Tag Archives: entitlement reform

In the Social Security Debate, Today’s Democrats Are Worse Than Yesterday’s Republicans

Having “retooled’’ his Presidency for a more open accommodation of the center right, Obama will soon be overseeing the battle to launch a dismantling of the Social Security system.

His government has, from the start, been reminiscent of the Clinton years, so it’s safe to say that we can expect more triangulation. Clinton’s adoption of Republican tropes led him to fulfill some of the conservatives’ fondest dreams: His administration countenanced the demise of the banking regulations originally established by the Depression-era Glass Steagall Act, and the destruction of the welfare system established in the 1930s and expanded in the 1960s. Obama will provide much the same function on Social Security. Without entirely destroying the popular program, he will support cuts that go beyond anything that should rightly happen during a Democratic administration.

Of course, the Democrats will say that it isn’t their fault: It all happened because of that horrid Tea Party, dragging conservative Republicans even further to the right. This suggests that Democrats had no choice but to head them off at the rightward pass, as if standing and fighting simply wasn’t an option—and as if they didn’t still hold the Senate and the White House.  

What makes this especially disconcerting, for anyone who has lived long enough to remember earlier political eras, is how favorably the Republicans of the past compare to the Democrats of the present on many points.

Tracking back to the New Deal, one can find Senator Robert A. Taft of Ohio—the most prominent conservative Republican of his time, later identified by John F. Kennedy in Profiles in Courage as one of the five most important senators in history–registering his support for Social Security. A champion of private enterprise and enemy of labor unions, Taft bashed Roosevelt’s “socialistic” programs every which way, fighting to reduce runaway government and even opposing entry into World War II. But at the height of the Great Depression, he also supported the new Social Security program, as well as public housing and public education.

Taft embodied the tenets of Main Street middle western life before the Second World War. And he was not unreservedly laissez faire, nor was he anti-government. He believed in the intervention and utility of the federal government where he deemed it necessary, and that included providing an adequate, if not generous, public welfare system.

Taft ran for president three times and never made it. But Eisenhower, the war hero who became a popular Republican president, carried some of these same basic tenets into the postwar era. Eisenhower was not opposed to federal intervention in the economy and, for example, backed the creation of an interstate highway system, which became a vast public works program. And Eisenhower not only supported Social Security, but took steps to enlarge the program. According to the Eisenhower Memorial Commission:

Dwight Eisenhower was the principal force behind the greatest single expansion of Social Security beneficiaries in the history of the program. He led the legislative drive to add over ten million Americans to the system. Here’s how it developed.

When the Social Security Act became law in 1935 its purposes were primarily aimed at factory workers and other employees of business organizations. The legislative process leading to passage of the law was both lengthy and contentious. Large numbers of working American’s were left out of the original Old Age and Survivors Insurance coverage. No major changes in the Social Security law had been made since its initial passage.

During the presidential campaign of 1952, candidate Eisenhower made it clear that he believed the federal government played a rightful role in establishing the Social Security system, but he made no promises concerning its future. However, after the election it became clear that the Republicans would have control, by slim margins, of both the House of Representatives and the Senate. This changed the political and legislative landscape considerably.

Previously, expansion of the Social Security system or increasing the level of payments to retired Americans had been given no chance to succeed in the Congress because there were enough conservative Democrats (and the majority of Republicans) who would vote against such bills. With a Republican President it now appeared likely that the majority of congressional Republicans would honor their President and support his initiatives. Among the new legislative possibilities, action on Social Security now seemed possible.

Thirteen days after taking his oath of office, President Eisenhower delivered his first State of the Union message to Congress and, when discussing the need for greater effectiveness of government programs, he said, “The provisions of the old-age and survivors insurance law should promptly be extended to cover millions of citizens who have been left out of the social security system.”

