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A Budget Lacking Entitlement Reform Shows No Leadership

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The author of this entry is responsible for this content, which is not edited by the Wilson County News or
U.S. Sen. Kay Bailey Hutchison
February 20, 2012 | 2,210 views | 7 comments

Last week, President Obama announced his Fiscal Year (FY) 2013 budget proposal. Rather than a blueprint for putting our financial house in order, his budget plan would add more than $11 trillion to the national debt in coming years -- in spite of the nearly $2 trillion in higher taxes that would only serve to undermine our economic recovery.

The President’s new budget would increase spending for dozens of programs that have been proven ineffective. And it would slash defense spending to unprecedented levels that could put our troops and our citizens at risk. But worst of all, President Obama once again ignored our biggest fiscal challenge.

The Social Security and Medicare Trust Funds are on a path to bankruptcy. Social Security’s Chief Actuary estimates that its reserves will run out in 2036, which would mean automatic benefit cuts by about one-fourth in order to keep sending out monthly checks to tens of millions of senior citizens. Medicare is in worse shape, with bankruptcy looming as early as 2022.

To ignore all of this is the present day equivalent of Emperor Nero fiddling while Rome burned. Nevertheless, in his 7,000 word State of the Union address, the President devoted 40 words to the Social Security and Medicare programs.

We need -- and the American people ought to demand -- a serious, bipartisan effort to shore up these two vital programs before it is too late. By making incremental reforms now, we can protect retirement and health care benefits for several decades. But endless fiddling by Congress and the White House guarantees huge pain for taxpayers and financial insecurity for tens of millions of senior citizens.

The place to start is Social Security. Americans are living longer, healthier lives than when Social Security was first enacted in 1935. If no adjustments are made, these huge demographic shifts will exhaust the Trust Fund’s financial reserves in less than 25 years, and big, automatic cuts in monthly benefits ($270/month, in today’s dollars) will be triggered.

Fortunately, such a catastrophe can be avoided without taking drastic steps -- provided action is taken soon. Legislation I introduced last year (The Defend and Save Social Security Act) illustrates that only modest steps are needed today.

My bill would assure that Social Security remains solvent until 2085 without raising taxes or cutting core benefits. It would do so by gradually increasing the Social Security eligibility age for those who are 57 or younger by increasing the eligibility age three months each year with a cap at 69 in 2027. Additionally, under my bill, the Cost of Living Adjustment (COLA) would be modified, so that any year in which the COLA exceeds 1 percent it would be decreased by 1 percent. However, if in any year, the COLA is calculated to be less than 1 percent, the final COLA would be reduced to zero. For example, this year’s COLA was 3.6 percent, so under my bill the increase of 3.6 percent would be reduced to 2.6 percent.

Exactly how to adjust eligibility age and cost-of-living adjustments can be worked out, if there is leadership from the White House and a bipartisan Congressional commitment to take responsibility for protecting Social Security now. The same type of timely, bipartisan action would assure that Medicare is shored up, too.

Social Security, Medicare, and other mandatory spending programs already account for more than one-half of annual federal government spending. Without reforms, all of these mandatory spending programs will grow to more than 75 percent of the federal budget within ten years. Not only would this threaten millions of senior citizens, it would leave too little for national defense, education, research, and other vital national priorities.

It is profoundly disappointing that President Obama’s last budget proposal before he stands for reelection has all of the weaknesses of his previous ones. The Senate unanimously rejected his budget last year, and will probably do so again this year. But rejecting a bad budget plan isn’t enough.

Just as Social Security and Medicare were enacted with broad bipartisan support, securing and saving these programs requires both political parties in Congress to work together. That is the only way to avoid the politicizing of the issue. Constructive dialogue and debating choices openly will bring us to solutions that are in the national interest.

Hutchison is the senior U.S. senator from Texas and Ranking Member on the Senate Commerce, Science, and Transportation Committee.
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Your Opinions and Comments

The Marcelina Muse  
Dry Tank, TX  
February 27, 2012 11:18am
Winston I have it on good authority that Michelle has dispatched not only the Lunch but also the Thought police down to see you. You have become a danger to the state. Your logical thought is a violation of the Federal BS Protection ... More ›

Winston Shaffer  
Floresville, TX  
February 22, 2012 12:53pm
Does anyone study history or just spout off? In 1995, the House of Representatives passed the balance budget amendment and came within one vote of passing the Senate. The Speaker of the House was Newt Gingrich. In 1996, the ... More ›

Rock'n chair Rambler  
Over Taxed, TX  
February 22, 2012 8:24am
"2001-2007 when the Republicans controlled the Supreme Court, The Presidency, Senate, and the House?" The Repubs only had control of the Congress for 2003-2005. The Supreme Court was unreliable at best until O'Connor ... More ›

One Voice  
February 22, 2012 4:17am
Our debacled government is a reflection of what the American people have become. This mess did not just happen over the last twenty years. It happened when the American people got their priorities up side down and then ... More ›

Tracy Bogert  
Von Ormy, TX  
February 21, 2012 9:48pm
Did you ever notice how many of today's problems can be traced back to 2001-2007 when the Republicans controlled the Supreme Court, The Presidency, Senate, and the House? Did they offer a balanced budget? Did they stop abortion? ... More ›

Rock'n chair Rambler  
Over Taxed, TX  
February 21, 2012 10:08am
Ever notice how many of today's problems can be traced back to Dear Ol' Uncle FDR, and his nanny statist ideas? FDR's brilliant idea called Social Security was intended to solve the problem of old age poverty, which many ... More ›

Elaine K.  
February 20, 2012 1:11pm
New post.

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