On SS and Medicare

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February 16, 2011, 9:54 am
There Is Still No Such Thing As Socialsecuritymedicareandmedicaid
by Paul Krugman
And President Obama, I’m glad to see, knows that:

The truth is Social Security is not the huge contributor to the deficit that the other two entitlements are. I’m confident we can get Social Security done in the same way that Ronald Reagan and Tip O’Neill were able to get it done, by parties coming together, making some modest adjustments. I think we can avoid slashing benefits, and I think we can make it stable and stronger for not only this generation but for the next generation.

It’s also important to realize that the conceptual issues are very different for Social Security than they are for M&M. For SS, we decide the level of benefits; for M&M, we can’t do that, because health costs for any individual are unpredictable; so cost-savings on the health-care programs essentially involve deciding what we’ll pay for rather than how much we’ll pay. (Death panels!)

I like the way Jonathan Bernstein puts it:

In my view, those who are upset about the long-term federal budget deficit should talk about it in terms of what it is, health care costs. Just as the phrase “weapons of mass destruction” encourages sloppy thinking (because nuclear weapons are not really similar at all to chemical and biological weapons in lots of important ways), talking about “entitlements” confuses the budget situation. I could see “Medicare and Medicaid” or, perhaps, “government health programs,” but not entitlements.