The following week, during a White House meeting of the House and Senate Republican leadership, Eisenhower brought up the Social Security expansion proposal and asked America’s most famous living conservative, Senator Robert A. Taft, if he would support the initiative. When he received a positive reply he knew that the possible had just become the probable. Before the end of the month, Eisenhower appointed a presidential commission to study the Social Security system’s deficiencies and submit a detailed report on specific reform measures. In his public statement creating the commission, the President said, “It is a proper function of government to help build a sturdy floor over the pit of personal disaster, and to this objective we are all committed.”

Those opposed to the initiative stressed their belief that retirement income was the responsibility of every individual and the federal government should not be involved. One citizen should not have to pay for the old age necessities of another. President Eisenhower responded to this notion during his press conference on June 17, 1953 with these remarks: “A strict application, let us say, of economic theory, at least as taught by Adam Smith, would be, ‘Let these people take care of themselves; during their active life they are supposed to save enough to take care of themselves.’ In this modern industry, dependent as we are on mass production, and so on, we create conditions where that is no longer possible for everybody. So the active part of the population has to take care of all the population, and if they haven’t been able during the course of their active life to save up enough money, we have these systems.”

You know it’s a measure of how far this country has moved to the right that someone like myself could wax nostalgic for the likes of Dwight Eisenhower and Robert Taft. (Next stop: Remembrances of the Nixon years, when the richest Americans were taxed at a rate of 70 percent.) Yet now we see the historic approach of these two major Republicans figures—the icon of the Senate and the storied war hero—submerged beneath the threat of the Tea Party adherents. And it is all happening under the listless hand of Obama, while the Democratic mainstream sits passively back and watches the demise of the programs that made their party great.

In the end, history most likely will judge that the final blows against the New Deal came not from the Republicans, but from weak or opportunistic Democratic politicians–first Clinton, then Obama.

The Peterson Foundation’s Retirement Plan: Debtors Prisons

For readers interested in the emerging entitlement wars, and the insidious influence of Pete Peterson’s anti-entitlement campaign on the public debate (and, apparently, on Obama’s Deficit Commission), yesterday’s post on “Entitled to Know,” the blog of the National Committee to Preserve Social Security and Medicare, needs no introduction. I’m quoting the post in full, but you can click through to the original post to watch the segment on CNBC–and while you’re there, subscribe to the blog to receive the latest information on these issues. 

Apparently, these are the “good-old days” our nation’s fiscal hawks relish.  The Peterson Foundation’s David Walker co-hosted CNBC’s Squawk Box this morning (personally, we yearn for the good-old days when so-called “news” shows were hosted by journalists—not partisan advocates—but that’s another debate). 

The discussion followed the classic Peterson Foundation talking points—government bad, business good—but ultimately led to a nostalgic reminiscence for the good old days when Americans faced debtors prisons and had no sense of “entitlement” (presumably to the Social Security and Medicare benefits workers have funded for their entire working lives):

“The fact of the matter is we have to change how we do things. We are on an imprudent and unsustainable path in a number of ways. You talk about debtors prisons, we used to have debtors prisons, now bankruptcy is no taint. Bankruptcy is an exit strategy. Our society and our culture have changed. We need to get back to opportunity and move away from entitlement. We need to be able to provide reasonable risk but hold people accountable when they do imprudent things…it’s pretty fundamental.”… (David Walker, Peterson Foundation, CNBC Jun 10, 2010)

Now, maybe in the Peterson Foundation’s circle of Wall Street types and multi-billionaires, bankruptcy is an exit strategy, but for millions of middle-class Americans bankruptcy is, in fact, a life-altering and often debilitating choice.  As for pitting “opportunity” vs “entitlement”—that’s classic Peterson Foundation messaging designed to convince us that America’s seniors are somehow riding high on the hog and soaking taxpayers with all of their “entitlements”. 

