Yesterday, Susan wrote about the tough reception Republicans who voted to gut Medicare and Medicaid are getting at town hall meetings in their districts. The representatives mentioned in Susan’s posts aren’t alone in hearing from angry constituents.
Charlie Bass, my former and Susan’s current representative in New Hampshire:
WOMAN: Despite all we’re hearing about Ryan and Medicare, there’s a 10 percent reduction in the taxes for the wealthiest Americans. My feeling is this whole thing about saying 55 and under or under 55 is a way to divide and conquer because their benefits will be cut and then we as older people will, there will be anger fomenting against us. A generational gap will start where the younger people are told you’re playing for these Cadillac plans these older people how is that fair. Because we’re older the thought is we won’t speak up and won’t tell congress this is not acceptable. All generations have to stand together and say we need this social safety net. The bigger part of the problem is the commercial insurance industry.
BASS: Well first of all the tax part of the budget is revenue neutral. [...] The tax reduction is not a reduction in taxes on the wealthiest Americans, it’s a reduction of corporate tax rate so that we’re competitive around the world [...]
WOMAN: No, this is –
BASS: Very few companies, we tax foreign income, companies keep foreign income offshore. [...] The quickest way to turn this deficit down is to turn this economy around [...] off this federal system, so that the deficit goes down. We’re in this situation now here we’re bumping along unless we do something to stimulate real growth in this economy […] Who’s going to pay the bills? It’s going to be the younger people, that’s the real generational war, they’re going to say we’re not gonna pay 50, 60 percent of our income to subsidize the rest of the population older [...]
WOMAN: I agree, you guys are setting it up! [laughter from audience]
During a town hall in Orlando earlier today, Rep. Daniel Webster (R-FL) faced a barrage of questions from outraged constituents about the Republican budget. The Orlando Sentinel accurately described the scene as “bedlam.”
For nearly an hour, Webster was peppered with one question after another about his support for ending Medicare, his desire to see tax breaks for the wealthy extended, and his vote to repeal health care reform, including its protections for people with preexisting conditions. For his part, Webster didn’t just avoid the questions by resorting to talking points, as most politicians commonly do. On numerous occasions, Webster simply declined to give an answer to contentious questions altogether, moving on to take a new question instead.
“I would like to know: Did you vote to eliminate Medicare as it is today?” a man asks Berg during his library appearance in an exchange caught on video by PlainsDaily.com
“No,” Berg says, before the audience contradicts him.
“You voted for every Republican issue and that was part of the issues that went out there,” the man says.
A woman interrupts to ask how much the elderly will be asked to pay out of pocket for health care costs under the new system.
“I want you to tell me how much it’s going to cost us when we’re 65 years old after you give us a voucher,” she says.
“Fifty-five or over, absolutely no change, absolutely no change, in this Medicare program,” Berg promises.
“As long as you are over 55,” the woman responds. “If you’re 54, to hell with those people.”
West’s town hall in Fort Lauderdale was interrupted by hecklers, one of whom shouted at the beginning of his remarks “How about our Medicare that you’re stealing?” The Palm Beach Post reports that that West took written questions submitted before the meeting, prompting another man to yell out that questions should be allowed from the audience.
You may recall that when tea partiers (often bused in from outside) showed up at town hall meetings to argue (often in monstrously inaccurate terms) against health care reform, it made national news for weeks. But here, though constituents are asking questions that are based in fact, it’s still a relatively low-profile story on a national level. These representatives should be sweating the fact that it is getting coverage in their districts, though.
It seems that Congresscritters are facing a lot of tough questions, and some outright hostility at town meetings in their home states. From The Nation:
Congressman Paul Ryan, R-Wisconsin, continues to be confronted with tough questions on his listening-session tour of southeastern Wisconsin communities. He’s been forced to move several of the events to bigger venues to accommodate the crowds—after things got tight and tense in places such at Milton, Wisconsin, where the crowd in a small venue was challenging him at every turn.
and
One of Ryan’s Republican colleagues, Wisconsin Congressman Jim Sensenbrenner, shut down a town hall meeting in a suburban Milwaukee community when he was challenged on economic issues in March.
