January 23, 2007
Tuesday

Now that House Democrats have given us 100 hours of razzmatazz - the speedy, unreflective passage of six bills that the Senate will mercifully either kill or amend - maybe they will do something responsible, something desperately needed, something crucial for the country. Maybe they will address the restructuring of Social Security.

More than likely, they won't.

It's easy enough to slap energy and drug companies around because, well, who likes them, anyway, and how many voters get it that the consequence of enacting this vindictive legislation in the years ahead would be boosted oil prices and fewer life-saving drugs? The other initiatives were likewise the stuff voter-approval dreams are made of. But reworking Social Security in substantive fashion is not.

To fix this popular program, you have to take some political risks. For decades now the demagogic message largely from Democrats has been that the program is fine as it is and that any adjustments will imperil those currently receiving benefits. Tiptoe toward the truth and you may get severely punished, as President Bush found out when he campaigned for individual retirement accounts and other changes. Ambushed by misinformation, fear-mongering and ideological idiocy, he was forced to retreat while opponents took deep bows.

But truth is a stubborn thing, and so it was the other day that Ben Bernanke echoed warnings of the Federal Reserve chairman who preceded him. He said, as Alan Greenspan had, that the retirement of the long-living, baby boom generation would cause a flood of entitlement spending if nothing were done to address Social Security, Medicare and Medicaid, and that the consequences would be ugly.

He repeated the story that should be old to our ears by now. People over 65 are 12 percent of the population today, and for each person in this age group, there are five younger adults whose taxes can help pay for benefits. Jump ahead to 2030, and people over 65 will be 19 percent of the population. There will be three younger adults to pay the taxes for their benefits. Hang onto current law, and this could mean a deficit in 2030 four times the percentage of gross domestic product of what it is now, which means less money for capital formation, less growth of real incomes and lower living standards.

In short, it could mean economic misery.

After sharing his dismal report with the Senate's budget committee, Bernanke was asked how soon we should act. Ten years ago, he responded, and that's less a joke than another piece of truth that should make members of Congress hide their heads in shame: Enact changes while the baby boomers are still contributing instead of receiving - well in advance of the deluge - and you won't have to do anything drastic. Wait until the floodwaters are swirling about us, and, as Bernanke said, you may have to resort to draconian measures.

Sadly, Democrats are talking as if they will put the issue off until after the elections of 2008. Social Security is the place to start because it is easier to address than Medicare, and a way to get the ball rolling. The method of getting past the political risks is for both parties to act jointly so that neither one gets unduly bashed on this particular issue on Election Day. Come hither, Bush has said - let's talk. He says he's agreeable to considering any plausible plan, but the Democrats are saying lately that they don't believe him and just might wait until they get one of their own in the White House.

They say they fear Bush won't consider raising payroll taxes for the wealthiest among us, or won't give up on his desire for personal retirement accounts. This is disingenuous. All they have to do is engage with the president and find out. What's to lose, other than possibly letting Bush go down in history as the Republican president who rescued Social Security, not exactly a concern that measures up against the concern of economic misery down the road.

My modest proposal is that the Democrats in the House and the Democrats in the Senate get together with congressional Republicans to give us not another 100 hours of showmanship, but hundreds of hours of seriousness during which they cooperate on Social Security reform and quit pretending there's no huge financing problem out there or that add-on personal accounts would do anything but worsen our fiscal mess. Let the truth have its day.

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