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GRAY MATTERS: The Simpson/Bowles Deficit Commission

SaulFriedman75x75 Pulitzer Prize-winning journalist Saul Friedman (bio) writes the weekly Gray Matters column which appears here each Saturday. Links to past Gray Matters columns can be found here. Saul's Reflections column, in which he comments on news, politics and social issues from his perspective as one of the younger members of the greatest generation, also appears at Time Goes By twice each month.

Who can forget that outburst from Alan Kooi Simpson, a former senator and now co-chairman the president’s flawed deficit commission, when he told a women’s group challenging his views: Social Security is like “a milk cow with 310 million tits?”

This was nothing new for Simpson, a conservative Republican, who has rarely had a kind word for Social Security or any government social insurance program.

Yet he has been on the public tit for much of his 79 years. His position on the deficit commission (he has served on others ) is only his latest government gig. And his reputation as a quotable, if often outrageous, character has served to get him such appointments. He certainly doesn’t know much about Social Security as in this interview. Here is a sample of his words to Alex Lawson, a Social Security expert and advocate:

“We’re trying to take care of the lesser people in society and do that in a way without getting into all the flash words you love dig up, like cutting Social Security, which is bulls--t. We’re not cutting anything. We’re trying to make it solvent. It’ll go broke in the year 2037.”

The $2.6 trillion in bonds held by Social Security, he called IOUs.

A third generation corporate lawyer, Simpson’s less than sterling political career was bestowed on him by his father, Milward Lee Simpson, a former Wyoming governor and U.S. Senator who distinguished himself by voting against the 1964 Civil Rights Act.

The son served a few years in the Wyoming legislature before going to the Senate in 1979, where one of his most signal accomplishments was an attack on AARP for its lobbying on behalf Social Security and older Americans. Simpson only succeeded in making AARP, the nation’s largest and most powerful voice for seniors, even larger, stronger and richer.

AARP’s senior vice president said Simpson’s comparison of Social Security to a “milk cow”

“is offensive...for belittling a bedrock program that is the foundation of family security for all generations. The vast majority of the 310 million Americans he insulted....don’t have access to the type of traditional pension that Senator Simpson has from his decades in Congress.”

Simpson, who retired from the Senate in 1997 and has taught at the Kennedy School at Harvard, enjoys a couple of healthy government pensions, the average value of which is over $60,000 a year, and he enjoys taxpayer supported lifetime health benefits which helped him get the best of care when he had a $70,000 knee replacement. Yet his latest epithet for older Americans who are anxious to protect Medicare and Social Security from Simpson and his commission:

“We had the greatest generation. I think this is the greediest generation.”

For the record, nearly half of the 43 million disabled and older Americans on Medicare have incomes below twice the poverty level, or $20,800 for an individual and $28,000 per couple. That’s per year, senator. Nearly 70 percent of black and Hispanic beneficiaries have similar incomes. And as drug prices, premiums and deductibles have risen, median out of pocket costs are approaching 20 percent of incomes.

Yet it’s these “lesser people” that will bear the burden of benefit cuts in Medicare and Medicaid. While much attention has been focused on Simpson’s and his allies’ intention to gradually raise the Social Security retirement age to 70, which would mean an absolute cut in benefits, members of the Commission also would raise the age of Medicare eligibility to 68, which could leave millions too old to work in an uninsured limbo.

In addition, Simpson would raise the 20-plus percent that beneficiaries pay for Part B to an astounding 35 percent. Since Part B, which pays for doctor visits and labs, is the most frequently used Medicare benefit, this would all but kill the program. To add insult to the devastation, Simpson and company would cancel the portion of the Affordable Care Act that would begin a voluntary, long-term care program championed by the late Ted Kennedy.

Don McCanne, an MD, and a spokesman for Physicians for A National Health Program, noted that Simpson and his co-chairman, Erskine Bowles who, while in the Clinton administration, sought cuts in Medicare, favor raising Medicare premiums, deductibles and co-pays.

“Shifting more costs from the federal government to the patient might reduce the federal budget,” said McCanne. “But it plays havoc with personal budgets”

of beneficiaries who would be obliged to buy increasingly expensive Medigap plans. In addition, Simpson and Bowles would cut the fees to doctors, many of whom are already deserting their Medicare patients because, they say, the fees are too low. The Congress keeps threatening cuts and so far has declined to end the threat.

President Drew Altman, CEO for the Kaiser Family Foundation, noted that Medicare cuts will be especially hard on beneficiaries.

“It will be difficult, if not impossible to ask a pay more and make do with less. Warren Buffet is not the typical Medicare beneficiary.

“Instead the prototype is an older woman with multiple chronic illnesses living on an income of less than $25,000 who spends more than 15 percent on health care. It is the people on these programs and the realities of their lives that have been left out of the discussion.”

