U.S. Budget: Obama Gambles His Presidency on Cutting Social Security

President Obama is taking an extraordinary political risk with his sudden move to bring the entitlement programs into the negotiations over the national debt. Indeed, it is by no means hysterical to suggest his re-election is at stake.

What the president is doing is betting that the American people will recognize both the necessity and wisdom of making changes in the Social Security, Medicare, and Medicaid programs that make up the safety net for most of them.

He is betting on a maturity in the electorate that has rarely been evident in this age of instant and pervasive partisanship.

It is the same bet the Democratic presidential nominee Walter Mondale made in 1984, when he declared in his acceptance speech in San Francisco: “Here is the truth about the future. We are living on borrowed money and borrowed time...Whoever is inaugurated in January, the American people will pay Mr. Reagan’s bills. The budget will be squeezed. Taxes will go up. Anyone who says they won’t is not telling the truth. I mean business. By the end of my first term I will cut the deficit by two-thirds. Let’s tell the truth. Mr. Reagan will raise taxes and so will I. He won’t tell you. I just did.”

Fritz Mondale was right; Ronald Reagan raised taxes several times. But Mondale’s trust in the collective wisdom of the electorate was not rewarded. He was buried in a Reagan landslide.

Four years later another Democratic nominee, Michael Dukakis, had a similar experience. In June 1988, I asked him how he was going to counter charges he was unpatriotic because he had honored a legal opinion that the Pledge of Allegiance should not be required in public school classrooms.

“Oh, I’m not going to worry about that.” he said. “People know better than that.” He was wrong. George H.W. Bush had his picture taken at a flag factory in New Jersey, and Dukakis was cooked. So much for the maturity of the electorate.

Now Obama is displaying a similar faith in the voters simply by mentioning changes in entitlements as one of the potential elements of a grand deal on raising the debt ceiling.

The truth is that for at least two generations, everyone in Washington knowledgeable on public policy has known that changes in both Social Security and Medicare are essential and, more to the point, could be accomplished without burdening present retirees or those in the next generation. The actuarial tables don’t lie.

On Social Security, the age requirements could be raised and a means test applied to protect the middle class and require higher tax liability for the wealthy. On Medicare, there is no logical justification for the payroll taxes that cover the entire income of everyone except Americans in the top brackets. In short, there are changes that would be relatively painless for the vast majority of taxpayers and no more than a small nick for those with big incomes.

But all of this is difficult in a partisan environment in which every proposed change is denounced as draconian. That is why tinkering with Social Security has become “the third rail of American politics.”

And it is the reason wise politicians have always considered any attempt to repair the entitlement programs as something that can be undertaken only by a president serving his second term and immune to extravagant charges of malfeasance.

Obama, however, seems willing to deal with the issue only 16 months before the next election. The inference you have draw is that he is confident the voters are wise enough to see beyond the braying of all the jackasses on television. We’ll see.