Igniting a Revolution to Reinvent America

GUEST: Bill Novelli
VTR: 01/25/2007

I’m Richard Heffner, your host on The Open Mind.

And though I’ve never before met or talked with my guest today, Bill Novelli, Chief Executive Officer of the AARP, I knew I had to like a guy who had earlier devoted his considerable communications and marketing skills to such do-good causes as CARE International, helping impoverished people around the world, and to battling big tobacco at The Campaign for Tobacco-Free Kids.

Besides, my guest often quotes John Gardner’s wonderful observation that … quote “We are all faced with a series of great opportunities brilliantly disguised as insoluble problems” … end quote. And that’s real optimism…which underscores as well Bill Novelli’s new St. Martin’s Press book, “50 +, Igniting A Revolution to Reinvent America”.

Still, I’ve never thought of my fellow seniors at AARP as “revolutionaries”. And I’d first off ask my guest to explain himself. What do you mean by that?

NOVELLI: Well, we are embarking upon a revolution in this country and I think it’s due to two things. One is we’re all living longer. Longevity is a wonderful modern benefit that we all enjoy.

Right now in, in the current era we live about a 100 years … excuse me, in a hundred years we have gained about 30 years in longevity.

HEFFNER: Amazing.

NOVELLI: And it’s continuing. It’s going to go on. And the other thing is the Boomers. This huge population cohort that’s coming in their mature years.

So you’ve got both size and you got, um, let’s call it distance, and the two things coming together are really going to change the face of America.

HEFFNER: But there’s always an organizing principle … a Jefferson around. Ideas of the enlightenment, whatever they may be. Or in the pre-Soviet Union, there are agitators. The AARP cast in the role of agitator?

NOVELLI: Sometimes we can be. I like to think of us as leading. I feel that our responsibility, we have 38 million members now, and I feel that our responsibility is to listen to our members, to understand what they want, but also to lead. And so, that’s how we see ourselves and that’s why we fought so hard to get drug coverage into Medicare and fought so hard to prevent the privatization of Social Security and now we’ve got an era in which we have terrible problems.

We’ve got an aging society in which our health care system doesn’t work. Long term care is a shambles. Pensions are being frozen or discontinued. So we have a, a lot of problems ahead of us. And, it’s my argument and my contention that older Americans are going to help solve these problems and make society better.

HEFFNER: Are you … from your vantage point at AARP …do you feel that seniors are well enough aware in the first place of the real problems and what lies ahead of us. And in the second place, willing to go to the barricades?

NOVELLI: Well, um, in terms of understanding what lies ahead, um, I think we start from the point that people are worried. And they know what they’re worried about, they’re worried about the fact that they may or may not be able to afford health care.

Now if you’re on Medicare you have Medicare, but there are many people who are not yet 65, who are worried about losing their healthcare and not being able to afford it. They want to be able to work longer either because they want to or have to. And they’re not sure that they will be able to.

They worry about so many things. They worry about retirement security and health care, the quality of care, all the uninsured … that sort of thing. And then they worry about their children and their grandchildren. And our research shows so consistently that, that the generations in our country are really glued together.

People care about their kids, their grandkids and they care about their country. And when you look at young people, the like and respect and care about their parents and their grandparents.

So I don’t know if we can say that older Americans are going to go to the ramparts, although today’s Boomers did, many of them, in the sixties. But I do think we will be able to get people to raise their voices, to speak out, to demand change from their elected officials.

HEFFNER: Is there any indication of that in the election returns in recent elections?

NOVELLI: There is. There is. Last November’s elections, 52% of the electorate were people 50 and older. And 25% of all the voters in that election were AARP members.

HEFFNER: But how did they vote? Do you know?

NOVELLI: Yes we do. First of all our, our membership is, is large and so it tends to mirror the, the political face of America. So we have the same percentage of Democrats as there are in the 50+ population, Republicans, Independents. So it’s not as though they represent a single voting block. They tend to, um, they tend to make their decisions on the basis of a variety of issues. Now, in ’04 when President Bush beat candidate Kerry, he got … President Bush got the biggest margin of victory among people 65 and older.

