Forces Pushing for Cuts in Social Security Are Preparing Conditions for Its Demise
About 50 years (or longer) ago anyone with a few working brain cells could see that the Social in-Security System was a Ponzi scheme foisted upon some of the U.S. citizenry. When I saw that Congress exempted itself and railroad unions, I immediately knew I’d never collect money equal to what was stolen from my wages each week. I’ve kept every income tax form I ever filed and have computed FICA contributions I’ve made plus those my employers made. I could’ve retired long ago on only my contributions had I been able to manage my own funds and gotten a minuscule 2% yield. Now, however, I expect to see Wiemar Republic-like hyperinflation before I die. All of my retirement planning will have been for naught because politicians can’t stop spending tax receipts. Socialism in the USA has destroyed self reliance. Responsibility for one’s self should never have gone out of style. - EruditeMan, Social Security Cuts Coming Soon?, TusconCitizen.com, February 21, 2011
Every payday the U.S. government mandates that employees and employers pay FICA taxes for Social Security and Medicare on the first $106,800 of annual wages. The employee and employer 'contributions' where 7.65% each or 15.3% total up until January 1, 2011, when the feds lowered the employee portion by 2%. This 15.3%, temporarily lowered to 13.3% for 2011, is money that employees and employers cannot contribute toward private retirement funds. And now the government tells us the Social Security is going bankrupt and we'll have to work until 70 before when can collect our benefits, while government employees can retire after 30 years, regardless of age, with generous pensions paid for by the taxpayers.
What President Obama Shouldn't Say in the State of the Union Address
January 24, 2011
The Nation - ...The co-chairs of Obama's deficit commission have already outlined a plan for reining in the federal deficit by reducing Social Security benefits and schemes for "supplementing" the program, which is a polite language for "privatization." The Republican who will respond to Obama's speech, House Budget Committee chairman Paul Ryan, R-Wisconsin, has a roadmap for going even further.
If Obama is in the mood for some political triangulation, this State of the Union speech—which sets the tone for his 2012 reelection campaign—would be the place to establish his deficit-buster credentials with a jab at Social Security. The problem, of course, is three-fold:
1. Attacking stable programs such as Social Security, Medicare and Medicaid buys into the absurd arguments of conservatives who are far more interested in killing off federal programs than fiscal responsibility—let alone societal good. To the extent that Social Security faces any challenges, they can be addressed with modest tweaks to payroll taxes and benefits. Radical restructuring and privatization are unnecessary.
2. Accepting the argument that Social Security must be changed in any substantial way buys into the broader argument that entitlements that serve working Americans are the cause of fiscal instability, as opposed to endless wars, bank bailouts and ever-expanding tax breaks for billionaires.
3. If a Democratic president starts arguing for serious changes in Social Security, Medicare and Medicaid, that legitimizes Republican positions on entitlement issues and pushes the debate to the right. That creates internal tension within the Democratic Party, not just between the White House and Democrats in Congress but between Democrats in Washington and Democratic governors, legislators and local officials who are struggling to maintain an economic safety net.
These are the sorts of concerns that prompted Vermont Senator Bernie Sanders to write Obama about "worrisome reports" that the president might use the State of the Union address to propose cuts in Social Security.
"I hope that information is wrong and that you will stand by your campaign promises to strengthen Social Security," read the letter from Sanders. "I urge you once again to make it clear to the American people that under your watch we will not cut Social Security benefits, raise the retirement age or privatize this critical program."
The message is being echoed by labor unions, senior groups and religious organizations as the State of the Union Address approaches.
"Let's get one thing straight right at the beginning: Social Security is not responsible for the deficit—the program actually has been running surpluses for decades, to the tune of $2.6 trillion total," reads a message from Sojourners, the Christian social justice group that champions programs to address poverty.
"Social Security is based on a promise: If you pay into the system with your payroll taxes, then you earn the right to guaranteed benefits. It is a system that reflects our values as a nation—values also found in scripture. There is no trust more sacred to biblical faith than the injunction to care not only for our families but also for those in need. Social Security is not just for the elderly—it also helps low-income children, widows and widowers, those with disabilities, and children without parents," the Sojourners message continues. "In fact, without the 75-year-old program, nearly half of elderly Americans would be in poverty; with it, only 10 percent are."
On the political side, Progressive Democrats of America has launched a "Keep Your Promise" campaign urging President Obama to use the State of the Union Address to restate past commitments to preserve Social Security.
"Nearly all Americans depend on Social Security at some point in their lives. Many are retirees. But millions are disabled workers, widows and widowers, and children who have lost a loved one. We need to keep the promise alive for all of us," notes PDA. "Fortunately, President Obama has supported our position in the past—no benefit cuts, no raising the retirement age, no cuts in the COLA and no privatization. In a 2007 newspaper editorial, Obama said, 'I do not want to cut benefits or raise the retirement age. I believe there are a number of ways we can make Social Security solvent that do not involve placing these added burdens on our seniors.' "
Along with the Strengthen Social Security Campaign, PDA is circulating a review of Obama's past statements that places them in the context of the current debate.
