Republicans, on the other hand, will again be forced into the position of being Grinches. They will try to explain that the benefits Democrats are promising cannot be had except at vastly greater cost. But Democrats will counter with studies from liberal groups like the Center on Budget and Policy Priorities, with lots and lots of statistics that no reporter will ever bother to read, showing that lead really can be turned into gold. And seniors, upset that they didn't get as much as they thought they were going to get, will turn on Republicans with a vengeance.
A good analogy is Richard Nixon's decision to permanently index Social Security benefits in 1972. Up until that time, Congress had boosted benefits on an ad hoc basis from time to time, usually in election years. Indeed, benefits were raised 20 percent in 1972 on top of indexing. Contrary to popular belief, the original Social Security legislation never promised beneficiaries automatic protection against inflation.
Thus, in order to buy himself reelection in 1972, Nixon initiated a permanent, annual increase in Social Security benefits. Now, every year, Social Security beneficiaries get an automatic cost-of-living adjustment that increases their benefits. Do any of them give thanks to Richard Nixon for this? I think not. They simply take it for granted as something they are entitled to. The vast majority of elderly undoubtedly believe that indexing has been part of Social Security since the beginning. If they thank anyone, it is probably Franklin Roosevelt.
Following Nixon's ill-conceived vote-buying action, inflation shot through the roof. Social Security benefits went up far faster than Congress would have raised them under the old ad hoc system. And whenever Republicans suggested slowing indexing to help get control of the budget, they were denounced as heartless monsters, even though their party had delivered the benefit in the first place. Even when economists proved conclusively that the Consumer Price Index was overstating inflation, thus giving seniors an extra benefit to which they were never entitled, it proved impossible to reform COLAs.
Cost problems are inevitable in all entitlement programs. That is why experts warn against enacting them. Consequently, I believe that Republicans have not only made a serious policy error in enacting a new drug benefit, but a political one as well. Whatever short-run gain they have made will melt away once the costs explode--which they will. Any future Republican effort to restrain those costs will completely reverse this temporary gain. In the end, only Democrats gain politically from entitlement programs.
Bruce Bartlett is a former senior fellow with the National Center for Policy Analysis of Dallas, Texas. Bartlett is a prolific author, having published over 900 articles in national publications, and prominent magazines and published four books, including Reaganomics: Supply-Side Economics in Action.
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