Friday, January 14, 2011

Ponnuru: GOP should wait to address entitlement reforms

Writing in the New York Times, National Review's Ramesh Ponnuru argues that, as pressing as budget issues may be, Congressional Republicans shouldn't push for Social Security and Medicare reforms unless President Obama clearly wants to engage:

Reforming these programs is vital to our nation's long-term fiscal health — which is why Republicans should resist this advice and leave the issue alone. Reform is impossible this year or next unless President Obama takes the lead on it. What's more, Republicans have no mandate for reform, and a failed attempt will only set back the cause.

Ponnuru also argues that the "third rail of politics" still carries a lot of juice:

Some Republicans are understandably eager to take on these entitlements. "The third rail is not the third rail anymore," Representative Paul Ryan, a Republican from Wisconsin, said in December. Maybe he's right. But Republicans have gotten a painful shock every time they have decided it's finally safe to take on entitlements. Ronald Reagan suffered a defeat in his first year when he tried cutting Social Security's early retirement benefits. Newt Gingrich's 1995 Republican revolution fizzled when President Bill Clinton fought him over Medicare cuts. President George W. Bush's effort to reform Social Security in 2005 ended any political momentum he brought to his second term.

I think Ramesh is right. In the past, I've often wanted to think that the public is ready to deal with entitlement reforms, but Congress's propensity to procrastinate is often a function of the public's habit of doing just the same. It would be better to deal with these issues sooner rather than later, but unless both the public and the opposition party are ready to engage, it's very hard for one party to do it on its own. Just consider how difficult it was for Congressional Democrats, despite massive majorities, to pass health care reform. Entitlements would probably be even tougher since there's much more "take" and much less "give" involved.

I'm hopeful that President Obama will choose to engage on Social Security, perhaps taking up his deficit commission's proposals in the State of the Union address. It could help him re-establish some centrist credentials and, if accomplished successfully, could give the public and financial markets renewed confidence that the federal government can tackle its budget challenges. But it might be better to do nothing than to try and fail. I'm not sure how many more unsuccessful attempts at entitlement reform our lenders are willing to overlook before they decide we're not going to be able to repay what we owe.


Dellis said...

Entitlement reform is my #1 issue. If the GOP is unwilling to take on this issue now, why should I vote for a party that I oppose on virtually every social issue on the ethereal hope that a GOP-dominated government will successfully take up the mantle of entitlement reform, unlike the period from '01-'06.

This seems like a classic game of chicken to me, with the American people as the collateral. While you and Ramesh are correct that the proper strategy in a game of chicken is not to give in to the other side (in fact the opposite - to clearly broadcast a refusal to give in), I look at this from the perspective of a young working American, not a party operative. And I'm appalled at your advice.

Andrew G. Biggs said...

Good points, although I think 'appalled' may be a bit strong. If the goal is to do something, then it makes sense to time your actions for when you've got the best chance to succeed. There's only so much political capital to go around, so if you use it today and fail then it may spoil things for post-2012 when you'd actually have a chance. If there's a chance to actually do something then I'm all for it, but that requires some buy-in from the White House. If not, then maybe better to set the stage for the next election to be a decider on entitlements.

Dellis said...

I see what you're saying, and it's a valid viewpoint. I just don't see a heck of lot of evidence that entitlements will be discussed in 2012, much less that a first term GOP president will take them on. In fact, given GOP rhetoric on Medicare cuts during this past election round, I suspect that any talk about entitlements during the '12 cycle will be both parties racing to the bottom by claiming that the other party is going to cut them. My best guess is that nothing happens on entitlements and they keep growing on autopilot, and the government reacts by continuously cutting discretionary spending and raising taxes.