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  • To Reform or Not To Reform

       January 17, 2005

    I was listening to Rush Limbaugh this afternoon while running errands at lunch. I don't normally listen to Rush, but I had left my new mix CD at my desk (that CD is awesome, by the way, it has everything from Madeline Peyroux to Velvet Revolver). So anyway, I caught a couple of callers. One young man wanted to convince us that the third world couldn't be successful capitalists because they didn't have any colonies to exploit. Okay there.

    The next caller wanted to talk about the Democrats' opposition to social security reform. The caller made a good point about how the left is always barking about far off potential dangers to the environment, but at the same time are so dismissive about potential problems with our current social security system. Their hypothesis was that Democrats just simply didn't want to do anything as long as it's a Republican President who will eventually get credit for saving the program. That's pretty much the standard theory.

    Rush had a more interesting theory. His comment was that the Left doesn't want to reform Social Security. It's in their philosophical interests not to. Their goal is not a short-term hit on President Bush's agenda, but rather a long term goal to increase the size and scope of the government. I think he's right. Think about it. If we do nothing about social security one of two things will happen: benefits will be cut or taxes will be raised. And let me tell you, benefits won't be cut. A majority of politicians are not going to throw themselves in front of the demographic train of social security recipients. So taxes will be raised. The social security wage limit will disappear (this will be easily justified as a "tax on the very rich"). Ever greater amounts of wealth will be transferred from private citizens to the federal government. The welfare state will grow dramatically and the American Left's dream of a socialist state will be one step closer to reality.

    As Hillary Clinton, in a refreshing burst of honesty, said, "We're going to take things away from you on behalf of the common good."

    I'm not necessarily on board with Bush (or anyone else's) plan to reform social security, because no one's talking about really reforming it and changing what it means to the American people. As Arnold Kling so succinctly put it in Tech Central:

    Today, we refer to Social Security as an "entitlement." In the 1930's, however, that was not the case. It was thought of as social insurance. The difference is significant.
     
    In the 1930's, relatively few people lived significantly past the retirement age of 65. In those days, it would have been foolhardy to save enough to last until you were 80. But if everyone contributed to a collective pool, then we could insure that the few who lived long past retirement would not be destitute.
     
    Since the 1930's, longevity has increased by more than a decade. However, the Social Security retirement age has been raised only a few years. As a result, Social Security no longer represents insurance for the unusually long-lived. It is now an "entitlement" for everyone.
     
    Back when it was insurance, Social Security's tax burden was low, and the benefits clearly flowed to people in need. Today, the tax burden is high, and benefits go mostly to people who had the means, if not the incentive, to save to provide for themselves.

    Those of us around my age are left with a difficult question. Do we support "reform" of the current system (which sucks) and expect to get benefits when we retire or do we too oppose reform on philosophical reasons and then vote like hell against any future measures to save social security for ourselves (in which case we'll be sacrificing every cent we ever put into it)? I'm almost inclined to go with the latter, because it's not like I've ever expected social security to be there for me anyway. And I'm not the only one. Check out the comments on this post at Citizen Smash.

    Heh, maybe the short-term opposition to social security reform will be a motley combination of right wing nutjobs and left wing moonbats. I suspect this isn't what people had in mind when they asked for bipartisan cooperation!


    Posted by kris at January 17, 2005 03:16 PM

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