EDITORIAL NOTE: Today's post is so U.S.-centric that non-American readers in other countries should feel free to take the day off.
Congress has done no governing since their last election in 2014 – none – but as soon as they are moved by outside forces to finally act, they try to decrease what they call “entitlements,” Social Security and Medicare.
Before I go any further let us be clear about one thing: the word entitlement relates to the idea of a person being inherently deserving of special privilege or treatment. And that has no relationship to Social Security and Medicare.
Elders paid for these benefits throughout the decades of our working years, and we continue to pay for our portion of Medicare with Part B, Part C and/or Part D premiums, with co-pays and with deductibles.
When politicians (and others) refer to these programs as “entitlements,” it is to suggest that old people are being handed freebies and that belief allows them to feel “entitled” to take them away.
Don't ever let anyone get away with labeling Social Security, Medicare (not to mention Medicaid and some other federal programs) entitlements. They are earned benefits.
THE DEBT CEILING AND SOCIAL SECURITY
The reason the Republican Senate Majority Leader Mitch McConnell is threatening to cut Social Security and Medicare right now is that the debt ceiling is approaching, the date on which the federal government's ability to borrow expires.
McConnell apparently figures cuts to these programs are easy pickings when the date of default by the federal government looms. That will happen, according to government and other sources sometime between November 1 and about November 10.
I'm sure you recall that we have been here before when Republicans in Congress refused to reauthorize borrowing and the government shut down for 16 days in October of 2013.
This time, according to CNN, in exchange for delivering the votes necessary to keep the federal government in business, McConnell wants an agreement to reduce future cost-of-living-adjustments (COLA) to Social Security and new restrictions on Medicare.
As the National Committee to Protect Social Security and Medicare (NCPSSM) reported,
”You’ll also note there is no talk of reversing trillions of dollars in tax breaks and loopholes for large corporations shipping jobs overseas. No talk of the billions more in tax breaks given to the ultra-wealthy.
“Instead, Republican leaders want to cut the whopping $1,291 average monthly Social Security retirement benefit. A benefit Americans have paid for throughout their working lives.”
According to Roll Call, last Thursday Treasury Secretary Jacob J. Lew told Congress in a letter that the date of default will arrive a bit earlier than previously thought. On 3 November,
“...we expect Treasury would be left with less than $30 billion to meet all of the nation’s commitments — an amount far short of net expenditures on certain days, which can be as high as $60 billion,” Lew wrote.”
Social Security benefits alone for November are about $42 billion. I won't get into the weeds about it but this almost veiled threat that Social Security (and other) payments might not be made in November isn't exactly fair.
They were paid in the 2013 shutdown and there are other means by which those payments can be made.
And anyway, according to Simon Maloy, a smart guy who writes at Salon, McConnell has no leverage to hold up a debt ceiling extension vote for what Maloy calls “pie-in -the-sky agenda items.”
"This is the second-worst bluff I’ve ever seen..." he writes. "Is
McConnell really going to try and force a debt limit showdown when the party is hopelessly fractured and the outgoing Speaker is more interested in clearing the decks for his replacement?”
Maloy thinks McConnell is taking on this exercise in futility as a
“...token demonstration to his own restive caucus members that he’s at least trying to put up a fight. At the end of the day, it’s in both Boehner’s and McConnell’s interests to raise the debt ceiling, and the easiest path – really the only path – for them is to pull in Democratic votes to sidestep the hardliners within their own ranks.
“That’s how past debt limit fights have ended, and that’s how this one is going to end.”
I tell you all this because over the next week or two, there will be a lot of speculating about Social Security benefit payments and other dire consequences that is unlikely to amount to much.
WHAT IF SIMON MALOY IS WRONG?
And Mitch McConnell pursues cuts to Social Security and Medicare in exchange for raising the debt limit?
Here's another potential safeguard: Last Friday, the House Rules Committee said it will take up a new bill, the Default Protection Act, and bring it to a vote by Wednesday. It
”...would allow the federal government to keep borrowing above the statutory debt limit for the sole purpose of paying principal and interest on debt held by the public or the Social Security Trust Fund,” reports the Washington Post.
“In other words: If Congress fails to raise the debt limit, holders of Treasury bonds would still be paid and Social Security recipients would still get their checks. That, advocates say, could help allay Wall Street anxiety as lawmakers approach the brink of default.”
This is a wonkier than usual TGB post but I've done it because more than one-third of Social Security recipients rely ONLY on Social Security for their retirement income. Many millions more rely on it for more than half their incomes.
If the reassurances I've related above come to nought in the next week or so, I'll be back here exhorting you to call your Congressional representatives.