Last week, I was asked to testify before the Senate Democratic Policy Committee.
I made it clear I was a Republican, but they said they wanted me anyway. I suppose they knew I have become very disturbed by the Republican Party’s fiscal policy, and they presumed I would attack it. I did not disappoint them.
I explained I am not particularly a deficit hawk, nor do the size of the Bush tax cuts bother me. What really bothers me is the orgy of spending by Republicans. It is just appalling that the recent highway bill had 5,000 “earmarks” in it, almost without exception, utterly unjustified pork barrel projects.
I am further appalled by President’s Bush’s unwillingness to use his veto pen to maintain some semblance of fiscal discipline. He is the first president to serve a full term without vetoing anything since John Quincy Adams, who served from 1824-28.
Adams perhaps had the excuse that his father, President John Adams (1796-1800), didn’t veto anything, either. But President Bush cannot use that excuse. His father vetoed 29 bills in his four years in office (1988-1992).
When I complain about this to my rapidly dwindling number of friends in the White House, they always tell me it is very hard to veto bills when a Congress controlled by your own party passes them. But this excuse is just total humbug, as the Brits might say. Franklin D. Roosevelt vetoed a record 372 bills, every one of them passed by Congresses controlled by his party. Other Democrats have also shown no unwillingness to veto bills passed by Democratic Congresses. John F. Kennedy vetoed 12 bills, Lyndon Johnson 16, and Jimmy Carter 13.
But pork barrel projects — even tens of billions of dollars of them — are not what have dug us into a fiscal hole. It is the rapidly escalating cost of entitlement programs. President Bush is well aware of the problems in this area. He eloquently explained the deteriorating fiscal condition of Social Security in many speeches this year, as part of his effort to reform that program and stabilize its finances for future generations.
He was unsuccessful largely, I believe, because he made the finances of the Medicare program — which was in far worse shape than Social Security to begin with — vastly worse by adding a huge, unfunded drug benefit. The Medicare program was already bankrupt and should have been the primary focus of Mr. Bush’s reform effort. Instead, he not only ignored the looming crisis, he made it an order of magnitude worse. By contrast, Social Security is in great financial shape and nowhere near the imminent collapse that faces Medicare in just a few short years.
Here are the facts as reported by the Social Security and Medicare actuaries earlier this year. The unfunded liability of Social Security in perpetuity is $11.1 trillion. The unfunded liability of Medicare is $68.1 trillion, of which $18.2 trillion is accounted for just by the recently enacted drug benefit.
In short, even if President Bush had enacted a perfect Social Security reform bill, one that completely eliminated its unfunded liability, we would still be $7 trillion worse off as a result of the extraordinarily ill-considered drug benefit. To put it another way, we could repeal the drug benefit, finance Social Security forever with no benefit cuts or tax increases and still have cut $7 trillion off our national indebtedness.
Why the Democrats don’t pick up on this idea is a mystery to me. Almost none of them supported the drug bill. Friday, Senate Minority Leader Harry Reid, Nevada Democrat, reminded me he voted against it. So they have nothing to lose. The program hasn’t really even taken effect yet, so no one would lose anything they now have. Seniors would lose only a future benefit few seem to keen on anyway.
Sen. John McCain, Arizona Republican, told CBS News last week the growing costs of the Iraq war and the new burdens created by hurricanes Katrina and Rita mean the drug bill must be reopened for discussion. “We’ve got to cancel it, go back to Square One,” he said. “It was a bad idea to start with.”
Unfortunately, Mr. Bush’s reaction to any suggestion the drug bill even be postponed has been outrage and the promise of a veto. “I signed the Medicare reform proudly,” he said earlier this year, “and any attempt to … take away … prescription drug coverage under Medicare will meet my veto.”
It would be ironic if the only bill of his presidency he absolutely should not veto became the only one he did veto.