Blue Collar Conservatives: Recommitting to an America That Works (19 page)

There are a number of ways we can do this. In the 1990s, when I was in the U.S. Senate, I supported personal retirement accounts as a long-term fix. This approach would give younger workers the opportunity to do better than they would in the current underfunded system.
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I still believe that a 401(k) approach to Social Security would provide better benefits for most seniors and is the most financially responsible way of solving the problem. The problem is that the current system is so underfunded that we need to get it on stable footing for current and near-term retirees before we look too far into the future.

So how do we do that when increasing payroll taxes will cause increased unemployment and slow economic growth, and decreasing benefits could harm those whom the program is designed for, the elderly and disabled? Why don’t we first see if any benefits are going to people who don’t meet the criteria of being old and disabled?

Social Security was established in 1936, when life expectancy was sixty-one. Benefits were set as follows: early old-age benefits were available at sixty-two, with full old-age benefits available at sixty-five. Today, average life expectancy is seventy-nine, so one might assume that early old-age benefits would begin at eighty and full old-age benefits at eighty-three. That’s not the case, of course, although in 1983 a Democratic
Congress and a Republican president agreed to gradually raise the full-eligibility age to sixty-seven by 2027. The most important step we can take is to recognize in law what people already know to be true. Sixty-two in America today is not old. Tell a sixty-two-year-old that he’s “past his prime” and see what reaction you get—you might need to duck. Yet that same sixty-two-year-old has no problem signing up for “old-age” benefits under Social Security; in fact, more than 70 percent do. Starting benefits this early would be fine if the system were solvent, but we don’t have the money. The system is running in the red, and it is getting worse every year.

It might make sense to gradually reform the system over the next thirty-six years by increasing the eligibility for early retirement by one month every year. Once early eligibility reaches sixty-five in 2052, further increases would be tied to increases in life expectancy. I propose doing something similar for the normal eligibility age—start raising it in 2028 until it reaches sixty-nine in 2052. For everyone born after 1983, I would tie both eligibility ages to increases in life expectancy, so every subsequent generation would receive benefits for the same number of years as the previous. I would do the same for Medicare, raising the eligibility age by one month per year until it reaches sixty-nine in 2052.

There is another big difference between seniors in 1936 and seniors today—wealth. In the 1930s the poorest age group of adults was people over sixty-five. Today the wealthiest age group is people over sixty-five. In part that’s because Social
Security and Medicare provide them with a minimum level of income and healthcare coverage, but it is mostly because many “young” seniors continue to work and because so many in this generation have lived the American Dream of opportunity and success. Who, by the way, are the poorest age group? Eighteen- to thirty-year-olds.
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Some have suggested raising taxes to pay for the shortfall in Social Security. In other words, they would increase taxes on poor grandchildren to pay wealthy grandparents. You say not all seniors are wealthy—true, so let’s begin with reducing the scheduled cost-of-living increases in benefits to the wealthy recipients who don’t need them.

There is even a benefit that we could eliminate without controversy. We should stop paying Social Security benefits to dependents (children under eighteen) of wealthy Social Security recipients. This usually occurs when wealthy men over fifty marry and have children.

There are dozens of other reasonable benefit changes that we ought to discuss. The most important thing is for the American public and seniors to have this discussion with a clear idea of the magnitude of the problem and what we want to accomplish—bridging the funding gap without hurting lower-income workers, lower-income seniors, or the overall economy.

Compared with Medicare, Social Security is in decent shape. It can survive with modest adjustments that will affect
only the wealthiest and healthiest seniors, but Medicare is a different story.

Medicare was started in 1965 to provide seniors with a basic level of healthcare, just as Social Security was to provide seniors with a basic level of income. The cost to the taxpayer of providing Social Security benefits increases with inflation and population. The cost of Medicare likewise increases with population and inflation, but also with innovation. Think of all of the procedures, treatments, knowledge, drugs, and devices that improve the quality and length of life, and then think of how much more those cost. Then think of how much more is in the pipeline and how much longer we can extend life.

