New York City
William Greider’s “The Man Who Wants to Loot Social Security” [March 2] grossly misrepresents Pete Peterson and the Peter G. Peterson Foundation’s views on Social Security reform and overlooks some large and inescapable truths.
Both Republicans and Democrats in Washington have charged everything to the nation’s credit card, including tax cuts and spending increases, without paying for them. Washington’s imprudent, unethical and even immoral behavior is facilitated by a lack of transparency and accountability. As of September 30, 2008, the government was in a $56 trillion-plus fiscal hole, according to its official financial consolidated statements. This amount is equal to $483,000 per household and $184,000 per American. Left unchecked, this burden will rise every year by $6,600 to $9,900 per person, even with a balanced budget.
The nation’s bedrock social safety programs, Medicare and Social Security, are not in danger of being looted–they already have been looted. The government has already spent any related surplus and replaced it with nonmarketable IOUs, which it doesn’t even consider liabilities. In addition, Medicare is already drawing down on these IOUs, and Social Security will start doing so within ten years.
Greider is correct in saying that the government will have to repay what it borrows from Social Security–but how will it do so, and what level of tax burdens will be required to meet our growing Social Security, Medicare and Medicaid obligations without fundamental reforms?
As a US comptroller general from 1998 to 2008 and a former public trustee of Social Security and Medicare, I share Pete Peterson’s deep commitment to preserving a strong, sustainable safety net for all Americans, including seniors. And contrary to the impression one could draw from Greider’s article, Pete and I both support the concept of a sound defined-benefit program for Social Security supplemented by additional automatic savings accounts for individuals.
At the same time, Pete and I also believe that the process one employs is critically important when transformational changes are needed. We have sadly concluded that the “regular order” in Congress is broken and that achieving progress on multiple fronts within a short time frame is not possible on a piecemeal basis.
What does this mean? The president and Congress need to work together to establish a Fiscal Future Commission (or task force), which, unlike most Washington commissions, would be designed to accelerate action and get the ball across the goal line rather than punt it down the field. Ideally, this bipartisan commission would be created by statute to ensure buy-in from Congress and the president. It should include selected and diverse members of Congress and of the administration as well as nongovernment officials. It should engage the public outside the Beltway, including by leveraging digital technology and the web. Everything, including budget controls, entitlement reforms, spending constraints and tax increases, would be on the table. After engaging the public and key stakeholders, it would make a range of recommendations that would be subject to an up-or-down vote in Congress.