McCain’s ever-evolving position on Social Security

May 15, 2008

While there have been plenty of polls suggesting John McCain would enjoy more support from elderly voters than Barack Obama, I’ve taken some solace in the fact that very few voters, in any age group, realize just how wrong McCain is about Social Security. For voters over a certain age, it has the potential to be quite a political problem.

Compounding the problem, of course, is that McCain seems to have trouble keeping track of what his position on Social Security is.

Take his interview this morning on “Live with Regis and Kelly.” Regis Philbin isn’t exactly known as a tough questioner, but this exchange was interesting:

MCCAIN: What should be partisan about the fact that Social Security is going to go broke? I mean, should we be divided up among Republican and Democrat…

PHILBIN: Do you have a plan?

MCCAIN: Yes, sir. It’s gonna require, though, cooperation and participation by the other side. And I’ll reach my hand out…

PHILBIN: Is it privatization of the Social Security program?

MCCAIN: No, no it isn’t. But I would say that I support … I’d put everything on the table to start with … but second of all … young workers ought to be able to put part of their salary, part of their taxes into Social Security, into an account with their name on it. But that would not in any way effect older workers. But you’ve got to have a negotiation.

First, McCain’s factual claims are just odd. Social Security isn’t “going broke.” What’s more, he doesn’t believe in privatization, but rather, wants workers to take their money out of the Social Security system and into private accounts. This, as far as McCain is concerned, is not privatization.

Second, the McCain campaign can’t seem to settle on one consistent position on the policy.

In 2000, McCain touted a Social Security privatization scheme, not unlike the proposal Bush made in 2005. Eight years later, his campaign decided to go in a different direction.

Sen. McCain’s 2008 presidential campaign Web site takes a different view, proposing “supplementing” the existing full Social Security system with personally managed accounts. Such accounts wouldn’t substitute for guaranteed payments, and they wouldn’t be financed by diverting a portion of Social Security payroll taxes.

Mr. McCain’s chief economic aide, Douglas Holtz-Eakin, a former head of the Congressional Budget Office, says economic circumstances forced changes concerning Social Security policy. Vast budget surpluses projected in 2000 evaporated with a recession, the Bush tax cuts and the cost of responding to Sept. 11.

Asked about the change, McCain rejected his own campaign’s Social Security policy. “I’m totally in favor of personal savings accounts…. As part of Social Security reform, I believe that private savings accounts are a part of it — along the lines that President Bush proposed.”

When reminded that his campaign website says something completely different, McCain said his site would be changed. Two and a half months later, the site remains the same. As a result, McCain and his campaign have taken completely different positions on the issue, with the candidate embracing the same policy pushed by Bush, which Americans rejected overwhelmingly.

I wonder what seniors in Florida are going to think about this?

Why isn’t social security going broke?

In 2048, or some such year, social security will only be able to meet about 70% of its obligations.

That sounds like ‘going broke’ to me.

  • Let’s have a CNN debate between McCain and his Website administrator. Should be riveting TV.

  • In 2048, or some such year, social security will only be able to meet about 70% of its obligations.

    That sounds like ‘going broke’ to me.

    Forty years or more out is “going broke”? No one can plan that far out economically, we have no idea what the world will be like. SS has “been going broke” many times in the past and a small tweek has corrected it. And the current projection is the worst case scenario with NO changes. Just raising the cap on SS income can make it solvent to infinity.

    As Dean Baker has been saying for years, it’s a phone crisis.

    Medicare, on the other hand, is a trainwreck waiting to happen.

  • Paul Krugman wrote in NOvember:

    “Inside the Beltway, doomsaying about Social Security — declaring that the program as we know it can’t survive the onslaught of retiring baby boomers — is regarded as a sort of badge of seriousness, a way of showing how statesmanlike and tough-minded you are.
    …
    But the “everyone” who knows that Social Security is doomed doesn’t include anyone who actually understands the numbers. In fact, the whole Beltway obsession with the fiscal burden of an aging population is misguided.

    As Peter Orszag, the director of the Congressional Budget Office, put it in a recent article co-authored with senior analyst Philip Ellis: “The long-term fiscal condition of the United States has been largely misdiagnosed. Despite all the attention paid to demographic challenges, such as the coming retirement of the baby-boom generation, our country’s financial health will in fact be determined primarily by the growth rate of per capita health care costs.”

