Social Security: An Issue to be Conservative About
Recent polls have shown fewer and fewer people to be in favor of President Bush’s plan to privatize Social Security. For me, the issue of Social Security reform has been one of great interest. Curiously enough, this interest initially came from the fact that I did not know why I was supposed to oppose it.
At his State of the Union Address, President Bush told the nation that there was a Social Security crisis. He then suggested an interesting way of dealing with the crisis and fixing the failing system—privatization. The boost of Democratic opposition showed that they stood firmly against this plan, but as I waited for their counter-suggestion, it became clear to me that the Democrats did not have one. The President had spotted a problem and suggested a solution. His opposition seemed to be taking the strangely conservative stance of sticking to the status quo instead of trying to make improvements.
I was incredibly confused by this. Do Democrats dislike Bush so much that they are willing to condemn America’s elderly population to poverty just to oppose him? Their decision did not seem to be liberal or progressive at all, just anti-Bush. What was going on here?
What was going on was that the Democrats had realized that there was no Social Security crisis. As more Americans became aware of this, it also became increasingly clear that even if there were a crisis, the President’s plan would not provide any kind of solution. Privatization only succeeds in phasing out the Social Security program, not improving it.
According to the Social Security Trustees report, Social Security can continue to operate as it has been, with no changes, through the year 2042. After that, benefits will have to be reduced, but they will still be higher than the benefits current retirees receive. This can be averted with a small increase in the payroll tax, which is the tax that funds Social Security. Many people do not realize that it has been necessary to raise this payroll tax several times throughout the history of the program. Since Social Security can exist in its present form for the next 37 years without any changes, the program is quite literally sounder than it has ever been.
The President’s plan would not bring more money into the Social Security system. What he proposes to do is to cut both Social Security taxes and benefits so that workers can put some of their Social Security money into private funds. Since less money would be coming into the system, this would require massive federal borrowing to pay current high benefits. More importantly, though, once the period of transition ended, Social Security would not be a better program, it would just be a smaller, less effective one.
Social security is not in danger. The President has only suggested that it is in danger so that he can make significant changes to the program. Democrats do not oppose the plan because they are trying to be anti-Bush or because they are ideologically opposed to private retirement funds; they oppose it because there is no imminent reason to change the current system. That is a very conservative motivation, but maybe just this once it’s worth being a little conservative.
Front Page (March 31, 2005)
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