This sounds a lot like the Tea Party invasion of town halls in 2009, only these folks have serious questions. The Tea Partiers intent was to disrupt, and get a lot of media attention. These folks are voters who have been suffering in this economy, and know very well when they’re being trickled down on.
The core issues that are bringing people out to the GOP town meetings are opposition to Medicare and Medicaid cuts (a real hot-button issue) and support for tax hikes for the rich. This fits with those national polls shows that show Americans are very opposed to developing voucher programs to replace traditional Medicare and Medicaid and would prefer tax hikes for the wealthy.
There is no solid, factual rationale for the proposed destruction of Medicaid, Medicare, or Social Security for that matter. No wonder these guys are having such a hard time. How do you explain that you want to destroy essential social programs because of your political ideology without actually saying that’s the reason?
One guy has an idea for how to deal with this:
Newly elected Illinois Senator Mark Kirk has an idea. Instead of hearing what the people have to say, the Republican senator is suggesting that members of Congress should hunker down in DC.
Brilliant! If you don’t go home, you won’t have to answer any pesky questions.
Strengthen Social Security is a coalition comprised of 270 state and national groups, united around the goal of protecting Social Security from cuts, and strengthening it for future generations.
On April 27 and 28, events will be taking place in 53 cities/18 states. The theme of these events is, Don’t Make Us Work Till We Die, focusing on the intent to raise the Social Security retirement age. This link will take you to the website that shows the event map, so that you can find events near you. For those who don’t have an event in their state, there’s also a virtual rally being held online, which can also be seen at the website.
Everyone who has worked in a physically demanding job knows what increasing the retirement age will mean. It’s one thing to preach the necessity of this from behind a desk in a cushy office. It’s another thing to be a miner, nurse, truck driver, cook, carpenter, janitor, or a waiter at age 67 – if our bodies last that long. For those who are among the still unemployed/underemployed, and over the age of 55, the promise of Social Security in the future is what keeps us going. We can’t let them pull the rug out from under seniors who have worked long and hard, and paid in to the Social Security Trust Fund.
Please join an event if you can, or the virtual rally if you can’t – and as always, make your feelings known to your elected officials.
Their new video:
In the interest of full disclosure, this post is part of the Campaign For America’s Future state blogger’s network project. I’m one of the bloggers participating in the project.
Noted economist Dean Baker sets the record straight following some particularly heinous untruths about Social Security that came from Sen. Richard Shelby (R-AL).
Dear Senator Shelby:
During a recent breakfast at the Institute for Education, you said that Social Security is actuarially unsound, that the next generation of workers would receive little or nothing from Social Security and that there is no proof that your sons would get much at all. This is badly mistaken. You should know, both for your own personal finances, and more importantly for your actions as Senator, that under any plausible set of circumstances you and your sons can anticipate a substantial Social Security benefit.
You reached the national retirement age for Social Security in 1999. While I don’t know your precise earnings history, your pay as a senator made you eligible for the maximum benefit if it were sustained for 35 years. The Social Security Trustees Report and likely your own personal finances show that a maximum wage earner retiring in 1999 receives an annual benefit of $21,674 in 2010 dollars.
The trustees’ projections show that if nothing is ever done, then Social Security would pay full benefits through the year 2037. At this point, even if Congress does nothing there still would be substantial money flowing into the program, allowing the program to pay just under 80 percent of benefits. In the case of your youngest son, he would receive $29,700 from 2037 on (in today’s dollars), if his lifetime earnings path is similar to your own (i.e. he is a maximum wage earner).
As can be seen in Table V1.F2 of the Trustees Report, Social Security’s revenue in 2040 will be equal to 13.23 percent of covered payroll, while its outlays are projected at 16.64 percent. This would be sufficient to pay 79.5 percent of scheduled benefits.