    How has conventional wisdom gotten this so wrong? Well, in large part it’s the result of decades of scare-mongering about Social Security’s future from conservative ideologues, whose ultimate goal is to undermine the program.

    Thus, in 2005, the Bush administration tried to push through a combination of privatization and benefit cuts that would, over time, have reduced Social Security to nothing but a giant 401(k). The administration claimed that this was necessary to save the program, which officials insisted was “heading toward an iceberg.”

    But the administration’s real motives were, in fact, ideological. The anti-tax activist Stephen Moore gave the game away when he described Social Security as “the soft underbelly of the welfare state,” and hailed the Bush plan as a way to put a “spear” through that soft underbelly.

    Fortunately, the scare tactics failed. Democrats in Congress stood their ground; progressive analysts debunked, one after another, the phony arguments of the privatizers; and the public made it clear that it wants to preserve a basic safety net for retired Americans.”

  • So let me get this Social Security is at a financial crisis point but we can willy nilly borrow 2-3 Trillion dollars from China to do the Irak War?

    Something ain’t adding up here.

  • “So let me get this Social Security is at a financial crisis point but we can willy nilly borrow 2-3 Trillion dollars from China to do the Irak War?

    Something ain’t adding up here.”

    Oh, no. It adds up fine.

    Social Security is in a crisis because it’s funded by the same tax dollars they’re borrowing against to do all of their other spending. SS is solvent because the money is locked away and can’t be spent on other programs. Unfortunately, if the government goes broke funding the war effort (or anything else), their assets will be liquidated to cover their debts, and Social Security will disappear right then and there.

    With $10 trillion in debts to repay, I’d say any government asset is in a state of crisis. But what really worries them is that if the government actually goes bankrupt, people will see exactly why SS is being lost and put the blame where it belongs. So they have to start training people now to see that SS is inherently flawed and that it will all be the libruls’ fault when it goes belly up.

  • Off-topic: BREAKING: McCain expects to “win” Iraq War by 2013.

    McCain: “By January 2013, America has welcomed home most of the servicemen and women who have sacrificed terribly so that America might be secure in her freedom. The Iraq War has been won”.

  • Commander Guy raises the right questions, which I would put like this: How much more money do we have to give Haliburton to bankrupt the country? Does Social Security give money to corrupt corporations who operate slave labor camps for people who hate us, wastefully building stuff that will just get blown up?

    I’m picturing an ad with a background video of a large drain with hundred dollar bills flowing down it, overlaid with graphs of the Republican deficits and war expendatures, and a voiceover telling us how fiscally irresponsible the Republicans have been and how they now want to tell us how to fix Social Security.

    They have no credibility, and that should be underlined at every opportunity for the low information voter. With that as a baseline, all their scaremongering will only serve as an endorsement of their opponents.

  • I wonder what seniors in Florida are going to think about this?

    Maybe his goal is to make sure seniors don’t know what to think? It’s easy to get confused by things that don’t make any sense, like McCain’s scattershot approarch to Social Security.

  • In 2048, or some such year, social security will only be able to meet about 70% of its obligations.

    Raise the top level from $90,000 to $150,000 and there’s no problem at all for Social Security.

  • I never said the solution isn’t fairly simple but, without change, social security is going broke.

    My personal choice is a combination of raising the retirement age, slightly reducing payment for current retirees by reducing the cola above a certain amount, and raising the cap from $105K to $150K or $200k.

    I wonder if we could solve the problem by having the ‘income’ from carry trades treated as social security income.

  • Neil #13 – You can’t pull the rug out from current retirees. They are defenseless. They can’t just go out and get good paying jobs to make up the difference. They planned their retirements around promises made by the federal government. Those promises must be honored among the most vulnerable recipients.

    There is plenty of time to solve the Social Security “crisis” and any number of viable solutions. The problem is, the Republicans are not acting in good faith. They are not interested in saving the current program. They want to eviscerate Social Security, and they want to get their hands on the payroll taxes that go into it, siphon off investment management fees to make their Wall Street cronies even richer. Not all Republicans, mind you, but you can’t trust their motives in general.

    I find it very troubling. The Preamble to the United States Constitution lists five fundamental objectives/responsibilities of the federal government. One of these is – surprise! – to “promote the general welfare.” We live in an age when Republicans don’t think the government ought to do anything for the people, when that view is totally countermanded by the Constitution. Republicans act as if that phrase isn’t there, and Democrats don’t help by being so intimidated and apologetic about a proactive government.