This is a great problem to have, but there’s no solution to it under the Medicare model that was designed fifty years ago. Some of the problems of Medicare are similar to the problems of Obamacare—in both cases the government is far too involved in dictating terms and prices. This meddling inevitably deprives customers of choice, creates costly inefficiency, and discourages innovation. Even before the passage of Obamacare, more than half of the money spent on healthcare in America was paid for by either the federal or state governments.
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Under Obamacare, the federal government in particular calls the shots for reimbursements and covered procedures, as well as policies on privacy, billing, competition, and a whole host of other details. A true revolution in affordable, quality healthcare will not come from more government
interference, as we have with Obamacare, but from letting the healthcare system benefit from competition, just as telecommunications and other high-tech industries do.

I have supported this approach for decades. In fact, when I was in the Senate I worked to make Medicare Part D, the drug benefit offered to seniors, adhere to market principles. Until President Obama tinkered with it in Obamacare, Part D was the first entitlement program in history to spend less money than the budget experts predicted. So far, Part D, which is privately run but partially funded by the government with some federal oversight, is coming in about $340 billion
under
its ten-year budget. Medicare, which is completely funded and administered by the government, is expected to double its spending to
$1.1 trillion
over the next decade.
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Let’s use the example of Part D and the popular Medicare Advantage option to create a dynamic public-private partnership that will improve the efficiency, quality, and affordability of the Medicare program.

Social Security and Medicare face primarily demographic challenges, but the bad economy of the Obama years has caused another entitlement program to explode. Spending on food stamps doubled between 2006 and 2012. We have to put food stamps recipients on the path to success. That means work. The great success of the 1996 Welfare Reform Act was its work requirement. We never applied that requirement to
food stamps, and that was a mistake. We should, in fact, make it a rule that all federal benefits programs that go to able-bodied Americans have a work requirement.

Of course, some Americans are seriously disabled and will never be entirely self-sufficient. I’m the father of a child with disabilities, and I know how difficult that can be. But unfortunately, we’ve also seen an explosion of fraudulent disability claims in order to tap benefits from the Supplemental Security Income (SSI) and Social Security Disability Income (SSDI) programs. The amount of money wasted because of this abuse is substantial. Between 2009 and 2012, more than 5.9 million people were added to the SSDI program. That’s more than twice the number of new jobs that were created in the same period. Unfortunately, when the economy is hurting, people become “creative” to secure resources for themselves and their families. Another word for creative is fraudulent.
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When I was in office, I was bombarded with stories of children’s being coached to lie by parents hoping to get money from SSI, or disaffected workers’ claiming SSDI as unemployment benefits were about to end. Such fraud not only steals from the taxpayers, it helps bankrupt a system that should be focused on serving the truly needy and disabled.

Thomas Jefferson articulated a principle that should guide a free society as it considers how to help its needy and vulnerable members: “What more is necessary to make us a happy and prosperous people? . . . [A] wise and frugal government . . . which shall leave [men] free to regulate their own
pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned.”
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We need to get back to the basic functions of government. And investing in our national infrastructure—our bridges, rails, highways, and dams—is something all conservatives can agree is one of the things government must do well. But we need dramatic reforms to reduce the cost of public infrastructure, starting with renegotiating many union contracts. And we need sufficient revenues at all levels of government, especially at the state and local levels, for this investment to bring an end to the massive infrastructure deficit we have. Government needs to get out of some of the areas it shouldn’t be in, like certain entitlements, and redirect resources to infrastructure. This investment will create jobs and strengthen the foundation of our national economy.

While we should be leery of grand government schemes like Obamacare, we must remember that government can be a force for good, and it is in our interest that it be healthy and functional. The mind-blowing waste of Obama’s “stimulus,” which lined the pockets of the administration’s cronies but did little for the economy, has left many citizens with an understandably dim view of their federal government. But Michael Gerson and Peter Wehner, presidential advisors in the George W. Bush administration, insist that excessive cynicism about the government is dangerous: “The reputation
of government is an important national asset—and an irreplaceable source of national pride. Government overreach by the Left has degraded that asset. Today’s hemorrhaging of trust in public institutions, if left to run its course, will only further degrade it. Skepticism toward government is one thing; outright hostility is injurious to the health of American democracy itself. How can citizens be expected to love their country if they are encouraged to hold its government in utter contempt?”
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Conservatives understand this best when it comes to national defense. That is a part of the national government that seems “conservative,” especially for blue collar conservatives. Because it embodies the values of patriotism, honor, and sacrifice, the military is the part of the federal government we’re proud of. It reflects what is best in our country.