Of all of the arguments for cutting and privatizing Social Security, the most obnoxious and misleading focus on the alleged "greed" of senior citizens -- present and future.
Arguments that are false in their conclusion often contain grains of truth, and so does this one. It's true that the aging of the baby boomers and relatively low birth rates in the post-boomer years mean that our population will get older in the coming decades and expenditures for Social Security and Medicare will rise.
Those who advocate cutting programs for the elderly inevitably stress the supposedly "unfair" burdens this population will place on everyone else. Younger workers are told they will pay exceptionally high taxes to support high-living seniors. Crocodile tears are shed over the programs for poor kids that will have to be cut -- often by the very same people who want to cut such programs now.
What's wrong with this argument? First, it deals with the elderly as a single, undifferentiated group. The retired millionaire playing golf in Palm Springs is spoken of as if he is in the same class as the elderly widow in a modest apartment in Cleveland. But the Palm Springs millionaire is not the typical senior; he's the exception. Most who use Medicare and rely on Social Security desperately need the help to stay out of poverty.
Consider that for about 20 percent of retirees, every penny of their income comes from Social Security. Social Security provides half or more of the income of nearly two-thirds of the elderly. Greedy is not a word that comes to mind to describe such people.
And the decline of defined-benefit pensions will make Social Security even more important for the next generation, which is facing the proposed cuts. According to AARP, in the year 2000, only 29 percent of seniors received income from private pensions; an additional 14 percent from government employee pensions.
Ah, but what about that rich golfer? I don't mean to pick on him, but the critics of entitlement programs always use folks like him to justify cuts. As it happens, an administration that says it's worried that the elderly will place too heavy a burden on the young has gone out of its way to transfer yet more money to our seniors -- as long as the seniors in question are really well-off.
Consider President Bush's cut in the tax on dividends. When he pushed that reduction (a slightly scaled-down version eventually became law), he bragged about its impact on the elderly. "We are helping seniors who rely on dividends," he declared.
But that's a pretty narrow slice of seniors. "The majority of elderly have fairly modest incomes and would receive little or nothing from this tax proposal," according to a 2003 report by the Center on Budget and Policy Priorities. As for helping seniors, "nearly 43 percent of the benefits of the dividend exemption . . . would flow to the 2.5 percent of elderly people with incomes exceeding $200,000. More than three-quarters of the benefits that would go to the elderly from this tax cut would flow to the 19 percent of elderly with incomes above $75,000."
In other words, this administration's tax policies favor the Palm Springs golfer over the Cleveland widow. And that doesn't even take into account the administration's obsession with repealing all inheritance taxes. To help that widow and her grandchildren would it really be too much to ask that estates of more than, say, $8 million or $10 million, pay at least some inheritance levies?
The focus on allegedly "greedy" seniors is a ruse to distract our attention from broader issues of equity and fairness. Yes, the baby boomers will be a burden on our social insurance system. It's reasonable to ask the best off among them to help out the less fortunate in their ranks, but even more reasonable is to ask the best off among all of us to help out the least well-off among all of us, regardless of age. That's why we have progressive taxes and social programs such as Medicaid.
The real "crisis" we face is created not by Social Security but by the administration's unrelenting effort to lighten the tax burden on the wealthy, which, in turn, creates a fiscal mess that forces cuts in programs -- for poor kids and needy seniors alike. If the issue here is greed, the elderly and soon-to-be elderly are the least of our problem.