    The First Amendment Center polls always indicate that Americans are woefully ignorant of the five basic freedoms listed in the First Amendment. I bet they are even more ignorant of the Preamble, which sets forth the raison d’etre for our federal government, and I’ll bet less than 1% know about promoting the general welfare.

    Why did we all fall for Reagan’s government-is-never-the-solution propaganda? It’s right in the Constitution what the obligations of government are.

  • Hark:

    you sound just like my father “I EARNED IT.”

    My point is that if you reduce the COLA increase to current retirees at the top end by .5% a year then after 10 years the person receiving 50% of the maximum payments would still get the exact same payments as under current law. The person receiving the maximum payments would receive JUST 97.63% of what they would receive under current law.

    Am I that terrible for suggesting that a rich retiree get 100% today and ONLY 97.63% in 10 years?

    BTW, it is IMPOSSIBLE to privatize social security. You can’t change the FACT that the people who are not working are dependent on the people who are working, period.

  • Neil Wilson,

    I never said the solution isn’t fairly simple but, without change, social security is going broke.

    Objection, assertion without facts in evidence. Cite your source.

  • Edo:

    Keep your head in the sand. It is safer than actually paying attention to what is going on around you.

    If you can find a reasonable source that shows social security not having a deficit over the next 75 years then I will find you 5 sources that says there is a 75 year deficit.

  • But what really worries them is that if the government actually goes bankrupt, people will see exactly why SS is being lost and put the blame where it belongs.

    If the US goes bankrupt, Social Security will be the least of our, and the world’s problems. THe US has never defaulted on bonds. Every country in the world that we’ve “borrowed” from is holding that IOU in bonds. If we default on SS, we default on those. Economies around the world will go down with the US. But we can’t go bankrupt unless the politicians in charge allow it (you think the US Gov’t goes to bankrupcy court? One thing they care about is keeping their job, and if it requires raising some taxes, they’ll do it.

    We have some hurting to go through in the next few years, but if the Reagan debt can be paid off by the end of the Clinton admin, the Bush debt can be paid off in about 20 years. Just have to keep the Repubs out of the cookie jar.

  • “If the US goes bankrupt, Social Security will be the least of our, and the world’s problems. THe US has never defaulted on bonds. Every country in the world that we’ve “borrowed” from is holding that IOU in bonds. If we default on SS, we default on those. Economies around the world will go down with the US. But we can’t go bankrupt unless the politicians in charge allow it (you think the US Gov’t goes to bankrupcy court? One thing they care about is keeping their job, and if it requires raising some taxes, they’ll do it.”

    The first part of this is true, but I don’t quite agree with you about what politicians will do to save their jobs. I agree that if they are forced to solve the problem they will raise taxes, but most of them would prefer to kick the ball down the field and leave it for the next person to sort out.

    In this case, if an administration is faced with impending bankruptcy that can be staved off by confiscating Social Security revenues and using them to pay other debts, then Social Security revenues will be confiscated to pay off debts. To prepare the ground for that, the rules about how SS revenues can be used need to be changed. Therefore, a case needs to be made that SS is in crisis and needs a massive overhaul to survive.

    The danger of simply increasing contributions to meet expected liabilities down the road is that people might start thinking it makes sense for the rest of the government to behave that way.

  • neil wilson: Keep your head in the sand. It is safer than actually paying attention to what is going on around you.

    If you can find a reasonable source that shows social security not having a deficit over the next 75 years then I will find you 5 sources that says there is a 75 year deficit.

    Objection, evasive action. Try answering the question instead of saying that you will when you get around to it. Your opposition has already cited upthread, isn’t that a good reason for you to tell us what you know? Or is your idea of an argument “the automatic gainsaying of any statement the other person makes”? Either way, you can’t change anybody’s mind unless you actually engage with them instead of casting aspersions like day-old spittle. Assuming that’s why you’re here.

  • It’s funny when one listens to only partially informed people like McCain talk about Social Security going broke because it will be paying benefits out of the Trust Fund. That’s exactly what the Fund was set up for, to pay out benefits to the Baby Boomers and then go away once they do.
    I’ve watched McCain on C-Span since this campaign started, and he is indeed having problems remembering what his positions are, much less keeping Shia separate from Sunni. John can’t remember what he says from one appearance to another.

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