But it wasn’t because they liked what he had to say about Social Security, or Medicare or any of these issues … or healthcare, it was because they saw him as the Commander-in-Chief. That’s how we analyzed the situation.

But among younger people, 50 to 65, they went more for Kerry. Right now what we see is that, that older people are very watchful. They want to know how their elected officials are voting. We’ve begun to record the votes on key issues …

HEFFNER: Is that fair? (Laughter)

NOVELLI: (Laughter) Well, I think it is. I think it is. And then inform our members about how their elected officials voted. So that then they can make their own decisions. So I, I would say we need to galvanize the public, including the older public, but that they have such a strong interest in America. They have a strong interest in legacy, in their children as I said. I think that we can ignite a revolution.

HEFFNER: Well you write a lot about legacy in, in 50+. You know, Bill, as I read the book I was wondering … you say, “no” in the book. You make that very clear what you’re, what you’re really passionate decision is about that.

But I wonder: am I at war with my grandchildren? If I have what I feel I need, looking into the future, even at my advanced age, am I taking it from them?

NOVELLI: Well, um, we see no evidence whatsoever of inter-generational conflict. Grandchildren do not resent what their grandparents have. Grandparents want their grandchildren to have what they have. I think there is an issue, though … and I think you put your finger on it, which is … if you represent, or you’re part of society that has clout, that votes, that has purchasing power … as older people do … does that disadvantage the more vulnerable, the low income, less educated children?

And I think … I do think about that a lot. And I think it’s very important for all of us to be inter-generational, to think about all generations. There’s this image of the greedy geezer, you know the, the …

HEFFNER: The greedy OLD geezer.

NOVELLI: The greedy geezer, the guy who will not vote for school taxes because he doesn’t have any kids in school. You know somebody who will drive 40 miles to get a discount on something. That, that really is an image that, or a stereotype that’s, that’s not well documented.

People are not like that and people do think about other generations. That’s one of the greatest, I think, values and strengths of America.

HEFFNER: Bill, wait a minute. I, I like to hear that. And even more I’d like to believe that. But doesn’t the evidence indicate that in communities where there are very few children, the, the geezers do, indeed, vote against school bond issues.

NOVELLI: It does happen. I’m not suggesting that this never occurs. What I’m saying though … that the vast majority of Americans, the vast majority of older Americans are not just focused on themselves.

I’ll give you a good example. In 2005 the Administration came forward with this idea of taking private accounts out of Social Security payroll taxes. And we opposed it, and many people opposed it. And the Administration said, “If you’re 55 years or older, you don’t have to worry about this, you don’t have … you’re not in this fight, you’re going to get your check, just let us fix it for the younger people.”

And that made older people madder than hell. And the reason they were so angry was because yes, they wanted their check, but even more … they wanted to make sure that their children would have Social Security for their older years. And so that’s an example, I think, of how people think.

HEFFNER: Where are we going? Where … whence comes your optimism?

NOVELLI: Well, you said I was an optimist. And I am an optimist. And I start from this point. That America is a wonderful, rich, vibrant place and we have always been able to re-invent ourselves.

I’ve taken many fact finding trips to Europe. And if you take an example like older workers. They can’t figure it out. They have people retiring at 52 and they’re being pushed out by companies and strong unions, and they culturally think that they need to go and sit on the front porch.

Here we have more older workers than we’ve ever had before. The retirement age is beginning to inch up. And, as I said earlier, some of them need to work, but many of them want to work, they want to be productive, they want to earn and so forth. So America is a place that can re-invent itself and has … and has proven that it has. I see older people as a great resource. And we an aging society and my argument and my thought and I think AARP’s as well, is that we will be a better society as a result of it.

HEFFNER: What indications are there, and I’m not challenging what you just said, but I’m puzzled by it. I recognize that most of my friends … who continue to work, do so largely out of a desire to. I can’t … I can’t image not working. I don’t consider what I do work


HEFFNER: … and I’ve never considered it work.

