AARP Is Open to Cuts for Social Security Benefits

Published: June 17, 2011 - New York Times

WASHINGTON — AARP, the powerful lobby for older Americans that has been seen as one of the leading opponents of Social Security benefit cuts, said on Friday that it was open to modest reductions in benefits for future recipients.

“Our goal is to limit any changes in benefits,” John Rother, the group’s policy chief, said in a telephone interview, “but we also want to see the system made solvent.”

Mr. Rother said that the group’s stance on possible cuts, which was first reported in The Wall Street Journal in Friday’s editions, should be seen less as a major change in position than as a reflection of the political and financial realities facing the Social Security system and the country as a whole.

“You have to look at all the tradeoffs,” Mr. Rother said, “and what we’re trying to do is engage the American public in that debate.”

Nonetheless, the group’s openness to the possibility of unspecified cuts was seen as a significant development by people on all sides of the Social Security question, because of AARP’s powerful voice on federal policies affecting older Americans, including Medicare, prescription drugs and many more.

Third Way, a moderate Democratic group in Washington that has favored possible reductions in benefits, called AARP’s position “a watershed moment” in the debate over Social Security. “Now that they have opened the door to reform, it is time for lawmakers to walk through it,” said Jonathan Cowan, president of Third Way.

But other advocacy groups that are pushing to preserve Social Security benefits accused AARP of effectively abandoning its core constituency.

Doug Henwood, the Brooklyn editor of a liberal business blog and Internet radio program who has written on Social Security, said AARP’s willingness to consider cuts in benefits “reads like a sign that this former lobby for the interest of older Americans has now transformed itself completely into an insurance company.” He continued, “Surely they can’t be persuaded by the merits of the arguments, since the alleged Social Security crisis is a phantom that can’t survive a serious round of fact-checking.”

The most recent estimates from the Social Security Administration, issued last month, indicate that under currrent law the program’s trust funds will be exhausted by 2036, and that $6.5 trillion in additional money will be needed over a 75-year period to pay all scheduled benefits.

Mr. Rother said that AARP expects to hear criticism from some of its members over the new position.

“We have such a broad membership, Mr. Rother said. “I’m sure there will be some who will not be happy, but others will be eager to see the program put on a stronger footing financial for the long-term.”

He made clear in an interview that the group’s willingness to discuss cuts comes with conditions: Reductions in benefits should be “minimal,” they should not affect current recipients and instead should be directed “far off in the future,” and they should be offset by increases in revenue.

While AARP has not issued specific recommendations or figures on how benefit reductions might be carried out, the group’s recent discussions with its public constituencies signal support for using increased revenue to fill two-thirds of the projected gap and benefits reductions for one-third.

Though AARP’s position is likely to shift the debate in Washington somewhat, its insistence that benefit cuts be pushed down the road will probably not sit well with many Republicans, who are demanding earlier reductions as a key part of their plans to address the nation’s overall budget deficit problem.