On Social Security, for example, the Good Mitt proposes two benefit cuts: a gradual increase in the retirement age and a technical change known as “progressive wage‐price indexing” that would effectively hold future Social Security benefits constant in inflation‐adjusted terms for all but low‐income retirees (currently, benefit levels are linked to wage growth rather than to inflation. Because wages generally grow faster than inflation, this means future retirees will receive higher real benefits than today’s retirees.) These changes would restore Social Security to solvency, but at the cost of making the program an even worse deal for younger workers, and it would do nothing to fix Social Security’s other problems such as ownership, inheritability, or wealth accumulation. That makes it disappointing that the Bad Mitt continues to resist the idea of allowing younger workers to privately invest a portion of their payroll taxes through personal accounts.
On Medicare, Good Mitt has generally endorsed the Paul Ryan approach to reform. He would allow seniors to use government subsidies (effectively a voucher) to purchase private health insurance. Because the vouchers would have a limited value, it offers the potential for controlling costs, while giving seniors more choices. But the Bad Mitt included a critical distinction. Unlike Ryan, Romney would leave traditional Medicare in place. Nor does it appear that he would make any significant cuts to traditional Medicare. This allows him to avoid any charges that he would “throw Granny off a cliff,” but a Medicare program with unlimited benefits will almost certainly be more appealing than a private alternative that caps spending. That means that either seniors will stick with traditional Medicare or there will be pressure to increase the level of subsidies in the private program. Either way, Medicare costs will continue to grow at unaffordable levels.