Peruse news analyses, and you learn that few have been talking seriously about the single most important domestic issue facing the federal government — the fact that baby boomers are lining up to begin retiring in a few years and what that will mean to entitlement programs and consequently to the federal budget, the economy and intergenerational peace.
If nothing is done — if Social Security, Medicare and Medicaid are not restructured so as to hold costs down as the number of recipients mushrooms and the number of workers supporting the programs dwindles — we will have a mess of mammoth proportions.
In terms of the annual budgets we now have, just 25 percent would be left for anything but these programs a quarter century from now, one observernotes.
If you raised taxes to meet the costs, you would dramatically lower the standard of living of younger, employed people, and if you turned to today’s favored solution for budgetary mayhem — borrowing — you would risk wrecking the economy. In fact, either of those devices would give you a crisis both politically and economically, and so what you have to do is start yesterday in bringing down the publicly financed expenditures.
President Bush had a long-term answer for Social Security, voluntary personal accounts that would have raised part of what’s needed through long-term investments in stocks and bonds, even enabling low-income families to have substantial savings by retirement time and boosting economic growth. That wasn’t an entire answer to the shorter term issue, and so in the spring of last year, Bush also proposed a Social Security formula change under which the richest among us would still get the same buying power as benefits provide today, but not as much money as they would get if you did not deal with embedded increases. The least rich would get those increases.
But Democrats killed both these ideas with their irresponsible screeching and were aided in the process by news stories that largely missed the point. I remember talking to a reporter for a prestige paper who said the second Bush proposal would decrease benefits — actually, it would merely have adjusted a formula that has been adjusted before. At any rate, she said, the real problem was Medicare, which is like saying don’t worry if a house is burning down on this side of the street because a bigger house is burning on the other side of the street.
Medicare, though, is indeed a bigger problem than Social Security, and Bush’s increase in drug benefits was not only a politically convenient piece of trickery that contradicted his previous position on the issue, but a further hindrance to ever getting that program under reasonable control. Wouldn’t it be nice if the Republicans had the courage to fight for principle, or if the opposition party had broad proposals about cutting costs other than their fringe, uncomprehending notions of reimporting drugs from Canada or bashing drug companies as villains? This stuff may play well in Peoria, but it’s as much balderdash as the broader accusation that, deep down, the Republicans are only happy if the elderly are eating dog food.