The Grief of Senator Daschle
It’s too much for him to bear.

September 7, 2001 3:15 p.m.

enator Tom Daschle, looking as if he were struggling to avert his gaze from the sack of Rome, tells us on television two or three times every day that he cannot stand the mere thought of it, that Candidate Bush would say one thing about Social Security and the fiscal surplus and contemplate, now, something else. The thought of a politician contradicting word by deed is too much for him to bear. "Oft have I heard that grief softens the mind, And makes it fearful and degenerate; Think therefore on revenge and cease to weep," Queen Margaret counseled in King Henry VI.

It was a mistake for George W. to say in the summer campaign that under no circumstances would he derail surplus revenues from the Social Security fund. He should not have said it for the simple reason that the resolution rested on assumptions that could not safely be banked on. President Bush noticed this belatedly when a few weeks ago he said that of course any pledge to sequester surpluses could not be held inviolate if there were war or depression. Some might call that a hedge, others, common sense. But the situation that causes Tom Daschle to weep is other than war or depression.

And it calls for a direct examination of the anatomy of Social Security and federal spending done with strenuous effort to refrain from the use of numbers.

1) Social Security, in its present scale, is in danger because federal income from Social Security taxes is not projected to match Social Security commitments.

The reason for this has nothing whatever to do with the budget. The problem arises from the number of Americans who are paying Social Security taxes and the number of people drawing Social Security benefits. When the program began, the ratio was approximately 40 to one. That meant that 40 people were paying into Social Security while one was drawing from it. That ratio contracts as more people reach Social Security age and then live longer, while relatively fewer people
work. It would be grand if every American lived on to age 100. But if that were to happen, and existing coverage rules continued, the young and middle-aged would be supporting everyone beginning at age 62.

2) The situation, then, calls for reform. This can only take one of several painful roads. The first is to revise the Social Security log-on schedule to adjust for longevity. Since 1935, when the Act took hold, Americans are graced to live eight years longer, and counting, than they then did. It would make sense to postpone qualification for Social Security to age 70, if the same criteria were advanced as in 1935. Alternatively, Social Security payments could be reduced. Alternatively, higher Social Security taxes could be exacted.

3) The idea of segregated funds is conceptually appealing, but unrelated to real life. When Candidate Bush said that he wouldn't derail current Social Security surpluses (brought on by the great Social Security tax-hike of 1981), what he meant was that continuing surpluses on the scale projected in the summer of 2000 translated to reduced national debt. The delusion was encouraged that debt reduction was the equivalent of sticking gold bars into a repository, to rest there until the Social Security program drew down to negative figures.

But of course that was, and is, mere paperwork — government-to-government IOU's are like lonely girls who send themselves Valentine cards.

4) What Daschle is trying to draw attention to is of course the tax cut. If you reduce taxes, you reduce revenues. That sounds obvious, though it is less than that, because a dollar untaxed is at liberty to generate wealth and greater federal revenues, even at a lower tax rate. The Daschle/Gephardt position becomes that the Bush tax reduction is requiring a corresponding diminution in the reduction of the national debt and therefore jeopardizing federal commitments to Social Security
in the year 2038.

The administration is pleading extenuating circumstances, namely less zing in the economy (which means reduced revenues from taxes), and increased burdens of government (which means more spending). Some of these burdens are welfare bloat and pork; others are security-oriented (the antimissile program and Pentagon spending).

Mr. Bush could call Daschle's bluff by saying: Go ahead, undo the tax-reform act, I promise not to veto it. Let's try the politics of that solution. To those Americans who plan to retire in 2038 at age 62, he could counsel that they put off doing so — or else breed more children to pay into Social Security.

And, of course, he can always say that future Social Security deficits can be paid by borrowing, which is how we managed 38 budget deficits under Democratic Congresses in the past 44 years.