A Liberal Voice for Budget Reform
An op-ed in the New York Times yesterday featured Rep. Earl Blumenauer (D-OR) and his unorthodox approach to fiscal sustainability. Unlike many of his peers on the Hill, Rep. Blumenauer does not believe in extensive federal program cuts to balance the budget—but he has advocated extensively for the need to balance the budget, somehow, and soon. Pushing aside the traditional conservative vs. liberal debate that seems to always center on the continuation of major federal programs like Social Security—with no room for compromise between leaving them unchanged to help those who rely on them and reducing benefits to help decrease the deficit—Blumenauer instead puts the focus on their efficacy, arguing that if their supporters really want to protect them in the long term, they must “bring their costs in line with reality” and figure out how to realistically pay them.
Credibility, he argues—of both individual programs’ longevity and of the sustainability of the federal budget as a whole—is crucial, and is in fact the only way to protect individual Americans’ investments in our systems. Programs like Social Security, for example, simply can’t exist on “make-believe money,” and if its long-term credibility problem was fixed—in other words, if young Americans today believed that the program they’re paying into today will still exist upon their retirement—they will be more willing to pay, because “they’re convinced their getting their value,” says Blumenauer. Along these lines, Blumenauer encourages liberals to seriously consider changing the benefit structure of Social Security, including “progressive price indexing,” or pegging more Americans’ benefits to the consumer price index rather than their wages and reducing overall government payouts.
Whatever way it’s done, we agree wholeheartedly with Blumenauer that fiscal reform is critical to the future success of our government and the programs that Americans rely on. For our projections on Social Security's fiscal path and recommendations for reform, see CRFB's report here.