There are two things you need to know about the federal government’s current budget situation. First, if you’re concerned with deficits and federal debt, things are getting better. The combination of spending cuts, tax increases, and modest economic growth has significantly decreased the government’s annual deficit, and if current projections hold, it will continue its downward slide.
Second, health care costs — the main driver of future federal spending — are decreasing. And this is not an artifact of bad economic conditions either. “National health spending grew by 3.9 percent each year from 2009 to 2011, the lowest rate of growth since the federal government began keeping such statistics in 1960,” noted the Kaiser Family Foundation in a recent report.
All of which makes it particularly odd that the Chamber of Commerce has rededicated itself to an effort to slash Social Security. In a speech to the Chamber of Commerce board of directors yesterday, Bruce Josten, their executive vice president for government affairs, outlined “ten truths about America’s entitlement programs.” If you’re familiar with arguments for cutting social insurance, you will recognize these claims: That entitlement programs are “large and expensive,” that their costs are growing, that financial solvency for said programs would cost trillions of dollars over the next five decades, and that the biggest threat to Social Security and Medicare is doing “nothing at all.”
You could lift all of these claims from Republican campaign rhetoric, nearly verbatim. And they’re overstated or inaccurate. Social Security costs, for example, are stable. And with small adjustments — higher taxes, for instance — the program will be able to pay out full benefits for the foreseeable future.
Likewise, when the Chamber says that “the cost to make these programs financially solvent for the next 75 years is almost $40 trillion,” it ignores the extent to which long range projections are unhelpful. We have no idea what the fiscal picture will look like in 2088, how technology will have changed, how society will have changed, or anything else. To make decisions in the early 21st century based on projections into the late 21st century is ludicrous.
The simple fact is this: The Chamber of Commerce wants to do as much as possible to cut retirement programs, regardless of whether its necessary to deal with the country’s fiscal situation. And in that, they have the support of the Republican Party, which continues to push for massive spending cuts to all areas of government, regardless of need or necessity.