NOVELLI: More of a privilege, I would say.

HEFFNER: Yeah, it’s a privilege and a pleasure. But my understanding is that old people, generally, in the labor market, are there because their resources are so meager and, in your own book, you indicate, with some statistics, that we haven’t been very good savers. We haven’t been very good providers for our older years.

NOVELLI: That’s true. Americans … well people … older people have a great savings ethic. And, of course, when they were younger they didn’t have all that money to save, but they did save at their, at the best they could. And they have Social Security, so the result is that people 65 and older … they’re generally doing okay. They’re, they’re making do.

HEFFNER: That’s a fact?

NOVELLI: That’s a fact. In fact there was a time … forty years ago, fifty years ago when older people would plunge into poverty. Social Security has made a huge difference in that respect. It’s the younger cohort, it’s the, the younger Boomers, the 40 to 60 year olds, the people who are 35 to 50 … those areas where people are not able to save or they are not saving … whether they can or not.

And what you have is some interesting conflicts, or let us say contrasts. These are the people who say they intend to work longer. But many of them know that they have to work longer.

Now, a person like yourself … me I’m not going to be stopping working any time soon. We work because we enjoy it, we’re productive. And, and it’s something that we want to do. There are many others who will have to work.

And so right now the Social Security debate … how to make it solvent … one key issue is …should we raise the retirement age? Now it’s moving up to 67 slowly at this time, by law. And some people say, “Well, since we’re living longer, we have to account for longevity, we should make it 69 or 70 or even 71.”

And, and that is a debate and it’s a difficult decision to make because even though you and I might be what they might call “knowledge workers”, there’s still many people in this country, they are a minority, but many people in this country work with their hands, they do manual labor. You know, they, they wouldn’t be able to work till they’re 69, or 70 or 71.

So we have to be able to account for all these things. We need really smart policies.

HEFFNER: Does the AARP take a position on this question of how to save the Social Security benefits?

NOVELLI: Well, right now, we’re working very hard to get Congress to pay attention to it. After the ’05 debate it sort of … you know, people say, “Well this is too much of a political hot potato, let’s let this lie for a while.”

HEFFNER: The privatization debate?

NOVELLI: Well, the privatization debate was the big hot potato, but, um, you know Congress is, let us say, “famous” for not wanting to take painful votes if they don’t have to. Social Security is going to be in deep trouble in about ten years, but not tomorrow, we’re still in surplus.

But from an AARP standpoint, our position is the pain will be a lot less if we make the changes we need to make today. Because it’s not sustainable over a long period of time. And so what we’re saying is everything should be on the table, we should look at everything. We should have a public debate. And we do this ourselves, we do these community level meetings among our members and we say to them, “There’s a long term problem here, we need to fix it for ourselves and for the future generations to come. Now here are eight or ten or 12 ways to do it. We need to figure how to get more revenues into the system and we do need to adjust the benefits somehow. And we give them examples of how to do this … raising the age is one way. There’s something called “longevity indexing” which Sweden and other countries do. And it is not to raise the retirement age, but essentially to give you the same amount of money you would have received, but stretch it out over the full length of your longer life.

We can get, for example, better investments. We don’t audit and invest our money as wisely as we can. That trust fund money is all in Treasury bonds. We can do better there.

So there are a variety of ways. And when we do this, when we lay this out for our members, invariably they come and they say, “Okay, we’ve got some ideas here.” They don’t run away from benefit cuts and they don’t run away from revenue enhancement. And so, what we say to the Congress and the Administration is if the public is willing to engage, then surely you can sit down, in a bi-partisan way and work on this and get it done.

And if you can, if you do and if you come up with a fair solvency solution, we will take it to the public. We’ll, we’ll inform the public about it and we’ll hopefully gather support for it.

HEFFNER: And when you say this, do you do it from a position indicating that you have a point of view, the debate that will go on, what’s your input into that debate?

