Need For Social Security Reform
In the following excellent (and bipartisan) Washington Post
op-ed, Bob Kerrey and Warren Rudman make their case for securing the future of
Social Security. While the authors are critical of Bush's proposed plan for
reforming Social Security, they are equally critical of the Bush plan's
opponents for failing to propose alternatives. The main point, say Kerrey and
Rudman, is that the Social Security system as currently set up is not
sustainable. Something has to be done... and soon.
Kerrey and Rudman deserve credit for noting that the disability and survivors
programs should be integral components of any reform proposal. Advocates from
across the country need to echo that refrain in public discussions and in the
media (e.g., letters to the editor, comments on radio programs).
Jonathan Young
JFA Editor, AAPD
Social Security Shell Game
By Bob Kerrey and Warren Rudman
The Washington Post
August 11, 2002
Wall Street's slump and the disappearing budget surplus are shaping this year's
campaign rhetoric on Social Security reform. It's easy to see why. These events
have taken two cherished free-lunch options off the table. Politicians can no
longer claim that investment returns from a never-ending bull market or general
revenue transfers from perpetual budget surpluses will save them from making
hard choices.
This development should spark a more realistic debate on genuine reform options.
But the clear danger is that without a free lunch to promise, politicians will
fall back on an equally bad option: the Do Nothing Plan. Voters shouldn't let
that happen.
In just six years the baby boomers will begin receiving Social Security checks.
Then, the number of workers whose wages are taxed, relative to the number of
beneficiaries who receive the proceeds of the tax, will begin to decline
sharply. Before Tiger Woods turns 50, the number of beneficiaries will grow by
at least two-thirds, while the number of workers will barely budge. Doing
nothing means deep benefit cuts or steep payroll tax increases for future
generations, which is why the Social Security trustees warn that prompt action
is essential.
Suppose that a member of Congress introduced legislation called "the Social
Security Do Nothing Act." Under this bill, promised retirement benefits would be
cut by 16 percent for today's 30-year-olds, by 29 percent for today's 20-year
olds and by 35 percent for today's newborns. Alternatively, payroll taxes would
go up by roughly 40 percent in 2041. How many politicians would rush to endorse
this bill? And yet these are the choices under the Do Nothing Plan.
Today's political heat is primarily aimed at three reform plans produced by the
president's Commission to Strengthen Social Security. Critics argue that the
commission's plans would result in deep benefit cuts, fiscally irresponsible
general revenue transfers and undue risk, when compared with the current system
in a hypothetically solvent condition.
It is certainly fair to criticize reform plans on policy grounds. But it is
fundamentally unfair to judge them against a standard that assumes the current
system can deliver everything it promises. It can't. Today's Social Security
system promises far more in future benefits than it can possibly deliver. The
relevant comparison for any reform plan is with what current law can deliver,
not what it promises.
No realistic reform plan looks good when compared with the false hypothetical of
a perfectly solvent system. Reformers have the burden of saying what changes
they would make to a system that is popular but unsustainable. Critics can sit
back and take pot shots at politically painful options without having to say
what they would do instead.
We have a simple suggestion to improve the dialogue. Critics of the commission's
proposals should come up with their own plans for shoring up Social Security.
They should be specific about the benefit cuts and tax increases they recommend
and the amount of general revenues that would be required. A real debate then
could take place -- not one between the commission's plans and an impossible
ideal but between the commission's plans and the plans of its critics.
The public should ask: How does each plan affect total benefits, total taxes and
different beneficiaries -- the retired, disabled and survivors? How will each
plan affect national savings? What are the risks? Do the plans provide the
resources to pay for promised benefits, or do they just balance the fund on
paper? Do they make Social Security permanently sustainable?
We should stop playing political shell games with this issue. If we do not have
the political will to solve the Social Security problem now, we can't hope to do
so when the baby boomers start collecting benefits -- not just for Social
Security but for Medicare and Medicaid as well. The problems facing our health
care programs are much more daunting than Social Security. These three programs
together are expected to double as a share of the economy within 30 years,
putting unthinkable pressure on tax rates, the economy and the budget.
Not acting is itself a choice -- one that has grim consequences for today's
midlife adults and even bigger ones for their children. Politicians of both
parties should get behind specific reform plans or be held accountable for
supporting the consequences of the Do Nothing Plan.
Bob Kerrey, a former Democratic senator from Nebraska, and Warren
B. Rudman, a former Republican senator from New Hampshire, are co-chairs of the
Concord Coalition.
To view the entire article, go to
http://www.washingtonpost.com/wp-dyn/articles/A6698-2002Aug11.html
Copyright (c) 2002 - The Washington Post
# # #
JUSTICE FOR ALL -- A Service of the American Association of People with
Disabilities
www.aapd-dc.org
www.jfanow.org
There's strength in numbers! Be a part of a national coalition
of people with disabilities and join AAPD today.
www.aapd-dc.org