Social Security’s finances are actually projected to improve slightly over the next decade so that the program would be able to pay 81.0 percent of scheduled benefits in 2050. For your son, this would be a benefit of slightly over $30,000. The situation is projected to change little in subsequent years. This means that your youngest son should be able to get a benefit of roughly this size for as long as he lives, even if Congress never does anything to eliminate the shortfall in the program. Again, these sums are all adjusted for inflation.
You also said that the normal retirement age for social security should be raised “every several years”. However, this would amount to a cut in benefits with each successive increase in the retirement age. If the normal age of retirement is phased in to reach 70 by 2036, it would result in a 4.0 percent reduction in benefits for workers between the ages of 50-54 in 2007 and a 10 percent reduction for workers between the ages of 40-44 in 2007.
Another point worth considering is that if the normal retirement age increased every few years, many workers would find it increasingly difficult to work until they are eligible for Social Security benefits. Forty five percent of workers over the age of 58 work in jobs that are physically demanding or have difficult work conditions. It is hard to imagine construction workers, firefighters, or nurses working well into their mid 60’s. Many would end up taking early retirement with a considerable reduction in benefits compared to currently scheduled levels.
Of course, it would be extremely unfortunate if Congress ever allowed Social Security to pay less than the full scheduled benefit. As a political matter it also seems unlikely in a context where beneficiaries are almost 50 percent larger as a share of the adult population than they are today. It is also worth noting that the necessary increases in funding are relatively small compared to items like the rise in defense spending over the last decade, so there certainly are not major economic obstacles to maintaining full funding.
I hope that you will take the time to review the program’s finances more carefully so that when you speak on it in the future you are better informed. I would be happy to assist you in providing additional background if it would be helpful.
Regards,
Dean Baker
Co-Director, Center for Economic and Policy Research
Many seniors are living on less in 2011. From PRNewswire:
Forty-four percent of seniors are receiving lower Social Security checks this year compared to 2010, while even more are dealing with significantly higher expenses. The findings come from an annual survey of elderly Americans, released earlier today by The Senior Citizens League (TSCL), one of the nation’s largest nonpartisan senior citizens advocacy groups.
and
Social Security checks are lower because many seniors have their Medicare Part D or Medicare Advantage premiums automatically deducted, and these premiums have increased in many cases. An annual Cost of Living Adjustment (COLA) typically offsets such premium increases, but seniors are not receiving a COLA for the second year in a row.
Combine the increase in Part D premiums with falling into the donut hole, when a senior has to pay full price for prescription drugs, and you have people that are barely making ends meet, or doing without needed medications because they can’t afford them.
The fact that expenses are increasing, while Social Security checks are decreasing isn’t being reported on. Social Security is still being dishonestly presented as a reason for the expanding federal deficit. Thankfully, Social Security has a strong, persistent ally in Senator Bernie Sanders:
Even with no change, the fact is that Social Security has a $2.6 trillion surplus that is projected to grow to more than $4 trillion in 2023. Is this surplus, as some have suggested, just worthless IOUs? Absolutely not! Social Security invests, as it should, the surplus money it accumulates into U.S Treasury bonds, the safest interest-bearing securities in the world. These are the same bonds that wealthy investors, China, and other foreign countries have purchased. The bonds are backed by the full faith and credit of the U.S. government which, in our long history, has never once defaulted on its debt obligations. In other words, Social Security bonds are as safe as any other U.S. debt obligation.
Further, despite the manufactured hysteria about a “Social Security crisis,” Social Security has not contributed one penny to the very serious deficit situation we face. Social Security is fully funded by the payroll tax that workers and their employers contribute into the system, not the U.S. Treasury. Our deficit has, in recent years, been largely caused by the cost of two wars, tax breaks for the rich, a Medicare prescription drug program written by the insurance and pharmaceutical industries, and the Wall Street bailout — all unpaid for. Social Security has played no role in our deficits.
This is a great (short!) op-ed piece by Senator Sanders. Pass it on to the doubters and naysayers you come in contact with. Social Security must be protected, and strengthened, for our current seniors and the generations to come.