NOVELLI: We, we do have input and that’s because of our members. Our members … we have clout because our members vote, as I said before.


NOVELLI: They’re activists. They write letters to Congressmen, they call and, and complain about things. And so, um, you know members of Congress understand this. So when AARP says, “You know, we have some ideas.” We are listened to.

And what we are saying to them on Social Security is, “You need to sit down, the two parties need to sit down, the leaders need to sit down.” Just as they did back in 1983 under Reagan when Tip O’Neill and Alan Greenspan and others were, were charged with this.

And we say to them, “We will … we will have comments. We will opine on what you come up with. We want to make sure it’s fair. It has to be fair to low income people; it has to be fair to everybody. We can’t make Social Security irrelevant to wealthier people because if they walk away from it, it will become a poverty program and we can’t have that.”

And so we try to lay out our balanced views and we say, “Well will weigh in when you’ve got a program for us to look at. But our job is not to write legislation.”

HEFFNER: Do you consider the AARP to be a lobbying organization?

NOVELLI: Yes. We lobby. And we are a non-partisan organization. We don’t support candidates, we don’t have a political action committee that gives money, we don’t even oppose candidates. But we lobby hard on a non-partisan basis. And, I like to say, “We call them as we see them”.

HEFFNER: That’s an interesting way you put it though, “we don’t even oppose candidates.” Why do you put it that way?

NOVELLI: Well, I, I should say, “We do not support nor oppose candidates.” Sometimes it would be tempting to do that. But we do not do it. We are, we are non-partisan. We are more interested, not in who gets elected, but what is done as a result of that.

HEFFNER: How successful do you feel you’ve been?

NOVELLI: I, I think we can take some pride in, in what we’ve done at AARP. I, I feel that we have been a collective voice for the public. And we have strong state offices all across the country and we’ve made some real inroads and some real changes at the State level.

Examples would be grandparents raising grandchildren. Now this not something that the majority of Americans are focused on. But there are six and a half million kids in this country who are being raised by their grandparents. And in many states the laws actually disadvantage grandparents.

If you’re a grandparent raising your grandchild you, you probably have less legal status and less financial help than if you’re a foster parent.

HEFFNER: Are you talking about custody matters or are you talking about financial aid matters?

NOVELLI: Financial aid and custody. And so we worked to change those kinds of rules. We did it in New York State. We worked on long term care to make sure that nursing homes are the best quality they can be.

Right now in many states health care is on the agenda. Massachusetts and Vermont passed legislation, Pennsylvania and California and other states are now looking at it. So we weigh in there as well. So I, I take pride in the fact that I think we represent our members well in that regard.

HEFFNER: Bill, it would be impossible for me to leave the program without asking you what the criticisms are of AARP and what your response to them …

NOVELLI: I think, I think there are several criticisms and I’m very sensitive to them. One of them is what we discussed earlier, which is that we’re so big and so strong, that we sort of tilt public discourse away from more vulnerable populations.

And I, I do worry about that and that’s why we work so hard, as I said, to be inter-generational.

Another easy criticism and I, I hear this from time to time is the greedy geezer criticism. “You know AARP and its members really just care about that age group, they’re not really interested in the rest of the country.” And I, I think that that is easily dispatched. I don’t, I don’t place any stock in that.

A third criticism is that we’re a big marketing organization and that we put our marketing of products and services first. And actually the opposite is true. We put policy first, we put people’s interests first. And we do endorse products … insurance products and other things. Even for the Boomers we have motorcycle insurance now. But those are separate from policy and they are only something that basically is … stems from policy. So I, I would say those are the essential criticisms.

HEFFNER: Taking the last criticism … how much of the budget that you have, or the dollars you have to put to totally good causes come from the more merchandize oriented sources.

NOVELLI: About forty percent of our budget comes from the endorsing of products. About a quarter of the budget comes from members dues. And we keep those dues, we keep the membership costs very low, so that anybody can be a member … it’s $12.50 a year. And then we have money from the advertising that we carry in our magazine and other publications. We have investments, we have grants and we have a pretty broad stream of revenues.

