The Los Angeles Times’ lead, Washington Post’s top non-local story, and Wall Street Journal’s top world-wide newsbox item all go with Fed Chairman Alan Greenspan’s congressional testimony that in order to keep the government from going broke during coming boomer retirement bomb, Social Security and Medicare benefits will eventually have to be cut a bit. Greenspan also repeated his position that Bush’s tax cuts should be made permanent, though he suggested that they should be off-set by spending cuts. The New York Times fronts Greenspan, but leads with the Supreme Court’s 7-2 decision that states are allowed to refuse funding for divinity school scholarships. Everybody sees the decision as a big bad sign for supporters of school vouchers. USA Today leads with a wrap-up of international efforts, such as they are, to address the rebellion in Haiti: France said President Aristide should resign and said an international security force should be deployed. The proposal left it unclear whether France was willing to go in without a peace agreement in place. The Security Council is also slated to chat about the crisis. Meanwhile, the LAT says that the end seems near in Haiti’s capital. Police are abandoning their posts and pro-Aristide gangs have been looting neighborhoods and robbing foreign evacuees.
“I am just basically saying that we are overcommitted at this stage,” said Greenspan. Social Security and Medicare currently take up about 7 percent of GDP. As the chief noted, that’s projected to rise to 12 percent by 2030.
Greenspan has issued similar calls before, but people were apparently surprised he did so during campaign season. And the reaction was swift. As the Journal puts it, “Bush rushed to distance himself” while “Kerry and Edwards pounced.”
Among the chief’s proposals: 1) Use a more accurate cost-of-living increase, which he said would have saved $200 billion over the last ten years. 2) Raise the Social Security retirement age a bit. It’s already slated to rise to 67-years-old over the next two decades. But as Greenspan noted, since people are living longer, the time they’re spending in retirement is growing. During questioning, he also said that tax increases will inevitably be part of the solution.
It’s a good thing the NYT didn’t lead with Greenspan, because its treatment is flawed. The headline gives a good sense of it, “TO TRIM DEFICIT, GREENSPAN URGES SOCIAL SECURITY AND MEDICARE CUTS.” That’s misleading, at best. Take a look at Greenspan’s comments. He wasn’t suggesting that Social Security should be cut to deal with the current deficit. He was talking about longer termtrends.
The Times then focuses on the political theater of it all before eventually makes a sort of important point: Greenspan’s assessment of the problem was spot-on, his proposals at least reasonable, and the outraged reaction…well, here’s what the paper says: “Greenspan was in many ways reflecting a widespread view that the only solution is to either cut benefits or raise taxes by huge amounts. But that is a conclusion that neither party in Congress has been ready to face thus far.”
The papers say inside that the Republican House leadership has shelved the proposed two-month extension for the 9/11 commission. The White House had reluctantly backed the extension, but as the Journal noted earlier this week the administration hadn’t been pushing the House to agree to it. Commissioners said that without the extra time they’ll have to cancel interviews and other work.
Everybody mentions that much-criticized administration advisor Richard Perle has stepped down from his post at the advisory Defense Policy Board, saying he didn’t want to be a distraction during Bush’s re-election campaign. The story was broken by Knight-Ridder.
The NYT fronts Israeli raids yesterday on banks in Ramallah. Israeli officials said they confiscated about $8 million from militant groups. A State Dept. spokesman criticized the raids, saying “We’d prefer to see Israeli coordination with the Palestinian financial authorities.””
A piece inside the NYT reflects on recent visits Kerry and Edwards had with the paper. The piece knocks Edwards for fumbling and punting after being asked whether the U.S. should send forces to Haiti. He said, “You know, I don’t have— I can’t set some arbitrary—I think it’s a judgment that you have to make on a case by case basis.” Answering the same question, Kerry responded, “Not to pander, but your editorial this morning hit it right on the head.” In other developments, NYT editorial page endorses Kerry.
[Note: The Post’s Web site was under the weather again, which limited TP’s ability to troll.]