2016 Is Turning Into a Historically Great Year for Social Security

By
President Franklin Roosevelt
Somewhere the ghost of FDR is smiling as threats to Social Security subside.Photo: Underwood Archives

Not that very long ago, Republicans were almost universally united in favor of a strategy of “entitlement reform” that included various benefit cuts — some overt, like changes in the formula for cost-of-living adjustments, and some indirect, like retirement-age increases — in Social Security. Most Republicans also favored, in principle at least, some sort of partial privatization scheme for the signature New Deal program. Meanwhile, Democrats were generally divided into a large camp trying to keep the program exactly as it was, and a smaller group — including, at least in theory, President Barack Obama — that was open to such “entitlement reforms” as part of some budgetary “grand bargain” with Republicans. 

How things have changed in 2016.

The Republican presidential nomination has been won by a candidate who conspicuously refused to climb aboard the “entitlement reform” bandwagon. Since rank-and-file Republicans have never much bought into Social Security (or Medicare) cuts, it was not surprising this particular Trump heresy troubled party elites but no one else. 

Meanwhile, both Bernie Sanders and (to a lesser extent) Hillary Clinton have both been talking about enhancing Social Security benefits, with their main argument being over the financing mechanism, with Clinton being reluctant to embrace a lift in the payroll tax cap that would hit upper-middle-class voters. 

But now along comes another potential game-changer: President Obama.

Not only do we need to strengthen its long-term health, it’s time we finally made Social Security more generous and increased its benefits so that today’s retirees and future generations get the dignified retirement that they’ve earned,” Obama said in an economic call to arms in Elkhart, Indiana. “We could start paying for it by asking the wealthiest Americans to contribute a little bit more.”

Now you can interpret Obama’s shift any way you want — as a response to leftward pressure from the primary contest, or as proof he was never serious about “entitlement reform” to begin with, or simply as a parting middle-finger-gesture to the GOP, whose leaders were probably less serious than Obama about reaching some “grand bargain” that included high-end tax increases. But the fact remains that the combination of forces in favor of Social Security benefit cuts — or even for simple maintenance of the status quo — has been reduced significantly.

You’d have to say 2016 is becoming the best year for Social Security since at least 2005, when George W. Bush devoted most of his post-reelection political capital to a partial privatization scheme and had his presidential ass handed to him as congressional Republicans headed for the hills while Democrats failed to rise to the “bipartisanship” bait. There will continue be extensive and fractious arguments over how to improve Social Security benefits and how to keep the whole system solvent. Meanwhile, nobody should take Donald Trump’s assurances on the subject to the bank, any more than anything else the mogul says. And if he loses in November, conventional Republican economic policy, including “entitlement reform,” could make a comeback. But for the moment the ghost of FDR must be smiling.