Sometimes politicians get things upside down. They ignore problems that are plainly staring them in the face, while they focus on dangers that are at best speculative.
Consider two long-range issues that are not pressing matters this year but pose, or are said to pose, threats a generation or two away. One of them you don't hear much about: Social Security. The other you hear about all the time: global warming. Yet this gets things upside down. We have an unusually precise knowledge of the problems that Social Security will cause in the future. But we don't know with anything like precision what a continuation of the current mild increase in temperatures will mean.
Start with Social Security. We have a pretty good idea of how many Americans will turn 62 and start collecting Social Security in 2068, because they've all been born, and we can estimate with near certainty how many will die then and, with a bigger but tolerable margin of error, how many will immigrate from foreign countries.
The Social Security Trustees' report issued on April 23 paints a pretty clear picture. Social Security costs will exceed Social Security revenues by 2017. That's a big problem, because for years Social Security revenues -- FICA taxes -- have been far greater than the cost of benefits, and so those monies have in effect been spent on other federal programs. But roundabout 2017 -- that's just 10 years away -- we'll have to dip into other revenues, or borrow or increase taxes, to pay Social Security recipients.
As early as 2035, the cost of paying promised benefits will absorb more than 17 percent of workers' wages -- nearly half again as high as current Social Security taxes. By 2041, Social Security taxes will finance only 75 percent of benefits.
These numbers and dates may prove to be off, but only by a little. Yet politicians are not eager to tackle the problem. In 2000 and 2004, George W. Bush campaigned for changes in Social Security. But his 51 percent in 2004 didn't give him enough political capital, and while he talked up the issue in 2005, he failed to present a specific plan. He failed to engage with young voters, the prime beneficiaries of changes and the age cohort likely to either suffer greatly reduced benefits or much higher taxes or both.
Congressional Democrats were happy to demagogue this long-term issue for short-term political gains. Exactly one Democrat in the House endorsed changes. House Republicans, happy to vote for a $260 million bridge to nowhere in July 2005, sighed with relief in August when Hurricane Katrina gave them an excuse to take Social Security off the agenda in September.
In Honor of His 103rd Birthday, Here Are The 20 Best Quotes From The Late, Great Milton Friedman | John Hawkins