Happy Birthday! Hose your Grandkids.By Jeffrey Polet for FRONT PORCH REPUBLIC
Of all the downsides attendant to turning fifty, none annoys quite so much as receiving membership offers from the AARP. The junk mail invites a response to the effect that one is not inclined to join an organization whose sole purpose is to block all legislation designed to keep us from screwing over our grandchildren, but instead it usually ends up in the recycling bin.
It turns out, however, that one underestimates organizations such as the AARP if one sees them simply as an interest group serving a particular and narrow set of interests, even if it does have 40 million+ members (out of 98 million persons over 50 in America). Ted Lowi’s well-known The End of Liberalism argued that public democracy as governed through representative institutions had waned in America and been replaced by “interest-group” liberalism that exercised control over the public sphere through the influencing of bureaucratic management. An essential part of Lowi’s claim is that interest-groups and bureaucrats form their own client relationship, at times only marginally attentive to the interests of their members, in the case of one, or citizens, in the case of the other.
Indeed, in policy areas of great size and complexity the tendency of policy to fall out of the realm of public scrutiny and into the hands of “experts” and insiders becomes even more pronounced. A public either bewildered or overwhelmed or made indifferent will only feebly exercise the sorts of oversight required to keep these actors in check. Walter Lippmann in his classic The Phantom Public compares these citizens to deaf spectators in the back row at a theater: they know something is going on, but know not what. Lippmann noted that “rules and regulations continually, taxes annually and wars occasionally remind him that he is being swept along by great drifts of circumstance” and that such a person doesn’t know “what is going on, or who is doing it, or where he is being carried,” living in a world “which he cannot see, does not understand and is unable to direct.”
Convinced of his own inconsequential public existence in the “foam of events,” the modern democratic citizen recognizes that he is not the sovereign or omnicompetent figure he is made out to be, but is constantly addressed as if he were by those who profit most from the complexity and scope of modern policy formulation. This myth of the democratic citizen, like all abstractions, serves the interests of those in power not simply because they think they know best and ought to govern anyway, or because they love power, but because they enjoy these and other advantages of the bureaucratic state.
In our contemporary politics nowhere does this complex reveal itself more completely than with an organization such as the AARP. The House Republicans, suspicious of the AARP’s machinations during the passage of Obamacare, began an inquiry into the finances, holdings, and operations of the organization. Recently, the Capitol Research Center produced a paper examining the AARP and how it benefited as an organization from Obamacare.
Between 1998 and 2010 the AARP spent $198 million on lobbying activities, while it took in $1.176 billion in revenues in 2010 alone. It currently has assets totaling over one and a half billion dollars. The main source of revenue for the organization is not membership fees, but rather the $670 million it received in 2010 as a result of its contract with United Health Care, a provider that stood and stands to take in massive amounts of revenue due to holes in the Medicare system’s coverage.
These holes are there intentionally, of course, and lawmakers, not overly concerned with the needs of average citizens, who couldn’t be counted on to work through the Byzantine code anyway, and who would be helpless once the burdens became real (the percentage of my household budget spent on medical insurance and care tripled in the one year following the passage of Obamacare), happily provided these gaps to companies such as UHC and groups such as the AARP. Indeed, Congress can hardly be said to have written the legislation, so prominent was the role of bureaucratic agencies and interest groups. Organized interests are not merely interests, they are organizations, with their own internal logics and pecuniary demands which can be masked by appeals to “public interest.”
Spend some time perusing AARP’s ads. The constant upshot is to get seniors riled up by the idea that Washington is threatening senior’s benefits to pay the government’s bills, ignoring the obvious fact that the bulk of those bills are precisely those benefits. All this with an underlying tone of “You better not mess with us.” This demagoguery is in part grounded in reality, but is largely rhetorical excess. Still, seniors are uniquely vulnerable, particularly in an age where their children have either moved away or, even if nearby, are all-too-frequently eager to warehouse their parents in assisted care facilities so they can keep pursuing their own vision of the American Dream.
Not valued in either the labor market or in their children’s homes, with an extended lifespan and corporately-constructed ideas of a happy retirement and a long and healthy life, the unique plight of the senior requires attention. I confess: I hope to become one myself someday. Such concerns, however, ought not convince us they can’t be selfish, and do not remove them from accountability to the common good. Indeed, the selfishness and self-satisfaction of many seniors, and the renowned self-absorption of Baby Boomers (see Mary Vander Goot’s forthcoming After Freedom), unlikely to attenuate in old age, poses a significant political challenge.
But a bunch of menacing-looking seniors standing in a park with their arms folded insisting that their benefits not be touched are only part of the problem. It’s the group that puts them in the park and takes their picture, claiming to be a non-profit while at the same time sitting on over $1.5 billion in assets, that represents the pathology of interest-group liberalism. This is what prompted the House investigation and the CRC report accusing Obamacare of “crony capitalism.” So long as the AARP gets theirs, and the seniors get theirs, and neither party shows any willingness to take them on (the AARP, remember, enthusiastically endorsed the Bush prescription drug plan), our financial crisis will continue to deepen to the disadvantage of our progeny.
The depth of this crisis can’t be overstated. The CBO reports that public holding of the debt will reach 70% of GDP this year, its highest level since World War II. Although the CBO provides alternate scenarios projecting the future of the debt, the more likely second scenario (“extended alternative fiscal scenario”) will have the public share of debt at 93% of GDP in ten years and 199% in twenty-five (and there’s reason to assume these estimates are conservative). The greatest factors contributing to this rise would be the large entitlements. Indeed, while Social Security, Medicare and Medicaid comprised 2.5% of GDP in federal spending in 1965, they are now up to over 10% and, under CBO estimates, likely to reach 16% by 2037. Within ten years, the CBO warns, “spiraling interest payments” and runaway spending would quickly push the debt into catastrophic regions.
While revenues have remained fairly constant at 18% of GDP, federal spending has outpaced the growth in household income by a factor of 12 (in constant dollars, household income has increased 24.2% since 1970 while federal spending has increased 287.5%). Federal spending per household has nearly tripled in that span. With increases in the three large entitlements slated at another 62%, the tax burden on the average household, in addition to reductions in disposable income, will undoubtedly create pressure from below. (The tax burden per household in constant dollars has increased from $11,554 in 1965 to $19,409 in 2012 – a number that is on the rise and significantly outpaces gains in household income).
The Tea Party has lost much of it mojo, but the underlying causes prompting its existence are unlikely to improve. The coming class warfare may not pit city against country or worker against owner or poor against rich. It may very well pit generation against generation, and in a deracinated society where the provisions of care are no longer taken up intimately and proximately, the two sides may find themselves on a darkling plain clashing by night harming those they ought to love most. The “invitation” I received from the AARP virtually begged me to think not of my children or my grandchildren, but to join an organization that would help me get mine, and in the process help the AARP get theirs. Time was when grandparents sent money to their grandchildren; it’s now the five-year olds who are writing the checks.
If, as Lowi suggests, the advent of interest-group liberalism represents the formation of a “second republic,” replacing the original one of limited government under public authority, the current fiscal crisis may be the beginning of the end for this second republic. But what rough beast slouches toward Washington to be born is only dimly imagined.