Alice Rivlin Wants to Cut Social Security So John Boehner Can Spend It On Wars
Posted in: social security
Alice Rivlin is the chief wonk appointed by President Obama to the debt commission, and has long supported cutting Social Security benefits as a way to address the country’s financial woes.
Alex Lawson caught up with Rivlin and asked her about her plans right after his famous interview with Alan Simpson when the commission met two weeks ago, and she didn’t want to talk about it.
But it appears Rivlin’s ideas are gaining important support.
A month ago, John Boehner was warning that the commission planned to report its findings after the election, and that their plan could be passed by a lame duck congress with little fear of electoral accountability.
But in an interview with the Pittsburgh Tribune-Review, Boehner is now publicly expressing support for the very same ideas Rivlin proposes. And he wants to use Social Security benefit cuts to fund the wars:
Ensuring there’s enough money to pay for the war will require reforming the country’s entitlement system, Boehner said. He said he’d favor increasing the Social Security retirement age to 70 for people who have at least 20 years until retirement, tying cost-of-living increases to the consumer price index rather than wage inflation and limiting payments to those who need them.
Boehner has a three-point plan here to get money for mo’ war: 1) raise the retirement age to 70, 2) adjust Social Security’s cost of living increases (COLA), and 3) reduce payments to those with higher incomes.
Quelle coincidence. Rivlin and Boehner both support raising the retirement age, “fixing” the COLA, and reducing benefits for those who are “more affluent” (sounds like Alan Simpson’s “Lexus driving retirees in gated communities”) .
In testimony last year before the House Budget Committee (chaired by fellow deficit commission member John Spratt), Alice Rivlin said that “projections of the federal budget show rapidly rising spending over the next several decades attributable to three major entitlement programs; namely, Medicare, Medicaid and Social Security.” (PDF) Because “rapidly rising debt threaten our credibility as sound fiscal managers,” Rivlin told the committee that:
It will take some combination of several much-discussed marginal changes: raising the retirement age gradually in the future (and then indexing it to longevity), raising the cap on the payroll tax, fixing the COLA, and modifying the indexing of initial benefits so they grow more slowly for more affluent people.
According to the Urban Institute, raising the retirement age would push an estimated 1.5 million senior citizens into poverty.
Rivlin appeared on the notorious CNBC segment where Peterson Institute head David Walker spoke longingly about the return of debtors’ prisons. On that segment, Rivlin reiterated her support for reducing benefits to those with higher incomes.
As Trudy Lieberman notes, it’s unclear what Rivlin meant by changing benefit calculations for upper income people. “Did she mean reducing benefits for the higher earners or means-testing them? That’s what some Social Security supporters fear could destroy the program’s social solidarity, with ramifications for workers now in their thirties, forties, and fifties.”
In a recent interview with US News & World Reports, Rivlin said that Democrats voted against empaneling the deficit commission because they were “rightly” afraid that the commission would “recommend cuts in Social Security or Medicare,” while Republicans did so because they feared tax increases. “In fact, we can’t get out of this problem without doing both spending cuts — especially slowing the growth of entitlements — and tax increases,” she said. President Obama subsequently created the commission by executive order.
Of the 18 members on the commission, 14 are “deficit hawks” and the magic number needed to pass any recommendation is 14. Even non-hawk Dick Durbin recently said that “the bleeding-heart liberals… have to…make real sacrifices to strengthen our nation.”
It goes well beyond “ironic” that defense contractor David M. Cote, CEO of Honeywell, is on the deficit commission that is tasked with addressing the future of Social Security. As Robert Kuttner has noted, “the argument that Social Security is adding to the federal deficit is a bum rap.” In 1983 the retirement age was raised from 65 to 67, a 13% benefit cut. It was done expressly so that Social Security would stockpile a surplus that would pre-fund the additional cost of the baby boomers. But as Kuttner says, “George W. Bush pilfered that surplus for his wars and his tax cuts for the rich.”
So, funding wars on the backs of senior citizens is nothing new. But raising the retirement age to 70 would be another 20% benefit cut. If you’re in your 40s or 50s right now, it is worth noting that they’re already looking to blow your money on defense.
That Boehner would eventually find common ground with Pete Peterson-funded wonks like Rivlin (who appeared in Peterson’s IOUSA) is no surprise. It should concern everyone who cares about the preservation of Social Security, however, that Boehner is making noise about his support for the same ideas the debt commission is considering. It means that when the commission finally issues its report on December 1, the Republican support necessary for passage could be there.
House Democratic whip James Clyburn met with the commission recently. He said that he worked closely with Nancy Pelosi to choose members from the House. Unsurprisingly, he too expressed support for both raising the retirement age and means testing, recycling George Bush’s debunked claim about “17 workers for every retiree.” Nancy Pelosi, Harry Reid and Joe Biden have all promised that the commission’s recommendations will be put to a vote.
There are 178 Republicans in the House, and 218 votes are needed for passage. Between the 18 Democrats who are retiring and the 53 members of the Blue Dog Caucus, they should have little trouble putting together the necessary votes without ever having to tap Democrats who would catch hell from within their districts if they vote for it. Even non-Blue Dogs like New Dem Jim Himes are echoing Petersen’s rhetoric about Social Securitiy’s “massive unfunded liabilities.” And the commission is packed with Senate firepower to garner sufficient support on the Democratic side of the aisle, from Conrad (Budget Chair) to Baucus (Finance Chair) to Durbin (Majority Whip).
Boehner will have considerable influence in what the commission recommends in exchange for delivering Republican votes. If he wants to take the money Alice Rivlin saves by putting 1.5 million seniors into poverty and give the money to Honeywell for more bombs, he’s got a lot of leverage to do so.