Tag: Social Security

Death and Taxes

Donald Trump really wants you to die so he can give his billionaire buddies tax cuts. The failure of the Republican lead congress to come up with a plan to kill the Affordable Care Act really put a crimp in that plan. After their bill couldn’t even make it to the House floor, Trump decided …

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You Can’t Say You Weren’t Warned

As we’ve reported here, the Republicans want to privatize Medicare by issuing vouchers to seniors to buy health insurance on the open market. Emboldened by the election of Donald Trump, who campaigned on not touching Medicare or Social Security, and the nomination of Representative Tom Price (R-GA) to head HHC, the House put forth a …

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Social Security at 80

80 years ago today President Franklin D. Roosevelt signed the Social Security Act as a major part of his New Deal. Calls for its privatization started over 30 years ago under Pres. Gerald Ford. We must not let that happen. If anything, it should be expanded as Senators Bernie Sanders (I-VT) and Elizabeth Warren (D-MA) proposed.

Sen. Warren sent an e-mail today reminding us of the vital importance of this program to seniors, the disabled and dependent children:

80 years ago today, President Franklin D. Roosevelt signed the Social Security Act into law – and it was in large part thanks to a remarkable woman from Massachusetts: Frances Perkins.

Frances Perkins was FDR’s Secretary of Labor – the first woman in US history to hold a cabinet position. Coming out of the Great Depression, she was a chief architect of the New Deal, and we can thank her for the 40-hour workweek, the minimum wage, and unemployment insurance. She was also the head of the Committee on Economic Security, which created the blueprint for Social Security. God bless Frances Perkins.

FDR and Frances Perkins established Social Security because, as FDR said, “It [would] take care of human needs and at the same time provide for the United States an economic structure of vastly greater soundness.” In other words, Social Security would be a win-win: good for our nation’s economy and good for the citizens of our nation.

They knew that Social Security was about economics, but it was also about our values. It’s about who we are as a people, and what kind of country we are determined to build. [..]

80 years later, we need Social Security more than ever. People are hitting their retirement years with less savings and more debt. Pensions are disappearing, being replaced by 401(k) plans that leave retirees at the mercy of the stock market. The squeeze on America’s middle class is now a squeeze on America’s retirees.

Social Security benefits are modest – just $1300 a month, on average – but two-thirds of America’s seniors rely on those checks for the majority of their income. For 15 million seniors, Social Security is all that stands between them and poverty.

Social Security is about independence and dignity. It’s no surprise that 79% of likely voters in last year’s election – Democrats, Republicans, and Independents – support increasing Social Security benefits. Every person who represents you in Washington, and every person running for President in 2016, should be talking about protecting and expanding Social Security – not cutting it.  

FDR and Frances Perkins knew that you don’t get what you don’t fight for. So today, I’m fighting hard to make sure we don’t cut a dime of Social Security benefits. I’m fighting to protect and expand Social Security – and I hope you’ll fight alongside me.

Decades after Social Security was established, Frances Perkins told the Social Security Administration:

Social Security is so firmly embedded in the American psychology today that no politician, no political party, no political group could possibly destroy this Act and still maintain our democratic system. It is safe. It is safe forever, and for the everlasting benefit of the people of the United States.

Let’s fight to make good on Frances Perkins’ promise by protecting and expanding Social Security.

Thank you for being a part of this, and a special thanks to Frances Perkins – a tough woman with a vision. Happy birthday, Social Security!

Elizabeth

She asks us to sign her petition to protect and expand Social Security:

Two-thirds of seniors rely on Social Security for the majority of their income in retirement, and for 15 million seniors – 15 million – this is the safety net that keeps them out of poverty. And yet, instead of taking on the retirement crisis, instead of strengthening Social Security, some in Washington are actually fighting to cut benefits.

The absolute last thing we should do in 2015 – at the very moment that Social Security has become the principal lifeline for millions of our seniors to keep their heads above water – is allow the program to begin to be dismantled inch by inch.

Join me today – on the 80th anniversary of Social Security – to take a stand: We believe in protecting and expanding Social Security so our seniors can retire with dignity.

