Nick Hanauer:

The rising inequality and growing political instability that we see today are the direct result of decades of bad economic theory.

Goldy:

The last five decades of trickle-down economics haven’t worked, but what’s the alternative?

Nick Hanauer:

Middle-out economics is the answer.

Goldy:

Because the middle class is the source of growth, not its consequence.

Nick Hanauer:

That’s right.

Announcer 1:

This is Pitchfork Economics with Nick Hanauer, a podcast about how to build the economy from the middle out. Welcome to the show.

Goldy:

Nick, I know you’re a few years older than me. You’re how old now?

Nick Hanauer:

66.

Goldy:

You’re 66. So that means that next year you qualify for your full Social Security. You must be worried, all the talk about how the trust fund’s running out, how cuts and benefits might affect you.

Nick Hanauer:

Yeah. Yes, very worried. Losing sleep.

Goldy:

Well, I actually-

Nick Hanauer:

I don’t even know how much I would get.

Goldy:

Yeah, probably nothing because you probably don’t pay it because all your income is in capital gains. When was the last time you earned a wage?

Nick Hanauer:

Yeah, it’s been a long time.

Goldy:

So you can’t even remember. That could be due to your advanced age that you and I are boomers, but I think it’s more likely that you haven’t earned a wage since the early 1990s or something.

Nick Hanauer:

Yeah, that’s probably true.

Goldy:

Yeah, which gets actually to the heart of the conversation we’re going to have today, that we have this impending shortfall in the Social Security Trust Fund. And we keep hearing that we’re going to have to cut benefits, I think was it by 2032, something like that, unless we fix this. But the reasons for this shortfall are not what people think it is.

Nick Hanauer:

No, they are not. And we have a wonderful guy today, Rey Fuentes, who works for the Roosevelt Institute, whose interest is Social Security. He’s the director of strategic initiatives at the Roosevelt Institute and has a lot to say about why Social Security is threatened and how it’s pretty straightforward to fix it.

Goldy:

Well, then let’s talk to Rey.

Rey Fuentes:

Hi, my name is Rey Fuentes. I’m the director of Strategic Initiatives at the Roosevelt Institute. We’ve been doing a lot of work debunking myths related to Social Security, and so that’s why I’m happy to chat with everybody about today. But Roosevelt’s thinking broadly about the economy and how it’s working for people.

Nick Hanauer:

So you have been writing about Social Security recently and you have a provocative headline out, “Social security doesn’t need cuts. The fiscal panic is missing where the money is.” I think we are in complete agreement with that sentiment, but kind of explain what the panic is around Social Security and why that panic may not be valid.

Rey Fuentes:

Conventional story around Social Security solvency starts, I think, many times with demographics where people say, “Oh, there are too many people retiring, too many people getting benefits, and so we need to figure out a way to make it affordable.” And really the first place they look because they’ve misdiagnosed the problem as one of demographics is they think, “Well, we just need to cut the benefits. We need to make sure that we are spending less.” But really the question is why? How did we get to this point? And that’s what Roosevelt’s work is focused on. That’s what my work is focused on, is really getting to the correct diagnosis because if we can’t diagnose the problem, we’re not going to treat it. And the underlying diagnosis is a weaker economy, one that was battered by the great recession and one in which earners are not really participating as much as they could in the economy.

I don’t know if you saw the recent report out that a quarter of the American workforce is functionally unemployed, means they are involuntarily working part-time hours, that they are earning poverty wages, and that directly contributes to the long-term health of Social Security because the money comes from wages. So if we have a better economy, we can really get to the root of the solvency crisis as well as thinking about how we can bring in more revenue. I know we’ll talk about all of those pieces from the top, but I think getting the diagnosis correct will set us on a better path to have a conversation about what the future of this program looks like.

