The Damned Lies: Attacking the Trust in America's Retirement System

Golden eggs in a bird's nest
Golden eggs in a bird's nest

Ever wonder why you hear Republicans and the Right-wing media constantly saying that Social Security is going bankrupt? This drumbeat of catastrophic outcomes for our nation's highly successful retirement security system is not at all connected to fact. It is part of a campaign to degrade public confidence such that support goes down and the framework for privatization is created. It is a concerted attempt at creating very bad proposals that will do great harm to millions of people now and in the future. We need to know what is behind this bad venture.

The Leninist Strategy

In 1983, The Cato Institute, a conservative think tank founded by the billionaire Charles Koch, published a paper focused on Social Security and titled "Achieving a Leninist Strategy." The paper lays out strategies aimed at undermining public support for Social Security. Using what they clearly admitted is Leninist theory, they make the point that "fundamental change is contingent both upon a movement's ability to create a focused political coalition and upon its success in isolating and weakening opponents."

The authors recommend not touching the benefits of current beneficiaries, suggesting instead "an economic campaign assisted by modest changes in the law." They call for a form of "guerilla warfare" with the goal of "weakening political support" and converting Social Security to a privatized system.

Starving the Beast

Cut to September 2003, New York Times piece by columnist Paul Krugman, called "The tax cut con." Krugman writes about Republican and conservative strategies to use tax cuts to reduce the size of government (often called "starving the beast.") About halfway through the piece, Krugman notes a comment by Grover Norquist, the president of the conservative group Americans for Tax Reform. "I don't want to abolish government, I simply want to reduce it to the size where I can drag it into the bathroom and drown it in the bathtub."

The outcome of Norquist's strategy is illustrated in a book published in the early 2000s, written by Professor Emeritus of International Studies at Cornell University Milton Esman and titled "Government Works, Why Americans need the Feds."

In the first chapter of his book, Mr. Esman tells us: "During the final quarter of the twentieth century the most significant mood in American public affairs has been disenchantment with government. This mood has ranged from cynicism to militant hostility...." Esman then notes, "In response to a question posed by the Gallup organization, 'Do you trust your government to do the right thing all of the time or most of the time,' in 1963, 75 percent responded affirmatively. A generation later that number dropped to 20 percent in 1995." In 2010, that number remains low at 19 percent.

He went on to say, "The dominant theme of Right-wing politics and public discourse during the past quarter century has been an unrelenting campaign to demonize government, chiefly the federal government, and to shrink its size and influence in American society and the American economy." He continues, "Hostility to government has become the rhetorical mantra and the defining core of modern American conservatism."

The Damned Lies

In exposing the lies, the damned lies, if you will, of the movement to dismantle Social Security, it is important to understand the underlying theory that has been pushed on to the public as the basis for a phony set of facts and reforms. The claim begins with a set of ideas (as noted above) that essentially say that government does not work and does a lousy job. This has become the context for policy positions supported by the conservative movement and contemporary Republicans.

For Social Security, this unrelenting campaign against government builds the frame from which to claim that the program is going broke and is in crisis. They claim that Government does not work, therefore Social Security, a government program, is going broke. And they say that Government does not work, therefore the government is stealing our Social Security Funds.

These allegations and distortions, pushed by Republicans are, in fact, an outright lie and a tremendous disservice to real public discourse. The facts about Social Security tell us that it is not broke and that it is not in crisis. Dozens of economists and other experts report, based on real data, that Social Security has a minor and easily solved shortfall years away, but it is not, in any way, broke or in crisis.

So why, then, are Republicans and conservatives making these outlandish and wild claims? Because after years of polling, research, and experience being defeated when proposing bad ideas (witness the Bush partial privatization plan in 2005 that went nowhere after a year of trying) the "going broke" position is all they have. The "going broke" lie appears to be their most effective, though untrue, premise for a set of very bad reforms.

We have to cut benefits because Social Security is going broke.

We have to raise the retirement age because Social Security is going to soon be bankrupt.

We have to means test benefits since Social Security will not be there for those who need it the most.

The American public loves Social Security so much, that privatizers and other opponents of Social Security can only justify their attempts to cut the program by claiming that it is going broke. The anti-Social Security crowd cannot assert that Social Security does not help people.

They cannot claim that it does not keep people from economic catastrophe as they age, as they become disabled, or after the death of a working parent. Folks know that none of these statements are true. So the privatizers and the deficit hawks have only one option, which is to claim Social Security is going belly up, broke, bankrupt. This perspective has as its foundation the disenchantment that many people feel toward government (as pointed out so well in the Esman book).

The Solution

This is not just about general claims and statements. The facts tell us the truth, and the truth is that Social Security is not in crisis and is not going broke. In their outstanding book, Social Security Works! Why Social Security is Not Going Broke and How Expanding It Will Help Us All, Nancy Altman and Eric Kingson spell out the facts about Social Security. They note that Social Security has a $2.8 trillion surplus and can pay full benefits "for the next 15 to 20 years." And they further report that at that point it can still pay 75 percent of promised benefits. That calculation is made based on a very low growth rate of growth in the economy. If we simply remove the $118,500 cap on Social Security payroll contributions, so that the wealthiest Americans pay their fair share into the program, we can easily afford to protect and expand benefits.

The shrill demands calling for cuts to Social Security and the full or partial privatization of the program have been built on nothing less than a sham. Nothing is perfect, neither in life nor in public policy. But when the facts come to light we know that Social Security is in very good shape, and should be protected and expanded. It is not a program in crisis.