Of course, these fiscal hawks never mention that fact that the government doesn’t pay for those “entitlements”, American workers do. It’s not the government’s money…it’s not Wall Street’s money…and those so-called “entitlements” have been paid for by you and me.  The truth is, retirees are entitled to receive the benefits they’ve been promised; however, fiscal hawks like David Walker would apparently rather roll back the clock, ignore those promises, and build more debtor’s prisons.

Pete Peterson’s Anti-Entitlement Juggernaut

When Obama’s new deficit commission gets going, it intends to be “partnering“–in the words of executive director Bruce Reed –with outside groups. Among them will be the foundation run by Wall Street billionaire Peter G. Peterson, who on Wednesday will upstage the president with his own fiscal summit in Washington. Obama insists he is keeping an open mind about how to deal with the deficit and national debt–but as I’ve written before, he’s already stacked his own commission with people who lean heavily toward one particular solution: cutting entitlements. And now he is working hand-in-glove with a wealthy private organization whose central purpose is to cut Social Security and Medicare. Talk about foregone conclusions. 

Pete Peterson: Beating a Dead Horse

Peterson, according to Forbes, was the 149th richest man in America last year, with $2.8 billion in assets. During his long career he has been, among other things, CEO of Bell & Howell,  head of Lehman Brothers, a co-founder of the Blackstone Group, and head of the Council on  Foreign Relations. He was Nixon’s Secretary of Commerce, and in 1994 served on a Clinton bipartisan commission on entitlements and tax reform. He launched his own Peter G. Peterson Foundation with a grant of $1 billion.  

A fiscal conservative, Peterson has long been issuing dire warnings about the the nation’s skyrocketing debt. The key cause of the problem, in his analysis, is that entitlement programs–primarily Social Security and Medicare, but Medicaid as well–are out of control; the only solution is to cut them. Peterson is the self-appointed head of what some people have begun to call the “granny bashers,” who argue that greedy geezers are ruining the lives of younger generations with their unconscionable demands for basic healthcare and a hedge against destitution. (Peterson himself is in his eighties–but of course he’s too rich to worry about such things.)  

The granny bashers’ real agenda, of course, is to cut the social safety net programs that they have long abhorred–but they have gained far more ground with their intergenerational inequity claims than they ever would with a straight-out attack on Social Security and Medicare. The majority of the Washington punditry seem to have fallen for it–and so too, apparently, has the White House. A year ago in Newsweek, Peterson wrote: 

For the first time in my memory, the majority of the American people join me in believing that, on our current course, our children will not do as well as we have. For years, I have been saying that the American government, and America itself, has to change its spending and borrowing policies: the tens of trillions of dollars in unfunded entitlements and promises, the dangerous dependence on foreign capital, our pitiful level of savings, the metastasizing health-care costs, our energy gluttony. These structural deficits are unsustainable. Herb Stein, who served alongside me in the Nixon White House as chairman of the Council of Economic Advisers, once drily observed, “If your horse dies, I suggest you dismount.” And yet, we keep trying to ride this horse. 

In June, according to the Washington Post,  Obama’s deficit commission will be participating in a 20-city electronic town hall meeting, put together by an organization called America Speaks. It is financed by Peterson, along with the MacArthur Foundation and Kellogg Foundation. This is a truly unusual event because it marks the first time a presidential commission’s activities are financed by a private group that has long been lobbying the government on the very subjects the commission is supposed to “study.” 

The Peterson summit is crammed with luminaries in finance and government. First there’s the keynoter, Bill Clinton. Then there’s Alan Greenspan, the Federal Reserve chairman widely credited with getting us into our current economic mess, and Paul Volcker, his conservative predecessor at the Fed. Robert Rubin, Clinton’s secretary of the Treasury, and another pillar of the current economic debacle, will speak. So will Republican Congressman Paul Ryan, a leading GOP guru, who among other things wants to replace Medicare with a system of vouchers and tax breaks. Judd Gregg, the senior and probably most important conservative senator when it comes to finance, will be featured as well; he is a keen  proponent of Peterson’s entitlement cuts. 

