Peter Diamond: Social Security an Easy Fix, Not Quick

Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from political conversations on WNYC. On this morning's Brian Lehrer Show, Nobel Prize-winning economist Peter Diamond discussed the need to save Social Security.

When asked if Social Security is easy to fix, Peter Diamond didn’t hesitate with his answer.

True—easy to fix and in the current economic climate the perfect thing for Congress to be addressing…This is a moment to: a) do good policy, b) not harm the recovery, and c) reassure people that the U.S. has the ability to get things on track for the long run.

Diamond is equally sure of the solution: bring more money into the program, but spend less of it.

If we get a proposal that is a balanced combination of benefit decreases and tax increases, and it’s all phased in slowly enough, I would look forward to supporting it.

"Benefit decreases and tax increases" is a potentially toxic phrase one could use this election year. However, Diamond insisted that this kind of plan would do almost nothing to hobble economic recovery in the short run, while making significant progress toward bringing down the deficit in the long run.

He made similar comments about extending unemployment benefits as more and more Americans take longer to find work. The cost may seem high now, he said, but it’s a pittance compared to the long-term benefits of keeping the unemployed afloat.

I think it’s a mistake to think of the negatives right now as being particularly large. We are in a very rough patch in the economy—the economy has been growing but not very fast, and there’s a vulnerability here because of the limited scope for more government actions. So I think it’s important to keep whatever supports we have going and going.

Listen to the entire conversation on The Brian Lehrer Show.