislation but says he'd like to explore other options that include raising the age of eligibility for recipients or means testing, which could help keep Social Security afloat by cutting benefits for wealthier Americans.

The options aren't particularly palatable to voters, said Gary Burtless, a senior fellow at the nonpartisan Brookings Institution who studies economics -- but the system does need to be fixed.

"Hey, look, give them credit," Burtless said in a phone interview. "They've both said: 'Let's do something unpleasant.'"

Social Security has surfaced as an issue on the Alaska campaign trail since mid-August, when Sullivan addressed reform at a pre-primary debate, saying, "I do think we need to look at raising the age. I do think we also need to look at means testing."

This month, the Democratic Senatorial Campaign Committee kicked off a multimillion-dollar ad campaign in Alaska with a TV commercial that cited Sullivan's remarks. And a new radio ad from the Alaska Democratic Party last week includes a man telling Sullivan to "keep your hands off my Social Security."

"I've been working for 40 years, and I feel like I'm entitled to what I've paid in. I just don't want to see my retirement taken away," says a man identified by a narrator as an Alaska senior.

A spokesman for Sullivan, Mike Anderson, said the candidate was unavailable for an interview Monday, though Sullivan appeared on the nationally syndicated Sean Hannity radio show and spoke about the need to "reform our entitlement programs."

Anderson referred questions about Sullivan's positions on Social Security reform to a news release distributed Monday afternoon. It included a full transcript of Sullivan's remarks from the August debate, in which he said "we're not going to touch" benefits for seniors who are already receiving them, or who are "in that age bracket where they are almost going to get it."

The release did not include further details about where Sullivan would set the age bracket or how much extra time his ideas for reform would keep the Social Security system solvent.

"Dan has been very clear that he is committed to honoring the promises we have made to our seniors and protecting the programs they rely on, like Medicare and Social Security," the release quoted Anderson as saying. "Unlike Mark Begich, Dan Sullivan is committed to saving the social safety net for our kids and grandkids, not just burying his head in the sand."

A spokesman for Begich, Max Croes, said in a phone interview that Anderson's statement was "more disappointing talking points from Dan Sullivan, who hasn't put a single proposal on the table to actually strengthen or protect Social Security."

In an emailed statement, Croes added: "Senator Begich has proposed a solution to make Social Security solvent for an additional 75 years."

Begich was also unavailable for a phone interview Monday. But Croes emailed a two-and-a-half-page document summarizing Begich's positions on Social Security reform.

In addition to lifting the cap on Social Social security taxes, which the Congressional Research Service has said would create a long-term surplus, Begich's campaign says he also supports a new method of calculating inflation that would boost benefits, by pegging cost-of-living increases to an index that tracks costs for seniors. (The background document, however, did not say how that change would impact the system's solvency.)

Begich's campaign and his Democratic allies have argued that the lack of details in Sullivan's positions on Social Security, combined with the endorsement Sullivan received from the conservative Club for Growth, means that Sullivan wants to see the program privatized.

Anderson, however, said in an email that Sullivan "does not support privatization of Social Security."

Burtless, the Brookings Institution fellow, called Begich's idea to lift the Social Security tax cap a "very standard proposal to fix Social Security's funding problem" -- one that Burtless said commands narrow support among the general population.

But Burtless added Begich's proposal is one that has typically made some Democrats uncomfortable, since the elimination of the cap means that some high earners who make big payments into the system could end up drawing large Social Security checks in the future.

Burtless said he was skeptical of means testing -- one of Sullivan's ideas for Social Security reform -- because it's less likely to provide large-scale savings for the program, and because of its potential to dissuade people from saving their own money for retirement.

"If you means-test the Social Security pension based on what your current income is when you're an old person, it's going to discourage a lot of people from accumulating savings," Burtless said.

Note: The first paragraph of this story was updated to reflect the fact that the Social Security system will exhaust its reserve funds in about 20 years but will still be able to pay most benefits based on annual tax income.