Government must get serious about reforming entitlements

The president’s annual State of the Union address is an opportunity for our country’s elected leader to put aside partisan politics, talk to Congress and the American people about our country’s direction and outline his priorities. This speech to the nation has carried even greater weight during the trying times, when Americans look to the president for unifying and inspiring leadership. 

Unfortunately, President Obama’s 2012 State of the Union address missed this mark. Our economic recovery is still very fragile. Nearly one-half of the 13 million unemployed Americans have been out of work for more than six months, the highest proportion of long-term unemployed since the Labor Department started tracking the statistic in 1948.

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How to boost economic recovery and spur businesses to invest and create more jobs remains our country’s most critical priority. For the past three years, the higher taxes and ongoing threats of new taxes, skyrocketing government deficits and over-regulation have put a wet blanket on new hiring. But rather than offering a new, more hopeful direction, the president’s State of the Union speech focused on familiar calls for higher taxes and even bigger government. 

In 2009 and 2010, a Democratic-controlled Congress approved the president’s priorities, including sweeping changes to our healthcare system that will begin next year. These priorities produced an unprecedented surge in spending and bigger government, including nearly $1 trillion in economic stimulus that has raised the national debt to $15.2 trillion. But the situation today is worse by any measure that is important to ordinary Americans: Unemployment is higher, the rate of foreclosures is higher, gasoline prices are higher and 46 million Americans are living in poverty. For the first time in our history, our national debt is larger than our gross domestic product.

Rather than championing fiscal responsibility, reining in over-regulation and promoting tax reforms to support sustained economic growth and job creation, the president in his State of the Union speech instead focused on repackaging many previously failed policies. Rather than focusing on bipartisan approaches to strengthen our country and put Americans back to work, the president spoke as if his audience were at a political rally. 

I was particularly disappointed that in a nearly 7,000-word speech, the president devoted only 40 words to Social Security and Medicare. Those two programs, vital to the welfare of tens of millions of Americans, account for more than half of all federal spending. The payroll-tax-supported trust funds that pay out Social Security and Medicare benefits are speeding toward financial brick walls. Medicare is on course to be bankrupt in 2016. Social Security’s chief actuary calculates that a 23 percent cut in benefits in 2036 will be required to maintain solvency. 

Last year, I introduced the Defend and Save Social Security Act, which would ensure that Social Security is solvent for the next 75 years, through very gradual yearly increases in the retirement age and a modest adjustment to the annual cost-of-living increases. It would keep core benefits untouched, and it requires no new taxes. Enacting such modest, incremental changes would avoid bankrupting the trust fund and forcing a 23 percent cut in core benefits in 2036.

Proposals for reforming Medicare have also been brought forward in this Congress. I applaud those of my colleagues who are working to find responsible solutions in this sensitive area. Constructive dialogue and timely reforms are required to assure healthcare security for millions of current and future retirees.

In the Republican response to the president’s State of the Union address, Indiana Gov. Mitch Daniels wisely noted: “The mortal enemies of Social Security and Medicare are those who continue to mislead Americans that we should change nothing.”

Entitlement reform is a critical component of a larger vision for economic growth and a strong, prosperous and secure America. This vision should include comprehensive tax reform, a prudent approach to regulation and development of our vast domestic resources. This vision must also be accompanied by hard choices — eliminating unnecessary spending and steering taxpayer dollars only to our nation’s long-term priorities. 

With the second session of the 112th Congress now under way, I hope the president and Congress will curb the politics and focus on putting American workers and businesses back to work and getting our country moving in the right direction again.

Hutchison is the senior senator from Texas.