Mike Huckabee, who may declare his intention to run for president soon, has some very ill-advised opinions about Medicare and Social Security. In an interview with a small group of reporters, he said the following:
"I don't know why Republicans want to insult Americans by pretending they don't understand what their Social Security program and Medicare program is," Huckabee said in response to a question about Christie's proposal to gradually raise the retirement age and implement a means test. Huckabee said his response to such proposals is "not just no, it's you-know-what no."
"I'm not being just specifically critical of Christie but that's not a reform," he said. "That's not some kind of proposal that Republicans need to embrace because what we are really embracing at that point is we are embracing a government that lied to its people--that took money from its people under one pretense and then took it away at the time when they started wanting to actually get what they have paid for all these years."
To the logic behind these claims, I say no -- but “not just no, it’s you-know-what no.” Several points are in order.
First, Americans now draw substantially more from benefits in Medicare than they ever pay in. In The American Health Economy, Illustrated, Duke University’s Chris Conover estimates that, by 2030, an average two-earner couple -- one with low wages and another with high wages -- will draw about $400,000 in net lifetime benefits from Medicare. That is, they will take about $400,000 more than they ever put in.
Entitlement reform has nothing to do with refusing people the money they put into the system -- because people are getting their full share, and much, much more.
Second, Medicare is only designed in part as a social insurance program. That is Part A, the hospital program. The doctor program -- Part B -- is funded via premiums, which have been systematically lowered throughout the years. Originally, the cost of premiums was split 50/50 between taxpayer and beneficiary, but they gradually shifted to 75:25, with the extra burden falling on the taxpayers. Reform efforts to shift it back have failed in the face of relentless opposition of senior groups. Again: this is not an issue of people having paid into a program, and merely collecting their fair share. This is wealth redistribution, pure and simple.
Third, it is redistribution to one of the wealthiest age cohorts. As I note in my new book, A Republic No More: Big Government and the Rise of American Political Corruption:
In 1959, seniors were a truly pitiable group: an astonishing 35 percent of them were classified as poor. Today, however, the figure is just 9 percent—less than the rate for those under 18 (22 percent) or aged 18 to 64 (14 percent).
Medicare can thus be counted like a number of programs -- from farm subsidies to pork barrel to corporate tax payouts -- as a way to subsidize the relatively wealthy at the expense of the relatively poor.
Fourth, the public financing regime of Social Security and Medicare was always suspect from a policy standpoint. It was pure politics. As Franklin Roosevelt himself said of Social Security:
I guess you’re right about the economics, but these taxes were never a problem of economics. They are politics all the way through. We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect those pensions. . . . With those taxes in there, no damn politician can ever scrap my social security program.
By talking about these programs in terms of “ownership,” Huckabee is simply repeating FDR’s false, wholly politicized premise.