Dole's Risky Opportunity

ELECTIONS OUGHT TO ENGAGE THE ISSUES THAT shape our future. By that standard, the campaign of 1996 already looks like a bust. Everyone talks of balancing the budget and reducing government without mentioning spending for older Americanswhich is the decisive issue affecting the budget and government's size. America needs a new generational compact: one that recognizes that the elderly are healthier and wealthier than ever before and that government programs should be revised accordingly. Only Bob Dole can compel this critical debate, and he should.

It's preposterous to think that the impending election could define every particular of a new generational compact. But the taboos against discussing social security and Medicare need to be broken; and broad principles for modifying them need to be proposed. Sooner or later, we will have to come to terms with an aging society in which 20 percent of Americans will be (by 2030) over 65, up from 12 percent today.

The reason that Dole ought to broach this subject is that Clinton won't. He has evaded these issues and attacked those who don't. When Republicans included modest Medicare changes in their budget, Clinton vilified them as enemies of the elderly. Probably Dole's strategists want him to avoid a similar fate by staying silent. This is the safe course. It's also wrongmorally and politically.

As a moral matter, Americans deserve candor. Review the basic facts. In 1995 social security and Medicare cost $513 billion, 40 percent of noninterest federal spending. This was twice defense spending, $274 billion. And spending on the elderly is rising, in part because their health costs are so high. Annual health spending for men in their late 60s averages five times ($7,400) that of men in their early 30s ($1,500), reports the consulting firm Watson Wyatt.

Longer lives, steep health costs and an aging baby boom will inevitably make social security and Medicare unbearably expensive in the next century. Economist Eugene Steuerle of the Urban Institute estimates that by 2030 annual tax increases of almost 50 percent (about $700 billion today) would be needed to support current programsor that the budget deficit would explode from its present 2 percent of the gross domestic product to 9 percent of GDP. Despite the usual uncertainties (about economic growth, life expectancy, health-care inflation), no plausible jiggling of assumptions can make the massive fiscal pressures disappear.

It is precisely because these pressures are so massive that almost no one thinks they will occur in practice. At some point, spending and benefits will be cut to avoid costs that seem politically intolerable. The trouble is that the longer changes are delayed, the more abrupt and unfair they will be. That's why silence is irresponsible. But politically, isn't it prudent for Dole?

Not really. Because these issues are seen as so treacherous, breaking the silence would instantly give Dole's languishing campaign a new identity. He would show he has enough confidence to tackle admittedly unpleasant changes; it is precisely such leadership qualities that millions of mainstream Americans crave. And all this would automatically raise the relevant ""character'' issue about Clinton: does he have the moral fiber to help America make difficult choices? Even some former supporters doubt that he does. ""I am awed by his understanding, which just makes his demogoguing worse,'' former Colorado governor Richard Lamm recently told NEWSWEEK'S Jonathan Alter.

Dole's operatives think their man can win by casting Clinton as a meddlesome ""liberal.'' Perhaps. But this ""liberal'' presidency hasn't left the country a shambles (unlike, say, the Carter presidency), and Clinton calculates he can triumph by portraying Dole as the stooge of a dangerously ""conservative'' Republican Congress. Right now, the odds favor Clinton, in part because Dole's other issues look like losers:

A Sickly Economy: Gee, unemployment has been below 6 percent since 1994.

Rampant Crime: It's still too high, but crime rates are actually drifting down.

The Stubborn Budget Deficit: In 1992 Clinton promised to cut it in half; and lo, it's projected at $144 billion in 1996, almost exactly half of the $290 billion deficit in 1992.

Of course, Clinton's crowing about these conditions will exaggerate his role in producing them. He fortuitously arrived in the White House at the start of an economic expansion. That, combined with the post-cold-war drop in defense spending, helped shrink the deficit. And crime is mostly a local matter. But, for Dole, a campaign based on these issues may go nowhere. Politically, for example, Clinton's opposition to assault weapons is at least as popular as Dole's diatribes against ""liberal'' judges.

Dole needs to differentiate himself dramatically from Clinton -- and Newt Gingrich. He needs a Dole agenda, and dealing with an aging America is his best opportunity. Taking it hardly ensures victory. Clinton might use it to scare the daylights out of the elderly. Or he might (as he so often does) seize the issue himself and convince voters that refashioning these programs is best left in the hands of a sympathetic Democrat. But at least Dole would have the chance to project himself as an emissary between generations.

Common sense suggests what the guiding precepts of a new generational bargain ought to be: eligibility ages for government benefits should be slowly raised to reflect longer life expectancy (76 in 1993, up from 71 in 1970); tax breaks for older Americans should be phased out and wealthier recipients should pay more for Medicare; and all changes should be made gradually to minimize hardship and allow time for people to plan. Today's elderly and near-elderly would be asked to take modest cutbacks in benefits to begin a process of preserving these programs for the 21st century.

What matters most is that this is an issue worthy of an election. Collective denial cannot survive America's relentless aging. One way or another, boundaries between public and private responsibilities will be redrawn. Silence about changes that everyone senses are unavoidable merely elevates popular anxiety and diminishes respect for leaders. If they want to restore confidence, they need to acknowledge the inevitable and deal with it.