Representative Mike Kelly Calls for Fact-Based Debate on Medicare Reform, Echoes Washington Post’s Claim that AARP’s New Ad Misleads

Representative Mike Kelly Calls for Fact-Based Debate on Medicare Reform, Echoes Washington Post’s Claim that AARP’s New Ad Misleads

Washington, D.C. — U.S. Representative Mike Kelly (PA-03) issued the following statement on AARP’s recent Medicare advertising campaign and its misrepresentation of the facts:

“As one of theoldest member of the freshman Congressional class, I can tell you that there are few issues as important to me as protecting our seniors. That is why I am supporting efforts to preserve, improve and protect Medicare for current and future beneficiaries.

“The truth is that something has to be done to fix Medicare, which its own actuaries say will go bankrupt in 2024 and which the non-partisan Congressional Budget Office says will run out of money even sooner.

“The recent ad run by AARPis yet another example of the rampant misinformation that has surrounded this critical public policy debate. Let me be clear, reforming Medicare is an either/or proposition. Either we fix it now, or it falls apart tomorrow.

“Even the New York Timesrecently acknowledged that, ‘Sooner or later, Democrats will have to admit that Medicare cannot keep running as it is — its medical costs are out of control….’

“I agree with the AARP that the wasteful and fraudulent spending taking place in Washington needs to be addressed, but to suggest that this, in and of itself, is the solution to our spending and debt problems is inaccurate.

“It’s time to stop playing politics with this important issue and focus on the facts, as the Washington Post article below has so clearly articulated.”

AARP’s misleading ad about balancing the budget
By Glenn Kessler
June 20, 2011

With talks on reaching a deal to cut spending and raise the debt ceiling reaching a critical stage, the venerable over-50 organization AARP has weighed in with a television advertisement that seeks to shift the focus from entitlement programs such as Medicare onto what it deems to be wasteful spending by Congress.

We had earlier given the American public four Pinocchios for failing to understand the basics of the federal budget. We reached that conclusion after a new poll showed 63 percent of those surveyed believe the federal government spends more on defense and foreign aid than it does on Medicare and Social Security. (That’s wrong.) A similar majority believes that problems with the federal budget can be fixed by just eliminating “waste, fraud and abuse” -- and that 42 percent of every federal dollar is wasted.

Given those beliefs, it seems that the AARP pitch would have a receptive audience. But is it right?

The Facts
We asked AARP to provide data on the programs mentioned in the ad, all of which certainly sound amusing or bizarre. (A video of the shrimp on a treadmill experiment is so funny we embed the video at the end of this article.)

But it turns out this stuff adds up to peanuts in the context of a $3.7 trillion federal budget. The shrimp on a treadmill cost $560,000. The pickle technology project amounts to $775,000. The poetry in the zoos totaled just under $1 million.

While the ad suggests Congress was responsible for this spending, only the pickle technology spending was the result of a congressional earmark. The shrimp and zoo spending were grants made by federal agencies—and actually were exposed by Sen. Tom Coburn (R-Okla.) as an example of wasteful spending.

The biggest line item mentioned in the ad is the Cotton Institute in Brazil ($147 million). But that was the result of the United States losing a ruling at the World Trade Organization over its subsidies to U.S. cotton farmers. There is an effort in Congress to stop the payments to Brazil and instead deal with the issue by adjusting U.S. subsidies.

Much has been made of wasteful federal spending though congressional earmarks, but the Republicans have vowed to end the practice. (There is some question about how successful they will be.) But even so, earmarks never amounted to much of the federal budget. At best, analysts estimate, eliminating earmarks would save only about $9 billion a year.

Meanwhile, much of the budget -- more than 40 percent -- is spent on social insurance, such as Social Security, Medicare and Medicaid. Spending on those programs has soared in the last three decades—while projections show the spending in them will only increase, especially as the baby boom generation heads into retirement. When the deficit is projected to be $1.1 trillion in 2012, according to White House estimates, those programs are where the substantial savings can be found.

In fact, the spending identified by the AARP in this ad is so puny that if all were eliminated, it would succeed in only reducing 15/1000th of the deficit--even though the ad starts out by saying “If Congress really wants to balance the budget” it should get rid of these programs.

AARP also suggests that Social Security cuts are on the table in the debt ceiling negotiations. All sides have generally agreed to leave Social Security for future discussions, with House Republicans in their budget further adding that potential changes to Social Security should not affect people over 55.

Mary Liz Burns, an AARP spokeswoman, justifies the inclusion of Social Security because there are proposals floating around Congress that reduce the deficit through some Social Security changes. Those ideas do not appear to be going anywhere in the next month, so this looks like scare mongering.

David Certner, AARP’s legislative policy director, said AARP is also concerned that Congress might extend a payroll tax holiday (which would not affect benefits but could weaken Social Security’s long-term financing) or make adjustments to how cost-of-living increases in benefits are calculated.

“No one would suggest that these three things or even similar projects would balance the budget,” Certner said. “This is a 30-second ad to catch people’s attention. We don’t have time to educate people over what’s going on.” He claims that AARP has identified $100 billion in health spending cuts that he says would not affect benefits.

The Pinocchio Test
The AARP ad perpetuates the worst stereotypes about how easy it would be to balance the budget. At a time when the nation’s fiscal crisis—amid the looming retirement of the baby-boom generation-- demands informed and reasoned debate, the AARP misinforms its members about the choices the nation faces. The choice is not between shrimp treadmills and Medicare; the question is how growth in the big entitlement programs can be restrained to accommodate the baby-boom generation without harming the elderly already receiving benefits. If AARP has identified real spending cuts worth $100 billion, it should have made an ad promoting those ideas, not an ad perpetuating myths.

Four Pinocchios

(About our rating scale)

###