The future health of Social Security depends on political courage
There are no comments for this page [ Add Comment ]Thursday, September 6, 2007
By Doug Gibson
Commentary
Referring to President Bush's unsuccessful attempt to reform the Social Security system in 2005, Rep. Rob Bishop was quite candid with the Standard-Examiner editorial board last week.
"Bush was right, Congress was wrong," Bishop said.
Bishop -- like the president -- favors an ownership-based Social Security system, where an investor would retain money accumulated after he or she dies.
Bishop would not change the present system for current retirees. Their returns would stay the same.
The congressman wants to include the option of investing a portion of Social Security in the private sector. The money, to be invested in historically stable investments, would accumulate interest over the years.
Retirees would have a nest egg saved that they could enjoy, or leave for their children.
Bishop says this is how states invest retirement funds. He says it is time for the federal system to do the same.
"If you are putting Social Security money into the private sector, you will grow the economy," Bishop said.
The current Social Security system, Bishop says, is a pay-as-you-go system where current workers support retirees. He is blunt about what will happen if we don't fix the problem of how to pay for an increase in retirees now.
"If we continue on the present path, we will either have a 50 percent reduction in benefits, or we have to double the taxes," Bishop said.
Bishop is correct. Despite politicians' rhetoric of Social Security lockboxes, there is no pile of Social Security cash just sitting there. The surplus is spent to mask much of the national debt. More baby boomers are retiring and that brings down the worker-to-retiree ratio needed to keep Social Security going.
It was once 20 workers to one retiree. It is now about three workers to a retiree. Soon it will be two workers to one retiree. Not long after that what comes in won't pay the Social Security bill. I don't like the idea of my children paying for my retirement.
Bishop told the editorial board changes to ensure Social Security's solvency would be easy to make.
In theory, perhaps. The big question, though, is, will the political class have the gumption and courage to change the system?
It is depressing to say this, but I doubt politicians do.
The president's Social Security initiative had a disastrous fate. Although there were several other reasons -- ethics, Katrina, Iraq, sex scandals -- many regard Bush's Social Security reform initiative as one reason Republicans lost Congress.
Democrats demagogued the issue, appealing to peoples' fears. Many Republicans behaved like cowards, allowing the issue to die without defending the president's initiative.
It could have passed. The then-GOP Congress could have tried to put it in a budget bill, avoiding a filibuster, or they could have used the so-called nuclear option of 51 votes to kill a filibuster. Those would have been unconventional, even drastic, steps, but the point is, the votes were there to reform Social Security.
What's missing is the will.
It is discouraging to see Congress punt on so many important issues, including Social Security, immigration, Medicare, ethics reform ... . Change is glacial or nonexistent because too many members of Congress are more concerned with political survival than making tough, necessary decisions.
It's a shame the court short-circuited mandated term limits when there was momentum for that issue 15 or 20 years ago.
If some politicians only had to worry about six years in office, or eight, or even 10, they might not get all panicky when confronted with a correct, but unpopular decision.
Gibson is the Standard-Examiner's assistant editorial page editor. He can be reached at dgibson@standard.net.
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