We stand with Sen. Warren. Please sign her petition

NRCC Bashing Democrats for Supporting Chained CPI

Cross posted from The Stars Hollow Gazette

You can tell it’s an election year, all the hypocrisy comes out of the closet:

After spending weeks subjecting the public to unfounded and widely debunked claims that Obamacare contains a hidden “bailout” for private insurers, Republicans have undertaken a complete reversal, and are attacking Democrats for cutting corporate welfare for insurance companies by too much.

Specifically, they’re attacking the Affordable Care Act’s reduction in overpayments to carriers who participate in Medicare Advantage, reflected in lower payment rates for program providers, which were officially announced late last week. [..]

When confronted, they retreat from pretending to oppose the cuts on the merits, to claiming the real problem is that Democrats used the savings from the cuts to fund Obamacare. But this is a non sequitur. A diversion. The attacks specifically express outrage on behalf of seniors who, Republicans claim, will lose doctors or get stuck with higher premiums specifically as a result of the ACA’s Medicare Advantage cuts.

But remember, Republicans actually support the cuts. All of these supposedly horrible things would happen under their plan, too, regardless of how the savings are spent. So right away it’s clear that the attacks are straightforwardly deceitful.

While some the beltway deficit scolds mourn the death of “entitlement reforms,” the The National Republican Campaign Committee has begun attacking Democrats for supporting Simpson-Bowles:

The National Republican Congressional Committee (NRCC) tried a political ju-jitsu on Thursday as it sought to turn former state CFO Alex Sink’s attacks on David Jolly on Social Security against her. Sink, the Democratic candidate, takes on Republican Jolly and Libertarian Lucas Overby in a special congressional election for an open seat in Pinellas County on March 11.

On Thursday, the NRCC bashed Sink for saying she supported Simpson-Bowles.

What digby said:

I have never understood why Democrats who have to run for office are so wedded to the idea that they will be rewarded for being “the adults in the room” and doing the “hard stuff” like cutting Social Security and Medicare benefits but they do. You’d think they’d remember what happened to them in 2010 when the Republicans ran against the Medicare cuts in the health care reforms by portraying them as monsters turning old people into Soylent Green. But they didn’t.

The president may have decided to keep his proposal to cut benefits from his new budget, but it’s quite clear from the talking points that they still very much want to get “credit” for being willing to do it.

Supporting cuts the social safety net, especially in the state of Florida, is not going to fly very well with elderly voters. And, yes, they do vote. So why aren’t Democrats giving the people what they want, an expansion of Social Security and open Medicare to all?  

The 2 Year Budget Deal In 90 Seconds

Cross posted from The Stars Hollow Gazette

A two year budget deal was reached yesterday with congressional leaders announcing the deal that would to replace $63 billion in sequester cuts, a very small part of the $180 billion in cuts that will occur over the next two years. The deal will restore defense cuts by funding from a tax on airline travel and cuts to federal pensions. The budget does not include extension of unemployment funds to the millions of workers who are about to lose their benefits the end of December. There will be no changes to Medicare or Social Security but none of the tax loop holes were closed.

As Ezra Klein puts it:

Whether this deal can be a model for future deals is an open question. The core principle of this deal is that Democrats didn’t have to touch entitlements and Republicans didn’t have to touch taxes. But a lot of the policies that made that possible got used up in this deal. It’s not clear that another deal like this would work in 2016.

DSWright at FDL News Desk notes:

The Republicans got everything they wanted. They get more cuts while none of their friends in the defense industry get hurt – actually they even got to do some damage to the federal pension system. All that while avoiding another shutdown that killed their poll numbers before the 2014 elections. Christmas came early for the GOP.

The Democratic Party, on the other hand, sold out its own base to help Republicans maintain power. Why? Who knows? The only thing that is clear is this is an awful deal for majority of Americans.

Once again, the majority of Americans get screwed by their elected representatives.  

