Bill would stop feds taking SS benefits to pay off student loans

Senate Finance Committee Ranking Member Ron Wyden, D-Ore., and Senator Sherrod Brown, D-Ohio, ranking member of the Finance Committee Social Security, Pensions, and Family Policy Subcommittee, along with five Senate Democrats introduced a bill Thursday to protect Americans who receive Social Security from having benefits taken away to pay outstanding federal debts, such as student loans.

Students and families already face substantial barriers to middle-class opportunities, with the cost of college skyrocketing more than 500 percent since 1985, the lawmakers said.

“Losing hard-earned Social Security benefits on top of increased college costs has created an unmanageable hardship for many seniors and Americans with disabilities who count on Social Security to maintain a basic standard of living,” their announcement said..

“Americans are getting hit by a wrecking ball of increasing college costs, and the last thing they can afford is to have their Social Security benefits reduced to pay off student loans,” Wyden said.

“Students and their families in Oregon and across the country who have worked to earn their benefits should not be penalized for trying to improve their lives and keep up with the climbing price of higher education.”

“Social Security is the bedrock of retirement security and a lifeline for Americans with disabilities,” Brown said. “These modest benefits put food on the table, pay for prescriptions, and help with monthly bills. When Americans are crushed by student loan payments, they should be able to count on Social Security benefits. This bill would correct the law to ensure that these earned benefits remain a lifeline instead of a direct deposit on federal debts.”

The bill, the “Protection of Social Security Benefits Restoration Act,” would repeal a decades-old change in law that allowed earned benefits to be garnished by the federal government to collect federal debts, like student loans, home loans owed to the Veterans Administration, and food stamp over-payments.

Social Security provides vital benefits to millions of Americans who worked and paid into the system, Wyden said. To support the purpose of the program as a fundamental lifeline, the original law protected these earned benefits from attempts to recover all debts.

These changes, made in 1996, were never fully debated in Congress, yet they continue to have a profound effect on beneficiaries living on fixed incomes today, the lawmakers said.

Although the 1996 legislation included some provisions to protect the most vulnerable, those protections have not been updated in 20 years.

The proposed legislation reestablishes protections in Social Security and other benefit programs, such as Railroad Retirement and Black Lung Benefits, which were in place for more than 40 years before the change was made.

A summary of the bill can be found here .

Other original cosponsors include Sens Whitehouse, Gillibrand, Klobuchar, Sanders and Warren.

The bill is supported by Social Security Works, the Strengthen Social Security Coalition, AFL-CIO, Justice in Aging, Campaign for America’s Future, Global Policy Solutions, Student Debt Crisis, the National Organization for Women, RootsAction.org, Project Springboard, the Alliance for a Just Society, the Economic Opportunity Institute, AFGE, the Progressive Change Campaign Committee, The Arc of the United States, the Public Higher Education Network of Massachusetts and the National Committee to Preserve Social Security and Medicare.