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With lawmakers and the White House reaching a temporary ceasefire in the austerity battles at the end of last year, there is one notable exception. Medicare and Social Security—huge government programs that provide retirement funds and subsidized health insurance for older Americans—have escaped relatively unscathed.
That is a remarkable feat given that a mere two years ago, Republican lawmakers were demanding substantial structural changes to both and the White House had conceded that it would be willing to consider them as part of a “grand bargain” on taxes and spending. Entitlement reform too has been a rallying cry for GOP candidates for national office for years.
For some, that is a testament to the political power of seniors as well as one enormously influential group in Washington that represents them—the American Association of Retired Persons (AARP).
The organization, started in 1958, has worked to empower a once-vulnerable population, and in the process has grown to include approximately 38 million members over the age of 50 and a $1.8 billion operating budget. For the last half-century, they have helped to ensure that seniors are guaranteed basic rights and protections, like access to health care and an income.
Interest groups like the U.S. Chamber of Commerce, and the pharmaceutical and financial industries typically claim the notoriety for leaving their imprints all over public policy, but there’s every indication that the AARP’s influence is equally formidable.
Their cultural currency is palpable: when First Lady Michelle Obama turned 50 earlier this year, she celebrated by tweeting a photo fo herself with her newly minted AARP membership card.
Frederick Lynch, an associate professor of government at Claremont McKenna College in California and the author of “One Nation Under AARP: The Fight Over Medicare, Social Security, and America's Future,” calls the organization the “900-pound invisible gorilla in the room.”
“They have a lot of clout but they love to stay out of the spotlight,” Lynch said. “All they have to do is whisper because they have a grassroots organization that can be activated at a moment’s notice.”
AARP’s fingerprints are all over health and retirement policies crafted over the last decade. The organization is credited with helping pass the Medicare Modernization Act of 2003, which added prescription drug coverage to the program, sinking President Bush’s Social Security privatization plan in 2005, getting the Affordable Care Act across the finish line--to the chagrin of many members--and more recently, standing against any reductions in benefits to Social Security or Medicare.
And they’ve wielded a sizable lobbying budget in those endeavors: the group spent a total of $232 million on their legislative priorities from 1998 to 2013, according to figures compiled by the Center for Responsive Politics, ranking them among the top political spenders of the last 15 years. The National Rifle Association, considered another heavy hitter in the political arena, in comparison has spent $32 million on lobbying since 1998.
For some—particularly those who believe that Medicare and Social Security are on an unsustainable fiscal course and are a perpetual drain of the nation’s resources—the AARP's outsized role on the legislative stage has been particularly unwelcome in recent years.
Ron Sider, a prominent Christian activist who leans liberal on many issues and is president emeritus for Evangelicals for Social Change, was so fed up with the AARP’s rigid resistance to any substantial changes to Social Security and Medicare that he publicly resigned from the organization in 2012.
“They’re great programs. I don’t want them privatized I think they’re important but we’ve got budget deficits that cannot continue,” he said. “To solve that problem, we’ve got to have a mix of increased revenue from various sources and we have to cut expenditures. I thought it was outrageous that the AARP was not willing even modest concessions.”
Social Security and Medicare do take up sizable space in the federal budget. About 22 percent of the federal budget was spent on Social Security in fiscal year 2012, while about 14 percent was spent on Medicare, according to the Center on Budget and Policy Priorities. For comparison purposes, about 12 percent of the budget was spent on programs for families facing hardship, like low-income housing assistance and the Supplemental Nutrition Assistance Program.
There is also the question of keeping the programs intact for future generations. Last year, the Medicare trust fund was projected to run out of funds in 2026, while Social Security was in danger of paying out more than it was taking in by 2033.
Both of the shortfalls are the result of an aging boomer population that will be increasingly reliant on the programs, coupled with Americans’ traditional reluctance to pay for a more robust social programs through higher taxes, like many European nations.
The American Seniors Association, which positions itself as a conservative alternative to what they consider the left-of-center politics of the AARP, believes the AARP is out to scare seniors about any sensible reforms and are too close allied with the Democratic Party to really be looking out for the best interest of their members.
“There are a lot of things wrong with the federal budget and almost all of them are tied to Social Security and Medicare and you’re not going to have any significant budget reform without tackling both of those programs,” said Randy Lewis, a spokesperson for the organization. “We’re not changing anything because their organization exists for the purpose of scaring seniors about Social Security and Medicare.”
The AARP did oppose many of the proposals floated to reform Social Security and Medicare over the last several years, from using a more modest measure of inflation to calculate Social Security cost of living increases to further pegging Medicare premiums to income. In 2011, at the height of the budget furor when changes were being considered, the group ran ominous ads, warning lawmakers “We are 50 million seniors who earned our benefits and you will be hearing from us, today and on Election Day.”
David Certner, a lobbyist for the AARP in Washington, said in an interview with Al Jazeera America that the organization is open to some changes in Social Security to guarantee its long-term solvency, but said it could be done without cutting benefits.
On Medicare, the AARP contends that program costs have already been pushed down as a part of the Affordable Care Act, which achieved $716 billion in savings mostly by tweaking reinbursement rates to hospitals and private insurance companies. Certner added that lowering costs and increasing efficiencies in the health care system overall would go a long way in bringing down the cost of Medicare.
Moreover, Certner said he rejects the frame that the national debt should be addressed on the backs of seniors, who have earned them by paying into the system for decades.
For Sider, that amounts to the AARP perpetuating an “intergenerational injustice.” An Urban Institute study released last year showed that the federal government already spends $7 on seniors for every $1 it spends on children. That disparity is partially a result of the disproportionate political power wielded by older Americans and the AARP.
As Sider points out, “Children can’t vote.” Nor are there powerful interest groups representing, for example, the recipients of Pell Grants or food stamps.
Expending the vast majority of resources on the burgeoning population of the elderly, Sider argues, crowds out investments in the future—on education, on training a workforce for the next century, on innovation to catalyze 21st century industries.
The social contract
Other experts said that the state of affairs in how the U.S. chooses to allocate resources—skewed toward consumption instead of investment—is not so much about the AARP as it is about seniors, a politically active group, who most lawmakers do not want to anger.
“Medicare and Social Security gave seniors a reason to participate to defend these programs,” said Andrea Campbell, a professor at the Massachusetts Institute of Technology who studies senior activism in the political process. “Because these are earned benefits, senior citizens feel pretty strongly that these are programs that should be maintained.”
John Rother, who worked as a policy expert at AARP for twenty years, said ultimately, AARP’s edicts come from the members themselves, making it hard for the group to spearhead reforms.
“AARP is a membership organization and is therefore accountable to its members and its members often don’t like change,” he said. “Older persons particularly those that are comfortable with the current arrangements are anxious anyone talks about changing programs, particularly if they are changed for reasons that are extraneous to the programs themselves such as the federal deficit.”
Rother caused a furor in 2011 when in comments to the Wall Street Journal he suggested the AARP was internally considering how to overhaul Social Security. Soon thereafter, Rother took a job as the CEO of the National Coalition of Health Care so he could dedicate himself fulltime to examining how the social insurance programs could be strengthened.
In a different light, said Lynch, the Claremont McKenna professor, the AARP does not stand for anything radical—younger generations have always financed the cost of living of older generations. After all, no one wants grandma and grandpa to be so destitute and unable to afford health insurance that they have to move into the basement.
“AARP is very devoted to maintaining the social contract between the generations which is very good thing,” Lynch said. “They don’t want to be the greedy geezer organization.”