The heavy hitters are all to be interviewed by big names in mainstream media: ABC’s George Stephanopolous will question his old boss Clinton; Leslie Stahl will speak with presidential commission co-chair Erskine Bowles, one of Clinton’s a White House chiefs of staff. Ranked below the big guys are a slew of lesser lights including some liberals like Lawrence Mischel of the Economic Policy Institute, Robert Greenstein of the Center for Budget and Policy Priorities, John Podesta of the Center for American Progress (and another former Clinton chief of staff), and former Congressional Budget Office head Alice Rivlin. 

All-in-all, it seems to be dominated by Clinton-era officials, who oversaw much of the Wall Street deregulation that nearly drove the country broke. These are the people who will now try to make up the losses on the backs of the poor and the old by rewriting the hard-won entitlement programs created during the New Deal and the War on Poverty. 

Meanwhile Obama–who seems to have learned nothing about strategy from the health care wars–will not say what he thinks about any of it. Instead, he prefers to sit on the sidelines and see what these people come up with–as if that horse wasn’t already out of the barn.

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Debt Commission Chair Alan Simpson Thinks “This Country is Gonna Go to the Bow-wows”

For more than a year, I’ve been joining with a handful of other critics in warning that all our economic woes–the costs of the financial meltdown, and the bank bailout and stimulus spending that followed–would eventually be placed square on the backs of our so-called old-age entitlements: Social Security and Medicare. And lo, it is coming to pass, via President Obama’s euphemistically named National Commission on Fiscal Responsibility and Reform–commonly called the Deficit Commission or the Debt Panel.

Despite the names, no one is even trying very hard to pretend that the commission has any purpose other than cutting Social Security, Medicare, and probably Medicaid as well. That choice was clear from the get-go, based on Obama’s choice of Alan Simpson to co-chair the commission. The former Republican senator from Wyoming has already described his mission as “saving” the United States from “insolvency” by hacking away at entitlements. And if we want any more proof, we need only look at Simpson’s background, as detailed by Saul Friedman in his latest “Gray Matters” column:

This time President Obama, in his obsessive reaching across the political aisle, may have gone a stretch too far. For the Republican he picked to co-chair the so-called deficit reduction commission, former Sen. Alan Simpson, has been a harsh critic of Social Security and Medicare. And he sought to destroy their most powerful defenders, especially AARP.

That was 15 years ago, but as recently as 2005, Simpson, a conservative from Wyoming who left the Senate in 1997, supported attempts by President George Bush to privatize Social Security by turning part of the pension and insurance program into millions of individual investment accounts, which by now would have lost 20 percent of their value. Bush’s plan failed, largely because of the opposition of AARP and other advocates that Simpson sought to discredit.

Even now, Simpson, who should know better, conflates or deliberately confuses Social Security’s long term fiscal problems, which are minor, with its supposed contribution to the federal deficit, which is almost nil.

In an interview with the NewsHour after his appointment, Simpson said of Social Security, “You have two choices…you either raise the payroll tax or decrease the benefits or start affluence testing. The rest of it is B.S. And if the people are really ingesting B.S. all day long, their grandchildren will be picking grit with the chickens. This country is gonna go to the bow-wows unless we deal with entitlements, Social Security and Medicare.”

Simpson insists that he is keeping an open mind. He told the Wall Street Journal that he didn’t like politicians who “demonized” their opponents: “Instead of saying this guy’s ideas are as goofy as a peach orchard boar, they are saying this guy is as goofy as a peach orchard boar. I won’t demonize people.” But its eminently clear whose ideas Simpson agrees with. In an interview on CNBC, Simpson referred to cutting entitlements as “correcting Social Security.” 

Simpson also told old people and their advocates to stay out of the debate, since the cuts would only apply to younger people.

