Means-testing is a back-door strategy for taking away benefits earned by hard-working Americans.
By Lynn Stuart Parramore
December 31, 2012
In Washington-speak, “means-testing” is a scheme to deny or reduce Medicare and Social Security benefits for people who are “too wealthy” in the name of saving money. It’s a counterproductive, harmful idea, but one that well-intentioned liberals often get snookered into embracing.
It’s easy to see why. Economic inequality has exploded to dangerous levels, and the argument for means-testing seems to appeal to a powerful sense that the rich are getting more than their fair share at the expense of everyone else. Combine this with the deficit hysteria promoted by conservatives, and the trap is set.
Don’t fall into it. The truth is that means-testing is a sneak attack on vital programs meant to weaken and eventually destroy them. There’s a reason why an ultra-conservative like Paul Ryan pushed means-testing during the presidential campaign. And there’s a reason why private equity billionaire Pete Peterson, enemy of Social Security and Medicare who served in Richard Nixon’s cabinet, makes a special point of bringing up means-testing when he is talking to liberals.
Conservatives push means-testing because it’s a highly effective political strategy for getting liberals and progressives to act against their own values and interests — so effective that some economists billing themselves as liberal, such as Jared Bernstein, a former adviser to the Obama administration, sometimes talk about means-testing as if it’s a reasonable idea. Bernstein recently went on CNBC and said that means-testing “sounded like a good idea” and characterized people opposed to it as “fringe.”
Bernstein’s assertion that means-testing opponents are “fringe” is nonsense. Does that include Paul Krugman of the New York Times, who describes means-testing as “an even worse idea, on pure policy grounds, than even most liberals realize”? In researching this article, I communicated with several highly respected economists, including Nobel Prize-winner Joseph Stiglitz, James K. Galbraith, Dean Baker, and Thomas Ferguson. All of them expressed their concerns about means-testing and provided a variety of sound arguments against it. (Bernstein, after being roundly criticized, backtracked in a blog and admitted that means-testing is a bad policy idea and a questionable way to address income inequality. He just forgot that when he was on TV!)