CNBC goes to school on Social Security, flunks out
A couple of well-heeled anchor-reporters for CNBC -- the type of people who need never beg for lunch dates among Wall Street bankers -- Friday batted around the supposed threat to the republic posed by hordes of seniors collecting Social Security benefits.
Unfortunately for them, their interviewee was Damon Silvers, policy director for the AFL-CIO and one of the best informed and fiercest defenders of Social Security in Washington. If they listened, they learned something. The evidence is they didn’t listen.
The segment began with Silvers explaining that 55% of Americans today fear they’ll be economically insecure in retirement. “That’s up from 33% 20 years ago,” he says. Consequently, “the last thing we should do for our country is cut Medicare, Medicaid and Social Security benefits.” He explains that’s why the AFL-CIO has told congressional Democrats that any of them who vote for reducing benefits will get no financial support from the American labor movement.
At that point anchorwoman Kelly Evans steps up to the plate. “Nobody’s saying that there’s not a good rationale for having these programs in place,” she says, charitably. “Of course people want to make sure that our citizens are taken care of. But that’s almost not the point.” (It’s not?) Evans proceeds to assail Silvers and the AFL-CIO for refusing to “negotiate” over seniors’ well-being.
“We’re not embarrassed about that whatsoever,” he replies. “If you cut Social Security benefits or Medicare benefits to our seniors, to our most vulnerable people in the country, you are going to get no support on it.”
Then anchorman Simon Hobbs breaks in to deliver what he thinks is the coup de grace, asking, “Are you as clear on the reality that if you don’t cut entitlement benefits this country may well go bankrupt.” That’s certainly one of the most baldly ignorant statements about the country’s fiscal condition and the effect of the two big social insurance programs ever to be heard on CNBC (and that’s a high bar), since (A) the U.S. can’t go “bankrupt,” and (B) the country has more than enough resources to pay for all its obligations to its seniors.
Silvers responds more politely than I would have. “That’s frankly not true,” he says. “That’s a lie put forward by billionaires who don’t want to pay higher taxes.” (He might have mentioned, but didn’t, Peter G. Peterson, the hedge fund billionaire whose network of Washington think tanks relentlessly pushes for “entitlement reform.”) “The only people who believe what you just said,” he added,"are people who are worried that their very large incomes will be taxed.”
Silvers is right about that: The promoters of the idea that the key to fiscal nirvana is to cut Social Security and Medicare benefits almost invariably are people whose wealth will protect them from having to rely on either program in their old age. That includes CNBC on-air talent like Evans and Hobbs, with or without their wardrobe allowances.
The truth is that without Social Security, more than 40% of elderly Americans would be living below the poverty line. Did that message sink in? Hobbs looked thunderstruck that anyone would dispute his threadbare and uninformed talking points about Social Security. So my Magic 8 Ball says, “Don’t count on it.”