Nick Hanauer:

So I guess our view for the longest time has been that the challenges that Social Security faces are largely a byproduct of rising inequality. When Social Security was set up, as I recall, 85% of all income was captured by the tax because even rich people got paid wages for their income. Today, I think it’s under 50% of all income is affected by the cap because so much income in the country is above the cap and is in forms of income, not wages that aren’t addressed by the Social Security tax at all, aren’t affected by the Social Security tax at all. For example, capital gains, which are Social Security-free and are the source of most income for most wealthy people.

Goldy:

So are you telling us, Nick, that you don’t pay Social Security on most of your income?

Nick Hanauer:

No, no, no.

Rey Fuentes:

Nationwide put out this survey. They had a really good piece out where they asked kind of true and false questions about Social Security to the respondents, and they asked whether or not they thought a person earning $200,000 a year versus earning a million dollars a year, if they’re paying the same rate in Social Security tax. And only 34% of the respondents correctly identified that as true, which is part of the problem. They either think that the richest Americans are paying more because they’re earning more or they don’t know.

And that I think is part of this fundamental mismatch because you’re exactly right, Nick, that we have a Social Security payroll tax cap. We only tax up to a certain amount. Now, you’re not going to receive more benefits if you’re wealthier above that amount, but you can contribute more. So the effective tax rate you’re paying on those wages, that’s fundamentally unequal.

And so that creates a systemic imbalance. And you’re right, early on in the program, it captured in the high 80s to 90%, and it was at a moment in 1983 when the last major reform of the program was set, that we were capturing 90% of wages in the economy. And that precipitously fell because, as I think we are correctly identifying here in this conversation, that inequality pushed wages far higher for those people above the cap.

So as people were earning more money, escaping the Social Security tax, and then converting that money into something that wasn’t, as you mentioned, Nick, it wasn’t labor income, it was income from capital, it was income from other sources.

Nick Hanauer:

Right, yeah.

Rey Fuentes:

So I think that has really skewed the finance base for the program in a way that I think could be reversed. And I think that’s the policy fix we should be talking about, not whether or not we should be cutting the program’s benefits.

Nick Hanauer:

Yeah.

Goldy:

It’s two-pronged the problem. One is that rising inequality has pushed a larger share of wages above the cap, and the other is that it has reduced wages share of the overall economy substantially over the past 40, 50 years.

Rey Fuentes:

And it’s one that we’ve correctly identified. I think you had Kathryn Edwards on talking about labor income and AI generation, and she’s written a paper for us where she talks about the overall health of the program as functionally a component of economic management. If we did better ensuring that wage earners could earn more and be more productive, we wouldn’t have to worry about things like the growth of the program’s benefits because it would be covered by the economic productivity. If we were better at allowing more immigrant labor to come into this country and work effectively, if we had childcare that provided opportunities for people to come into the labor market, if we could manage the economy better, Social Security would be better. And I think those are the fundamental connection points that we want to make.

Nick Hanauer:

I mean, I think what most people just don’t understand is that I think the cap is now 185,000 bucks or plus or minus.

Rey Fuentes:

184 and change.

Nick Hanauer:

If you make $185,000 a year, 12.5% of your income is devoted to Social Security, right? The six you pay and the six-year employer pays.

Rey Fuentes:

Yeah. And it’s actually more. We know that employers shave their wages to cover some of that tax. So employees are more than their half essentially in lost wages. And so that I think is the other fundamental mismatch when we talk about what people are paying into this program. We made a promise to them the benefits would be available and guaranteed when they reach retirement, and we want to ensure the benefits are there because they paid in over this period of time. And I think that’s one of the reasons protecting this program is, we think, vital for a civic infrastructure as well.

Nick Hanauer:

Right. So if you make $185,000 a year, you devote a lot of your income to Social Security. If you make $18 million a year, I just did the math.

Rey Fuentes:

In wage income.

Nick Hanauer:

Yeah. No, on any income. Right? Let’s just assume you also make $185,000 in wage income, which may not be true, but let’s just assume that you do. Is it 0.01% of your income to Social Security?

Rey Fuentes:

Yeah.

Nick Hanauer:

You basically don’t even notice that you’re spending the money. And that disconnect I think is really is part of the problem here.

