Perry's Social Security Take: Boon For Opponents, Bane For Party
Texas Gov. Rick Perry says he wants to be honest with the American people.
That now involves attempts to shelve the part of his presidential campaign playbook that had him just last week vigorously dismissing Social Security as a "Ponzi scheme."
Good luck on changing that conversation, Republican presidential frontrunner Perry, what with seven opponents nipping at your heels.
The difficulty that Perry, and the party, face in trying to extricate their fortunes from his position on the 76-year-old program was on full display during Monday night's Tea Party-sponsored GOP presidential debate in Florida.
When former Massachusetts Gov. Mitt Romney pressed Perry on assertions in his recent book that the program benefiting more than 52 million old and disabled Americans is "unconstitutional," the Texas governor insisted that he had no intentions of taking away an entitlement he once referred to as a "monstrosity."
Romney took a few hits of his own for writing in his own recent book that a requirement that the program invest its surplus in U.S. Treasury securities is tantamount to defrauding Americans.
It may be troubling to the party, but it's no mystery how its presidential conversation, occurring in the midst of an economic crisis, became mired in bickering over a popular program that is projected to remain solvent until 2036.
When the leading presidential candidate has a record of incendiary comments about an entrenched program that not even Rep. Paul Ryan (R-WI) would touch in his controversial House budget plan, it's catnip to opponents.
Particularly when a recent Pew Research Center survey found that 87 percent of Republicans (and 85 percent of independents) believe that Social Security "has been very good/good for the country."
Perry's historic take on the program has become such a problem for his nascent but rocket-like candidacy that he took to the opinion pages of USA Today before Monday's debate to insist that he wants to fix the monstrosity. Though he didn't use that word. He also avoided "Ponzi scheme."
That Perry took that moderating tack in advance of a debate sponsored by small-government Tea Party enthusiasts, a number of whom in the past have called for abolishing Social Security, leaves little question as to the backlash he and the party are facing on the issue.
It's not that voters out there are blind to future funding issues the program faces. The Pew Center found that a majority of high-earning Republicans and those who identify with the Tea Party movement favor "reducing the federal budget" over keeping Social Security and Medicare benefits as is.
So, where does the program stand? Is it "on its last legs," as GOP candidate Ron Paul, a Texas congressman, suggested during Monday's debate?
Craig Copeland, a senior research associate at the non-partisan Employee Benefits Research Institute, says funding fixes are needed. And the Trustees of the Social Security and Medicare trust funds say that the financial conditions of both "remain challenging."
Last year, the trustees reported, was the first since 1983 that Social Security's expenditures exceeded its "non-interest income." That means the program has to begin redeeming its trust fund assets from the Treasury's general fund — to the tune of about $5 billion — in 2012, Copeland says.
The trust fund is projected to be depleted in 2036, drained by a weakened economy and big aging population, if the program is left unchanged.
"Just because the trust fund is depleted, doesn't mean the program will end," Copeland says. "Without changes to the program, it could still go forward, paying out 75 percent" of what the legislation has required, he adds.
"The payroll tax still exists," he says. "It will still be a typical pay-as-you-go system."
The program's trustees this year called for "legislative modifications if disruptive consequences for beneficiaries and taxpayers are to be avoided."
Copeland says, for example, that a two-percentage-point increase now in Social Security taxes has been projected to cover the program fully for another 75 years.
Ponzi scheme? Not so much, he says.
"A Ponzi scheme doesn't have the ability to tax the next group of participants," he says, "or to force them to be participants."
"In the case of Social Security, there is money coming in every year, and, by law, people can't stop contributing," Copeland says.
It is with keen interest that voters, politicians and influential Republicans will be watching another Republican presidential debate on tap next week. And just where Perry, and his opponents, take the Social Security issue just over three months out from the start of presidential primary-and-caucus season.
As he was pressed Monday by Romney about whether he still believes Social Security should be ended as a federal program, Perry responded: "I think we ought to have a conversation."
Romney, mastering the obvious, replied: "We're having that right now, governor."
Whether the party likes it or not.