“Social Security does not add one penny to our debt, not a penny,” Sen. Dick Durbin of Illinois, the No. 2 Democrat in the Senate, insisted Sunday on ABC’sThis Week.
During Monday’s briefing at the White House, press secretary Jay Carney repeated the theme: “We should address the drivers of the deficit, and Social Security is not currently a driver of the deficit — that’s an economic fact.”
Well, saying it’s a fact doesn’t make it so.
Durbin, Carney and others making that claim should take a look at the president’s own budget to see what’s really going on. On page 465 of the budget’s “Analytical Perspectives,” they’ll find a chart showing that Social Security ran a deficit of $48 billion last year. This year, Social Security will come up $50.7 billion short. In 2015, as more Baby Boomers retire, the gap between cash in and cash out is expected to reach $86.6 billion.
Need a second source? In a report released last month, the Congressional Budget Office said Social Security benefits began exceeding payroll tax revenue in 2010, and without changes, the program will never get back into balance.
Denying this harsh reality requires playing accounting shell games and believing (or pretending to believe) that Social Security can be bailed out by its trust fund. And if you believe that, we have a bridge to sell you in Brooklyn.
Social Security has always been a pay-as-you-go program: Each year’s payroll taxes fund each year’s benefits. From 1983 through 2009, Social Security collected more in taxes than it paid in benefits. The surpluses were supposed to go into the trust fund, protected by what Al Gore called a “lockbox” when he ran for president in 2000. Alas, there is no lockbox and never has been; the money came into the Treasury and went out just as quickly, spent on the government’s day-to-day expenses and replaced by IOUs in a file cabinet.
Financing the difference between benefits paid and taxes collected requires borrowing money, which increases annual deficits and adds to the cumulative national debt. That’s the “economic fact.”
Democrats, of course, have a political interest in fudging the issue to keep Social Security out of negotiations over the year-end “fiscal cliff” of abrupt tax hikes and spending cuts. “I am not going to be part of having Social Security as part of these talks relating to this deficit,” Senate Majority Leader Harry Reid, D-Nev., told reporters this month.
Seriously? How exactly do Democrats expect Republicans to bend on their destructive refusal to raise taxes if Democrats won’t bend on their destructive refusal to trim unsustainable benefit programs?
Social Security represents more than one-fifth of federal spending, much too big to ignore. The likeliest fixes are well known. These include raising the cap on income subject to the payroll tax, tying cost-of-living adjustments more closely to actual inflation, and bumping up the retirement age for able-bodied future retirees. The sooner these changes are made, the less painful they will be.
But shoring up the program starts with politicians telling the truth about how Social Security works. That’s something the White House and congressional Democrats apparently think the public can’t handle.