Rey Fuentes:

And even in components of the economy where we think about labor income being reclassified, for example, as profits, people set up a pass through, they set up an S corp where they are generating income through their labor that would in any other time in our economy be classified as labor income, be subject to the payroll tax gap, and that money would also flow into the program. And so in fact, there are Social Security Administration actuaries who have assessed the value of a proposed reforms that would capture some of that pass through income and even raise the payroll tax cap at a more conservative level than what we would argue for. And you could actually close the solvency gap just with those reforms. You wouldn’t raise taxes, you wouldn’t have to raise the payroll tax for current workers who are paying into the program.

Goldy:

So you mentioned the solvency gap and you’re talking about the so-called trust fund, the Social Security trust fund.

Rey Fuentes:

The lockbox.

Goldy:

What I find amusing about all this is that for decades we’ve had critics telling us that the trust fund is a fiction. It’s not really there. And now that it faces insolvency, oh no, that trust fund that I’m told was fictional, now it’s real and it’s insolvent and that’s why we need to cut benefits by 30%.

Rey Fuentes:

Yeah. I mean, it cuts both ways for people in this conversation because really it is an accounting tool. And I think that’s the way we should be thinking about it is a tool. The reason it was set up in the first place was to accumulate more income from a working population because the SSA actuaries understood and accurately predicted that there’d be a lot of baby boomers retiring and drawing on Social Security benefits. So we needed to get over that hill, which is why we generated a trust fund in the first place, which is why it generated reserves. And it was held by the federal government for that purpose. And as that trust fund is depleted, we then run into the statutory problem where the program itself is required to make cuts if it doesn’t have those reserves in place. But again, these are changeable problems, fixable problems, things that Congress can address, but it’s a functional tool that’s allowed us to accomplish a specific task.

And that’s part of the misdiagnosis problem is that the 1983 reformers correctly identified the demographic trends. And even today, we have better worker to beneficiary ratios than they though we would in 1983. So we’re actually doing better in some senses in terms of the demographics of the situation, but the great recession and the lack of economic growth long-term has really taken a hit to the program. And I think the challenge is protecting the program and correctly identifying the problem. Otherwise, Social Security is used as a punching bag for every conversation related to, “Oh, we spend too much. Oh, the government is too generous to certain populations.” And I think that misidentifies the problem and actually obscures the solution, which is why Roosevelt is in this fight.

Goldy:

Yeah, I agree.

Nick Hanauer:

Right.

Goldy:

It’s an entitlement, I’ve been told, isn’t it?

Rey Fuentes:

Yes. It’s an entitlement. We say that for a reason that we’ve made a promise to people, the paying into the program. And as a form of social insurance, we argue that this program also represents, because it is that promise we’ve represented to the beneficiaries who one day can claim those benefits, but it’s a promise for society. I think the misconception is that Social Security isn’t just like a 401(k) with a federal logo on it. It’s also some people’s only access to life insurance, their only access to disability insurance.

And again, this is my favorite line from Kathryn Edwards again, that you couldn’t buy this type of protection on the open market. This isn’t something the private market would provide for. We’ve had folks and analysts talk about how we should eliminate the program to incentivize private savings, yet only 60% of people even have access to 401(k)s, even if they wanted to retire.

And that’s assuming they had excess income after all the costs in their life to devote to their retirement. So we’ve set up a system through Social Security to protect against so many of the things that we know are going to happen to so many people throughout their lives. And then we act because they somehow get to an age where they can finally start collecting those benefits, that they have the temerity to grow old in retirement and use those benefits that somehow now they’re a drain on the system. And we think that gets it fundamentally backwards.

Goldy:

So you’ve talked about the solution being that we can outgrow this, this solvency gap. I’m curious the idea of if we actually did cuts in benefits, what that would do to economic growth, because that’s money you’re taking right out of the economy. If you’re cutting retirees benefits by 30%, a huge chunk of retirees rely on Social Security for the majority of their retirement income.

