politics

Four Reporters, Four Different Stories

March 24, 2005

Yesterday the Social Security Trustees released an update on the finances of Social Security and Medicare. As we noted yesterday, the coverage that immediately followed picked up on the relatively meaningless detail that two doomsday dates — the year that the Social Security will start drawing on its trust fund, and the year that the fund will dry up — had been moved up by one year each.

The Washington Post‘s coverage today shies away from the hype we saw yesterday, and focuses on the problems with Medicare. The Post frames its story around the makeup of the panel itself. On one end of the spectrum were three trustees from the Bush cabinet, intent on publicizing Social Security’s shortened timeline, and on the other were the independent trustees who focused on Medicare’s woes.

In the past five years, the date when Social Security would begin taking in less in taxes than it pays in benefits has actually slipped, from 2015 to 2017, the public trustees wrote, while the date of Social Security trust fund exhaustion has been pushed back from 2037 to 2041. … In contrast, Medicare’s financial outlook has deteriorated on all fronts. … The point of [Medicare] trust fund exhaustion has moved up from 2025 to 2020.

While the New York Times‘s headline — “Report Says Medicare Is in Poor Fiscal Shape” — on its page A19 story calls attention to Medicare, the lede shifts gears and focuses on Social Security. David Rosenbaum writes, “The long-term financial condition of the Social Security system deteriorated slightly over the last year, the government reported on Wednesday.”

But, that’s not even true. Social Security’s “long-term financial condition” actually improved slightly over last year, according to the government report. Take a look at this chart that shows Social Security’s balance as a percentage of taxable payroll. The report specifically states, “After 2030, the annual shortfall of program income is somewhat smaller than projected last year.”

Rosenbaum trips up again later, writing, “To pay all scheduled benefits over the next 75 years, the government would have to raise an additional $4 trillion in today’s dollars, $300 billion higher than the figure projected last year.” As Matthew Yglesias pointed out, “[W]atch your inflation. The $4 trillion is in today’s dollars. Last year’s report used last year’s dollars.” In other words, the total grew by $300 billion in part because of inflation, not because Social Security’s finances worsened. (The other factor contribuing to the increase is that this year’s report and last year’s report naturally covered two different time periods, 2004-2079 and 2005-2080, respectivley. Since 2004 is a year in which the Social Security system operates with a surplus and 2080 is deficit year, the overall deficit appears to increase.)

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For its part the Associated Press also led with the hard numbers, once again making the mistaken assertion that the program will be broke by 2041. Then, instead of discussing the implications of the report, the AP tells us that “both sides in the current political debate over Social Security seized on the update with familiar arguments.” We are then treated to about ten paragraphs of “he-said, she-said” reportage before any mention of Medicare at all. After two paragraphs it’s back to Social Security, with AP repeating the Times‘ error by stating that Social Security’s unfunded obligation increased by $300 billion from last year.

The Wall Street Journal buries the new report and its details on Social Security and Medicare inside a story suggesting that “The Bush administration is weighing a change in its proposal for private Social Security accounts that would make them more attractive to workers, though potentially more costly to the government.” The Journal came to know this through an interview with the National Economic Council director Allan Hubbard. While this reeks of message control by the White House, the Journal does have its eye on the ball; a change of this kind is significant enough to outweigh the relatively non-news made by yesterday’s trustees’ report.

–Thomas Lang

Thomas Lang was a writer at CJR Daily.