You remember the last time we corrected Social Security, and people calling me.  Let me tell you, everything that Bush and Clinton or Obama have suggested with regard to Social Security doesn’t affect anyone over 60, and who are the people howling and bitching the most? The people over 60.  This makes no sense.  You’ve got scrub out [of] the equation the AARP, the Committee for the Preservation of Social Security and Medicare, the Gray Panthers, the Pink Panther, the whatever. 

There’s an interesting twist to Simpsons argument. Usually, we geezers are accused of being greedy and selfish for opposing entitlement cuts that would affect us. We’re told we should be willing to give up some of our government handouts for the good of future generation. This time we’re being attacked because we might actually care about the next generation, who won’t even be able to count on the modest social programs we enjoy.

But Simpson himself says he’s doing all this for his grandchildren, according to US News and World Report. (Warning: This quote contains more animal metaphors.)

There are six little people running in and out of my house, called grandchildren, who are absolutely just little lambs led to slaughter. They are totally uncomprehending. They have no idea that when they reach 60—under the present system—they’ll be picking grit with the chickens.

This would be quite noble if not for the fact that Simpson wants to cut his grandkids’ Social Security (presumably because he thinks the debt threatens them even more?) And if not for the fact that there is no crisis looming for the future of Social Security. Any long-term shortfalls in the system could be fixed with a minor adjustment:  raising the ceiling on earnings subject to Social Security taxes, which currently stands at $106,000. Obama himself has suggested this in the past.

More importantly, as Friedman points out.

Social Security’s long term fiscal problem has nothing, absolutely nothing, to do with Social Security’s role in the deficit. For, as I have emphasized in my column for years, Social Security costs the budget not one cent-aside from the one percent it spends on its thousands of employees and field offices. Indeed, Social Security helps finance the deficit by loaning the treasury money, for which it earns interest (about $700 million a year.) If what’s owed to Social Security must be cut as part of deficit reduction, will that help Social Security?

As for Medicare, the only way to deal with its fiscal problems are through comprehensive health care reform to address the skyrocketing cost of privatized medicine.

The real contributors to dangerously high deficits are health care costs and military spending, along with undertaxing of the rich. This means that what the “debt commission” really ought to be doing is raising taxes on the highest earners, getting us out of two wars, and instituting single-payer health care. But as Alan Simpson might say, that dog won’t hunt.

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David Brooks Goes After Greedy Geezers

David Brooks wants to pull the plug on us greedy, grasping old folks. Or more accurately, he wants us to pull the plug on ourselves, by giving up our generous “entitlements” and submitting to Social Security and Medicare cuts. We should be more than happy to do this, he says, out of an altruistic urge to rescue younger generations from misery and penury. Too bad Brooks fails to mention that what really needs rescuing is the nation’s system of social inequality and corporate greed.

In his Monday New York Times column, called “The Geezer’s Crusade,” Brooks zeros in on one of the increasingly popular straw men of our times–that enemy of the people known as the Greedy Geezer.

Dripping with condescension, Brooks runs through a list of all the wonderful things that come with old age in the 21st century. Instead of sinking into dimwitted oblivion, the modern geezer–lo and behold–is actually able to think and function. “Older people retain their ability to remember emotionally nuanced events. They are able to integrate memories from their left and right hemispheres. Their brains reorganize to help compensate for the effects of aging.” Brooks even has scientific proof for his claims: “A series of longitudinal studies, begun decades ago, are producing a rosier portrait of life after retirement,” he writes. According to these studies, old people “become more outgoing, self-confident and warm with age.” We “pay less attention to negative emotional stimuli,” and are just plain happier than the middle-aged.

Yet despite all these bountiful gifts (which undoubtedly offset such minor inconveniences as not being able to walk, see, screw, or control our bladders), we old coots just can’t shake the selfish idea that we ought to get a little help from society in our golden years. After working, raising and educating our kids, and paying taxes all our lives, we Greedy Geezers now want to sit back and rake in our “entitlements”–Social Security and Medicare. Can’t we see that in doing so, we are actually stealing  from the young, denying them a future, and worse, driving the nation into bankruptcy? Brooks writes:

Far from serving the young, the old are now taking from them. First, they are taking money. According to Julia Isaacs of the Brookings Institution, the federal government now spends $7 on the elderly for each $1 it spends on children.

