The Social Security Obsession

Something to keep an eye on, the “Very Serious People” inside the beltway are at it again:Lawmakers Seeking Consensus On Social Security Overhaul, by Lori Montgomery, Washington Post: Key lawmakers from both parties have held tentative talks about overhauling the Social Security system, and Congress could turn its attention to the federal retirement program as soon as this fall if a bipartisan consensus emerges…

So far, Democrats have found a willing partner in the Senate, where Sen. Lindsey O. Graham (R-S.C.) has stated his desire to work with President Obama to make changes to keep Social Security solvent. … Graham said yesterday that he has spoken to Hoyer and Sen. Richard J. Durbin of Illinois, the second-ranking Senate Democrat, about the issue and that he stands ready “as a Republican to more than meet the president in the middle.”

“I know what it takes to get a solution,” Graham said. “I think we can get double-digit Republican support for a reasonable compromise. But the key to this, at the end of the day, is presidential leadership.”

Graham … sketched out a plan that would include lower benefits for wealthy Americans, a higher retirement age and additional revenues. With the stock market devastated by the recession, the traditional Republican option of diverting Social Security taxes to new private retirement accounts is, he said, “off the table.” …

Hoyer is expected to sketch out a similar plan in a speech today… According to an advance copy of the speech, Hoyer will suggest that Congress could approve “more revenues,” “restrain the growth of benefits, particularly for higher-income workers,” “and/or we can raise the retirement age, recognizing that our life expectancy is higher today.”

“What is missing here is not ideas — it is political will,” the speech says. …

“Right now energy and health-care bills are the major focus,” Hoyer said. But if those issues are finished by the August break, he said, “we could start focusing on . . . Social Security early this fall.” …

“At the end of the day, most Americans would embrace a balanced solution that did not require Draconian impact. They are ready to make some hard decisions for the benefit of future generations,” Graham said. “If there were ever a time to do it, it’s now.”

Remember that the “Beltway obsession with Social Security reflects ideology and fashion, not the real problems facing America.” They may think that they can wait until health care reform is completed before turning to this issue, but if they continue to have these meetings and push this agenda, there’s a good chance Social Security will become a bargaining chip during the health care debate. However, trading Social Security against health care is not an outcome I’d like to see. There is no pressing need to modify the Social Security program, fairly minor changes will solve whatever problems the program has, and there are many other possible tradeoffs within the budget that could fund a new health care system (on both the revenue and spending sides). But I’m sure conservatives would love the chance to pit these two porgrams against each other as part of the health care reform process.


Originally published at the Economist’s View and reproduced here with the author’s permission.