Retirement in Crisis

Cross posted from The Stars Hollow Gazette

Increasingly over the last few months the sensible people of congress have gotten on board with the idea that Social Security should be expanded. With the failure of many 401k’s and inadequate pension funds, many seniors and future retirees are more reliant on Social Security for a substantial part of their retirement plans. Senators Tom Harkin (D-Iowa), Bernie Sanders (I-Vt.), and Sherrod Brown (D-Ohio) have proposed that instead of switching to a “chained” consumer price index that cuts retiree benefits, the nation should adopt CPI-E, which measures the actual cost of living for the elderly and would raise benefits to meet actual needs.

The latest to voice support for this idea is Massachusetts Senator Elizabeth Warren who took to the Senate floor to criticize the Washington Post‘s editorial that said  called expanding Social Security “wrongheaded” and suggested the nation should instead be more concerned about the higher percentage of children living in poverty. Sen. Warren called this the “uglier side” of the debate on Social Security.

Floor Speech by Senator Elizabeth Warren (pdf)

The Retirement Crisis

November 18, 2013

As Prepared for Delivery

(Mr./Madame) President, I rise today to talk about the retirement crisis in this country – a crisis that has received far too little attention, and far too little response, from Washington.

I spent most of my career studying the economic pressures on middle class families – families who worked hard, who played by the rules, but who still found themselves hanging on by their fingernails. Starting in the 1970s, even as workers became more productive, their wages flattened out, while core expenses, things like housing and health care and sending a kid to college, just kept going up.

Working families didn’t ask for a bailout. They rolled up their sleeves and sent both parents into the workforce. But that meant higher childcare costs, a second car, and higher taxes. So they tightened their belts more, cutting spending wherever they could. Adjusted for inflation, families today spend less than they did a generation ago on food, clothing, furniture, appliances, and other flexible purchases. When that still wasn’t enough to cover rising costs, they took on debt credit card debt, college debt, debt just to pay for the necessities. As families became increase singly desperate, unscrupulous financial institutions were all too happy to chain them to financial products that got them into even more trouble — products where fine print and legalese covered up the true costs of credit. These trends are not new, and there have been warning signs for years about what is happening to our middle class. One major consequence of these increasing pressures on working people – a consequence that receives far too little attention – is that the dream of a secure retirement is slowly slipping away.

A generation ago, middle – class families were able to put away enough money during their working years to make it through their later years with dignity. On average, they saved about 11% of their take home pay while working. Many paid off their homes, got rid  of all their debts, and retired with strong pensions from their employers. And where pensions, savings, and investments fell short,

they could rely on Social Security to make up the difference. That was the story a generation ago, but since that time, the retirement landscape has shifted dramatically against our families. Among working families on the verge of retirement, about a third have no retirement savings of any kind, and another third have total savings that are less than their annual income. Many seniors have seen their housing wealth shrink as well. According to AARP, in 2012, one out of every seven older homeowners was paying down a mortgage that was higher than the value of their house.

While President Barack Obama and House Minority Leader Nancy Pelosi have expressed their support for cuts to Social Security as part of a budget agreement to trim the deficit, which Social Security does not contribute to, most Democrats wisely have said ruled that out in the current debate talks. We need to make sure that any cuts to the Social Security benefits of our most vulnerable citizens is taken off the table permanently.

 

Rantings of a Frustrated Blogger: Expanding Social Security

Cross posted from The Stars Hollow Gazette

As recounted by relapsed blogger David Dayen, intrepid blogger, economist and former college professor Duncan Black, aka Atrios, became frustrated with stagnating wages over the last ten years that have been putting working class families at risk of being unable to sustain their standard of living past retirement.

(I)n late 2012 he embarked on a sustained crusade, on his blog and in a series of columns for USA Today, to inject a single idea into America’s policy discourse: “We need an across-the-board increase in Social Security retirement benefits of 20 percent or more,” he declared in the opening of a column for USA Today. “We need it to happen right now.”

The proposal was not exactly attuned to the political winds in Washington. Indeed, for anyone inclined to think in terms of counting potential votes in Congress-especially this Congress-the idea of expanding Social Security is the epitome of a political non-starter. Black’s proposal was attuned, however, to a mounting pile of research and demographic data that describes a gathering disaster. The famously large baby boom generation is heading into retirement. Thanks to decades of stagnant wages and the asset collapse of the Great Recession, more than half of American working-class households are at risk of being unable to sustain their standard of living past retirement. To put it even more starkly, according to research by the economists Joelle Saad-Lessler and Teresa Ghilarducci, 49 percent of middle-class workers are on track to be “poor or near poor” after they retire.

