On Friday, the day before Christmas Eve when much of America was thinking about sugar plums, lay-away plans, and protesting Christmas pageants, the Federal Accounting Office released its analysis of the net present value of the nation’s Social Security and Medicare obligations, “net present value” being the total funds that would have to be set aside today to pay the costs of these programs in the future. Seldom do figures so clearly indict the unethical practices and statements of so many.
In fiscal 2011, the cost of the catching up on the required funding of Medicare and Social Security rose from $30.9 trillion to $33.8 trillion. That $2.9 trillion increase should be regarded as adding to the $1.3 trillion cash deficit for fiscal 2011, making a $4.2 trillion deficit—and this coming in a year in which the rising national debt was supposedly recognized, at last, as a threat to America’s stability, prosperity, and welfare. The costs of Social Security and Medicare are rising at a frightening rate, nearly doubling in the last decade, with little or nothing being done to address the problem. And there is good reason to believe that the Medicare estimates are based on unrealistic assumptions. The GAO report also includes an alternate, less rosy scenario (or perhaps “more putrid” is a better phrase) in which the projected Social Security-Medicare debt is more than $46 trillion. How serious is that? Well, the combined value of the equity in U.S. homes and the value of all publicly-traded companies is less than 20 trillion dollars.
What do these figures tell us about the ethics of the various players on the national scene?
- Republicans: The figures tell us that the Republican insistence that taxes can’t be raised is reckless and irresponsible, as well as dishonest and cowardly. In addition to having to deal with these obligations, there is also a 15 trillion dollar national debt that shows no sign of falling, and that must be reduced for the nation’s economy to have a fighting chance of thriving again. You can’t pay debts with program cuts. Responsible leaders of both parties need to be building consensus for a concerted national effort to reduce the debt, the deficits, and the looming entitlements bill in real terms. For elected officials to continue telling voters that avoiding tax increases for everybody is anything less than suicidal amounts to an unconsionable breach of trust. They are lying, or they are too dumb to be in office. It is as simple as that.
- Democrats: The figures tell us that Democrats playing the class card and insisting that Social Security and Medicare “not be touched” (as Rep. Gerald Nadler (D-NY) did a couple of weeks ago) are every bit as irresponsible, dishonest, reckless and cowardly as their Republican counterparts. The figures are pretty clear: even if the U.S. became nothing but a check-writing entity for the sick and elderly, it could not afford the system as currently structured and funded. Yet nothing in the policies being put forward acknowledges this. The payroll tax cut, for example, takes money from the Social Security trust fund. The budget needs to be cut dramatically; all the protesting interest groups need to be confronted and resisted. Real programs, good programs, have to go, and there needs to be major tax increases. It’s not debatable.
- The Tea Party:The figures tell us that the Tea Party’s militant “no new taxes” position is willfully ignorant or intentionally contemptuous of reality, making any politician who kowtows to its pleasure either cynical, incompetent or both.
- The media:The figures tell us the news media is more interested in describing political machinations, dwelling on the inside-baseball of politics and flacking for its favorite party rather than telling the public what it needs to understand, and understand now, about the nation’s real fiscal peril. Instead, “Fact Check” columns in publication after publication “debunk” statements by Ron Paul, Rush Limbaugh and others that the U.S. is “bankrupt,” saying, in essence, that the critics are fear-mongering, that things “aren’t so bad.” Yet most companies would consider declaring bankruptcy, if their obligations exceeded their wealth by similar proportions. Yes, of course: the U.S. has assets in land and resources that make technical bankruptcy all but impossible, but the same could be said of Greece—boy, the Parthenon alone would fetch billions. The American public needs to be concerned enough about the problem to commit to real sacrifice in a shared initiative as a people. The media need to tell the bad news; instead, its playing games and politics.
- The public: The figures tell us that, so far, at least, the public is too selfish, lazy, gullible, and irresponsible to insist that its government do what is necessary to avoid looming financial disaster. Even the knowledge that our children and grandchildren will be the primary victims hasn’t created a nationwide willingness to be responsible.
- Seniors: The figures tell us that the cries of injustice from well-off seniors (it is the richest demographic group in the U.S.) who argue that they are owed the full measure of their Social Security benefits whether they need the money or not mark some of “the Greatest Generation” and their successors as “The Selfish Generation.” The obligation has to be reduced, and the program was designed as a safety net, not retirement benefit for those who would be fine without it. Financially secure seniors can help address the crisis with a minimum of pain. They should be ashamed of themselves.
- The Obama Administration: The figures tell us how much of a sham and a betrayal the Administration’s pledge of transparency has been. Why was this data dumped into the news pool when it was least likely to be noticed? Why isn’t the Administration trumpeting the problem, rather than hiding it? Don’t Americans have the right to know when their country is in trouble? Where is honesty, trustworthiness, courage, and accountability.
- President Obama: The figures tell us what a truly negligent. passive, politically cynical and irresponsible leader he has been. He should be reprimanding both parties. He should be building consensus among the American people for a long period of shared sacrifice, instead of working to turn black against white, rich against poor, old against young, veteran against civilian, immigrant against native born, all at a time when every citizen will have to make serious sacrifices. He should be giving speeches explaining exactly what these figures mean, how they will make it difficult to afford keep our sewers from erupting and our roads from crumbling, harder to stop aggressive regimes abroad, more difficult to care for the environment or improve our education system. He should be asking sources of private wealth to develop plans to shoulder a greater share of the social burden of caring for America’s most vulnerable while the nation gets its finances back on a survivable course.
In his interview on “60 Minutes,” the President said that he thought his first term was one of the four most successful in U.S. history. That is delusional or dishonest. No matter what his other accomplishments, no President can call his time in office successful or even responsible when such a major, growing, undisputed and dangerous problem as the burgeoning debt and deficit is not only ignored, but made worse and deliberately hidden from the public.
All of this and more can be seen in those stark GAO figures that our government wanted us to ignore in the haze of holiday cheer. Robert Samuelson, in a recent column, described what is going on as nationwide denial, and wrote that we were “playing Russian roulette with the country’s future.” He is right about that, but too kind about the reasons the deadly game goes on. It’s not denial. It is selfishness, cowardice, and incompetence.
The numbers don’t lie.