Entitled to Know

This week the Chairman and Ranking Member of the Senate Budget Committee renewed their plan to create a task force to write comprehensive entitlement and federal tax legislation.Under the plan, jurisdiction for long-term changes to Social Security, Medicare, Medicaid, and federal taxes would be handed over to a 16-member task force, divided equally between the majority and minority party. We understand Rep. Jim Cooper and Rep. Frank Wolf will introduce companion legislation in the House.

We appreciate the effort that both Senator Conrad and Senator Gregg have invested in their proposal. Despite their good intentions, however, we believe this plan contains many of the fatal flaws that have tainted similar bills over the years.

Social Security and Medicare are critical lifelines for America’s seniors. Seniors deserve to have changes to these programs receive substantive consideration by Members of the Committees who best understand their intricacies. Major changes to these programs also deserve to be considered by Congress under a normal, open legislative process. The Conrad/Gregg plan would bypass these important protections. If it is adopted, America’s seniors will be the big losers.

For these reasons, the National Committee to Preserve Social Security and Medicare strongly opposes this measure.

Social Security Privatization Will Again Threaten America’s seniors. The President and many of his supporters in Congress have made it clear that they favor privatizing Social Security. Despite strong public opposition, they continue to press for diverting money out of the Social Security Trust Fund and into private investment accounts.

Despite the expressed opposition to private accounts by the current majority Congressional leadership, establishment of this task force would give supporters of privatization a new forum in which to resurrect privatization. In addition, it offers privatizers a voice and a vote significantly disproportionate to their representation in Congress.

In effect, while the Task Force appears to be structured in a neutral manner, in fact it will create a platform for those who support the privatization of Social Security which might not be available to them through an open legislative process.

Legislative Jurisdiction over Social Security, Medicare, Medicaid and Federal Taxes Will Be Handed to the Task Force. Major restructuring of Social Security, Medicare and Medicaid has never been attempted in a single piece of legislation, and for good reason: these programs encompass significantly different economic issues and touch virtually every facet of American life. Under the Conrad/Gregg proposal, their future, as well as the construction of our entire system of federal taxation,would be placed in the hands of a group of only 16 people who may or may not have significant experience in the breadth of issues they encompass. Congressional Committees of jurisdiction, which have cultivated detailed knowledge of the programs and the needs of their beneficiaries over decades of hearings and education, would be relegated to being bystanders in the process.

We recognize the perspective of those who believe Social Security, Medicare and Medicaid should all be treated as one, with a focus on their long-term budgetary impact. However, we strongly believe this approach is both inappropriate and counterproductive. While these programs are entitlement programs, they have little else in common, yet they would be treated under a single legislative umbrella.

Social Security and Medicare are distinct programs and need to be addressed separately. Contrary to popular rhetoric, Social Security’s funding gap is both modest and manageable. This gap is caused by a combination of demographics and the changing nature of income in our economy. Achieving Social Security solvency requires neither privatization nor deep cuts in benefits. If privatization were permanently and affirmatively rejected as part of the discussion, there is no reason to believe the Committees of jurisdiction could not devise a suitable plan to strengthen both the program and its long-term finances.

Medicare, on the other hand, is a health care program and most of its cost increase is being driven by the cost of overall health care, not demographics. As you know, solutions for our nation’s health care problems are elusive because they are extremely complex, and can hardly be expected to be resolved by a budget-oriented Task Force. In the absence of this type of comprehensive health care reform, any changes to Medicare standing in isolation are likely to simply shift costs onto the elderly.

The American People Will Be Left Out of the Discussion.Under the Conrad/Gregg proposal,a working group of current members of Congress and representatives of the current Administration would meet during 2008 and design the legislation that would address all of the long-term funding issues affecting Social Security, Medicare and Medicaid. The Task Force’s recommendations would be issued on December 9, 2008. The legislation would then be forced through Congress under extremely short timelines with no opportunity for amendments.

This would result in legislation written by a group which is not representative of the composition of the current Congress and may be even less representative of the Congress elected in 2008. More importantly, the American people will elect a new President in the fall of 2008. The legislation written by the working group would be forced upon a President who may have been elected by the American people on a platform at odds with the legislation offered by the working group. As a result, the voice of the American electorate would be diluted.

The Conrad/Gregg proposal runs counter to the intent of our Founding Fathers that actions by Congress reflect the will of the people they represent. Creating restrictive timelines and prohibiting amendments to push through changes of this importance to millions of Americans, especially senior Americans, ultimately disenfranchises voters and hurts the political process. While we agree with the goal of strengthening Social Security and Medicare, we strongly disagree with the process created by the Conrad/Gregg bill.

Cordially,

Barbara B. Kennelly, President/CEO