If it were possible to fuse together the coverage that the New York Times, Washington Post, Los Angeles Times and USA Today gave to Alan Greenspan’s House Budget Committee testimony this week, you just might have the perfect beast. Each story tackled the issue from a slightly different angle, filling in gaps the others left wide open. Unfortunately, there were a few holes — glaring omissions — that none of these outlets caught, so here we are with the spackle to complete the job.
First is the New York Times. The paper does a good job in pointing out that making the president’s earlier tax cuts permanent “would add about $1.8 trillion to the federal debt over 10 years,” which would “come on top of a rapid escalation in the federal debt from $3.4 trillion to $4.3 trillion” according to the Congressional Budget Office. But the Times fails to include the estimated cost of adding private accounts Social Security in those debt projections — an estimated $1 to $2 trillion over the next ten years — which will be funded either in whole or in part by further borrowing. Since the whole Social Security debate is still speculative, the Times may be forgiven for this lapse, but let’s hope they don’t make a habit of it.
The second omission comes in the oft-repeated assertion that the president has plans to “reduce the budget deficit by half by 2009.” Problem: that’s just not true. Last year, the federal government ran a shortfall of $413 billion, which was short of the $521 billion deficit that administration numbers wonks had predicted last February.
Working from the inflated projection instead of the actual deficit number, the president claims to have already “reduced” the deficit by about $100 billion, and by cutting it by another $260 billion, he can ultimately claim victory. But even this only tells part of the story. In its budget and deficit projections, the administration neglects to include the costs of Afghanistan, Iraq, its Social Security plan, or fixing the alternative minimum tax. If these add-ons were included, even the inflated $521 billion number would skyrocket.
The Los Angeles Times has a similar problem in laying out the potential cost of partially privatizing Social Security, noting that “In a possible boost for the president, Federal Reserve Chairman Alan Greenspan urged Congress on Wednesday to move quickly to shore up Social Security’s likely long-term financing gap. That gap is expected because of the coming wave of baby boom retirees and is estimated to reach $3.7 trillion over 75 years.”
The Times fails to mention that the $3.7 trillion figure is so speculative as to be little more than a guess. The estimate has been called into question by, among others, the American Academy of Actuaries, who have written that the projection provides “little if any useful information about the program’s long-range finances [and is] likely to mislead anyone lacking technical expertise in the demographic, economic, and actuarial aspects of the program’s finances into believing that the program is in far worse financial condition than is actually indicated.”
Finally, there is the matter of USA Today‘s definition of the word “critic.” Reporter Sue Kirchhoff writes, “Critics point out that private accounts don’t address the financial shortfall in Social Security, would expose Americans to additional risk and would require borrowing that would swell the deficit.”
That’s true. But what USA Today fails to mention is that it’s not just “critics” of the president’s plan who point these facts out — in a sort of if-you-can’t-beat-’em-join’em strategy, the president himself, as well as his most ardent supporters, fully concede all three points.
–Paul McLeary
Correction: The above post has been changed to delete a reference to the “infinite horizon” projection of Social Security’s solvency and to better characterize the nature of the president’s plan.
Paul McLeary is a former CJR staff writer. Since 2008, he has covered the Pentagon for Foreign Policy, Defense News, Breaking Defense, and other outlets. He is currently a defense reporter for Politico.