Last week was the 80th anniversary of Social Security, which of course meant that everyone had to weigh in on how the program should or should not be fixed and bend a knee to the appropriate voter groups. Among those was Florida Senator and presidential hopeful Marco Rubio, who took to the pages of National Review to offer up a few modest suggestions. After noting that we may have only a year or two before the fund’s reserves are depleted and the possibility of benefit reductions will have to be considered, Rubio notes that this is still largely avoidable.
First, we must gradually increase the retirement age for individuals under 55, without changing it for current seniors like my mom. It is important that we keep our promises to current beneficiaries and those nearing retirement, but for Americans closer to my age, we need to have an honest conversation about saving Social Security…
Second, we should do more to protect seniors on the bottom of the income scale, who are too often consigned to poverty in old age. This can be done by reducing the growth of benefits for upper income seniors while making the program even stronger for lower-income seniors…
Finally, we must empower our people to save more for retirement. Social Security should be one component of retirement security along with employment-based plans and personal financial assets like IRAs, mutual funds, and personal savings accounts.
With absolutely no offense intended to Marco Rubio, there’s nothing new or revolutionary here. These are ideas which have been brought up before by conservatives and roundly rejected by Democrats. Rather than dealing with the fact that trouble is coming and reaching across the table to see what might be productively done about it, the usual chorus of voices generally chime in, threatening senior citizens and portraying the GOP as wanting to throw them off the cliff. On the rare occasion that one of them suggests a change to the system at all it’s just to increase taxes. (And usually benefits as well.)
I wonder if that will happen again this time? Ah, here we go. RELEASE THE KRAKEN! … err… the Krugman.
The issue in question is the future of Social Security, which turned 80 last week. The retirement program is, of course, both extremely popular and a long-term target of conservatives, who want to kill it precisely because its popularity helps legitimize government action in general. As the right-wing activist Stephen Moore (now chief economist of the Heritage Foundation) once declared, Social Security is “the soft underbelly of the welfare state”; “jab your spear through that” and you can undermine the whole thing…
Thus, Jeb Bush says that the retirement age should be pushed back to “68 or 70”. Scott Walker has echoed that position. Marco Rubio wants both to raise the retirement age and to cut benefits for higher-income seniors. Rand Paul wants to raise the retirement age to 70 and means-test benefits. Ted Cruz wants to revive the Bush privatization plan.
For the record, these proposals would be really bad public policy — a harsh blow to Americans in the bottom half of the income distribution, who depend on Social Security, often have jobs that involve manual labor, and have not, in fact, seen a big rise in life expectancy. Meanwhile, the decline of private pensions has left working Americans more reliant on Social Security than ever.
Well, Paul, if you reject all of those ideas as being horrible for American and secret, granny tossing schemes, I don’t suppose you have a proposal in mind to fix the program, do you?
And no, Social Security does not face a financial crisis; its long-term funding shortfall could easily be closed with modest increases in revenue.
DING DING DING. There you go, Paul. Just some modest increases in revenue. I wonder what he could mean by that?
Make no mistake, this is still a serious exposure for Republicans. The Democrats have been cunningly effective in selling their scare tactics about entitlement reform. Having worked for them in the past, there is absolutely no question that they will go back to the well again on this one. So what is the GOP to do? One obvious school of thought is to simply not give up hope and keep trying to educate voters about the realities facing the system and the measures available to keep it solvent. Unfortunately that requires messaging which can push across large, complicated ideas in a bite sized package which won’t overrun the attention span of the average fruit fly. No easy feat, that.
There is, of course, one other alternative. As unpleasant as it may sound, we could just let the system go broke. Continue to reject huge tax hikes while offering packages which would fix it and allowing the Democrats to either block the measures or wait for the President to veto them. Then, when the first set of checks go out which are more than ten percent short the voters will be outside the halls of the powerful with pitchforks and torches. At that point all you can do is wander out to meet them, shrug your shoulders and tell the angry hordes to go speak to the Democrats.
Emergency measures for temporary refills of the shortfall would be put in place at once and then you’d have a serious negotiating partner on the other side of the table. At that point anything is possible.