Second, they are taking freedom. In 2009, for the first time in American history, every single penny of federal tax revenue went to pay for mandatory spending programs, according to Eugene Steuerle of the Urban Institute. As more money goes to pay off promises made mostly to the old, the young have less control.

Third, they are taking opportunity. For decades, federal spending has hovered around 20 percent of G.D.P. By 2019, it is forecast to be at 25 percent and rising. The higher tax rates implied by that spending will mean less growth and fewer opportunities. Already, pension costs in many states are squeezing education spending.

In the private sphere, in other words, seniors provide wonderful gifts to their grandchildren, loving attention that will linger in young minds, providing support for decades to come. In the public sphere, they take it away.

Brooks doesn’t specify the exact reforms necessary to correct this cancer on society, but we all know what they are: We need only reduce the entitlements, along the lines Pete Peterson has been strenuously advocating. That can be accomplished by setting up an Entitlement Commission to impartially hand down “fast-track” cuts to old-age entitlement programs, tell Congress what it has to do, and get the economy back on course. When Obama sees the happy-times oldster lolling about on his houseboat in the Florida Keys, he ought to react the way Reagan did when he observed the “welfare queen” who was supposedly ripping off  taxpayers: Cut off the supply of federal funds, and stop letting the Greedy Geezers feed at the public trough.

If it isn’t politically expedient to cut us off (because we darned geezers insist upon voting), then convince us to do it to ourselves. What Brooks calls the Geezer’s Crusade is an imagined “spontaneous social movement” by elders to reduce their own benefits. He writes:

It now seems clear that the only way the U.S. is going to avoid an economic crisis is if the oldsters take it upon themselves to arise and force change. The young lack the political power. Only the old can lead a generativity revolution — millions of people demanding changes in health care spending and the retirement age to make life better for their grandchildren.

Brooks has audacity, I’ll give him that. Too bad his premise is as phony as a three-dollar bill. But Brooks is far from alone in advancing what I call the Myth of the Greedy Geezer, in which old people’s selfish attachment to their entitlements is the primary cause of the nation’s economic woes, and entitlement cuts are the only solution. The myth is circulated by pundits of all political stripes, and graces the editorial pages of some of the nation’s largest newspapers.

This fabrication serves a myriad of purposes. It substitutes a phony intergenerational conflict–a phantom battle between young and old–for the real conflict in American society: the conflict between the interests of poor and middle-class people, who pay more than their fair share, and the corporations and wealthy elite, who get an easier ride in America than they do anywhere in the developed world.  

In the past 30 years, according to Congressional  Budget Office data, the income of the top 1% of Americans has risen 176%, while the middle fifth have seen a 21% growth in income, and the poorest fifth just 6%. But hey–why talk about taxing the rich when you can balance the budget on the backs of those Greedy Geezers?

Wall Street had to be bailed out to the tune of $1 trillion, and they’re back to business as usual. But why take measures that might “stifle” the “freemarket” when we can just cut Social Security instead? (And never mind that the Greedy Geezers saw their retirement savings decimated and their home values plunge; they’ll manage.) 

Millions of Americans suffer and even die from inadequate health care, and medical costs drive thousands into bankruptcy every year. But why should we expect the drugmakers and insurance companies to reduce their hefty profits, when we can just reduce Medicare payments to those Greedy Geezers? After all, does grandma really need that hip replacement when it means taking money out of the hands of her grandchildren? Should grandpa have a triple-bypass, just to get a few more years of life, when it means bankrupting the country?

