I love my country. It’s the government I don’t trust.
No bumper sticker could be more appropriate following the failure of the supercommittee in Congress to come to terms in cutting the federal budget. However, that is just one example of how our government fails us when it doesn’t plan for the future. It isn’t a problem just in Washington, D.C., but let’s begin there and work down to state government.
Social Security is a good place to start. A recent report in the Washington Post said the program reached a milestone last year when it went “cash negative.” The cost of benefits in 2010 outstripped tax collections for the first time since the early 1980s.
“Now, Social Security is sucking money out of the Treasury,” the Post said. “This year, it will add a projected $46 billion to the nation’s budget problems, according to projections by system trustees…”
If President Obama is successful in expanding a payroll tax break for a second year, the newspaper said Social Security will need an extra $267 billion to pay benefits.
As most Americans are aware, the Social Security trust fund that was designed to pay benefits when times got tough is gone.
“… The $2.6 trillion Social Security trust fund will provide little relief,” the Post reported. “The government has borrowed every cent and now must raise taxes, cut spending or borrow more heavily from outside investors to keep benefit checks flowing.”
Senate Majority Leader Harry Reid, D-Nev., doesn’t think that’s a problem.
“Let’s wor ry about Social Security when it’s a problem,” Reid said after his re-election last year. “Today, it is not a problem.”
We shouldn’t be surprised at what has become a “heads-inthe-sand” attitude in the nation’s capital.
Robbing Peter to pay Paul may have also occurred at the U.S. Postal Service that has fallen on hard financial times. When the agency became independent it was forced to pay future retirement costs, and postal officials said it has overpaid as much as $75 billion into those accounts.
Give that money back, and the Postal Service wouldn’t be in financial trouble, the agency says. The Government Acccountability Of fice doesn’t ag ree, saying transferring that money back wouldn’t address the agency’s longterm debt problems.
It will come as no surprise to most Americans that Republicans and Democrats don’t agree on this issue, either. Many Democrats side with the Postal Service. Republicans insist it’s not a valid issue.
U.S. Rep. Darrell Issa, R-Calif., said, “There is not now nor has there ever been an overpayment.” He calls it just a claim to justify use of taxpayer dollars to cover up declining postal revenues.
And so it goes as Congress continues to jump from the frying pan into the fire without finding workable solutions to monumental problems.
State governments aren’t immune. Nearly half of them have retirement debt problems. Louisiana’s $18 billion retirement debt has been a major focus at every legislative session, but lawmakers have only managed to trim around the edges.
Blueprint Louisiana, a group of businessmen, attorneys and physicians, wants to see major retirement reform at the next legislative session. It wants to give employees more choices about how to plan for their retirement years.
Cindy Rougeau, executive director of the Louisiana State Employees Retirement System, said changing retirement systems isn’t going to solve the debt problem. The $18 billion debt for all of the state’s retirement systems has grown because the state has failed for decades to pay its obligations on time, she said.
Pension costs aren’t the issue, Rougeau said, noting that average benefits are $21,000 to $22,000 a year.
State government had an opportunity in 2007 to pay down a substantial amount of retirement debt when it experienced surpluses totaling over $3 billion, but the money went elsewhere. Private companies are regulated and often have to put extra money into their retirement plans in order to pay benefits. They don’t have the government’s luxury of letting things slide.
Sadly, these are only a few examples of governments’ unwillingness to face serious issues head-on. You can see why that bumper sticker resonates with many Americans.
Jim Beam, the retired editor of the Lake Charles American Press, has covered people and politics for more than five decades. Contact him at 494-4025 or [email protected].