Rey Fuentes:

Absolutely. And they spend those dollars locally. They spend those dollars on goods every month and they’re going to use that money and it cycles throughout the economy. Billions of dollars in economic activity, hundreds of thousands, even not millions of jobs. I’d have to get the exact statistics, but I think that is, I think, a functional part of the program is that supporting a lot of demand. But the other component, I think, as you mentioned, Goldy, the idea around the program itself really being one where we could think about benefit cuts, but that I think obscures the fact that there is revenue available to help stabilize the program. Now, I wouldn’t go so far as to say the only way to sell the program is just to outgrow it because we’ve waited so long that we need to take action, but the action available to us is revenue left on the table.

As Nick had mentioned, if we open up our Social Security revenue streams to income that should otherwise be classified as labor income, for instance, there will be opportunities to really revitalize the program and ensure that it has a long-term future, but one that is really not the conversation right now. You can really think about the cost to the program and then never once have a conversation about the money that’s on the table in one of the wealthiest countries of the world. We suddenly forget we had that money.

Goldy:

Nick, you have a specific proposal that you have talked about and written about.

Nick Hanauer:

So if it was me, Rey, what I would do, given that 50% of all income of all types is above the cap today, what I would do is reduce the Social Security tax to 6.4% and apply that rate to all income of all types. And if you do that, something like 95% of Americans get a giant tax cut.

Goldy:

So when you say 6.5%, you’re talking about the total, the employee-employer, so you’re going to have the Social Security tax.

Nick Hanauer:

Yeah, you go from 12.4 to 6.2%, plus or minus. I mean, it’s not exactly… It’s within a couple of fractions of a percent. And then you apply to all income. I don’t see why capital income should be protected from this tax. If you make money, you should pay into the system. And when you were born, you definitely knew you needed to be able to retire, but you did not know that you were going to make capital income versus labor income, right?

Rey Fuentes:

Or that it existed when the program was created, right?

Nick Hanauer:

That’s right. Yeah.

Rey Fuentes:

There are now forms of income that no one could have imagined people [inaudible 00:17:08] the system.

Nick Hanauer:

That’s right. And so I think it’s really stupid to have some income subject to the tax and some income not subject to the tax. All that does is encourage people to find income that isn’t subject to the tax, right? You just have this sort of force generating more cheating effectively. But GDP growth rates in the country would be significantly higher if 90 or 95% of Americans earned 6% more in income. And if a tiny minority of people at the very top paid 6% more in tax, there would be no effect really on the economy from those folks paying more in tax and a huge effect from the majority of people paying less in tax. And now you never have to worry about the system ever again. It’s just fixed. As the economy grows, so shall Social Security. Full stop.

Goldy:

Okay. So your solution, Nick, is we’re going to have or substantially lower the rate.

Nick Hanauer:

It’s about half.

Goldy:

The Social Security tax rate, and then we’re going to apply it to all income, no cap, wages, capital gains-

Nick Hanauer:

Dividends.

Goldy:

Interest, dividends, everything.

Nick Hanauer:

Anything you get.

Goldy:

All income at approximately 6.2%.

Nick Hanauer:

Correct.

Goldy:

Okay. That would mean that for a lot of billionaires, their tax rate, their effective tax rate would increase from 0% to 6.2%.

Nick Hanauer:

It’s possible. Yes.

Rey Fuentes:

What a dramatic increase. Yeah.

Goldy:

What do you think about that, Rey? How would that work? Do you think, could it work? I mean, either technically or politically?

Rey Fuentes:

What’s great is that, I mean, the SSA, the actuaries have actually evaluated part of Nick’s proposal and part of it is, oh, could we raise that 6.2% of the payroll tax cap on net investment income for very wealthy earners? And if you did that, you could close about 18% of the 75-year actuarial solvency that the actuaries actually look at to determine whether or not we are effectively resolving the solvency gap. That’s not a solution to sneeze at. That’s actually real money on the table.

