Despite New Tone, Gov. Perry's Social Security Op-Ed Is The Same Old Scam
Gov. Rick Perry's (R-TX) attacks on Social Security seem like a strategy to woo Republican primary voters that would hurt him with the national electorate, but his op-ed today may signal how he will make the same case in different terms to the rest of the country. Dropping the venom that he employs when talking to his base, Perry pledged this morning in USA Today that he will "be honest with the American people" about Social Security's finances:
I am going to be honest with the American people. Our elected leaders must have the strength to speak frankly about entitlement reform if we are to right our nation's financial course and get the USA working again.
For too long, politicians have been afraid to speak honestly about Social Security. We must have the guts to talk about its financial condition if we are to fix Social Security and make it financially viable for generations to come.
Perry presenting himself as a 'frank' and 'gutsy' truth-teller who you can trust is in keeping with his campaign's efforts to avoid talking about Perry's past claims that Social Security isn't really legal in the first place — a tough sell since the candidate keeps calling the retirement system "a Ponzi scheme" and "a monstrous lie." However, when it comes to the truth-telling part of the op-ed, Perry is just as disingenuous about the program as he is about his own radical stance:
These are the hard facts: Social Security's unfunded liability is calculated in the trillions of dollars. Last year, annual Social Security outlays exceeded annual revenues for the first time since 1983. The Congressional Budget Office projects that outlays will be roughly 5% greater than revenues over the next five years, worsening as more and more Baby Boomers retire.
By 2037, retirees will only get roughly 76 cents back for every dollar that is put into Social Security unless reforms are implemented.
Let's take these one at a time. Outlays exceeded revenues for Social Security last year, for the 13th time since 1958, because when Wall Street collapsed and millions were laid off, the payroll tax base that funds Social Security took a wallop. Perry is attempting to exploit a temporary economic crisis to make a permanent rightward shift in the social contract.
The statement that Social Security's annual deficits will worsen due to retiring Baby Boomers seems designed to imply that the program can't survive the coming glut of retirees. But as Perry acknowledges, in his own warped way, the program can pay every penny of its obligations for the next 25 years — by which time every Baby Boomer will be upwards of 80 years old. In other words, the trust funds can weather the brunt of the retirement boom. And the cost of avoiding that post-2037 benefit cut is actually pretty tiny, compared with the size of the American economy: It's less than one percent of GDP.
Perry's biggest sin, however, is one of omission. He implies that sweeping reform is needed, but overlooks a simple tweak to the program that would eliminate the post-2037 shortfall. While 94 percent of Americans pay Social Security taxes on 100 percent of their earnings, the other six percent who make more than $106,800 per year do not. By erasing the cap on payroll taxes so that every American is paying retirement taxes on their whole income, we can make Social Security solvent for 75 years.
If Rick Perry wants to rebrand himself from flamethrower to truth-teller, he needs to do better than this.