At the recent Republican debate, New Jersey Gov. Chris Christie won his war of words with Sen. Rand Paul of Kentucky over government surveillance. But the combative presidential hopeful fell off his high horse by aligning with the Wall Street-Washington axis seeking to convert Social Security into a glorified means-tested welfare program.
Declaring the social-insurance system “broken” is no way to win a primary, let alone the presidency. Like Walter Mondale’s ill-fated pledge to raise taxes in 1984, promising to overhaul earned-benefit programs that remain popular with older Americans would assure electoral shipwreck. As Bush 41 veteran Lloyd Green notes, seniors haven’t voted Democratic since 1992; in 2012, Republicans captured voters older than 45 years of age.
Mr. Christie also sounded like overpaid multinational executives who think U.S. wages are too high, whining that Social Security and Medicare consume too much of the federal budget. He framed things completely backward: These self-financing programs have been budget bracers, not budget busters, for a generation.
Indeed, revenues flowing into the four related earned-benefit funds (Social Security, disability, Medicare hospitalization, and Medicare supplementary medical) have generated annual surpluses since the late 1980s, ranging from $121 billion to $221 billion between 1998 and 2009. Not even President Obama’s payroll-tax cut in 2011 and 2012 spilled red ink on the combined balance sheet.
Yes, the retirement of the baby boomers and disability claims are eating into those surpluses; the 2014 excess, for example, was merely $11 billion. But the governor and his fellow candidates should be yanking at the roots of the projected shortfalls: slow-growth, upside-down demographics — including anemic marriage and birth rates triggered by Roe v. Wade — and the hemorrhaging of private-sector, family-wage jobs stemming from ballooning trade deficits.
Too bad Mr. Christie wasn’t briefed by CNBC host Larry Kudlow, a fellow Garden State conservative eyeing a U.S. Senate run, who argues Social Security would be “in fine shape” if annual GDP growth was 3.5 percent. Instead, the governor risks outdoing Mitt Romney, who infamously demeaned 47 percent of Americans as “takers.”
Given the dislocations shaking Middle America, this is no time for any Republican to weaken the rung that tens of millions of aging middle-income folk have been clinging to since the 2008 market crash. As Jack Kemp’s top economic adviser, John Mueller, insists: Pay-as-you-go social insurance can “provide a valuable form of retirement security that the private market cannot duplicate.”
Especially as Wall Street has reaped bonanza after bonanza since George H.W. Bush slashed taxes on capital (while boosting taxes on labor) and Bill Clinton dismantled the Glass-Steagall firewall separating investment from commercial banking, as well as windfalls from the Troubled Asset Relief Program and a host of corporatist-globalist trade deals. All these policy departures from the Reagan era have devastated the U.S. manufacturing sector, a key source of American strength and wealth, and the economic security of Americans without college degrees.
Mr. Christie claimed his cuts will mostly hit well-endowed households with annual retirement income in excess of $200,000. Yet who among Republican voters — most of whom support increased funding of Social Security and Medicare, according to the Pew Research Center — believes middle-income folk would be spared?
On the stump, Mr. Christie likewise peddles the “premium-support” theories of House Ways and Means Chairman Paul Ryan, proposals that would force seniors to bargain-hunt with insurance carriers, mega-hospitals, pharmaceutical giants and medical specialists. Another winning idea for the campaign trail.
Though Americans may not like Obamacare, they still prefer having a third party — whether it be employers or a trusted system like Medicare in retirement — mediating for them the “big, complicated, nutty, messy market,” as columnist Peggy Noonan describes the health sector.
Instead of relitigating the New Deal, the GOP should heed Carly Fiorina, the candidate enjoying the biggest debate boost, who last week demanded that the government “get its house in order before it goes to the American people and takes something away from them.”
Better yet, follow the promising path pioneered by Mike Huckabee. Rather than “rob seniors of the benefits our government promised” and they paid for, the former Arkansas governor is promoting research, in line with House Energy and Commerce Chairman Fred Upton’s 21st-Century Cures Act, to combat debilitating diseases like Alzheimer’s, which now cost the U.S. health system $200 billion a year.
Not only would cures preserve Medicare by reducing long-term outlays, but more importantly, they would deliver a tangible coveted by the voters while rebranding the GOP as the party of science, progress and growth.
Perhaps Chris Christie is too invested in ideological budget-cutting to learn from his debating companions. But as long as he entertains privatizing Social Security and Medicare for the sake of America’s bondholders, the New Jersey heavyweight won’t redeem his low single-digit poll numbers — or connect with middle-income voters that his party desperately need to win not just the debates, but the election of 2016.
• Robert W. Patterson is a policy consultant who served in the administrations of President George W. Bush and Gov. Tom Corbett of Pennsylvania.