"In blaming Social Security for the deficit, politicians and pundits like to claim that Social Security is on the brink of bankruptcy. In fact, Social Security currently has a $2.6 trillion surplus. But with an aging population, it will inevitably start to feel the strain. President Obama addressed that, too, in an October 2008 campaign video: 'The best way forward is to first look to adjust the cap on the payroll tax.... Ninety-seven percent of Americans will see absolutely no change in their taxes under my proposal.... What it does allow us to do is to extend the life of Social Security without cutting benefits or raising the retirement age.' And candidate Barack Obama responded to candidate John McCain's suggestion that the way to keep the pressure off of Social Security would be to cut cost-of-living adjustments or raise the retirement age, 'I will not do either.' "
PDA and other groups want to hear those words once more on Tuesday.
"President Obama's State of the Union address will be on January 25," the groups says, while urging progressives to "let him know that he must state in no uncertain terms that he supports Social Security and will veto any threats to its integrity. Tell him you support Social Security and want to see it strengthened, not weakened."
The GOP Plan to Cut Social Security ... Starting Right Now
Institute for America's Future - Call it a "general strike" ... from above. Republicans in Congress are trying to paralyze the government with their new budget bill, using a "disrupt and defeat" strategy to prevent it from delivering services promised to the the nation's citizens and required under current law. It's fiscal sabotage, plain and simple. Will people fight back?
The GOP'S first attack is on Social Security, slashing its budget in order to deprive people of vitally needed services. While the "austerity economics" crowd talks disingenously about future Social Security cuts in the coming decades, they're actually trying to cripple its activities starting right now.
House Republicans passed a budget which cuts $1.7 billion from the operating budget for the Social Security Administration (SSA) for the rest of 2011. That would damage its ability to deliver the benefits that were paid for by the working men and women of America. And remember: These same Republicans just held the government hostage in order to win a tax break for the wealthiest of Americans -- a deal that will cost the public treasury hundreds of billions of dollars. Now they're turning on the elderly, the disabled, and people who have lost a loved one.
If this strategy succeeds, they won't stop there. Their goal is the radical downsizing of government, and their next target could be anywhere that government provides needed services. They've already made it clear that they're willing to gut the FBI, disaster relief for future Katrinas, and even food safety and inspection services.
The one-time "law and order" party is even going after after police officers on the beat, with cuts that include programs like "COPS" that support state and local law enforcement. (Remember the theme song from the TV show COPS - "Whatcha gonna do when they come for you"? If the GOP has its way, they may not be coming at all.)
Here's what would happen this year if this budget stands: According to an analysis prepared for Democrats on the House Ways and Means Committee, the proposed $1.7 billion cut would have the following impact in the next seven months:
- The Social Security Administration will have to furlough its employees for up to one month between now and the end of the year (according to its administrators).
- 400,000 people won't be able to get their applications processed in a timely manner for retirement benefits, Medicare, and survivor benefits, creating an ever-increasing backlog. Nearly 300,000 more will face additional delays in having their disability benefits processed, which would add an estimated 30 days to an already unacceptable 514-day backlog.
- Tens of thousands of internal reviews, which could prevent millions of dollars in inappropriate payments, will be delayed.
Somebody who becomes disabled is already forced to wait nearly a year and a half to receive a disability payment. This inhumane situation will become even worse under this budget, even though they paid for that coverage with their FICA tax from every paycheck. Retiring people, those reaching 65, and the newly bereaved will also be forced into an intolerable waiting period -- often with no income and no means of support.
Think about it: The country's just been through a devastating financial crisis caused by Wall Street greed. Yet even as the Republicans work to protect bankers from regulation, they're imposing financial hardship onto people whose savings have in many cases been wiped out by the same bankers.
And for what, exactly? The estate-tax deal the Republicans just jammed into this year's budget will cost the government $68 billion over two years. That figure doesn't come from some fringe-lefty-blogger outfit, either, unless that's how you see those hippies over at Accounting Today magazine. This break that will only benefit people inheriting millions of dollars. Yet these deficit spendthrifts suddenly become misers when it comes to Social Security, where they're only saving $1.7 billion by slashing its administrative budget. It's worth asking why they're cutting an item that's such small potatoes compared to what they give away so freely.
The best answer seems to be: That's the plan. They want to dismantle government, to render it incapable of doing anything but serve the needs of the wealthy. Remember all that right-wing talk about "starving the beast"? This is it. The beast is you -- and your grandparents, and the widow or widower, and the person who's too sick or too badly injured to work. We're all expendable, and the strategy seems to be designed to break your will by discouraging you from thinking you'll ever receive the benefits you've earned...
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