And I think one thing that I like about that proposal is that it also correctly, as we talked about at the top, it correctly diagnoses the problem as one related to inequality because we know, I mean, just putting concrete numbers to it, from 1983 to 2000 when economists were studying the issue, they saw that the 6% of workers that earned money over the cap, their incomes grew by 62% in that time period. But of the 94% of people under the cap, their income, their wages grew 17%.

Goldy:

Correct.

Rey Fuentes:

So the idea that we’ve misdiagnosed the problem, but then also not invested in an economy where people can work and be as productive as possible as share in those gains, but also contribute more into the Social Security program. So I like the proposal around getting rid of the tax cap. That’s absolutely something that should be on the table. It’s something that would close, depending on whether or not you also extended benefits to the additional taxpayers, you could close roughly half to almost two thirds of the 75-year solvency just by eliminating the tax cap. So I think there are a lot of questions you’d have to go forward in terms of analyzing that proposal, but it’s definitely on its merits. I think there’s a lot to like.

Goldy:

So how large is this gap in trillions of dollars? Put a number on it over the next, you’re saying 70 years or?

Rey Fuentes:

Yeah, I’d have to-

Goldy:

Because we’re told it’s like 2030 something the trust fund runs out. So how big is the gap?

Rey Fuentes:

Yeah, I’d have to go back to the trustee’s report and have it open to give you the exact number. It’s in the trillions because. And again, this is where we get into the topic of the big scary number. That’s what is being used essentially as a bludgeon against advocates who talk about are there ways to resolve this issue? Had Congress acted earlier and just either raised a small portion of the payroll tax itself or eliminated portions of the tax gap, we could have resolved the solvency gap. But the challenge now is thinking about how you resolve it as you’re getting so close to the solvency date. And that’s fundamentally what matters. But I think the other kind of challenge in communicating this issue to folks is also that when you hit that gap, it’s not as if federal funding kind of falls off a cliff.

It’s just the statute that creates Social Security says that you can’t pay any more money because there’s no more money in the reserve to pay out. There’s no more money available. And so there’s a statutory cut in benefits, but the revenue is there. That also tells us that the program will continue paying benefits at a reduced rate. So it’s not that Social Security is going to implode and go away tomorrow, but a significant cut for, I think the last survey that I saw about the bottom quarter of income earners, half of their wealth is Social Security. Having a cut like that would be devastating.

Goldy:

I think the big takeaway here is that this is not a fiscal problem, this is a political problem. There are multiple things we could do to solve this with the political will to actually do it. I mean, I think the easiest thing to do personally would be we just mint a trillion dollar coin or three every once in a while and deposit it into the trust fund and problem solved. The money’s there. I mean the economy as people are planning for it, we’re still planning for it as if retirees are going to get their full benefit and that money will be spent. So in a sense, that money is already spent in the future in terms of expectations. What’s inflationary about letting that money be spent? It was going to be spent anyway.

Rey Fuentes:

Yeah. We’ve heard those types of proposals before to erase the deficit, to handle the debt. And I think there are economists much smarter than me that could answer why we shouldn’t approach the challenge in that way in terms of its effects on inflation, its effects on savings in the future, and how we think about the budget discipline necessary to run a government. And that’s the challenge is kind of thinking through some of those pieces. But in our existing system, we could solve this problem without new exotic tools. We have all the tools in front of us. I think that’s the part we communicate. We have a dedicated system that funds into the program. It’s there. It’s been working for 91 years now, and it’s the economy that really has failed us. It’s the economy that hasn’t really kept up its end of the bargain, mostly because we have leaders that have not invested in things like childcare, immigration reform.

Nick Hanauer:

It’s not the economy let us down. It’s-

Rey Fuentes:

Well, our policymakers mismanage the economy. That’s probably a better way to describe it.

Nick Hanauer:

Economists who let us down.

Goldy:

Right.

Nick Hanauer:

Economic policymakers, political leaders let us down. It wasn’t the economy.

Rey Fuentes:

Yeah. A better way to phrase it. Yes.

