We Can’t Fix What Aint Broken

August 06, 1998

Mark Weisbrot
San Francisco Chronicle, August 6, 1998

Knight-Ridder/Tribune Media Services, July 8, 1998 
Hartford Courant
, July 9, 1998

We are currently witnessing a major national debate over the future of Social Security, of a kind we have not seen since the 1930s. No one should be deceived as to the nature and significance of this debate.

It is not about shoring up the program’s finances, or about how we can “save Social Security for the 21st century,” as President Clinton has asserted. It is not about preparing for the retirement of the baby boom generation, which has already been done. It is not about making the program more equitable or fair, or improving it in any way.

This debate is about how to cut Social Security. At its worst, it is about privatization, about undermining or even destroying the program that has formed the bedrock of our social safety net for more than half a century.

Privatization would have more serious consequences than some of the smaller proposed benefit cuts. But these cuts– whether packaged as an adjustment to the Consumer Price Index, an increase in the retirement age, or changes in the formula for computing benefits– would eventually push millions of senior citizens below the poverty line.

The poorest among the elderly would be the hardest hit. Yet these benefit cuts are treated with serious consideration in the media, and almost no attention has been paid to the human consequences of their impact.

No one should confuse the current discussion with an honest one. The fundamental premise on which it rests– that there is a legitimate reason for Americans to be concerned with the financial health of Social Security– is simply false. Even the “reformers” acknowledge that the program will meet all of its obligations for the next 34 years without any changes. By that time the last members of the baby boom generation will have already retired.

Any shortfall that might occur after 34 years would be small. The margin of error for projections that far out into the future is, to put it generously, enormous. Lately economists have not been able to forecast the Federal budget deficit one year in advance within a margin of 80%.

In other words, Social Security is secure, for as far into the future as we could ever hope to project. The forecast of a small deficit over an incredibly long 75 year planning period, under very pessimistic assumptions about economic growth, is not anything that anyone who has a life should be worrying about.

The entire debate is driven by politics: a coalition of interest groups, including Wall Street financial firms hoping to cash in on privatization, have decided that the time is finally ripe to approach the so-called “third rail” of American politics. The White House has not helped matters by sponsoring a series of forums which give the impression that we really do have to do something about Social Security.

Unfortunately many of those who would like to preserve Social Security are unwilling to say that the emperor is not wearing any clothes. This is a mistake, similar to the one that was made during the debate on welfare reform. In that debate, conservatives argued for years– contrary to the evidence– that welfare actually caused poverty. Through constant repetition, this became a “fact” that many liberals decided to accept.

The liberals then opted to support welfare “reform,” thinking they might win some real reforms such as health care, job creation, and child care for welfare recipients. Instead, the Federal government’s longest-running entitlement for the poor– Aid to Families with Dependent Children– was abolished.

Social Security “reform” will not be so easy, since we are dealing with an entitlement that has 44 million recipients. All the more reason to tell the truth: force the granny-bashers to explain why we need to be tinkering with the nation’s most successful anti-poverty program.

Let them explain why we need to cut Social Security. Are America’s senior citizens living too high? The average payment is only about $750 a month. About half of all beneficiaries would be living below the poverty line if not for their benefits.

Sooner or later the truth will come out, and the politicians now leading the charge for Social Security reform will be scurrying for cover. We can only hope that it happens before they succeed in breaking the commitment that our federal government has maintained for most of this century.

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