What we have here is a classic bait-and-switch. Politicians are talking about the urgent need to cut Medicare because Democrats and Republicans alike won’t take on the real enemies of affordable health care–the insurance companies, Big Pharma, and other providers of medicine for profit. They’re saying we have to “reform” Social Security (a program which, compared to Citibank and Goldman Sachs, is a model of financial solvency) because they are unwilling to really take on Wall Street. They’re devising ways to skim off of entitlements, which have lifted millions of old people out of dire poverty, because they won’t consider a more “socialist” tax structure–like, for example, the one we had in the United States during the Nixon Administration.

In the long run, the Myth of the Greedy Geezer also serves one of the most cherished items on the conservative agenda: permanent cuts to core social safety net programs that date back to the New Deal and the War on Poverty. Commenting on Pete Peterson and the other right-wing “granny bashers” last year, Dean Baker of the Center for Economic and Policy Research wrote: “It should be evident that the granny bashers don’t care at all about generational equity. They care about dismantling Social Security and Medicare, the country’s most important social programs.” 

This quest just got a potentially big boost from David Brooks and his “Geezer’s Crusade.” I just hope we geezers don’t fall for it.

(For another take on Brooks’s piece, I recommend this post by FireDogLake’s pithy “Earl of Huntingdon.”)

The Phony Age Gap War

In “Politics and the Age Gap,” featured in yesterday’s New York Times, Adam Nagourney adds to the litany of recent articles that position old people as a primary obstacle to health care reform. In part, the target of these pieces is the tea party geezers who rant about socialism–but it goes well beyond that. Seniors tend to be depicted, explicitly or implicity, as obstinate or selfish because they fear cutbacks in Medicare will be made in order to provide health care for younger people. What’s more, they refuse to accept that Medicare must be cut back to keep it from going bankrupt before younger generations even get to use it. Thus, the argument goes, what’s really going on in the health care struggle is a fight by the old against the young, in which we miserly old coots are unwilling to give up what we’ve got for the sake of the greater good. “As the population ages and the nation faces intense battles over rapidly rising health care and retirement costs,” Nagourney writes, “American politics seems increasingly divided along generational lines.”

But the whole intergenerational conflict is a phony one. This health reform debate is about substituting a trumped up intergenerational war for what ought to be class war–pitting the old against the young, instead of pitting the rich against the poor, or the corporations against the little guy. 

If health reform moves forward, there surely will be cuts to Medicare–that isn’t some fantasy of demented old folks. And you can be sure the cuts won’t only apply, as promised, to “waste and inefficiency.” But the real scandal is this: The only reason that any cuts at all need to made to Medicare is because pols are unwilling to cut the profits of insurance and drug companies. That’s where the money to finance health reform really should be coming from.

In other countries, single-payer systems deliver better health care at far lower cost.  If we did the same here–or at least made moves in that direction–there would be enough for everyone. We could have Medicare for all–the young as well as the old.

But that, of course, wouldn’t serve the interests of corporations or their conservative cronies. The interests in question are not only those of the drug and insurance companies, but of the financial giants on Wall Street. As Dean Baker of the Center for Economic and Policy Research wrote back in January:

The classic definition of “chutzpah” is the kid who kills both of his parents and then begs for mercy because he is an orphan. The Wall Street crew are out to top this. After wrecking the economy with their convoluted finances, and tapping the US Treasury for trillions in bail-out bucks, they now want to cut Social Security and Medicare because we don’t have the money.

And here’s what I myself wrote on the subject a while back:

Advocates for the preservation of so-called old-age entitlements have been warning for some time that Social Security and Medicare may be offered up as a sacrifice to offset the cost of the bailout and stimulus. This would suit conservatives, who for years have been looking for ways to undermine the popular programs. Leading that charge are the the “granny bashers” hunkered around the Peter G. Peterson Foundation. With an endowment of $1 billion, the Foundation pursues an agenda that consists mainly of bitching and moaning that greedy geezers are taking money away from poor young things with their unconscionable demands for basic health care and income support. With increasing support from the media, the punditry, and some members of Congress, they warn that aging boomers will soon bankrupt the country and destroy the lives of future generations.

