Paul Krugman considers that question, Matt comments also. I would offer a few points:

1. One might prefer, for macro reasons, to start with fiscal consolidation a year from now rather than now. But still the question can be considered with that slight shift of time frame if need be.

2. One major problem is that America is aging, and benefit cuts or decelerations will become successively harder to achieve as the years pass. There will be many more elderly voters and the elderly as a voting bloc are already quite effective at getting their way.

3. As the years pass, our health care establishment becomes increasingly geared to require especially high revenue streams. It becomes successively harder to back out of an excessively costly health care system. Do you believe it would have been easier to put in a more unified and more efficient system of health care assistance in say 1969? Probably so, and this is simply the mirror side of that belief.

4. Whether one likes it or not, U.S. politics phases in benefit cuts, or benefit decelerations, only slowly. Grandfathering is much preferred, so that a critical mass of elderly voters will support the changes and arguably this is more fair as well. That means one must start relatively early to have a significant cumulative fiscal impact over time.

4b. David Henderson makes numerous good points, here is one: “people can adjust better when they have more time to adjust. If the Social Security formula is altered for the future, people can have longer to save to make up for the higher benefits they would have got but will not get. That’s the argument for doing something about it now rather than later. Remember what happened in 1981 when OMB Director David Stockman tried to cut the early retirement benefit by about one third for people retiring only a few years later. That got nowhere. People looking at a one-third reduction in their retirement benefits who are planning to retire in a few years will not look on that kindly. But what if some previous Administration had announced in 1962 a gradual reduction in the early retirement benefit for people retiring in the early 1980s. Those people would have had much more time to plan.”

5. Krugman has written about why raising the retirement age is a bad way to make up for fiscal gaps and I agree with many of his arguments. Nonetheless I would insist on taking the continuing survival of such proposals as a kind of datum, indicating just how many other (possibly more sensible) proposals are complete political non-starters. Let’s learn and draw inferences from the popularity of “raise the retirement age” proposals rather than merely condemning them.

6. The threat is not that future benefits will have to be cut (if that were the case, cutting benefits now would be an odd solution, as Krugman notes). The threat is that future benefits cannot be cut or slowed and that the U.S. will spend far too much on consumption and the elderly, along with having excessively high taxes and permanently slower growth.

7. I am puzzled by Matt’s argument that government cannot easily save for the future. Even if one accepts it as stated, government could subsidize private consumption of health care and other amenities less than it does. That would be easy to achieve.

8. Morgan Stanley estimates that most developed economies are, when unfunded liabilities are taken into account, in some manner insolvent. Or ask how the fiscal picture would look if the standards for private pension funds were applied to the government.

Maybe my reading is missing it, but I don’t see that Krugman pays much if any heed to political lock-in arguments. Overall I do not see entitlement spending paths as very easy to alter, mostly for political reasons. One plausible scenario is simply that it is already too late and has been too late for some time (the rejection of managed care in the 1990s?), although denouement (which does not have to mean default) remains a ways away. If you are fiscally and/or growth doomed anyway, hurry at the margin will indeed seem of not much extra value. But that is on net hardly an argument for fiscal complacency.