As you may recall, back when George W. Bush was freshly re-elected and fairly popular, backed by Republican majorities in the House and Senate, he wanted to partially privatize Social Security. Well, it didn’t work, and his effort to do so contributed to his current massive unpopularity. In the meantime, the GOP lost control of the House of Representatives and lost control of the US Senate. This, via Brad DeLong, is said by The Economist to lay the groundwork for a “grand bargain” on Social Security since though “Stonewalling is a plausible political tactic when you are in opposition” “It doesn’t work so well if you are actually in charge on Capitol Hill.”
Well, there’s sort of no telling what sort of foolish things the Democrats will agree to, but I say no, no, no to this. For one thing, while stonewalling on administration priorities may work out okay if you’re in opposition, it actually works way better if you’re actually in charge on the Hill. In the minority, you don’t need to agree with administration proposals, but you do need to deal with them on some level. In opposition, administration proposals can simply be dismissed out of hand. And, indeed, any proposal that involves “carve out” private accounts should be rejected out of hand. Such accounts are poor public policy (increasing the riskiness of retirement at a time of generally growing riskiness, increasing inequality at a time of generally growing inequality) and the political proof is in the pudding — opposing them wins elections, proposing them loses elections.
The starting point for a responsible approach to the federal budget is, in the short term, brining the ruinously costly Iraq War to as speedy a conclusion as possible. Next is rescinding the bulk of Bush’s tax cuts. Next would be looking toward some increase in taxes on gasoline or carbon emissions. Reform of the country’s wildly inadequate health care system (implicating, among other things, Medicare and Medicaid) should always be a priority. Minor adjustments to the Social Security tax and payout formula could prove necessary in the future depending on what happens to immigration and productivity, but needn’t be a high-level priority. Carving private accounts out of the system should remain off the table and certainly Democrats have no business collaborating in any such endeavor.