Over the weekend, the White House informed Democratic lawmakers and advocates for seniors that Obama will emphasize the need to reduce record deficits in the speech, but that he will not call for reducing spending on Social Security – the single largest federal program – as part of that effort.
Liberals, who have been alarmed by Obama’s recent to shift to the center and his effort to court the nation’s business community, applauded the decision, arguing that Social Security cuts are neither necessary to reduce current deficits nor a wise move politically. Polls show that large majorities of Americans in both parties – even in households that identify themselves as part of the tea party movement – oppose cuts to Social Security.
Good. Apparently all the effort put into calls, letters, emails, and petition signing was not in vain. At least for now.
Senate Republicans are sticking to their pledge and refusing to vote on any legislation until they pass the agreement extending the Bush-era tax cuts for the super-rich. Yesterday, two Democrat-sponsored bills felt the wrath of this pledge after failing to collect the 60 votes necessary to reach the floor.
Largely party-line votes squelched both bills, one that would have allowed public safety workers to unionize and another that would have dispensed a one-time $250 cost of living payment to Social Security recipients. Both measures drew more than 50 votes but didn’t come close to 60.
But Social Security can also be connected to the Senate Republicans’s soft-spot for the super-rich. $250 might not seem like a lot of money to some people, but for seniors who are primarily living off of their social security benefits, it can be a huge help. $250 can pay rent. It can put food on the table. It can pay the heating bill through the winter.
Beyond this one time payment, Social Security payments each month matter more to the middle- and working-classes than to the super-rich. From the New York Times, here is Paul Krugman’s take on it,
Social Security, by contrast, is something that matters enormously to the bottom half of the income distribution, but no so much to people in the 250K-plus club. A 30 percent cut in benefits would represent disaster for tens of millions of Americans, but a barely noticeable inconvenience for [the super-rich] and everyone they know. A rise in the retirement age would be a vast hardship for people who do manual labor, but if anything a gift to [the super-rich] who don’t want to step aside in any case. And so on down the line.
This isn’t just the opinion of the liberal left, but clear economics. This chart shows the percentage to which the different classes depend on social security benefits. The lines are clear. For people in the first income bracket, social security payments make up 83.2% of their income. That’s rent, that’s groceries, that’s heat. For the top percent, these measly checks only make up 17.9% of their income.
This latest vote shows exactly whose side Senate Republicans are on. Not that we were wondering.
Poor Alan Simpson. The co-chair of the Deficit Reduction Commission (popularly known as “The Catfood Commission”) isn’t feeling the love from folks responding to his initial recommendations on how to reduce the deficit. From the Wyoming Capital Journal:
During Al Simpson’s nearly 50 years in government, he hasn’t been afraid to take on critics and naysayers of his work in the U.S. Senate or on a variety of high-profile commissions and committees.
But as the co-chair of President Obama’s debt commission, the Wyoming Republican said he’s been taking an unprecedented amount of flak for the commission’s draft proposals to help erase the nation’s $13.8 trillion debt.
“I’ve never had any nastier mail or [been in a] more difficult position in my life,” said the 79-year-old Simpson. “Just vicious. People I’ve known, relatives [saying], “‘You son of a bitch. How could you do this?’”
And
Simpson said he’s spent about $25,000 of his own money on travel and hotel expenses on behalf of the debt commission — an expense he said he doesn’t mind paying.
Oh, the humanity! What a noble fellow, spending his own money to ensure that low income seniors live under bridges and eat catfood in the years to come! Simpson also had this to say:
“We had the greatest generation — I think this is the greediest generation,” he said.
In other words: he made millions. He’s got his. You, on the other hand, are greedy because you’ve paid in to Social Security, and will be receiving a retirement benefit.
In March, Erskine Bowles, co-chair of President Obama’s Deficit Reduction Commission spoke at the North Carolina Banker’s Association annual Bank Director’s Assembly. He was quoted in the Columbia Journalism Review:
“We’re going to mess with Medicare, Medicaid and Social Security because if you take those off the table, you can’t get there. If we don’t make those choices, America is going to be a second-rate power, and I don’t mean in fifty years. I mean in my lifetime.”
