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Monday, 08 April 2013

Social Security: For the First Time in History...

...a Democratic president has proposed to cut Social Security benefits. That's not rumor, that's official. It is an item in the budget plan Barack Obama will send to Congress on Wednesday.

The cut is, as we have discussed in these pages many times, a different way of calculating cost-of-living increases called “chained CPI.” It measures inflation in a different way from currrent calculations so that COLAs would be reduced by .3 percent per year.

That doesn't sound like much but it is cumulative year to year and cuts so much money from beneficiaries who have earned it through a lifetime of work (estimates range from $100 billion to $208 billion over 10 years), that chained CPI is popular among deficit hawks (I now assume Mr. Obama to be among them).

Plus, those hawks have wanted to kill Social Security since the day President Roosevelt signed the legislation for it in 1935 and this looks to them like a terrific beginning.

Remember, the money comes out of the hides of Social Security recipients and it is not just old people Obama is selling out. It would negatively affect pretty much everyone in the U.S. except rich people for whom the change is so small in comparison to their wealth as to be unnoticeable.

In addition to elders who receive the Social Security old age benefit, others whose income would be reduced include:

  • Disabled veterans and family survivors
  • Veterans' pensions
  • Disabled who rely on SSDI
  • Everyone who pays federal income taxes due to adjustments to tax brackets by chained CPI too

Elders, veterans, children, widows and widowers, the working class, the poor along with all future beneficiaries of every type whose benefits under chained CPI would start out lower than without chained CPI.

Obama's proposal for chained CPI includes “protections for the vulnerable” but contains no details about who that is or how that determination would be made. This would create an additional layer of Social Security bureaucracy to gather forms, documents, tax returns and who knows what else to prove someone is "vulnerable."

The New York Times, in reporting on the president's budget proposal, had this to say about chained CPI [emphasis is mine]:

”As Mr. Obama has said before, his budget documents will emphasize that he would support the cost-of-living change, as well as other reductions that Republicans have called for in the popular programs for older Americans, only if Republicans agree to additional taxes on the wealthy and infrastructure investments...”

And that brings us to the politics of Obama's chained CPI offer.

Some pundits and commentators say that Congressional Republicans will never agree to additional taxes so don't worry about chained CPI. In fact, on Friday House Speaker John Boehner rejected the president's proposal.

Some other observers suggest that offering up chained CPI is a savvy president's political ploy. As Jason Easley explains it:

”What the White House is doing is a clever bit of political strategy. They are using something that Republicans really want (Social Security cuts) to force Republicans into making a choice on whether or not to defend raising taxes on the wealthy. The president knows that his budget is DOA, so he is using it to push his broad overall goal of raising taxes.”

Oh yeah? And what if that idea backfires and the Republicans go for it? Do we really want to rely on Boehner's tax intransigence to protect Social Security?

Once upon a time, back in September 2008, then-candidate Obama made this campaign promise:

Apparently that was then and this is now because the president has been offering to cut Social Security via chained CPI since last summer. So there is no point in hammering the White House with objections.

Here is Robert Naiman at Truthout explaining, ”The only thing that can stop President Obama from cutting Social Security now is Congress.”

”...public pressure on Congress to stand up to Obama and say no. The pressure that has been exerted so far was not sufficient to stop President Obama from doing this. Therefore, public pressure against Social Security cuts must significantly escalate.”

That would be you, me, our friends and neighbors and relatives and everyone else you can think of – young and old because it affects all of us - must fight this ourselves.

There are a number of web petitions against chained CPI and on Wednesday, several progressive organizations are holding call-ins to Congress. You don't need to wait until then to tell your representatives “no to chained CPI” but I will have a bunch of links on Wednesday for you to use.

If you don't do this, if you don't help all the rest of us fight as hard as we can with as many phone calls, petitions and emails as it takes to preserve Social Security for ourselves, our children and beyond, you deserve to have your benefits cut.

If we lose this battle, let's at least be able to say we tried.


At The Elder Storytelling Place today, Marc Leavitt: There Were Blizzards in Those Days


Posted by Ronni Bennett at 05:30 AM | Permalink | Email this post

Comments

I've probably signed at least a dozen petitions on this in addition to writing a stern letter to Obama. Am I outraged? Yes! He promised us better.

This is not a time to be tired, even though we are.

This is about people who have a comfortable future stealing from people who face an uncertain future. It marks a complete collapse of any pretense that Americans are all in this together.

I *am* entitled to Social Security. I first paid into it in 1967, and I've been paying into it ever since - that's 46 years.

I've signed several petitions and I am calling, calling. I too have paid into Social Security, 45 years. I am concerned about outlasting my money. It is not an entitlement, it is not underfunded, I am so disappointed in Obama.

He did promise better.

A commenter over on Huffington Post summed it up: "He's playing chicken with old people." Yes, I've written to the White House (there's a link for that), I'll be writing to my representatives, and I'll be signing petitions. I'm furious!! Such a betrayal!

