President Donald Trump has developed a reputation for making unconventional choices. Among them is the selection of Frank Bisignano as the next Social Security commissioner.
While he has yet to be confirmed, Bisignano represents a departure from previous commissioners who all came from government backgrounds. Bisignano is the current CEO of financial tech company Fiserv, and if approved, serving as commissioner will be his first foray into public service.
“I think Frank is a great choice,” says James Mohs, associate professor of accounting and taxation at the University of New Haven in West Haven, Connecticut. “He is a seasoned professional.”
Not everyone is so sure, though.
“It’s scary to me,” says Martha Shedden, president and cofounder of the National Association of Registered Social Security Analysts. She worries about Bisignano’s lack of background in public policy and wonders if his business experience may lead him to take risks with Social Security trust fund money.
While time will only tell, here’s what Trump’s pick could mean for the Social Security system.
[Related:Social Security Fairness Act: What It Is and Will It Affect You]
Frank Bisignano’s Background
The 65-year-old Bisignano was born and raised in Brooklyn, New York. He earned a bachelor’s degree in finance to start his career and went on to hold executive positions at Citigroup, JPMorgan Chase & Co, First Data Corp and now Fiserv.
“He has built a reputation for being transformative,” says Devin Carroll, owner and lead advisor for Carroll Advisory Group, a Texas-based financial firm that serves clients nationwide.
At JPMorgan, Bisignano was selected to lead the company’s mortgage unit in 2011 as it dealt with the fallout from the housing crisis. In 2013, he took over the reins at First Data Corp, a payment processor. He found success there, and First Data was eventually sold to Fiserv in 2019. In 2020, Bisignano was named Fiserv’s CEO.
Under his leadership, Fiserv has positioned itself as a leader in payments and financial technology. It has helped to expand the reach of digital payment service Zelle, and the company’s point-of-sale service Clover has seen significant revenue growth.
“He’s been a very successful CEO, but I don’t see anything in his background that relates to social services and public policy,” Shedden says. She is also concerned that Bisignano’s wealth may make it difficult for him to appreciate the needs of retirees living on lower, fixed incomes.
Shedden isn’t alone in those concerns. In a press release, Richard Fiesta, executive director of the Alliance for Retired Americans, said: “Nothing in Mr. Bisignano’s career suggests that he understands the unique needs of older and disabled Americans.”
[Read: A Guide to Social Security Disability.]
Business Experience Could Be a Plus or Minus
Depending on whom you ask, Bisignano’s business background either makes him ideal for the role of Social Security commissioner or a concerning candidate. Those who are optimistic about Bisignano point to the shortfalls of what they see in the current Social Security Administration.
“It’s as efficient as a government bureaucracy can be, (but) it’s still a dumpster fire at times,” Carroll says. He thinks Bisignano could implement systems used by the private sector to increase efficiency and improve service.
Another area of improvement, according to Mohs, is the investment earnings from the Social Security trust funds. Currently, money from the trust funds is invested in government-backed Treasury bonds and securities. These investments are very safe but yield little interest. Mohs suggests that there may be other conservative investments that could earn the trust funds more.
The idea of Bisignano moving money from government-backed securities to other investments worries Shedden. That type of change could garner higher returns, but higher returns typically come with greater risk of loss.
“I don’t think running the Social Security Administration is the same as running a company where you’re looking to make shareholders and investors a profit,” Shedden says. Protecting money in the trust funds is more important than maximizing returns, in her view.
[Read: What Happens to Social Security Benefits When You Die?]
Major Reforms Must Come from Congress
The 2024 Social Security Trustees Report estimates that without any changes to the program, the trust funds will run dry in 2035. At that time, they will only be able to pay 83% of scheduled benefits.
How to address the rapidly approaching shortfall in the trust funds has been a topic of extensive public discussion, but don’t expect Bisignano to come up with a solution alone.
“The commissioner is generally not the one who leads on reform issues,” Carroll says. Instead, appointees typically follow the direction of the president.
Two common suggestions for shoring up the Social Security trust funds are increasing revenues through payroll taxes or reducing expenditures by pushing back the retirement age. So far, Trump has not indicated what, if any, path he prefers, although he has pledged to eliminate income taxes on Social Security benefits.
As for Bisignano, he told Bloomberg in an interview that he has “no objective to cut the benefit of any American.”
Everyone Agrees: Technology May Improve
While there are conflicting opinions on whether Bisignano is the right person for the job of commissioner, everyone seems to agree that his fintech background could help modernize the Social Security system.
“It could very much benefit from technological improvements,” Shedden says.
Bisignano’s experience with financial technology may allow him to streamline computer systems and identify improvements that will make it easier for agency employees to do their jobs and Social Security beneficiaries to get the information they need.
“He’s a seasoned senior executive,” Mohs says. “I have a feeling he’s going to take the bull by the horns.”
More from U.S. News
How Much Could Trump?s Social Security Pick Impact Your Benefits? What to Expect in 2025 originally appeared on usnews.com