These dire predictions are surfacing again–but what’s now driving the move toward entitlement cuts isn’ t the bailout, but health care reform. And because Democrats aren’t willing to stand up to the force that’s most reponsible for soaring health care costs–the U.S. system of medicine-for-profit–they are playing right into this hand, jumping on the Medicare-cutting bandwagon.

In the end, old folks are likely to end up getting screwed by Medicare cuts–right at a time when we’ve already been screwed from several other angles. More from Dean Baker

The recent collapse of the housing bubble and the resulting stock market plunge have reduced the wealth of older workers and retirees by close to $15 trillion. This is a transfer to the young, since they will be able to buy the housing stock and the corporate capital stock for a far lower price than they would have expected to pay just two years ago.

Remarkably, the granny basher crew has somehow failed to notice this enormous transfer of wealth from the old to the young. They just continue their crusade to cut Social Security and Medicare as though nothing has happened.

It should be evident that the granny bashers don’t care at all about generational equity. They care about dismantling Social Security and Medicare, the country’s most important social programs. It is important that the public recognize the granny bashers’ real agenda so that they can give them the respect they deserve.

In view of all this, it’s no surprise that old folks have started to get paranoid, feeling like our country is getting ready to sweep us out with the trash. Too bad so many old people are wasting their  time tilting at bogus adversaries like the death panels, instead of at their real enemies of their golden years.

Phony Social Security “Crisis” Is Fueled by New Report

Yesterday I wrote about the new rounds to come in the phony crusade to “save” Social Security from bankrupting the country and destroying the lives of our grandchildren. This manufactured crisis has gained new traction during the recession. It is likely to be used by conservatives (apparently with some cooperation from the Democrats) in a quest to cut old age entitlements–in effect taking money away from elders to pay for the Wall Street bailout.

I mentioned that, contrary to the overheated rhetoric, Social Security was projected to remain solvent for at least three decades (the exact number was 32 years, until at least 2041). Today, according to the AP, that figure has been downgraded to 28 years. The trustees for Social Security and Medicare now project that the trust fund could run out in 2037, due to the reduction in payments into the fund as a result of the recession’s job losses.

This means that in terms of solvency, the giant government program is still running 28 years ahead of Citibank, Bank of America, and the other behemoth private financial institutions run by the high-paid geniuses of Wall Street (and much longer, if you count the years when the bubble was expanding). In addition, the Social Security trust fund is still in better shape than it was a decade ago, according to the Center for Budget and Policy Priorities

As for Medicare, which actually is in pretty bad shape–that cannot be “fixed” by even the mot draconian cuts to the health care of the nation’s elders. The only long-term solution to the Medicare shortfall must come through comprehensive reform that reduces the private profits of the health care industry.

In spite of these fact, the trustees’ report is already being brandished by proponents of entitlement cuts. Within hours of the report’s release, a new post on the Cato Institute’s blog was warning that it “shows that the program’s financial crisis is growing worse while Congress has continued to duck the issue.” As for the solution–even the financial meltdown that has decimated all of our 401(k)s is not enough to avert the likes of Cato from its true agenda:

critics of personal accounts for Social Security have pointed to the decline in the stock market over the last few years as an argument against allowing younger workers to privately invest a portion of their Social Security taxes. Yet as the new Trustee’s Report shows, the same poor economy that hurts the stock market, hurts Social Security’s ability to pay its benefits.

In the end, there are only three possible solutions to Social Security’s problems. Taxes could be raised (and the Social Security payroll tax would have to be nearly doubled to keep the program afloat). Benefits could be cut. Or younger workers could be allowed to invest privately.

And there we are: In two easy step, we’ve returned to the most cherished–and most discredited–domestic policy objective of the Bush Administration, the privatization of Social Security.