Sold out. So this is how it feels. Aren't we lucky to have a Democratic 'leader'.... hmph.

Well so much a government "for the people, by the people..." What a joke they all are. Bummer. Dee

The other scary part to this outrage is that it is the first step in dismantling Social Security. Like the fight against abortion, the Republicans will chip away at it one step at a time until it is weakened so they can kill it outright. For those of us that fought so hard for Obama this is a major disappointment. He talks a good game, but fails to walk it.

It's an outrage. If the rich paid their share instead of hiding their assets, there would be plenty of money for SS, Medicare and all the other social programs we need.

It is an outrage. I've written letters daily to the White House protesting the chained CPI to no avail. I will sign petitions and send emails. I just hope we can affect enough politicians to make a difference.

The next thing we need to decide is whether we need to overhaul the Democratic Party or to start a third party. The people we currently have in office are NOT representing us, they've all been bought by Wall Street and Big Business.

I am on SSDI. I have already used up whatever savings I had on medical co-pays. All I have is my SSD cheque every month. Groups like AARP have said very little about the disabled (who happen to be over 50 and members) and I have written them and my representatives many times to include the ramifications to what happens to individuals like me or someone much younger. I finally saw something on C-Span a week or so ago where AARP had a conference and actually had a lawyer named Rebecca Vallas (with Community Legal Servces of Philadelphia) explain the plight of the disabled with their (earned!) SSDI benefits. It was the first time I heard anyone hit the nail on the head and it gave me so much validation on what I had been going through these last few years and how this change in COLA would affect us. I get in too much for medicaid or food stamps (I don't know how anyone can pay bills on that miniscule amount they want you to have) and no plan has been mentioned so far how anyone who falls through most of the cracks now like me would be helped (the vulnerable as they put it). I am still in my 50's and I can't imagine how I will manage if and when I ever reach 80.

I voted for Obama because he was the better choice, not because I thought he would fix everything. When the conservatives called him a socialist I laughed because Obama is a fairly conservative democrat. When the conservative think tanks create their new weasel words of the week and start framing everything their way, politicians who lean center or left get scared fast. Yes it is a game of chicken and this isn't the first time Obama has lost. He loses just for putting this out there. We all lose if he wins.. how's that work???

Congress won't pass Obama's budget.

Groups like AARP have said very little about the disabled, who happen to be over 50 and members. I have written them and my representatives many times to include the ramifications to what happens to individuals on disability who have many more years before retirement. Finally last month, on C-Span, AARP had a conference where a lawyer named Rebecca Vallas (with Community Legal Servces of Philadelphia) explained the plight of the disabled with their (earned!) SSDI benefits. It was the first time anyone had hit this nail on its head and it gave me so much validation. No plan has been mentioned thus far how anyone who falls through most of the cracks now like me would be helped (the vulnerable as they put it). I am still in my 50's and I can't imagine how I will manage if and when I ever reach 80.

I voted for Obama because he was the better choice, not because I thought he would fix everything. When the conservatives called him a socialist I laughed because Obama is a fairly conservative democrat. When the conservative think tanks create their new weasel words of the week and start framing everything their way, politicians who lean center or left get scared fast. Yes it is a game of chicken and this isn't the first time Obama has lost. He loses just for putting this out there. We all lose if he wins.. how's that work???

I voted for hope and change. This is not the change I was expecting.

Seems like, there is a growing realization that social security is more necessary than ever. I believe the chained CPI is strategy because higher taxes will never be accepted by the Republicans and chained CPI will not be passed by the democrat Senate. Therefore, it's just talk, but any talk in this regard is scary and simply makes it easier to accept the next time or next time after next time.

I voted for Obama. Twice. I may as well have voted for a Republican.

As for the chained CPI move being just a game of chicken, well, so was the sequester. And look how that turned out.

I'll do my part to register an objection, but I no longer believe anyone in power cares what we have to say anymore.

If it is indeed "strategy" (and it could be), I d&@# well hope it works! Philosophically, I'm with janinsanfran, Mary J and Celia. I've been paying into SS since I took my first part-time job at 16--that's 60 (yes, sixty!) years. And I'm still working and paying into it.

Chained CPI won't hurt the well-off--by the way, whatever happened to raising the earnings cap so that high earners pay their fair share?--but it will hurt working and middle class retirees. I've come to understand the concept better in the past year, and the worst part is the cumulative effect. There's absolutely nothing I can do to help myself 10 years from now when I'm 86 or 20 years from now when I'm 96, if I'm still around! So, I'll be adding still more emails and letters to the many I've already sent.

your graph showing the cumulative effect of the change is very impressive.

Medicare is the real issue. I wish they would figure it out.

If they insist on meddling with SS, they should at least introduce means testing. As you note, the very wealthy won't notice the tiny reduction in their income.

Also if O is going to offer this "cut" the Republicans should bend on raising taxes via closing loop holes as Romney offered. Dianne

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