January 28, 2005
Little Black Lies
By PAUL KRUGMAN
Social Security privatization really is like tax cuts, or the Iraq
war: the administration keeps on coming up with new rationales, but
the plan remains the same. President Bush's claim that we must
privatize Social Security to avert an imminent crisis has evidently
fallen flat. So now he's playing the race card.
This week, in a closed meeting with African-Americans, Mr. Bush
asserted that Social Security was a bad deal for their race, repeating
his earlier claim that "African-American males die sooner than
other males do, which means the system is inherently unfair to a
certain group of people." In other words, blacks don't live long
enough to collect their fair share of benefits.
This isn't a new argument; privatizers have been making it for years.
But the claim that blacks get a bad deal from Social Security is
false. And Mr. Bush's use of that false argument is doubly shameful,
because he's exploiting the tragedy of high black mortality for
political gain instead of treating it as a problem we should
Let's start with the facts. Mr. Bush's argument goes back at least
seven years, to a report issued by the Heritage Foundation - a report
so badly misleading that the deputy chief actuary (now the chief
actuary) of the Social Security Administration wrote a memo pointing
out "major errors in the methodology." That's actuary-speak
for "damned lies."
In fact, the actuary said, "careful research reflecting actual
work histories for workers by race indicate that the nonwhite
population actually enjoys the same or better expected rates of return
from Social Security" as whites.
Here's why. First, Mr. Bush's remarks on African-Americans perpetuate
a crude misunderstanding about what life expectancy means. It's true
that the current life expectancy for black males at birth is only 68.8
years - but that doesn't mean that a black man who has worked all his
life can expect to die after collecting only a few years' worth of
Social Security benefits. Blacks' low life expectancy is largely due
to high death rates in childhood and young adulthood. African-American
men who make it to age 65 can expect to live, and collect benefits,
for an additional 14.6 years - not that far short of the 16.6-year
figure for white men.
Second, the formula determining Social Security benefits is
progressive: it provides more benefits, as a percentage of earnings,
to low-income workers than to high-income workers. Since
African-Americans are paid much less, on average, than whites, this
works to their advantage.
Finally, Social Security isn't just a retirement program; it's also a
disability insurance program. And blacks are much more likely than
whites to receive disability benefits.
Put it all together, and the deal African-Americans get from Social
Security turns out, according to various calculations, to be either
about the same as that for whites or somewhat better. Hispanics, by
the way, clearly do better than either.
So the claim that Social Security is unfair to blacks is just false.
And the fact that privatizers keep making that claim, after their
calculations have repeatedly been shown to be wrong, is yet another
indicator of the fundamental dishonesty of their sales pitch.
What's really shameful about Mr. Bush's exploitation of the black
death rate, however, is what it takes for granted.
The persistent gap in life expectancy between African-Americans and
whites is one measure of the deep inequalities that remain in our
society - including highly unequal access to good-quality health care.
We ought to be trying to diminish that gap, especially given the fact
that black infants are two and half times as likely as white babies to
die in their first year.
Now nobody can expect instant progress in reducing health
inequalities. But the benefits of Social Security privatization, if
any, won't materialize for many decades. By using blacks' low life
expectancy as an argument for privatization, Mr. Bush is in effect
taking it as a given that 40 or 50 years from now, large numbers of
African-Americans will still be dying before their time.
Is this an example of what Mr. Bush famously called "the
soft bigotry of low expectations?" Maybe not: it isn't
particularly soft to treat premature black deaths not as a tragedy we
must end but as just another way to push your ideological agenda. But
bigotry - yes, that sounds like the right word.