There is very little safety net left to break this fall. The labor market for older workers is bleak. Private pensions are largely a thing of the past. Private savings are so far gone that some 25 percent of households with 401(k) and other retirement plans have raided them early to cover expenses, and a growing number of Americans over age 50 find themselves accumulating, not settling, debt. On the whole, 401(k)s have proved a “disaster,” as Black puts it, one that has enriched the financial sector but lashed the country’s retirement security to a volatile stock market-and left 75 percent of Americans nearing retirement age in 2010 with less than $30,000 in their accounts.

What’s left? Social Security. Though it was never meant to be a national retirement system all by itself, that’s increasingly what it has become. For Americans over age 65 in the bottom half of the income distribution, Social Security makes up at least 80 percent of retirement income.

In one of those columns in March of this year, Black used the “three legged stool” metaphor to bolster his argument to expand Social Security:

According to the Pew Research Center, the median household wealth for those aged 65+ is about $170,000. While that sounds like a significant amount of money, as Dean Baker of the Center for Economic and Policy Research pointed out, this is actually a trivial amount of wealth for people with little or no income other than Social Security benefits. Remember that this figure includes housing wealth. Even if it was a bunch of cash in a bank account, it wouldn’t actually provide for a significant supplement to other retirement income, but the reality is that many people have a house and not much else. [..]

Social Security was envisioned as one leg of a three-legged stool of retirement, along with employer pensions and private savings or insurance (though the metaphor itself was devised after its creation). The problem is that two of those legs have shrunk significantly. This is not a stool one can comfortably sit on. This is not a stool most people will be able to sit on at all. The system, as envisioned, is failing.

We can goad and cajole people into saving. We can provide incentives for people to save for their retirement, and penalize them for raiding those funds before they retire. We can subsidize employer contributions to retirement funds.

But we have been doing all of these things for decades, and they haven’t worked. The majority of people nearing retirement will not have sufficient funds to retire with anything resembling economic security and comfort.

Well our frustrated blogging buddy’s idea is at long last taking root. Two Democratic Senators, Tom Harkin of Iowa and Mark Begich of Alaska, have introduced legislation that not only would expand Social Security but strengthen it.

The Strengthening Social Security Act of 2013 would:

Strengthen Benefits by Reforming the Social Security Benefit Formula: To improve benefits for current and future Social Security beneficiaries, the Act changes the method by which the Social Security Administration calculates Social Security benefits.  This change will boost benefits for all Social Security beneficiaries by approximately $70 per month, but is targeted to help those in the low and middle of the income distribution, for whom Social Security has become an ever greater share of their retirement income.

Ensure that Cost of Living Adjustments Adequately Reflect the Living Expenses of Retirees: The Act changes the way the Social Security Administration calculates the Cost of Living Adjustments (COLA).  To ensure that benefits better reflect cost increases facing seniors, future COLAs will be based on the Consumer Price Index for the Elderly (CPI-E).  Making this change to Social Security is expected to result in higher COLAs, ensuring that seniors are able to better keep up with the rising costs of essential items, like health care.

Improve the Long Term Financial Condition of the Trust Fund: Social Security is not in crisis, but does face a long-term deficit.  To help extend the life of the trust fund the Act phases out the current taxable cap of $113,700 so that payroll taxes apply fairly to every dollar of wages.

The legislation has the support of AFL-CIO, AFSCME, the Alliance for Retired Americans, the National Organization for Women (NOW), the National Education Association, Paralyzed Veterans of America, Strengthen Social Security Coalition, Social Security Works, the United Automobile Aerospace & Agricultural Implement Workers of America (UAW), United Steelworkers, MoveOn.org and others.

