Social Security Works spoke to several conservatives at the Conservative Political Action Conference (CPAC) this past Friday, who were none too pleased to hear Mitt Romney he plans to cut Social Security and Medicare.
To the right is a video Social Security Works put together contrasting Romney’s statements on Social Security and Medicare in his speech at CPAC with the reactions of some CPAC attendees.
It is no surprise that I spoke with many CPAC attendees, who either agreed with Romney, or had more extreme positions. But in addition to the people we included in the video, I spoke with several more conservative activists, who we did not have the space to feature, but also opposed the idea of cutting benefits.
A few things stood out to me in my conversations with CPAC attendees, whether they took issue with Romney’s remarks or not:
• There are faces behind the poll numbers. While I had seen the poll numbers showing widespread Republican opposition to Social Security cuts before CPAC–the latest National Journal poll shows 77 percent of the country, presumably including many Republicans, opposed to cuts–I had to see it to believe it.
• A “grand bargain” for the elites only. All year long, proponents of a “balanced” deficit reduction package that includes Social Security cuts have sold it as a measure that will win the President political support from moderate Republican and independent voters. But my experience led me to believe that cutting Social Security seems to appeal more to elites and their donors in both parties, rather than rank-and-file voters.
• Insurance not welfare. Even the CPAC attendees I spoke to who favored cutting Social Security and Medicare, agreed that Social Security was insurance, not welfare. For conservatives who malign “government” in the abstract, and consider busting welfare cheats a top national priority, this is the highest compliment. We make fun of Tea Party activists for sporting signs saying, “Get your government hands off my Social Security and Medicare.” But conservatives’ support for Social Security speaks more to the political intelligence with which these programs were created than it does to conservatives’ selfishness or hypocrisy. Social Security’s character as a self-funded earned benefit plan that is universal, not means-tested, has spared it the scorn that other means-tested government programs elicit. This is one reason we should be wary of proposals to means-test Social Security and Medicare.
• Denial. Several interviewees simply refused to believe that Mitt Romney had proposed cutting Social Security or Medicare. Call it a case of political cognitive dissonance.
• Myths and misinformation. Many conservatives I spoke to were beholden to the same myths about Social Security that have resonated with the broader American public. This is often what led them to reconcile their appreciation of the program with support for cuts:
◊ Social Security is “broke.” Many CPAC attendees endorsed benefit cuts reluctantly, but had exaggerated views of the program’s funding gap, calling the program “broke” and “bankrupt”
◊ Congress raided or spent the money in the trust fund. For many people, Social Security is a perfect program, but Congress spent its surplus on frivolous government expenditures
◊ President Obama turned Social Security into welfare. According to these people, Social Security was once a quintessentially American earned insurance program, but in recent years, Congress and President Obama have expanded into a wasteful welfare program.
In reality, Social Security is facing a modest funding gap, not “going bankrupt;” its $2.7 trillion surplus is invested in United States Treasury bonds that cannot be “spent” by Congress; and President Obama has done nothing to change Social Security.
As for Romney’s proposals, Social Security Works has made a fact sheet chronicling his statements on Social Security prior to CPAC. (Spoiler alert: Romney has called Social Security a fraud in the past.)
What made Romney’s CPAC speech unique was that Romney articulated specific policies he would pursue rather than discuss them vaguely as he has in the past. Let’s focus on two key points:
Raise the Retirement Age
Romney said: “We will slowly and gradually raise the retirement age for Social Security.”
This is bad policy because:
• Raising the retirement age to 69 is a 13% benefit cut at whatever age you claim benefits. Even if you delay retirement to age 69 your benefit would be 13-16% less. (See chart here.)
• Many older workers cannot find work or cannot work after age 67, let alone age 69. Raising the retirement age greatly disadvantages lower-wage and minority workers, who, on average, have seen little or no increase in life expectancy, suffer from work-limiting health problems, and work in physically demanding jobs.
Opposes Making the Rich Pay Their Fair Share
Romney said: “Tax hikes are off the table.”
This is bad policy because:
• The vast majority of Americans must make payroll tax contributions on all of their wages, millionaires and billionaires like Mitt Romney only do so on the first $110,100 of their earnings.
• Scrapping the cap so that all earnings are subject to the payroll tax would close Social Security’s entire projected 75-year funding gap.
While President Obama has yet to draw any lines in the sand for bipartisan reform efforts, Romney has already precluded revenue increases from the discussion. Unless President Obama hardens his negotiating position, the price of keeping Social Security reform bipartisan could be very high.