As the debate to get our nation’s finances in hand continues, a group of lawmakers recently warned budget reformers to “back off” from Social Security. Arguing that the nation’s pension program should be excluded from any discussions on budgetary reform, the lawmakers insist that Social Security is not a problem.
That kind of logic will get us nowhere. To get our nation’s finances under control, everything must be on the table, including entitlement and tax reform.
At best, that statement is a gross distortion of the truth. Yet the president’s budget waived the opportunity to address the looming fiscal crisis in Social Security (or any other of the major entitlement programs, for that matter).
Incredibly, one of the leading proponents of Social Security reform, House Budget Committee Chairman Paul Ryan, also bowed to political pressure and excluded from his so-called “brave, bold” budget any real plan to preserve this essential program.
As a moderate, fiscally conservative Democrat, I’m pretty much disappointed with everyone. For too long, Social Security has been “the third rail” of American politics — too politically charged to touch.
But we’re fast approaching the time when the program will be permanently paying out more than it brings in, making it inherently unsustainable. And this problem gets far worse the longer we wait to address it.
Consider the most recent Social Security Trustees’ report, which illustrates the looming funding challenges. Last year, Social Security paid out more than it collected in tax revenue.
By 2036, the Social Security Trust Fund will be exhausted, and Social Security will, according to statute, cut benefits by 23 percent if no steps are taken to overhaul the program.
Reform won’t be easy — it never is.
But a good place to start is President Barack Obama’s National Commission on Fiscal Responsibility and Reform, led by former Clinton chief of staff Erskine Bowles and former Republican Sen. Alan Simpson of Wyoming. The co-chairmen proposed a comprehensive plan in December 2010 to bring the federal deficit under control and place indispensable programs, such as Social Security, on stronger financial footing.
Take the commission’s assessment of the state of Social Security, for example. Before the program’s launch in 1935, the average life expectancy was 60 years while benefits did not kick in until several years after that. When Americans are now living to an average of 78 years, the program is ill prepared to continue working effectively.
And with fewer workers compared to the number of retirees, there is a serious mismatch between the numbers of those paying in to the system and those receiving benefits. This mismatch will grow only more severe with the retirement of the baby boom generation, which is already under way.
To address these challenges, the commission offers several common-sense proposals, including an increase in the retirement age, from 65 to 68 by the year 2050, to help account for increased life expectancy. Clearly, no one wants to increase the retirement age for future retirees, but I would suggest that cutting benefits by one quarter would prove far more difficult for all.
The good news is that there is still hope some policymakers in Washington will show the leadership necessary to meet this challenge. Perhaps the most notable efforts come from senators Saxby Chambliss, R-Ga., and Mark Warner, D-Va.
Their shared goal is to collaborate on legislation to address deficit reduction, budget reform and entitlement reform — including Social Security. The fact that these are all policy leaders with records of legislative achievement signals that this undertaking will be more than a back-bench effort.
It may seem as if reaching bipartisan consensus on contentious issues such as the budget and Social Security reform is an impossible goal.
But it’s worked before; I know, because I’ve seen it. I worked on Capitol Hill in the 1990s when President Bill Clinton worked closely with congressional Republicans to enact sweeping reforms to federal welfare programs.
As a staffer to then-Rep. Blanche Lincoln, D-Ark., a founding member of the moderate Blue Dog Democrats, I was there when the two parties worked together to get results for the America people.
The resulting bipartisan 1996 welfare reform package is justly celebrated as one of the significant policy achievements of our time.
I believe it’s time we bring a similar approach to tackling the challenges facing our entitlement programs. Social Security’s spending problem has become too big to ignore.
Enough of the “third rail” — let’s make it a first priority.
Kelly Bingel is a partner at Mehlman Vogel Castagnetti and a former chief of staff to Sen. Blanche Lincoln, D-Ark.
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