Another plan, sponsored by former budget director Alice Rivlin and Republican Representative Paul Ryan of Wisconsin, who is to be chairman of the House Budget Commiittee, would end Medicare as we know it by giving beneficiaries vouchers to buy their insurance on the market.

Whether or not Simpson and Bowles are able to get 14 of the 18 Commission members to vote for a proposal that would then go to the Congress, liberal members and allies in lobbying groups have begun their campaign for less draconian alternatives to cut the deficit.

Representative Jan Schakowsky, an Illinois Democrat, put forward a plan which would strengthen Medicare and Social Security and fund programs to create jobs, but would lower the deficit by $427 billion in four years by, among other things, cutting military spending by $110.7 billion, increasing revenues by $151.6 billion, ending tax breaks which cost $132 billion and reducing farm subsidies by $7.7 billion.

Unfortunately, most of the press, enamored with Bowles and Simpson, has ignored Schakowsky, although at least two other commissioners support her. Their view is that deficit reduction should follow job creation and be delayed until unemployment is down to six percent.

The New York Times reports that several progressive groups – Demos, the influential Economic Policy Institute and the Century Foundation as well as a coalition of economists, labor leaders – the Citizens’ Commission on Jobs, Deficits and America’s Economic Future - are weighing in on their own plans to lower the deficit without further killing the working and middle classes and the nation’s social insurance programs.

So far AARP, which is opposed to cuts in Social Security, has not weighed in with its views of the Bowles-Simpson proposals.

Let us not forget, this is Barack Obama’s commission. He made the mistake of falling for the deficit reduction frenzy which stunted his efforts to revive the economy and create jobs; he reached out to right-wing Republicans, who wished to see his presidency fail; then he reached out (too far) for the likes of Alan Simpson; and now he’s stuck with him.

Let’s see where Obama really stands on Social Security, Medicare and Medicaid – if anywhere.

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It is becoming increasingly apparent that Obama, while a great orator, is not a great leader. He doesn't stand for much of anything since becoming president. Instead of using his bully pulpit, he is still reaching for a compromise that the Republicans gleefully won't give him.

I am sad to see this happening and some Democrats are trying to fill the needed gap by standing up for Social Security, as well as letting tax cuts for the wealthy expire. Of course, wihout a strong voice from the president and an outcry from the public, they will fail.

More than a symboolic gesture is needed and it is now too little too late to get anything done.

I am proud of Jan Schakowsky for her stand and it appears that the commission has failed because she, and a few others, had the courage vote agsinst it.

Let us hope "for."

Dick Diurbin signed onto the plan and I hardly consider him a right winger.

Darlene as said it for me. Obama is a bust, captive to conventional wisdom that rewards the rich at the expense of most of us.

I would remind us all though that most of us have little experience of trusting the Democrats and the government to be on our side. Bill Clinton was no better; he's the guy who ended support for poor women with children. After a siege of working from the inside, it's back to hammering the system from the outside if we want a decent life for ourselves and our loved ones.

Right on, Darlene!!!!

For me, Simpson's ideas are a death sentence.

Why did I not move to expatriate myself in '88 when it first occurred to me to do so? Now I will write letters that are not valued, participate and fail in campaigns and watch my home slip into the dark hole of the growing economic abyss to become a statistic. For me when this Unemployment Insurance runs out, it is the shopping cart, the streets - even if my family steps up to help, I still have all the the lovely trauma and stigma that accompanies such a misfortune to wrestle with. Such is the fate of any dignified low wage earner in this country today.

I doubt I will be alive at 70 (or want to be) to collect any Social Security...but, sadly, perhaps that is part of their equation.

My disappointment in the Obama Presidency cuts deeper than I dared think possible even a year ago. Of course, if I hadn't been laid off and I was still working, I would still be hoping for the best. This realization also makes me sad because now, it seems even hope is handicap to progressive change.

I'm having a bad day and I apologize for the rant but appreciate the forum. Thank you for keeping these important issues, as hard as they may be to report, uppermost in our minds. It is always better to be aware of the facts of the situation.

I don't understand how a raving Republican like Simpson was allowed to head up a committee like this. Didn't Obama have a part in deciding this?

Darlene and Kay have expressed how I've begun to feel about Obama. He needs to grow a backbone and stand up to the Republicans. They're like the school yard bullies who've figured out he's not going to fight no matter no how. He's likely to be a one-term president and if Sarah Palin becomes president because of him, I'll never forgive him!!!!!!!!!

Social Security is a ponzi scheme that we can't afford as the population tips with the boomers. Something has to be done to provide the safety net for people who can't make it but we have to stop providing tits for perfectly capable people who can feed themselves. and , by the way, AARP is a leach that sucks dry the people it pretends to help.

Social security is an insurance program, self-funding and valid.
The best social program we the people pay for. The government stole from it and now does not want to pay the money back. Shameful.

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