Catfood Co-Chairs Explicitly Use Social Security To Cut Deficit
Social Security does not affect the deficit, according to the Catfood Commission Draft Report, above. They want to ‘Reform Social Security for its own sake, not for deficit reduction.” Page 43. The goal is to “Ensure Social Security solvency for the next 75 years while reducing poverty among seniors.” P.8
So, if Social Security doesn’t increase budget deficits, why is it in this plan? Take a look at page 11, which shows the sources of the deficit reduction, pointedly excluding Social Security reform. Now, look at the note at the bottom of the page:
Note: Projections based off of constructed plausible baseline (see last slide). Including off-budget savings from Social Security, the plan would reduce deficits to 2.0% of GDP in 2015 and 1.4% of GDP in 2020.
The big point of Social Security reforms as seen by the Catfood Co-Chairs is that it reduces the budget deficit after they apply the money we are paying in new excess taxes. The main chart shows that in 2015 the deficit is 2.2% of GDP, but as the note helpfully explains, we get a further reduction of .2% of GDP by spending the excess taxes. The same thing happens in 2020.
Obviously this is the reason to reform Social Security: it gives the Co-Chairs bigger deficit reduction.
Of course, this comes at the expense of practically everyone. For people in the middle quintile, the lifetime median loss is 8% of total benefits. P. 48 For people in the second lowest quintile, the loss is about 3%. They aren’t living in poverty (?), so the Co-Chairs feel justified in reducing their Social Security.
At least they are up front about this abuse.