The Fake Crisis

In selling the idea that there's a crisis, Bush has a lot of powerful words on his side: "choice," "freedom," "ownership society." What words do you have to counter his sales job?
Scam. Three-card monte. I've been thinking a lot about flying pigs. The privateers are claiming that you can have something for nothing. They're basically saying, "Let's assume that pigs can fly." And when you say, "You know, it's not good to assume that pigs can fly," they respond by saying, "What's wrong with you? Don't you understand the enormous advantage of flying pigs?"

The only reason they talk about how wonderful an ownership society would be is because we managed to win the battle over the word privatization. The Cato Institute — which is the intellectual headquarters for all this stuff — founded something in 1995 called the Project on Social Security Privatization. But focus groups don't like that word, so in 2002 they changed the name to the Project on Social Security Choice. They didn't announce a name change — they just went back and scrubbed their Web site, so there's no indication that it was ever called "privatization."

If there's no crisis in Social Security, why aren't the Democrats saying that more clearly and forcefully?
There's a lot of timidity. They're desperately afraid of seeming like "Oh, well — we have our heads in the sand, and we're not active." I would like to see them step up to the plate and say that these claims that we're going to have a crisis sometime in the next fifteen years is just garbage. Bush is handing them an opportunity by making this the centerpiece of his agenda. Democrats should treat privatizing Social Security the way Republicans treated Clinton's health-care plan — they should say, "This is a disaster, and we will stand against it." Social Security is simply not the biggest problem facing the government today.

What is?
If you really want to get scared about something that can happen between now and 2052, you should talk about Medicare and Medicaid. The entire system of private health insurance is gradually collapsing. And as the share of people getting medical insurance through their employers continues to decline, the number of people who have to rely on the government for health insurance keeps going up. At the same time, medical costs keep on rising, because doctors keep on figuring out new stuff to do — procedures that didn't exist ten or twenty years ago.

So what needs to be done to shore up Medicare?
In our system, we have huge administrative costs — which are mostly driven by insurance companies spending huge amounts of money trying to avoid covering people. Our health-care costs are eighty percent higher than those in other advanced countries. The best way to contain those costs is to go to a single-payer system, one in which the government insures everyone. That would probably cut the cost of health care by at least twenty-five percent.

But there's no way that will happen under Bush.
He actually wants to do the opposite. If he manages to privatize Social Security, he'll try to privatize Medicare next. He'll try to strip away guaranteed health care and turn it into some kind of system of individual health accounts. The right says that what we need is more choice, more competition. But every piece of evidence suggests that health care is an area in which privatization actually raises costs. If they succeed at dismantling both Social Security and Medicare, then you're pretty much back, on domestic policy, to the days of Warren Harding — which is exactly where they want to go.

[From Issue 966 — January 25, 2007]