Senate Majority Leader Harry Reid (D) has consistently denied there is an immediate Social Security crisis, and, therefore, he says won’t consider Social Security reform. He was at it again yesterday:
“Two decades from now, I’m willing to take a look at it,” said Reid, 71, in an interview to air Wednesday evening on MSNBC. “But I’m not willing to take a look at it right now.”
Reid’s remarks may well signal a death knell for hopes that lawmakers might be able to accomplish Social Security reform this Congress. . . .
“So what I’ve said, if we want to look at something to take care of the out years, let’s do it at the right time,” he said. “It is not in crisis at this stage. Leave Social Security alone. We have a lot of other places we can look that is in crisis. But Social Security is not.”
It’s shocking, really. The top Senate Democrat — along with the administration’s budget director — ignore that the Social Security trust fund is spending more than it is taking in. Moreover, the “trust” fund is a misnomer. Social Security operates with a fiction — the Treasury and the trust fund exchange Treasury notes for IOU’s. But it’s all federal money and part and parcel of our debt problem.
Appearing on MSNBC’s Morning Joe today, Sen. Tom Coburn (R-Okla.) provided this explanation:
“We have stolen $2.6 Trillion from it. We put paper money in there. But the problem is, we spent the money. We didn’t just take it. We took it and spent it. Social security ran about a $53 billion deficit last year. It’s projected to run a continuous deficit. So there’s no question that there’s an IOU in there. But our problem in our country, borrowing $4 billion a day, which is what we’re doing, is we’ve got to create a realistic expectation by the people loaning us money that we’re going to solve our problems.”
“There’s no question, if we had the money we could wait 10 or 15 or 20 years to fix social security. But because we don’t have the money, and we’re going to have to borrow the money, we have to create an environment where people trust us.”
Moreover, the longer we wait, the more abrupt and Draconian will be the changes. The Social Security fund’s own actuary explained in a 2010 report that if action isn’t taken sooner rather than later, “then changes necessary to make Social Security solvent over the next 75 years will be concentrated on fewer years and fewer generations.” That would entail such measures as increasing the payroll tax to about 16.1 percent in 2037 and roughly 16.7 percent in 2084. Benefit cuts “would be reduced 22 percent at the point of trust fund exhaustion in 2037, with reductions reaching 25 percent in 2084.”
Entitlement spending and payment on the debt now are about 70 percent of our federal spending. Without reform, we’ll continue to rack up more and more debt and crowd out available funds for every discretionary program.
Last week on the same show, Senate Minority Leader Mitch McConnell (R) had this exchange:
MIKA BRZEZINSKI: You note a reluctance on the part of the president. What about you, sir? Is there reluctance from you, from members of your party, when it comes to dealing with the bush tax cuts and maybe spreading the pain? How do you feel about it?
SEN. MCCONNELL: Yeah. I don’t think we have a problem in this country because we tax too little. I think it’s because we spend too much. And I think it’s clear, given the election last November, we will not be raising taxes. So the question is, can we get our spending under control? We’re spending too much, borrowing too much. Mika, we’ve added $3 trillion to the national debt just in the last two years. Our cumulative debt now is $14 trillion, which is the size of our economy. We begin to look a lot like Greece. And by the way, that doesn’t even take into account the over $50 trillion in promises we’ve made to future generations. The entitlements, very popular, but the only way you can do entitlement reform is with the leadership and signature of the President of the United States.
DONNY DEUTSCH: Senator McConnell, 88% of the budget lies in both entitlements and defense spending. As somebody as a fiscal conservative, you would want to cut defense spending, is that fair to say?
SEN. MCCONNELL: I think everything is on the table. What is before us at the moment is the domestic discretionary spending reductions. And if you focus on that first step, it is noteworthy that the House Republican spending reduction proposal did better in the democratic Senate than the democratic alternative. So what I think that tells you is, there’s a bipartisan desire to go down this path. I agree with Chuck Schumer, we need to do entitlement reform but we can’t do that without the President’s complicity, involvement and signature.
And, of course, the president’s own debt commission recognized that there is no fixing our long-term debt problem without addressing entitlements, including Social Security.
Reid is metaphorically putting his fingers in his ears and humming to avoid listening to unpleasant truths.I n essence, he is saying the Democrats are uninterested in solving our debt problems. Is the White House going to go along with this head-in-the-sand approach to governance?