As the CJR points out, given that Bowles is 64, “in my lifetime” sounds pretty dire. Luckily the millions he made on Wall St. will insulate him from any unpleasantness during his later years.
Those of us who aren’t so well insulated may be less fortunate. From an op-ed in the LA Times by Nancy Altman and Eric Kingson, the co-directors of Social Security Works:
In releasing their plan, the co-chairs went out of their way to make clear that they were proposing changes to Social Security “for its own sake, not for deficit reduction.” This was an acknowledgement that Social Security does not and cannot contribute to the deficit, because it has no borrowing authority and by law cannot pay benefits unless it has sufficient income and reserves to cover their cost. But Simpson and Bowles just couldn’t keep their hands off the program.
This needs to be repeated. Often and loudly.
One thing they propose is increasing Social Security’s retirement age to 69. Every year that Social Security’s retirement age is increased amounts to a 6% to 7% across-the-board benefit cut for recipients. The retirement age is already being raised to age 67 for those turning 62 in 2022. Increasing the age to 69 would cut benefits by one-quarter from a decade ago, when the retirement age was 65.
The co-chairs also want to increase the early retirement age to 64. Currently, the majority of Americans start claiming benefits at age 62, despite the fact that this means they receive reduced benefits. As a new General Accountability Office report concluded, the people who take early retirement often do so because they work in jobs that are too physically demanding to continue or because they have health problems or can no longer find work. Raising the early retirement age will shut out workers who are disproportionately low income and minority, and it will do it when they are most vulnerable, potentially forcing them to seek disability benefits or welfare.
I’m at a loss. I truly do not understand how cutting benefits for older people will make the US a first rate power. I can think of many things it will make us, but I’m far too genteel to list them.
The co-chairs apparently think most Americans can work as long as politicians, Wall Street billionaires and others who have all of life’s advantages. In effect, the Bowles-Simpson plan says to America’s workers that they must work longer for less because the rich are living longer.
Erskine Bowles and Alan Simpson are a couple of reverse Robin Hoods, attempting to steal from the poor to give to the rich.
The folks at Social Security Works are asking all of us to participate in a national day of action. On November 30, people all over the country will be calling their US Senators and their Congressperson to say: Hands Off My Social Security!
Paul Krugman is not a fan of the Bowles-Simpson proposal coming out of the fiscal commission. (Which, again, we should remember is not the commission’s official report—it’s Erskine Bowles and Alan Simpson’s attempt to get ahead of the official report and define the terms of the debate.)
Nor should he be a fan. Nor should anyone aside from the wealthiest. Krugman lays it out:
Actually, though, what the co-chairmen are proposing is a mixture of tax cuts and tax increases — tax cuts for the wealthy, tax increases for the middle class. They suggest eliminating tax breaks that, whatever you think of them, matter a lot to middle-class Americans — the deductibility of health benefits and mortgage interest — and using much of the revenue gained thereby, not to reduce the deficit, but to allow sharp reductions in both the top marginal tax rate and in the corporate tax rate.
It will take time to crunch the numbers here, but this proposal clearly represents a major transfer of income upward, from the middle class to a small minority of wealthy Americans. And what does any of this have to do with deficit reduction?
Let’s turn next to Social Security. There were rumors beforehand that the commission would recommend a rise in the retirement age, and sure enough, that’s what Mr. Bowles and Mr. Simpson do. They want the age at which Social Security becomes available to rise along with average life expectancy. Is that reasonable?
The answer is no, for a number of reasons — including the point that working until you’re 69, which may sound doable for people with desk jobs, is a lot harder for the many Americans who still do physical labor.
But beyond that, the proposal seemingly ignores a crucial point: while average life expectancy is indeed rising, it’s doing so mainly for high earners, precisely the people who need Social Security least. Life expectancy in the bottom half of the income distribution has barely inched up over the past three decades. So the Bowles-Simpson proposal is basically saying that janitors should be forced to work longer because these days corporate lawyers live to a ripe old age.
