The Agenda

NRO’s domestic-policy blog, by Reihan Salam.

Like Clockwork, the House GOP Lines Up Behind Chained CPI


Having been persuaded by Andrew Biggs that Congress should reject chained CPI as the basis for setting Social Security cost-of-living adjustments and personal-income-tax brackets, I’m disappointed but not surprised by the news that Republican lawmakers, including House speaker John Boehner, appear to have embraced the proposal. The Obama administration maintains that it intends to protect older beneficiaries from the cumulative impact of chained CPI, which is a good thing. Yet we don’t have a clear sense of exactly how the White House intends to achieve this goal. And so I think there is a strong case for broadening rather than narrowing the Social Security–reform conversation, to include more progressive benefit reductions or a larger effort to improve work incentives and establish a mandatory savings component.

Mark Thoma seems convinced that Biggs and his allies are insincere, and he betrays a lack of familiarity with arguments Biggs has made about Social Security for several years now. (Biggs has a forthcoming book on the subject, and he has published a short primer outlining his views.)

Specifically, Thoma maintains that NRO’s decision to publish a critique of chained CPI flows from a cynical desire on the part of conservatives “to position themselves as defending the elderly and the working class as they pursue their real goal of keeping taxes from increasing.” But of course Biggs is not a political strategist, and NRO does not set GOP policy. Those who do set GOP policy, and who have the most “skin in the game” when it comes to political outcomes, are members of the Republican congressional leadership, who appear to be united in support of chained CPI. So any cynicism on the part of NRO has proven, alas, fairly inconsequential.

And if we want to remain in the universe of purely cynical explanations — I’m comfortable swimming in those waters — a more plausible and sophisticated explanation for why some conservatives object to chained CPI could be that the Republican electoral coalition disproportionately consists of retirees and near-retirees, and it also relies heavily on non-college-educated white voters. Defending the interests of the elderly and the working class thus makes sense in narrowly political terms for Republicans, thus explaining the Republican reluctance to bring forward the timetable for Medicare competitive bidding and other measures designed to restrain the growth of old-age entitlements. The trouble, of course, is that Biggs tends to favor implementing structural reform of Medicare sooner rather than later, as do most NRO editors. Even if Thoma embraced this more sophisticated critique, he’d be wrong about Biggs and NRO more broadly. But this notion that Republicans are more attuned to interests of the elderly than the non-elderly poor accounts for more of the facts, e.g., the contrast between Republican enthusiasm for aggressive reductions in the growth of Medicaid expenditures and Republican caution on Medicare and Social Security.


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