Guest Op-Ed: Seize the Third Rail Now
By U.S. Rep. Bob Turner
Entitlement reform is called the third rail of electoral politics — to touch it is to die. Political wisdom dictates that any real solution be postponed until “after the next election.” But those of us in Congress must seize that third rail now. The situation facing Social Security and Medicare is grim, but solutions are possible without the privatization, or gutting, of these programs. We can put aside politics and electoral calculus to make careful changes today to preserve the programs for current retirees and to strengthen them for the future.
Americans are living longer and working longer, placing serious strains on programs that were designed at times when the average life expectancy was in the mid-60s. Take a look at the statistics. In 2011, there were 55.3 million Social Security beneficiaries, while approximately 50 million people were enrolled in Medicare. The first tranche of Baby Boomers (those born from 1946 – 1965) have begun to retire and, between 2010 and 2030, the number of people aged 65 and older is expected to increase by 78 percent. By comparison, the number of workers whose taxes will support future benefits is only projected to increase by 7 percent. All of that on top of the fact that the program is already running a $280 billion dollar deficit with 50 thousand new beneficiaries added each day.
Payments into the system will not keep pace with the increasing number of retirees. Social Security is funded by a trust fund as well as taxes on American workers and seniors. The fund’s resources are steadily running out and there will be no resources to fall back on for Social Security. Combined with the mass retirement of Baby Boomers, this coming funding crisis will strain Social Security to the point of breaking unless we act soon.
Medicare also faces funding problems, compounded by the Obama Administration’s health care reform which cut $500 billion from the program. By repealing the health care law, we can put that money back into Medicare. Congress must also tackle waste and fraud in the system, which is estimated by Medicare’s chief actuary to cost nearly $150 billion a year. Finally, Medicare should not and must not turn into a carbon copy of Medicaid. Medicaid is less flexible, less accessible and has fewer resources than Medicare.
New York State has a particularly challenging situation with 3 million people on Medicare and 5 million people, or 25 percent of the population, on Medicaid. In New York State alone, $53 billion was spent on Medicaid in just one year; $30 billion coming from the federal government and $23 billion coming from the state government.
There is no time to continue on with “business as usual”; there must be reform. For Medicare and Medicaid, we need to cut the overhead, bureaucracy and waste that accompany every government program. More importantly, my colleagues and I need to reach bipartisan solutions to the funding crisis. Senator Ron Wyden (D-OR), a liberal Democrat, and Congressman Paul Ryan (R-WI), a conservative Republican, have put forth a bipartisan plan that offers several suggestions on how to ensure long-term survival of the programs. While not perfect, there are good ideas in the Wyden-Ryan plan that could serve as a basis for broader discussions of reform.
Congress must have a serious discussion about how to close the medium-term funding gap and ensure the long-term solvency of Social Security. A similar set of issues faced Social Security in the early 1980s and a bipartisan effort between the then-Democratic Congress and President Reagan passed legislation that ensured adequate funding into the early 21st century. Congress must emulate the example of President Reagan and his bipartisan partners to extend the viability and solvency of the Social Security program now.
The numbers do not lie and they tell us that, in later years, we will pay more to get less. We owe it to current and future retirees to put Social Security and Medicare back on a sound footing. We must preserve these programs, without privatizing them or making them unrecognizable. I am committed to working with my colleagues and the American people on solving these problems.
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