The Usual Suspect Bashes Social Security

That would be Robert J. Samuelson at the Washington Post, and, yes, he has done it yet again, actually for the first time in a while. Dean Baker has already done a good job of cutting him up over on CEPR, but I can’t help piling on as well.

Samuelson presents his case as opposition to Social Security being expanded as proposed by Cong. John Larson (D-Conn). Samuelson also cites a recent study Andrew Biggs at AEI supposedly showing that old people have been doing better in income terms than previously reported.

Dean notes several points. One is that the current setup of Social Security is that is going to be reducing benefits over the next few years as retirement ages get raised as a result of long past agreements, actually dating to 1983. The supposed expansion by Larson is quite minor and mostly just offsets this planned reduction, although not precisely.

Another point is that while it is true that while some older people have been doing better than previously reported, although not the poorest recipients, the main source of this better performance is due to something that will be disappearing in the near future. It is due to income from defined pensions, which have nearly all disappeared. Such income will be less and less important for older people as time proceeds.

I shall add to these valid points one other. It is a par for the course nearly all times RJS gets off onto this topic. Early in his column he sets up as how disastrous for future budget balances all these awful “entitlements” will be is to cite projections for Social Security, Medicare, and Medicaid all lumped together. So, according to the CBO, while federal transfers to over 65s in 2005 was 35% of federal outlays, and those rose to 40% in 2018, these are projected to be 50% in 2029. Now while this might happen if no changes happen, the overwhelming majority of this increase is due to to expected further increases in medical care prices, not due to an increase in use, much less an increase in Social Security spending. It is only a couple of those projected percent increases.

He does this all the time, citing these kinds of scary looking aggregate numbers and then jumping to focus on Social Security and how we need to cut benefits (and certainly block any proposed increases in benefits). He never talks about how maybe we should make serious reforms in our health care system that would really put a serious dent in those projected increases. I recognize that this is a lot harder than it may seem (see all the battles over Obamacare). But RJS simply shreds his own credibility by failing to make this point before he jumps right in to wildly exaggerate the fiscal issues related to Social Security.

OTOH, given how much just totally weirdly wacko things that have been going on, having Robert J. Samuelson back on his old Monday morning schtick bashing Social Security is almost a nostalgic relief, a return to older and simpler times.

Barkley Rosser