With Dean Baker on leave and Bruce Webb and other usual suspects laying low, I guess it is up to me to dump on the Washington Post's Editorial Page Editor, Fred Hiatt, for his latest assault on entitlement programs for the American elderly, something that he is the ringleader of at the WaPo editorial page, leading such eager followers as Robert J. Samuelson and Ruth Marcus, among others. Much of today's column, "Never-Compromise wins again: New Democrats are being driven to extreme positions," is old hysterical boilerplate, but there are some new themes. One is to dump on Congressional Democrats for supporting expanding Social Security, which is the "extreme position" he denounces them for, and is something he clearly never expected to see. The other is to see how he adjusts some of his standard lines in the face of this shifting of the political ground from trying to push cuts in Social Security (and Medicare) to trying to oppose efforts to expand its payments. Of course, his main line is to compare unfavorably the Congressional Dems to the GOPsters as sources of "gridlock." If only they would get on with good old Bowles-Simpson, all would be right in the VSP world!
In the face of this push to expand Social Security benefits, with Maryland's Rep. Chris Van Hollen being the main object of Hiatt's wrath (and Van Hollen is accused of moving to this position from his supposedly responsible previous position favoring Bowles-Simpson for, ack!, political reasons as he is running to replace Barbara Milkuski in the Senate, and, horrors!, he has figured out that expanding Social Security benefits might be, awful!, popular with Dem primary voters in MD), Hiatt softens up just a bit on his usual criticisms of Social Security. In particular, for the first time I have ever seen, he admits that "It is by no means lavish; the average monthly retirement benefits is about $1,300. It must be protected." And, he admits that it is "an essential and successful program that has lifted and continues to lift millions of elderly Americans out of poverty." Wow! This is the first time I have seen Hiatt say anything even remotely as positive as this about the program. But, hey, nothing like the earth moving under your feet politically to bring out the recognition that the program is not just some awful nightmare of fiscal disaster.
But of course, it still is such a disaster in his eyes, even if he now admits it has some virtues. So, he informs us that "But those monthly benefits are paid out of the taxes of working Americans, of whom there were more than five for every beneficiary in 1960. Today there are fewer than three workers for every pensioner. In 2030, the ratio will be two to one." Well. So those benefits are coming out of the hides of the virtuous younger workers! That the recipients have paid into the system in the past is not mentioned.
This demographic pitch is the main negative argument he provides, aside from his general whining about how the Dems are now contributing to gridlock and not accepting the sublime VSP wisdom of Bowles-Simpson. This is old stuff, but all the more reason for pointing out how silly it is. Presented this way to someone never thinking about the issue before or not knowing much,this forecasted change can sound pretty scary. However, what Hiatt and others pushing this line never mention is that this is not bad when one compares the US with other high income nations. Indeed, we have among the best demographics of any of these nations for such programs. That ratio we shall have in 2030 is what one finds already in Germany, where the budget is not in bad shape, people can retire earlier than in the US, and the benefits are higher than in the US. This is something to panic and freak out about? Obviously not, but one will not hear this from Hiatt and his flunkies.