Analysis: Deficit forces AARP compromise on Social Security

WASHINGTON Mon Jun 20, 2011 11:52am EDT

The shadows of U.S. Senator Hillary Clinton (D-NY) are seen as she speaks at the annual public policy meeting of the American Association of Retired Persons (AARP) in Washington February 13, 2007. REUTERS/Kevin Lamarque

The shadows of U.S. Senator Hillary Clinton (D-NY) are seen as she speaks at the annual public policy meeting of the American Association of Retired Persons (AARP) in Washington February 13, 2007.

Credit: Reuters/Kevin Lamarque

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WASHINGTON (Reuters) - For much of its 53-year history AARP, the powerful lobbying group for older Americans, has had such clout in Washington that its opposition or support has often helped decide the fate of legislation in Congress.

But with a report on Friday that AARP is dropping its long-standing opposition to cutting Social Security benefits, it appears that the organization is giving ground to an even more powerful force: the enormous federal deficit.

Faced with the political reality in Washington that at some point lawmakers will have to rein in the costs of Social Security to keep it from going bankrupt, the willingness of AARP to consider benefit cuts shows that outright opposition -- a successful tactic in the past -- can no longer carry the day in an age of soaring federal debt.

Rather, AARP recognizes that if it wants to help shape the debate for its estimated 37 million members, it needs to give ground to have a seat at the table.

"In the past AARP really has been the 800-pound gorilla in American politics. Often it has taken absolute stands on issues, and it could afford to do so because they wielded enormous power and did not have to compromise," said Mark Rozell, a political scientist at George Mason University and the author of books about interest groups in U.S. politics.

But with the issue of long-term deficits having moved center stage in Washington and becoming a major concern for voters, Rozell said AARP recognizes it cannot stand by and simply oppose benefit cuts, because this time lawmakers will probably proceed to reform Social Security without them.

The Wall Street Journal reported on Friday that AARP had decided to drop opposition to benefit cuts. AARP said in a statement the story was "misleading" and that "AARP has not changed its position on Social Security."

AARP officials acknowledged an openness to consider benefit cuts as part of the solution to shore up the retirement system finances. But they want the program's financial health to be worked out separately and not in the context of current negotiations over the $1.4 trillion deficit and $14.3 trillion national debt.

In an interview with Reuters, David Certner, AARP's legislative policy director, said that any future reform of Social Security will include changes "on both sides of the equation" -- benefits and taxes.

BLOCKED BUSH

The power of AARP was demonstrated in 2005 when its opposition played a large part in the successful effort to block former President George W. Bush's attempt to partially privatize Social Security.

According to the government's most recent projections, Social Security -- which last year began paying out more in benefits than it collected in taxes -- faces insolvency by 2036, unless reforms are made.

There are no immediate plans in Congress to tackle Social Security, but recent proposals by deficit-reduction groups include options such as raising the retirement age, cutting benefits and reducing payments for wealthier retirees.

Liberal groups, vehemently opposed to benefit cuts as part of any plan to shore up Social Security's finances, decried AARP on Friday for even considering the move.

But David Gergen, an adviser to four former U.S. presidents and a non-partisan political analyst, said AARP recognizes that Social Security is "on an unsustainable path."

Gergen added: "They recognize that it is better to work within the system to bring wise changes, than possibly be run over. They will have a much bigger voice at the table, rather than outside the room."

Stephen Farnsworth, a Washington-based political scientist, said AARP was actually becoming more powerful as more baby boomers retire. "Intransigence is a very viable strategy, and AARP has wielded it well," Farnsworth said.

"If they are moving toward a greater willingness to compromise, it suggests that the fixed position has become a loser politically."

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Comments (3)
Eideard wrote:
AARP has been selling out seniors ever since they began to realize a much higher income acting as an insurance agent. Their cooperation was critical to the doughnut hole forced on Medicare drugs benefits by the Bush/Cheney cabal.

That was 2003. That’s when I dropped my membership along with thousands of other seniors.

AARP now has a very small real constituency: United Healthcare, the Hartford and NY Life. The only grayheads in that crowd have 7-figure incomes.

Jun 20, 2011 12:20pm EDT  --  Report as abuse
2045 wrote:
If social security was only for the elderly there would not be a money problem with the looming deficit for the program. I realize the younger people on social security need help and the goverment should have a seperate program for them. As seniors we have no way of getting jobs for added income. Also when you as a senior get these jobs it takes away from the work force for the younger. As the rising cost of food housing and gas also medical where are we suppose to get the exstra income. When we were younger we got a better job or did overtime when possible those opptions are gone now.

Jun 20, 2011 1:18pm EDT  --  Report as abuse
DrJJJJ wrote:
Social security went into the red (bleeding) last year folks-most people aren’t aware of this fact and several years ahead of forecasts FYI! Which party has been saying unfunded entitlements will need to be revised for 80 million boomers (1/4 of US) lining up and how will this effect a tax and spend/invest/gamble strategy that banks on robust growth that just can’t happen with monster debt?? Vote accordingly! A vision without a way to pay for it is a dangerous illusion now and honesty is the best policy!!!

Note: when the Demos say SS will be insolvent in 25 years, they mean total and complete bankruptcy/ National monster crisis, not just running a little short!

Jun 21, 2011 2:14pm EDT  --  Report as abuse
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