Social Security Is the Hardest to Cut, on Paper

In a piece in which he makes the case that U.S. government spending on retirement is crowding out other priorities and must be curtailed, Washington Post columnist Robert Samuelson criticizes both Democrats and Republicans for failing to present Social Security reform measures, calling out Paul Ryan in particular.

The prospects for reducing Social Security spending are probably brighter than Samuelson indicates in his column. In fact, some kind of significant Social Security reform is the most likely component of any small-scale 'Grand Bargain' that would be struck, as recent headlines confirm. Both sides are open to such measures because they are easy, in policy terms, especially relative to reducing Medicare expenditures -- all that's involved is raising the retirement age or cutting smaller checks to seniors.

The reason, however, that neither President Obama nor Paul Ryan offer detailed plans for cutting Social Security in their budgets is that doing so would entail real political risks but no advantages, at least on paper.

Remember, Ryan isn't one to be shy about Social Security issues. This is the legislator who sponsored President George W. Bush's politically radioactive Social Security privatization plan (New Hampshire's John Sununu was the sponsor of the Senate version of the bill).

In the first iteration of his House Republican budget, Ryan did include a substantial Social Security proposal, one that would have trimmed benefits and partially privatized the program. The Congressional Budget Office projected that Social Security expenditures would actually go up in the 10-year budget window under Ryan's plan. It's no surprise, then, that in his later budgets Ryan scaled back that part of the plan, merely calling on Obama to address Social Security's integrity, without offering specific plans of his own.

The problem with budgeting for Social Security reform is that its receipts and outlays technically flow in and out of a special trust fund, not the general budget. If a politician cuts Social Security spending on paper, he extends the life of the trust fund, but doesn't lower federal spending. In real life, however, if Social Security benefits are lowered, it will relieve pressure on the rest of the budget. The political result is that both sides of the aisle want to cut Social Security, but neither wants to talk about doing so.

Joseph Lawler is editor of RealClearPolicy. He can be reached by email or on twitter.

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