Hypocrisy in the calls for Social Security reform

Social Security needs some small changes; but irresponsible fiscal policies are the real problem.

Rep. Gil Gutknecht, R-Minn., recently tried to show bipartisan support for Social Security reform by using a quote from former President Bill Clinton’s Sept. 19, 1998, radio address: “We must act now across party lines to make Social Security as strong for our children as it has been for our parents.”

He should have read the entire radio address because Clinton also said, “Unfortunately, the Republicans in Congress have a different idea. The black ink in the budget hasn’t even had a chance to dry – indeed, it hasn’t appeared yet. But they already want to drain the surplus to fund a tax plan before we make the most of our opportunity, our historic opportunity to save Social Security.” Clinton’s message was to save the surplus to fund the Social Security trust fund.

Their talk about reforming Social Security “For our kids’ sake,” which is another example of the hypocrisy of Republicans. I am a strong supporter of “generational fairness” and doing things “for our kids’ sake,” but their continuous campaigning on tax cuts while they run up huge debts is doing damage to our children’s future.

The gross federal debt, which was approximately $909 billion in 1980, had grown to approximately $5.6 trillion by 2000, but the Clinton administration had slowed the deficit’s growth to approximately $23 billion a year. President George W. Bush and the Republicans took over and their tax cuts and spending sent the debt skyrocketing again.  Bush’s own budget shows the debt increasing to approximately $11.1 trillion by 2010 and Congressional Budget Office projections shows it increasing to approximately $14.6 trillion by 2015.  The annual gross interest on the debt was approximately $322 billion in 2004, and it will increase to approximately $561 billion in 2010 and to approximately $765 billion in 2015.

Bush has claimed his budget cuts the deficit in half in five years, and on paper it shows the reported deficit decreasing from approximately $412 billion in 2004 to approximately $207 billion in 2010.  While this might seem like progress, you need to take a closer look at the budget numbers to see the real story.  The gross federal debt increased by approximately $595 billion in 2004 and Bush’s budget shows it increasing by approximately $594 billion in 2010.  While the reported deficit shows a decrease, the annual increase in debt is virtually the same. Bush accomplishes this, in part, by taking the approximately $104 billion increase in the annual Social Security surplus and interest earned by the Social Security trust fund to make his reported deficit look lower.

Bush and the Republicans have made a point of identifying Social Security problems starting in 2018, but this is very misleading. Social Security will still be solid in 2018 and projected to be able to pay full benefits until 2042.  What we will have in 2018 is a budget problem caused by today’s irresponsible budget policies. Bush and the Republicans will no longer have the Social Security surpluses to help finance the deficits and they will have to start paying back the Social Security trust fund money they have spent.  Instead of taking responsibility for their policies, they are looking to blame Social Security and trying to find a way to avoid paying back the money they owe to it.

Here are the big problems with their private accounts plan. Bush and the Republicans will have to borrow money from the public to give to people to put in their private accounts and they do nothing to solve the future problems with Social Security. Even with the private accounts, there would be significant benefit cuts to make the system solvent.

If Bush and the Republicans are really interested in saving Social Security, they need to make the tough decisions today that will help lead to balancing the budget.  They can start by canceling the tax cuts that have been passed but scheduled to be implemented in the future.  An example would be the elimination of the estate tax on estates more than $3.5 million scheduled in 2010.  They can also reinstate the pay-as-you-go rules that helped to balance the budget in the 1990s. Most importantly, they can honestly report the true size of the federal deficit by implementing the Social Security lockbox.

There are some small changes we can make to Social Security that will help to extend the trust fund’s life, but it is today’s irresponsible budget policies that are the real threat.

Doug Stene is the 2nd Congressional District chairman of the Independence Party. Please send comments to [email protected]