Washington's pull-and-tug deficit-reduction talks, now on the eve of a Friday deadline, are demonstrating that it's easier to sculpt marble with a butter knife than it is to trim expected future social security benefits. Why? Blame it on the three P's: politics, perception, and poverty. Plus one more factor: Some opponents are convinced that the economic effect of a trim would be pure illusion, with no actual impact on the national debt.
Now, as in the past, politics is the biggest single stumbling block to a trim.
``Most politicians would feel that [a trim] would just cause an enormous firestorm'' politically, says Stuart Butler, director of domestic policy at the conservative Heritage Foundation. He notes that early in the Reagan administration the President and some Republican senators talked of holding down the growth of social security payments but beat a hasty retreat in the face of strong opposition from the elderly and organizations representing them.
Legislators are loath to walk into that trap again, Mr. Butler says: ``I don't think there would be many in Congress [who now would support a trim] unless it's as the result of some real bipartisan commission looking at social security.''
Most of the 37 million Americans who receive social security are elderly (the rest are widows, children, and the disabled). And they have political clout. As politicians are very much aware, more of the elderly and those near that age vote than younger Americans do.
Further, the elderly are well organized. Their largest group, the American Association of Retired Persons, has 27 million members and is widely considered an effective lobbying force on Capitol Hill.
The average monthly social security check for a retired American now is $491. Since the mid-1970s this payment has been indexed to the cost of living, as measured by the consumer price index. With few exceptions, social security payments have risen as much as living costs have. In true Washington fashion these cost-of-living adjustments often are referred to by an acronym: COLA.
This increase is often called a ``raise,'' and may be perceived as such by many Americans. But advocates for the elderly say it is only keeping up with the treadmill of inflation. ``You have to get the COLA,'' says Rep. Claude Pepper, ``to keep on getting the same amount'' of purchasing power. The venerable Florida Democrat is Congress's most visible spokesman for the elderly.
During the current White House-Congress budget summit, reports have repeatedly surfaced that, as one way of cutting the annual budget deficit, the 4 percent cost-of-living adjustment that retirees are supposed to receive might be trimmed in one of two ways. Most often discussed is a delay of three months, which would save about $2 billion this fiscal year. Another option, occasionally whispered, is to cut the increase from 4 to 2 percent. That would save about $4 billion.
The possibility of COLA cuts has brought a mighty protest from organizations and individuals who represent the elderly.
``A lot of organizations are mobilizing,'' Ronald Pollack says. ``Their memberships are getting letters and telegraphs up to'' Capitol Hill, thereby putting pressure on senators and representatives. Mr. Pollack is executive director of the Villers Foundation, an advocacy group for the poor.
It is ``bitterly unjust to ask 37 million Americans to sacrifice their standard of living,'' which for many is ``already inadequate,'' says Jacob Clayman, president of the National Council of Senior Citizens.
``President Reagan promised solemnly that social security would not be on the negotiating table,'' says Representative Pepper. The congressman promises to try to force the House to conduct a roll-call vote on any social security trim, something guaranteed to make virtually every member of the House extremely uncomfortable.
``There will be political fallout if this [a social security cut] is pursued,'' warns Arthur Flemming, a former secretary of the old Department of Health, Education, and Welfare.
Producing political fallout may not be necessary: In the wake of such criticisms, conferees are believed to be backing away from a trim. They gave it the cold shoulder Monday, participants said.
House majority leader Thomas Foley emphasized Tuesday that under the ground rules established for the talks, social security remains ``off the table'' as negotiators seek ways to prune the budget.
For many people the transcendent issue is poverty, not politics. ``Poverty among the elderly has been greatly reduced from the shameful levels of 20 years ago,'' says Lou Glasse, president of the Older Women's League. A major reason is the significant increase during the 1970s in the monthy amount that social security pays to the elderly, and the tying of that benefit to the cost of living.
In 1959 more than one in every three elderly Americans lived in poverty; today only one in eight does. That level of income would seem very modest to the average American: It is just $5,600 a year for a single person.
Today's poverty among the elderly disproportionately affects black Americans: one in every three elderly black women is poor, as is one in every four elderly black men.
In addition to the 12 percent who live below the official poverty line, advocates say another 18 percent of the elderly are barely above it. ``Surely we can find a source [of budget cuts] other than these poor people,'' Representative Pepper says, noting that social security payments make up much of the income of the elderly poor.
There is one final factor in considering whether to trim future social security benefits: Would it have a real impact on the budget deficit? Dr. Flemming and others insist it would not, because social security is financed not from the general Treasury of the US, where the deficit exists, but out of a totally separate fund, the Social Security Trust Fund. He says it's a ``shell game'' to claim that trimming expenses financed from this fund would somehow reduce the annual debt incurred by the general Treasury.
Robert Ball, a former commissioner of social security, says the Social Security Trust Fund is now ``adequately financed,'' thanks to major increases during this decade in the amount of money collected from employees and employers for the social security system.
Five years from now, he notes, according to ``best guess estimates,'' the fund will have a surplus of $282 billion. That surplus, which is expected to continue to grow, is needed to ensure that the government will have sufficient funds to pay social security benefits to the baby-boom generation when it retires during the first quarter of the 21st century.
``We object to cutting the benefits and accomplishing nothing by doing it,'' Flemming says.
``The only thing'' a delay in the cost of living would accomplish, he adds, is to increase the surplus, ``and we don't need that.''