And then, unlike corporations, what we do is … we take all that money and then reinvest in our social programs … in the lobbying we talked about, in driver safety programs, consumer protection programs, that sort of thing.

HEFFNER: What do you think … as you look into the … this century …what do you see happening? Now your wish list … but what do you think is going to happen … in reference to us old geezers?

NOVELLI: (Laughter) Well, one thing is absolutely sure and that’s based on demography … and that is we will be a much older society. America is a graying society. And, of course, we’ll be a much more diverse society. And many of these … today’s minorities will be older as well. So Hispanics are aging, African Americans are aging. We’re all aging. So we will be an aging society and with that will come both benefits and challenges. And being the optimist that I am, I think that the, the benefits will outweigh the challenges. People want to give back … as I said older workers are being more valued by employers. Older workers … excuse me … older people are a huge market place and I think people will advocate for causes and want to leave legacies.

HEFFNER: And globalization? How is that going to impact upon what you want to do?

NOVELLI: Well the whole world is aging. And so global aging is part of globalization. We’re doing a lot of work in Western Europe, we’re doing a big conference shortly in Japan called “Reinventing Retirement in Asia”. So Japan, Korea, even China … these are, these are that are aging very fast. And so we can learn from those countries. But we can also share our knowledge with them as well. So the globalization of the world includes global aging.

HEFFNER: Are you convinced that what’s good for Japan and Asia will be good for the United States?

NOVELLI: No. No. It doesn’t work that way. There are real cultural and political differences. But what I am convinced of is that we can take what happens in Japan, what happens in Italy, what happens in the Netherlands and we can benefit from it and apply it here. But, of course, applied in an American context. And then what we have to offer, the same can happen there.

HEFFNER: Frequently, when there are medical people on the program, I ask them, would you rather be sick in Great Britain, Holland, France, wherever …

NOVELLI: (Laughter)

HEFFNER: … if you’re going to be old, would someone be advantaged …would most people be advantaged to be Swedes and old?

NOVELLI: Yes. Yes. The Scandinavians especially have a very good program of long term care and they really take care of their elderly. There’s no question about it.

Our country has real health care problems. And long term care problems, you know you have to virtually impoverish yourself to, to go into a nursing home on Medicaid and be able to afford the $70,000 a year it costs. We need to fix that.

HEFFNER: So it is in the health area that you find your greatest concerns.

NOVELLI: Health and the financial security we were talking about.

HEFFNER: Well, they’re intimately related.

NOVELLI: Exactly. They’re inextricably linked.

HEFFNER: You write somewhere here, as, as we have very little time left .. but I’m very impressed with … you’re talking about, talking to a Congressional Aide, talking about the problems we have and you make the point that it is the high cost of healthcare that is basic to our problems.


HEFFNER: Not the high budget for Medicare or Medicaid.

NOVELLI: Yes, exactly so. I was speaking to this senior House member’s staff person, his Chief of Staff and he said, “These Medicaid and Medicare costs are making our budget unsustainable.” And I said, “You have to think that healthcare costs are really what’s driving this problem. We need to get healthcare under control. And don’t start by saying ‘How much can we cut our of Medicare or who can we cut off the Medicaid roles?’ Start by figuring out how to control these rocketing health care costs. And then we’ll make some progress.” So we need to elevate the debate.

HEFFNER: Bill Novelli I’m delighted that you’re there to elevate the debate and I appreciate you’re coming, joining me on The Open Mind today.

NOVELLI: Thank you for having me.

HEFFNER: And thanks, too, to you in the audience. I hope you’ll join us again next time. For transcripts of today’s program, please send $4.00 in check or money order to The Open Mind, P. O. Box 7977, FDR Station, New York, New York 10150.

Meanwhile, as an old friend used to say, “Good night and good luck.”

N.B. Every effort has been made to ensure the accuracy of this transcript. It may not, however, be a verbatim copy of the program.

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