Whatever Happened to Entitlement Reform?

If you want a good indication of how unserious America’s politics are at the moment, consider that this election has had virtually no discussion of entitlement reform. It was a central issue in 2012, and not only that, Republicans put the issue front and center by putting Paul Ryan on the ticket, who remains the only major politician in the last number of years to propose a serious plan to reform entitlements. (If Ryan’s proposals had a flaw, it’s that they were not aggressive enough.) While Republicans lost the 2012 race, polls showed that they had fought the Obama administration to a draw on the question of which ticket would protect Medicare. And this is despite the Obama campaign pulling out every Mediscare tactic in the book, including a slew of deceptive ads about the Romney-Ryan entitlement proposals.

The problem has only gotten worse since then. Medicare and Social Security have $72 trillion dollars in unfunded liabilities, according to the latest Social Security and Medicare Trustees reports. It cannot be stressed enough what an astronomical sum of money that is—absolutely no amount of confiscatory taxation or draconian budget cuts will come close to fixing that problem. Thursday, Charles Lane had a terrific column at the Washington Post laying out why it’s so terrifying that entitlements are being ignored this election:

Seventy-five percent of planned federal spending between now and the end of the next two presidential terms is mandatory: Social Security, Medicare and other entitlement programs, plus interest on the national debt, according to Congressional Budget Office forecasts. That money is going out the door no matter who’s president. Eugene Steuerle of the Urban Institute has come up with an “Index of Fiscal Democracy” to express this vast, automatic commitment of resources, and the preemption of actual political choice it represents. The higher the index, the more possibilities we have for actually governing ourselves. At present, the index stands at 19.7, which is the percentage of federal receipts left over after mandatory spending and interest, according to data compiled by Steuerle’s collaborator Caleb Quakenbush. By 2026, however, the index will sink to 1.7, absent reforms. That’s the sliver of money we’ll have to pay for research, natural disasters, defense and everything else. By contrast, in 1962, the index stood at 65.3; in 2007, 34.3.

Despite it being a stark and relatively immediate problem, the two presidential frontrunners are largely missing in action. Hillary Clinton not only opposes cuts to Social Security, she wants to expand benefits to widows and add cost of living increases. And while she seems aware of Medicare’s cost problems, she hasn’t made any serious moves to address it.

Similarly, Trump has pledged to both save Social Security and “not touch” the program, which is a mathematical impossibility. As for Medicare, he’s rolled out a health reform plan that health care wonks referred to, and not without cause, as “willfully ignorant.” Elsewhere he’s said he would abolish Medicare and then flip flopped by saying he wouldn’t ever abolish it because “because some people are wedded to it emotionally.”

However, neither can touch Bernie Sanders for proposing “Medicare for all.” The New York Times said Sanders’s “health plan is more of a tax plan.” And when the Times asked the economist who ran the numbers on the Sanders’s heath care proposal about some discrepancies, he told the paper “The details very quickly get very messy.” Despite being laughed out of the room by experts, Sanders has received millions of votes.

But you might expect that from a Vermont socialist. When he was still in the race, Republican candidate Mike Huckabee made an about face from his position on entitlements when he ran in 2012 and started bashing other Republicans for proposing reforms.

Entitlements are one of the most dire problems America faces. If neither Republicans nor Democrats can honestly address this and voters are so enamored of their benefits that they can’t be made to understand the severity of the problem, then our politics are truly broken.

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