Social Security: The Political Football
Ventura County Star (CA), November 17, 1999
Knight-Ridder/Tribune Media Services, November 15, 1999
Ventura County Star (CA), November 17, 1999
Social Security has now become the ultimate political football that is tossed and carried by any political team trying to grind out some extra yardage toward its goal. Take this recent, and typical, statement from Congressman John Thune of South Dakota:
"We've made a conscious, deliberate decision-- we are not going to raid the Social Security trust fund." He might just as well say, "We've made a conscious, deliberate decision not to fly around Washington by flapping our arms and making bird noises."
Nobody is going to "raid" the trust fund, nor could they even if they wanted to. The simple truth is that none of spending decisions made by Congress will have any impact on Social Security.
That's because the Social Security Trust Fund only lends money to the rest of the government-- it doesn't give it away. When that money is spent, the trust fund is still holding the U.S. government bonds that it purchased. So the trust fund will be repaid, with interest; and it doesn't matter whether the money it lends to the government is used to pay down the national debt, or whether it is spent on education or health care or anything else.
Everyone in Washington knows this. But it hasn't stopped Republicans from running TV ads accusing the Democrats of trying to "raid" Social Security to pay for "big government" programs.
President Clinton can hardly complain. After all, he started this nonsense last year when he and most of the Democratic leadership successfully beat back a Republican tax cut by saying the same thing: that they were trying to "raid" the Social Security Trust Fund.
The worst part about this bi-partisan dishonesty is that it continues the charade that has undermined public confidence in our Social Security system. Here's another little secret that most politicians know, but aren't telling: Social Security is financially healthy for the foreseeable future, even beyond the retirement of the baby boom generation. All that hype you may have heard about Social Security going broke when the baby boomers cash in has as much substance as the current debate about "raiding" the trust fund.
Anyone with a computer and a modem can find the numbers on the Social Security Administration's web site (www.ssa.gov). Even if the economy limps along at less than 1.5% growth for the next 75 years-- about half of its historic growth rate, as the Trustees pessimistically assume-- there's really nothing to worry about. For the next 35 years, all benefits would be paid in full; to keep the system's promises for 75 years would require some additional funding, but the amount is less than one percent of our national income.
Of course the whole idea of making 75-year projections for Social Security is ridiculous, as anyone can see from the grand-canyon-size errors economists make when they try to predict the Federal budget balance just a few years out. And one of the worst things about projecting into the science-fiction-future is that it is so easy, given the vast range of uncertainty surrounding the various economic and demographic assumptions, to fudge the results.
The 1999 Social Security Trustees' report seems to have done a little bit of that, knocking about five or six years off the program's solvency by an unexplained-- and unexplainable-- change in their assumptions about productivity growth. It appears that the Trustees, who are political appointees, don't want Social Security to look too secure too far into the future-- otherwise people might stop talking about how to "fix" it. When some particularly alert members of Congress raised questions about the change in assumptions, they discovered that the Trustees' deliberations on the subject, as well as the recommendations of the program's actuaries, are secret.
Now add this to the mix: there are Wall Street financial firms with a multibillion dollar stake in privatizing Social Security, and they don't mind investing in some think tanks and policy organizations who make it their business to convince people that the program is in trouble. Then there are the right-wing ideologues in Congress who have never reconciled themselves to America's largest anti-poverty and social insurance program. And many liberals-- including the President, when he was looking for a legacy to displace impeachment-- have found it convenient for their own political reasons to pretend that Social Security needs to be "saved."
So the game goes on, and will probably continue until the voters discover the truth: the only thing we need to do to protect Social Security is to keep Congress from changing the law and cutting benefits. Luckily, that's one battle we're winning-- so far.
Mark Weisbrot is co-director of the Center for Economic and Policy Research, in Washington, D.C. and president of Just Foreign Policy. He is also the author of the forthcoming book Failed: What the "Experts" Got Wrong About the Global Economy (Oxford University Press, 2015).