Tell that to former President Bill Clinton. In 1992, the Wall Street Journal asked President Clinton, "Let's run a couple [of deficit cutting schemes] by you just to see if you would entertain them: raising the retirement age for Social Security benefits." Clinton answered, "I think it's something we ought to look at, I sure do. When Social Security was instituted . . . the retirement age was pegged at an age that was higher than the average life expectancy of the people paying into the system. The average person that actually drew retirement benefits spent about five or six of their adult years in retirement. Now, with the fastest growing group of the population over 80, by the turn of the century the average person could literally spend 20 years in retirement. . . . "
To examine the system, Clinton appointed a Social Security Advisory Board. They came up with three options: a Maintenance of Benefits plan, which involved tax increases; an Individual Accounts plan, which mandated an increase in employee contribution that would be allocated to government-held individual accounts; and a Personal Security Account, with privately managed, fully funded individual accounts to replace a portion of Social Security.
No matter what the president proposes, expect Democrats to object. For example, the White House recently floated the notion of indexing Social Security benefits to inflation, rather than wages. (By indexing to inflation, the expected so-called guaranteed benefit decreases, but the worker would more than make it up through expected greater returns with money put into a personal account.)
Foul, cried House Democratic Leader Nancy Pelosi, D-Calif. " . . . Recent press reports suggest that your administration favors a privatization plan that includes 'price indexing,'" said Pelosi, "which would reduce Social Security's progressive benefits by up to 46 percent for future retirees. These benefit cuts are the equivalent of asking today's seniors to live at a 1940s standard of living."
Are these the same guys who tell us that workers keep falling further and further behind consumer prices?
Former Democratic presidential candidate John Kerry said that many Americans are being "squeezed" as wage gains fail to keep pace with a rising cost of living. Then-vice-presidential candidate John Edwards said last year, "It made the front page of the paper today, but it's not news to many Americans that wages are not keeping up with inflation." But if inflation outpaces wages, as Sens. Edwards and Kerry argued -- why not index the benefits to the higher number, inflation? Historically, wages outpace inflation, and Democrats -- despite their whining about the "Bush economy" -- know this.
It's gonna be a long four years. Let's hope we have the knowledge and wherewithal to endure.
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