Playing the Numbers Game


"LAST YEAR," began a leaflet circulated by Congress man Barney Frank, typical of Democratic propaganda this fall, "the Reagan Administration and its Republican friends in Congress tried to cut Social Security cost-of-living benefits. Barney Frank and the Democrats stopped them."

"Shouldn't try to scare folks like that," piously chided a Republicans commercial in response. It went onto explain that President Reagan would keep his promise never to cut Social Security.

The seemingly perpetual fiscal crisis in the Social Security system exemplifies the sort of mess that responsible partisan politics can get us into Social Security, both parties admit, it in serious trouble. The cost of the program has grown enormously: since 1960 the proportion of the federal budget it consumes has doubled. So far, shuffling money between Medicare, disability insurance, and Social Security has kept the latter program afloat. But by mid-1983, if not extended, the law allowing such tactics will expire. And by 1984, all three funds will be bankrupt. Indeed, the system is projected to run a cumulative deficit of more that $150 billion in the next seven years.

The core of the Social Security crisis is not just a temporary accounting problem, or the unwillingness of flint-hearted conservatives in Congress to pay for it, but the long-term demographic impossibility of maintaining Social Security as it is currently conceived. Medical advances have extended the average life span so that more people are retiring than was ever expected. Back when FDR first conceived so Social Security, only one American in 20 was over 65. Now the figure is one in 10, and in 50 years will be one in five.

Misguided generosity has exacerbated the problem. The original internet of Social Security was to supplement the income of the elderly poor without resorting to something that looked like welfare. To effect this, the myth was propounded that retires had "earned" their Social Security payments by paying into the system--despite the fact that recipients now get vastly more than they contributed. Since the system's inception, the level of payments, and of expectations, has risen drastically. Ten years ago, the average retiree could expect payments of about 601 percent of his pre-retirement income: now, the figure is 90 percent. Yet the amount each recipient gets remains independent of need, so that for some Social Security provides bare subsistence, while for others it is a pleasant gift from Washington.


THE HABIT both political parties have of making loud, frightening noises whenever the other makes a move has stymied reform so far Liberals like to call Social Security the "third rail" of politics, because to touch it is to die. When Reagan asked for a lame-duck session of Congress to consider the Social Security problem, for example. Tip O'Neill and Ted Kennedy scored quick points by accusing Reagan of a "secret plan" to cripple Social Security.

The lame-duck session should ideally give legislators a chance to consider Social Security without an election looming before them. A commission appointed by Reagan, the National Commission on Social Security Reform, is due to present recommendations on the Social Security problem by the end of this year, and, again ideally, Congress will soberly consider the commission's proposals and emerge with a responsible, dipartisan plan. "Between Thanksgiving and Christmas is a perfect time." "Sen. Robert Dole (R-Kans.) has noted cheerfully. "Even politicians aren't very political then."

But even while evincing such optimism, the two parties have continued to circle each other warily. A proposal to index Social Security to the wage level rather than the consumer price index--which rose in 1980 twice as fast as wages--came immediately under fire from the AFL-CIO and from the American Association of Retired Persons. In retaliation. Dole demanded recently that the Democrats present the first reform package in the upcoming session.

Whoever wins the political games, the policy outcome is predictable. Since both parties have vigorously announced their intentions to protect Social Security payments from cuts, the only alternative is to increase revenues. The tax we all pay on our income will go up, of course; the only question is how fasts. One suggestion has been to hasten the 15 percent increase currently scheduled between 1985 and 1990. Another is to eliminate the exception from Social Security that some groups enjoy. Neither Democrats nor Republicans dare to suggest a more surgical solution--phasing out Social Security and replacing it with a welfare program that targets its aid to the people who need it. And so this political monster will grow bigger and bigger, and we will keep on feeding it.