TheDC Analysis: AARP, Dems undermine younger workers’ retirement

Workers under age 45 will pay the price for AARP’s lobbying against Medicare and Social Security reforms over the past two decades in the form of reduced benefits, critics say.

AARP has been described as the “800-pound gorilla” in the Medicare and Social Security debates and has played a key role in blocking many pieces of major legislation aimed at restructuring Medicare and Social Security to prolong their lifespans for the past 20 years.

According to a 2003 Los Angeles Times op-ed by Dale Van Atta, former President George H.W. Bush described the 36-million member lobby as being extremely formidable and  “like ugly on an ape” when he opposed the group’s positions.

The group similarly demonstrated its power when it forced Bill Clinton to shelve his plan to cut $58 billion from Medicare to pay for his ill-fated 1994 health care package.

“They’re major role seems to be that of obstruction,” said Ryan Ellis, director of tax policy with Americans for Tax Reform. “The people being affected are not current AARP members, and for some reason they feel they need to obstruct and demagogue to curry favor with their membership.”

The Baby Boom generation’s retirement over the next decade will significantly increase Social Security and Medicare costs while simultaneously reducing the payroll taxes that will be needed to cover benefits.

“If you look at the big three entitlement programs, which are Medicaid, Medicare, and Social Security, they will eventually consume every penny in taxes by themselves, assuming we don’t increase taxes from the current 18 to 19 percent of the economy that taxes normally take,” Cato Institute scholar Michael Tanner said. “Those three programs alone will cost more than that. We could abolish all of the rest of the government and still not have enough money.”

The looming insolvency of the Medicare and Social Security trust funds has been well known since at least the mid-1990s when officials began warning the Boomers’ looming retirement threatened to bankrupt both systems, but politicians in Washington have lacked the resolve to fix the problems.

Ellis primarily blames Congress for the problems in both systems, but says AARP has been an accessory.

Former Fed chairman Alan Greenspan correctly warned as far back as 1996 that Social Security would not remain viable starting around 2010 because of pressures posed by an increasing number of beneficiaries being supported by a declining number of active workers.

Beginning “in the year 2012, the annual expected costs of Social Security are projected to exceed annual earmarked tax receipts, and the consequent deficits are projected to deplete the trust funds by the year 2029,” Greenspan said in a Dec. 6, 1996 speech at Philadelphia’s Union League.

“Medicare currently is in an even more precarious position than Social Security,” he continued.

Nonetheless, AARP and similar groups such as the National Committee to Preserve Social Security and Medicare have worked with congressional Democrats to preserve the status quo.

At the time of Greenspan’s speech, the Medicare trustees predicted the program’s Part A trust fund, which covers hospitalization for the elderly would be depleted by 2001.

AARP fought hard against bipartisan temporary Medicare fixes such as those found in 1997’s Balanced Budget Act (BBA), which successfully kept Medicare from collapsing in 2001 by cutting the rate of Medicare spending.

But the BBA did not address the looming problem of Medicare funding, which Republicans initially hoped to address in 2003 with their initial Medicare prescription drug package, which sought to reform the entire system.

The House version of the Medicare prescription drug bill contained a provision backed by conservatives like former Pennsylvania Republican Rep. Pat Toomey – who is now the Republican nominee for Senate in Pennsylvania — that would have encouraged price competition between the traditional Medicare program and private plans starting in 2010.

  • aaarrrggg

    Nanny nanny nu nu.
    The very people who voted Obama in to office are the ones who will be harmed the most.

    AARP knew form the get go they would profit from the health care bill, with the abolishment of Medicare Advantage, who do you think will pick up the slack.

    As I have said many times, for those of us who read the Health Care Bill ( now law) we are going to sit back and LAUGH 😮

  • rainmaker1145

    Surprise! AARP sold out Americans in 2005 when they opposed reform then. They know Social Security has to be privatized and they know Medicare has to be privatized for these programs to survive.

    That wouldn’t work though for the leadership at this company. AARP is now too big and it has failed.

    • Whit

      No surprise here. At least forty years ago AARP tried very hard to recruit me as a warm body they could use to back up their vote but they did not represent my interest, neither did they want to hear it. Every AARP member represented the interest of AARP to the extent that they were finally called on that. They used various baits to collect members and then used them to back up the ARRP demands regardless of how that member felt about it. This is a well worn subversive tactic. I know they spent far more than the five dollar membership fee trying to get my name on their list. I knew then where they stood and they have not moved one nanometer. This is a subversive group just like the ACLU and any number of like minded entities both in and out of government. Go do a fine tooth history research of this group and you will see I know what I am talking about. The National Committee to Preserve Social Security Represented by FDR’s son whose given name slips my mind right now was off the same root and using the same tactics at that same time. Somehow all this history got covered up.

  • Typehuile

    I’ve been getting AARP solicitations, invitation, come-ons, and alerts for many years. I just take them from the mailbox to the round file. A long time ago, I came to the conclusion that they were the single biggest reason that any discussion of Social Security and Medicare in Congress was destined to have a shelf life of about three days, just long enough for AARP to rev up their attacks on any member of Congress who might entertain the idea of reform.

    AARP is to Social Security reform as NARAL is to partial-birth abortion regulation or LaRaza is to immigration reform.

  • libertyville

    When the Association for American Retired People changed its name to AARP, it also changed its charter to sell insurance. This is not the lobbying group for seniors that once existed. It’s a political business group that has targetted a vulnerable age group and is just looting them.

    • Whit

      Not the same set of Subversives? Insurance was one of the more effective baits to secure warm bodies they could lobby with. As with my post above. this group is dedicated to the furtherance of the UN and other Marxist representatives. If Social Security had a leg to stand on it would not have been a government entity supported by enforced mandated and enforced government rules and the concomitant taxation nor would it have had that 50/50 split trying to make us believe that the business pays half the tax. Business, regardless of how it is shown on the books has to factor their 50% against the cost of our wages. There is no other way it can work. Social Security is not aid out of net profit. That is one of the first lies supporting Social Security but a long way from being the last. Lock box or no, Social Security funds were “invested” by our government to pay a modest one percent interest rate or something like that. Some look it up and tell us how that money was used as an investment. Who was responsible for the IOU and what was accomplished? Now when you loan investment capital for any cause the borrower is obligated to pay it back or the creditor owns the business.

      “Once 2015 comes around, Social Security will be forced to fund its obligations to the nation’s seniors by redeeming billions worth of Treasury bonds to cover the gap between revenues.”

      Where and how, pray tell, are these IOUs going to be redeemed? We will not only be paying twice for Social Security by may find we are paying for inflation, too.

      “If you decided you wanted to go to a system of individual savings accounts where people under a certain age can put their money into private accounts, that wouldn’t relieve you of the need to take care of current beneficiaries,” Certner said. “You simply would be paying taxes for Social Security benefits twice ̶ once for yourself and once for current beneficiaries.”

      I have never been able to spend my money twice. I have been in debt and I have had to make mortgage payment at the expense of maintenance. What we are overlooking is when we pay our tax we are not spending that money creating jobs, just enriching politician and their favorites while losing jobs. It is time we changed our doctors and our medicine so that we can spend more where we want to rather than supporting government graft at their demand.

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