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Liberals Against Saving Social Security


Josh Marshall and Noam Scheiber argue that the crusade to save the program makes no sense. Scheiber is the more succinct:

If you believe the Social Security trust fund is one big myth, as most conservatives do, why on earth does it make sense to start “saving” Social Security today? After all, the Social Security program will be running surpluses for another decade or so. Those surpluses currently help fund the rest of the government, which, in return, sticks a lot of IOUs in the Social Security trust fund. The only thing ”saving” Social Security today–that is, raising taxes or cutting benefits–would accomplish is to increase the size of the current Social Security surplus, and therefore the number of IOUs in the trust fund. But, of course, if you don’t actually believe in the trust fund, it’s not clear why you’d want to make it bigger. (Well, it is clear, as Josh points out: Because you want to raid it for tax cuts. It’s just not clear why anyone should go along with you.)

There’s a good point in here, which is that it makes no sense to, say, raise more payroll-tax revenue, as Barack Obama is open to doing, if the federal government would squander the additional revenue rather than devote it to future Social Security benefits. That’s one of the reasons that most conservatives (and a surprising number of centrists) don’t, in fact, favor a traditional Social Security fix that shores up the trust fund: The experience of the last three decades tells us that the government would spend the additional money on other programs.

But there are some reasons you’d want to start with a non-traditional solution sooner rather than later. For one thing, if you want to rein in benefit growth, starting earlier allows you to take less drastic means to do that. If we wait until the middle of the next decade, we will have to choose between cutting benefits for people who are already retired, raising taxes, and changing benefit formulas so that one generation gets lower real benefits than the one that came before it. If we act now, we have more options (such as reducing the growth rate of benefits).

There is also, relatedly, the generational-equity point: The longer you wait, the more pain you impose on the age cohorts that are already getting a worse deal from Social Security.