Nick Hanauer:

Yeah. I guess, how much are Social Security payments annually?

Rey Fuentes:

The average benefit amount is around $2,200 a month for the average beneficiary. And it obviously which is-

Nick Hanauer:

How many beneficiaries are there?

Rey Fuentes:

Roughly over 70 million beneficiaries. And this includes people, and like I said at the top, this includes people who are receiving survivor’s benefits. These are people who are receiving spousal benefits.

Nick Hanauer:

Do you remember what the aggregate amount that goes into the economy is from Social Security?

Goldy:

Annual payments?

Rey Fuentes:

Yeah, I’d have to look at the specific payment amounts that come into the program, but we know that it reflects billions of dollars of economic activity, but I’d have to look at the actual, again, from the trustee’s report that details a lot of those aggregate statistics. I wish I had them right the top of my hands, but that’s a piece that absolutely is in the trillions of dollars and you have roughly 70 million beneficiaries. And that’s why we talk about part of this cut being devastating is if the average monthly Social Security amount is around $2,200, that’s a $500 haircut that people have to take. And for many beneficiaries, that’s their only source of income. It’s hard for me to imagine how someone lives off of $2,000 a month and meets all of their expenses, and it’s even harder to think about that. They lost a third.

Nick Hanauer:

So my calculator says like $150 billion. If it’s 70 million times 2,200, I don’t know. I mean, we got to look it up, but it’s a lot of money and it’s a lot of haircuts and it’s a lot of restaurant visits and it’s a lot of rent and it’s a lot of things. Rey, if you were in charge of Social Security and just wave your magic wand, what would you do?

Rey Fuentes:

Absolutely. We spent a lot of time at Roosevelt thinking about this issue. We actually just put out a paper around the history of the program and its guarantee and its promise. I think when we think about Social Security itself, if I had a magic wand, it would be come back to the negotiating table when we were thinking about Social Security reform because the initial package included federal unemployment insurance, it included universal health insurance. We were talking about ensuring the vast majority of risks that people are experiencing in their life. And for various reasons, those things went off the negotiating table. And we got Social Security and we got many other things that came along with it like disability insurance. We now have SSI, supplemental security income. And so what I would do, absent constraints, is thinking about how can we guarantee the promise of this program as it was designed?

And one is through guaranteed benefits, through ensuring that individuals have access to those benefits in a clear, easy, and dignified way. I think we can have this dog conversation around what it did to the Social Security administration being objectly horrible thing, but we should make it as easy as possible for people to access the benefits. And then we should think about the other things surrounding the program. What about the people that have worked really physically demanding jobs up to the age of retirement?

Nick Hanauer:

Yeah.

Rey Fuentes:

Having bridge benefits so they can access those benefits earlier. What happens if a single mom is caring for her children for a good portion of her working years? We should have care credits that recognize that form of labor. So there are ways of reforming the program that reflects the economy we have while also protecting the dignity and security of people coming into retirement.

Nick Hanauer:

Interesting. One final question. Why do you do this work?

Rey Fuentes:

Yeah. I think a lot about my parents coming into retirement. My dad worked a physically demanding job on an oil field. My mom’s a cancer survivor. The idea that they would have to take a cut in their Social Security benefits that they paid into during their working years doing some of the hardest work I could imagine, but also raising a family and then thinking that their moment of retirement should be one where they can access a dignified retirement that allows them peace of mind. The idea that in this moment, people like my parents would have to worry about that rather than thinking about how they’re going to spend that time, to me is a moral failure. And I’m in this fight because of that specifically, because I think we can do better by our promise and thinking that we can just cut our way or that benefit cuts would be easy and they wouldn’t be a real tragedy for a lot of families in this country is something we want to correct.

Nick Hanauer:

Goldy, at the end of the day, to fix Social Security, it’s got to be some variation on my idea. Basically, we have to capture more income that is now finding a way to evade the tax, whether that’s capital income or dividend income or pass through income or whatever it is. The problem isn’t Social Security. The problem is the way in which our economy has evolved to provide income, particularly to wealthy people, which is not subject to that tax. That’s the problem.

