THE DEBATE over reducing long-term federal spending got off to a rocky start this week when several Democratic leaders flatly rejected proposals by the leaders of a deficit commission to adjust Social Security, including a rise in the age of eligibility. Whatever the merits of the draft report cobbled together by Democrat Erskine Bowles and Republican Alan Simpson, deficit reduction is too important to have a major entitlement program like Social Security taken off the table.
After a mid-term election in which older voters, perhaps spooked by the health reform law’s call for a $400 billion reduction in the long-term rate of growth of Medicare, voted overwhelming for Republicans, the Democrats are understandably chary about tinkering with Social Security. Yet its future solvency can be assured with relatively minor adjustments in its tax and its benefits — though Congress should ensure that any benefit cuts spare low-income retirees.
While most Republicans in Congress have taken a more wait-and-see approach to the Bowles-Simpson report, the likely next chairman of the House Ways and Means Committee, David Camp, is as unbending on tax increases as the Democrats are on Social Security cuts. The Michigan Republican, himself a member of the Bowles-Simpson panel, told Bloomberg Television that Congress should forswear tax increases. “If we raise revenue,’’ he said, “we’ll never get to the reductions in spending that we need to see to have a more sustainable government.’’ Under the proposal by Bowles and Simpson, about a quarter of deficit reductions would come from higher taxes, and three-quarters from spending cuts.
It’s easy to see what’s happening here. The political message of the last few elections has been that adamant stands carry the day, be they Democratic refusals to discuss changes to Social Security or Republican refusals to consider comprehensive reforms of health care (“socialism’’) or immigration (“amnesty’’). It’s more than a recipe for gridlock: It’s a serious misreading of the public will. Voters are desperate for pragmatic solutions to taxes, Social Security, health care, and immigration, and want their representatives to engage with each other. Of course, those same voters should be more rigorous about assessing blame: Another of the lessons of the last three election cycles is that any politician who sticks his or her head out is likely to get it cut off.
Unfortunately, the same refusal to bend infected the deficit-reduction panel. It hasn’t come to agreement, so the co-chairs, Simpson and Bowles, produced their own report.
While they deserve credit for putting some tough choices on the table, they dance around the root cause of runaway government spending: health costs. Bowles and Simpson talk vaguely about strengthening the Medicare payment advisory board and propose malpractice reforms and a public-option insurance plan if premiums by private insurers rise too steeply. But the report provides mainly crossed fingers on health spending reductions, saying they will be achieved by “establishing a process to regularly evaluate cost growth.’’ Presumably, Washington knows how to evaluate health cost increases — it is doing something about them that has proven so difficult.
The mission of the deficit commission was to provide a framework for compromise that would get members of Congress off their ideological toadstools, primed for serious action on the deficit. Sadly, the Simpson-Bowles report, and its reception by key leaders this week, evoke more skepticism than optimism.