The retreat by the Democratic leadership on the extension of the Bush tax cuts until after the election sets up a major tax-policy fight for the lame-duck session — the session that occurs after the elections but before the new Congress has been sworn in. But a far bigger tax-and-spend fight could be brewing: multi-trillion-dollar changes to Social Security, based on the recommendations of President Obama’s deficit commission, which is set to report December 1. The commission’s point-person on Social Security, former Clinton administration budget director Alice Rivlin, said recently that “the stars are aligned” for major changes to Social Security, adding that the lame-duck session was “a convenient moment to do this.” Activists on both the left and the right should be very worried.
Two of the most prominent members of the deficit commission have been clear about their plan to jam its recommendations through over the holidays. Democratic Senate Budget Committee chairman Kent Conrad went so far as to say the session would be “one of the most significant lame-duck sessions in the history of the United States.” Sen. Judd Gregg correctly noted that the lame-duck vote on the deficit-commission report could be more consequential than last Christmas Eve’s health-care vote.
Sen. George Voinovich, like Gregg a retiring lame-duck Republican, seems excited to vote for the deficit-commission recommendations on his way out the door. “We’re going to get some wonderful recommendations out of the debt commission,” Voinovich told Congressional Quarterly
last week. It should scare us when senators who will never again face voters are taking the lead on major policy changes.
Some activists on the left understand the danger. Obama’s key Social Security advisers from the 2008 campaign, Nancy Altman and Eric Kingson, didn’t hold back in describing the unfolding process:
President Obama and the leadership in Congress have delegated enormous, unaccountable authority to 18 unrepresentative, inordinately wealthy individuals. The 18 individuals are meeting regularly in secret, behind closed doors, until safely beyond this year’s mid-term election. If they reach agreement, their proposal will be voted on in December by a lame duck Congress, without the benefit of open hearings and deliberations in the pertinent committees and without the opportunity for open debate and amendment on the floors of the House and Senate. Despite the speed and lack of accountability, the legislation will affect, in substantial ways, every man, woman, and child in this nation.
If anything, they understate the lack of accountability, since the Senate voted decisively to reject the deficit commission, but President Obama went ahead and created it anyway, by executive order. While I couldn’t disagree more with the substance of the criticism from the left, I strongly agree that we deserve a genuine national debate, not a rush job in a lame-duck session.
It is possible to reform Social Security to provide a better deal for workers — without cutting benefits, raising taxes, or raising the retirement age — by harnessing the power of real investment returns. In fact, the chief actuary of Social Security found that four separate plans would do just that during the big national debate in 2005, a debate President Bush lost by focusing on unpopular benefit cuts instead of the popular prospect of using real investment returns to provide higher benefits.
Unfortunately, in an abbreviated dash to jam through the deficit-commission recommendations in December — an eerie déjà vu of the way health care was forced through over the objections of millions at the same time last year — positive pro-worker alternatives would not be on the table. Instead, there would be an attempt to “balance” tax hikes and benefit cuts. An analysis by Americans for Tax Reform found that the “balance” favored by commission members Erskine Bowles and Judd Gregg would include an astonishing $26.7 trillion tax hike, a crushing blow to economic growth and the largest expansion of government in history. It makes the fight over the Bush tax cuts look like peanuts.
It would be outrageous for Congress to consider forcing through massive changes to Social Security with limited public scrutiny under any circumstances. But to do it in a matter of weeks during the holiday season? In a body full of people who already lost reelection — some of whom were appointed, not elected, to the Senate in the first place? Without the benefit of proper hearings or committee action?