President’s Message TOM TERRY
Promoting Objective Public Policy in a Partisan World
POLITICS. We love to complain, but it’s the way our
Founding Fathers chose to get things done in this
True, the environment has “evolved.” Compromise—once a
staple of our political system—now seems to be a four-letter word.
Six years ago, the Academy announced support for raising
the retirement age as part of any Social Security reform package. Is such a pronouncement a partisan political position or an
objective policy statement reflecting underlying actuarial perspectives on sustainability?
To this day, I hear some criticism of the Academy for taking a political position: e.g., raising retirement age is a benefit
takeaway. I understand that perspective. But there’s another
relevant viewpoint that’s driven by the need for long-term sustainability: that increasing the retirement age is an appropriate
remedy to what are, in effect, automatic benefit increases as the
result of the interaction of fixed retirement ages and increasing
My view? We’re making a difference. During the past six
years, the debate has evolved, bringing with it greater recognition that longevity improvements need to be factored into any
Social Security reform.
But we need to expand our sights to include other emerging concerns that are the result of our aging population. How
will we make the trade-offs necessary to responsibly navigate
our way through the coming financial/budgetary stresses stemming from entitlement programs? In the near term, how will we
deal with necessary reforms in our Social Security Disability Insurance system? And how do we begin an intelligent
national discussion about the stresses that end-of-life
expenses place on Medicare, a topic that is currently discussed only in hushed tones for fear of being painted as
advocating “death panels”?
These aren’t easy issues. Can actuaries and the
actuarial profession shine a light on them to inform
policymakers, policy influencers, and the public at
large? Yes, we can. Can we do so and avoid criticism? Unlikely. Should this deter us? No.
Public systems of all sorts are extraordinarily stressed. Not
just Social Security and Medicare but also Medicaid, the National Flood Insurance Program, terrorism risk insurance, etc.
The Academy’s Public Interest Committee is spearheading a
serious examination of the sustainability of large public systems.
Appropriately, this examination will include but also reach beyond traditional solvency measures. I have no doubt that our
activity has the potential to become politicized.
The Academy goes to great lengths to maintain its objectivity.
But let’s face it. There are plenty of other expert voices (and not-so-expert voices) out there whose public policy contributions
are aimed at supporting or advocating a particular outcome.
We encounter this when we see congressional panels made
up of experts who support partisan viewpoints. Understandable.
But who then picks the honest brokers? Unfortunately, there’s
less interest in objectivity when policymakers view themselves
as combatants who have to come out swinging as soon as the
This isn’t a complaint. It’s just a reality—and a challenge.
Navigating a Polarized Landscape
We actuaries take pride in assessing what others cannot. And so,
on behalf of our profession, the Academy takes pride in taking
on some of the toughest (and least easily quantifiable) chal–
lenges of our society.
We have a responsibility to speak out on matters that are important to the public and in which actuaries have a pertinent and
informed perspective. Our analysis of data, our understanding
of risk, and our facility with models are important. But so are
the underlying principles that guide us—integrity and objectivity being paramount.
Our heightened focus on sustainability serves as an aspira-tional beacon. Will it also draw us into occasional political cross
fire? Probably. But it’s important for us to speak up, and this will
be where our integrity and objectivity matter the most.