Julie Su’s Nomination for Secretary of Labor Passes Senate Committee

The Senate Committee on Health, Education, Labor and Pensions advanced Julie Su’s nomination to be Secretary of Labor to the full Senate late Tuesday by an 11 to 10, party-line vote. Su has served as acting secretary since March 2023, having been confirmed as deputy secretary in July 2021.

The hearing was initially scheduled as a public hearing for Wednesday. Senator Bernie Sanders, I-Vermont and the chair of the HELP Committee, did not explain during a separate open committee on Wednesday why the vote was changed to a closed session. In the closed session, the committee also approved Moshe Marvit to be a member of the Federal Mine Safety and Health Review Commission and Stephen Ravas to be inspector general of the Corporation for National and Community Service.

Su was previously approved by the HELP Committee in April 2023, also by an 11 to 10 vote. Her nomination stalled and never received a full Senate vote. She has continued to serve in an acting capacity since previous Secretary of Labor Marty Walsh resigned in March 2023.

Senator Bill Cassidy, R-Louisiana and the ranking member of the HELP Committee, was critical of the hearing that took place “behind closed doors” on Tuesday. He said that, due to “bipartisan opposition, she would not be confirmed.” He was also critical of Su’s “troubling record” and said Su would “promote large labor unions at the expense of worker’s freedom and economic growth” and is focused on “dismantling the gig economy,” a reference to independent contractor rules approved under her tenure as California’s secretary of labor and her tenure as acting Secretary of Labor at the federal level.

The Senate has not scheduled a full vote to confirm Su.

HELP Discusses DB Plans

The HELP Committee’s public hearing on Wednesday morning considered how expanding defined benefit plans could help improve the retirement savings gap. Sanders spoke to the importance of expanding Social Security and advocated for lifting the cap on income that is subject to FICA payroll taxes, currently $168,000, “You make a billion dollars a year, you make $168,000 a year, you pay the same amount. Does that make sense?” Sanders asked rhetorically.

Cassidy described promoting DB plans as “an agenda that is outdated and a little disconnected.” Cassidy emphasized the flexibility that defined contribution plans offer because they are more portable than DB plans.

Dan Doonan, the executive director of the National Institute on Retirement Security, called this a “chicken and egg thing,” in which the decline of DB plans leads to lower retention, and higher turnover in turn leads to higher demand for DC plans.

Doonan said that “the move away from pensions is a major culprit in the nation’s retirement crisis.” Though he acknowledged that DC plans have value, “they are just not designed to replace pensions,” and “pensions are user-friendly for workers.”

Though the hearing was intended to focus on DB plans, Senators and the witnesses also spoke about Social Security and retirement security more broadly.

Senator Tommy Tuberville, R-Alabama, suggested that some of the tax collected by Social Security should be invested in some securities. For someone who paid about $1 million into Social Security, Tuberville said that “I could have put my Social Security money in the market, and it’d be worth $8 or $10 million today,” but instead, “the federal government wasted it.”

Rachel Greszler, a senior research fellow at the Heritage Foundation, concurred in part later in the hearing. She said she would support lowering benefits for higher earners, increasing benefits for lower earners, while tying benefits to life expectancy and a more accurate measure of inflation. She added that, “I think workers need an option for something that has a positive rate of return” as an alternative to paying into Social Security.