Goldy:

This is a system designed to work in a 1930s-

Nick Hanauer:

Economy.

Goldy:

… industrial economy where most people’s income came from wages, not capital income, and where the economy was less unequal.

Nick Hanauer:

Yeah, correct.

Goldy:

That wages consumed a much larger portion of the economy than it does now. So as inequality grows, an increasingly smaller portion, I don’t know how to. A decreasing portion of the economy is actually subject to the Social Security tax.

Nick Hanauer:

That’s right. So by way of example, wages in 1970 were 51% of the economy. Today they’re 41%. So 10%, that’s $3 trillion plus or minus that used to be wages and is now other things, mostly corporate profits. But if-

Goldy:

And 90-some percent of that would’ve been subject to the Social Security tax.

Nick Hanauer:

Correct. So now you’re talking about, well, what’s 12% of, call it 10% of 3 trillion, it’s 300 billion extra that would be going into Social Security if we didn’t have an economy.

Goldy:

And that would cover the gap.

Nick Hanauer:

And that would cover the gap.

Goldy:

Right. It’d be growing the trust fund instead of shrinking it. I mean, there is another solution, which I think in the Republican Party you might find more politically palatable. And that is, and this is a two birds with one stone approach. What we do is we eliminate Medicare. So we don’t have that trust fund problem either coming up. So no more Medicare. And then all of us boomers die early. Well, not you, Nick, because you got plenty of money, but people like me who couldn’t afford to buy insurance on the private market or pay for insurance. We die early, thus reducing the stress on the trust fund. Problem solved.

Nick Hanauer:

Works for me.

Goldy:

No more boomers, right? That demographic problem goes away like that because instead of the average lifespan for somebody my age being 83, that’s what they say. At 63 years old, on average, median, I should expect to live to be. That’s what I need to expect in terms of saving, will die by in their early 70s. They save like 10 years of Social Security benefits right there.

Nick Hanauer:

Well, Soylent Green. It’s people.

Goldy:

Well, there we can solve the ground beef problem too. That’s true. Exactly. All at once. As these boomers die-

Nick Hanauer:

We can make them into hamburger.

Goldy:

Maybe not ground beef, but let me tell you, any meat, no matter how tough, slow cooked with onions, tender and delicious.

Nick Hanauer:

Delicious. Exactly.

Goldy:

I would be tasty that way.

Nick Hanauer:

Exactly. Exactly. Goldy, I think we’ve solved the nation’s problems.

Goldy:

Right. Look, the point is, all joking aside, as I said during the interview, this is not a fiscal crisis.

Nick Hanauer:

No.

Goldy:

This is not a fiscal problem. This is not a budgetary problem. This is not something that requires a lot of sacrifice. It is a political problem. There are multiple ways around this, lift the cap, add in capital gains, however you want to do it. There are multiple things that can be done without cutting benefits and in fact with increasing benefits. And there’s a strong argument to make for increasing benefits rather than cutting.

Nick Hanauer:

That’s right.

Goldy:

We can do these things with the political will.

Nick Hanauer:

Absolutely.

Goldy:

And the fact that we haven’t is because-

Nick Hanauer:

Neoliberalism.

Goldy:

Yeah, it’s politics. Anyway, if you want to read more about this issue, we will provide links in the show notes to some of Rey’s writing, much of it at the Roosevelt Institute.

Announcer 2:

Pitchfork Economics is produced by Civic Ventures. If you like the show, make sure to follow, rate, and review us wherever you get your podcasts. Find us on other platforms like Twitter, Facebook, Instagram, and Threads @pitchforkeconomics. Nick’s on Twitter and Facebook as well, @NickHanauer. For more content from us, you can subscribe to our weekly newsletter, The Pitch, over on Substack. And for links to everything we just mentioned, plus transcripts and more, visit our website, pitchforkeconomics.com. As always from our team at Civic Ventures, thanks for listening. See you next week.