Over at the Corner, my AEI colleague Ramesh Ponnuru looks at former Arkansas Gov. Mike Huckabee’s shameless – and I think mistaken – pitch to seniors as Huckabee launches his campaign for the GOP presidential nomination. Huckabee says:
“You were forced to pay for Social Security and Medicare for 50 years. The government grabs money from our paychecks and says it will be waiting for us when we turn 65. If Congress wants to take away someone’s retirement, let them end their own Congressional pensions-not your Social Security. As President, I promise you will get what you paid for!”
One problem with this statement is basic math: since Social Security and Medicare are (vastly) underfunded, we either need to pay more in or get less out. Sure, politicians promised us a certain benefit formula, but they also promised a certain tax rate. Huckabee implicitly asserts that changes should be in the tax side, not the benefit side. Good luck running in a Republican primary on that platform.
Second, as Ramesh points out, Huckabee’s support for the Fair Tax implies a 30% sales tax on goods and services. So seniors’ benefits might not be cut under a Huckabee administration, but the amount they could buy with their benefits would fall by 30%. Again, good luck.
Finally, Huckabee’s basic “get what you paid for” statement is incorrect: by law, Social Security benefits will be cut when the trust fund runs out (next year for disability, in the early 2030s for retirement). Whatever you may believe about the economics of the trust fund – personally, not much – the trust funds’ exhaustion is by definition a signal that Americans haven’t paid enough to fund the benefits they’ve been promised. In other words, Huckabee’s Social Security policy could be to slash benefits across the board by 25% when the trust fund runs out and that policy would be entirely consisting with his promise that “you will get what you paid for.” Just not a penny more.