The Harkin/Begich bill has now been endorsed by Ohio’s Senator Sherrod Brown (D) who has also introduced legislation that would change the cost Of living formula for Social Security to better reflect seniors’ true expenses:

With the introduction of several proposals that would reduce Social Security benefits for seniors by changing the formula used to calculate annual cost-of-living adjustments (COLA), U.S. Sen. Sherrod Brown (D-OH) today joined the National Committee to Preserve Social Security and Medicare (NCPSSM) to announce the Consumer Price Index for Elderly Consumers Act.  The new legislation would change the COLA formula for Social Security to more accurately reflect the expenses of senior citizens. Because of the method by which inflation is calculated, seniors and other Social Security recipients did not receive a COLA in 2010 and 2011, even though the price of prescription drugs, food, energy, and other necessities continued to rise. [..]

Social Security COLAs are calculated using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).  The CPI-W was chosen as the measure of inflation because it was the only measure available at the time the automatic COLA was established in 1972.  The CPI-W measures changes in the prices of goods and services purchased by those who earn more than half their income from clerical or wage occupations.  However, the CPI-W formula only represents about 32 percent of the U.S. population and does not accurately represent the inflation experience of older Americans. According to the Congressional Research Service, between 1982 and 2009, the cost of living under the CPI-W rose at an average rate of 2.9 percent, while the cost of living for seniors-as measured by an experimental CPI-E-rose at a rate of 3.2 percent.

Brown’s legislation would formalize a Consumer Price Index for the Elderly (CPI-E). The CPI-E would take into account seniors’ specific consumption habits, including increased prescription drug and energy costs, and would be used to determine the COLA for Social Security benefits.

It is time for President Barack Obama and congressional Democrats start acting like progressives and back both the Harkin/Begich and Brown bill. The president and the Democratic leadership should remove Social Security as a bargaining chip from the faux debt/deficit austerity negotiations and start protecting some of our most vulnerable citizens.

You can support the Strengthen Social Security Act (S.567) by signing this petition

Thanks, Atrios.

Seven Seconds to Save the Social Safety Net

Cross posted from The Stars Hollow Gazette

7 Reasons to Take 7 Seconds to Save Social Security and Medicare

by Richard (RJ) Eskow, The Huffington Post

A broad coalition of organizations, including the Campaign for America’s Future and Social Security Works, is joining Sen. Bernie Sanders in a petition drive to resist cuts to Social Security, Medicaid and Medicare. It only takes a few moments to sign; it’s that easy. [..]

The threat is very real, and these cuts could take place with very little warning. On a personal note: I signed. I did it because a lot of people would suffer needlessly by the kind of deal they’re cooking up. I did it because I think it’s wrong to allow the privileged and powerful to overrule the will of the people. And frankly, I did it because I’m scared. This deal could be done before most Americans even see it coming.

It’s fast and easy to sign this petition. It only took me seven seconds. Here are seven reasons why you should. [..]

1. Republicans are still demanding “entitlement cuts.”

[..]

2. Some of these cuts are in the President’s budget.

[..]

3. The “chained CPI” is a deep cut to Social Security benefits.

[..]

4. The chained CPI isn’t fair, either.

[..]

5. The cuts to Medicaid and Medicare are both inhumane and cumbersome.

[..]

6. Millennials are already getting a raw deal. This would make it worse.

[..]

7. In a democracy, the people — not corporations are billionaires — are supposed to decide.

Take Action: Defend Social Security, Medicare, and Medicaid

Stand with Senator Bernie Sanders and our coalition partners in demanding, “No grand bargain in exchange for cuts to Social Security, Medicare and Medicaid benefits.”

Bernie is serving on the Budget Conference Committee which will be negotiating a new federal budget over the next few months — and where a deal could be struck to slash Social Security, Medicare and Medicaid.

As the founder of the Defending Social Security Caucus, Bernie is fighting every day to protect our earned benefits. Stand with Senator Bernie Sanders and a diverse coalition of thousands of fellow progressives now and demand that Congress and the President oppose any grand bargain which cuts Social Security, Medicare and Medicaid benefits.

Add your name today!

He’s right, depending on how fast you can type and press enter, just seven seconds. So it for yourself and future generations.

More Jobs Than Expected But Don’t Get Optimistic

Cross posted from The Stars Hollow Gazette

The June employment report from the Bureau of Labor Statistics reported that the US added 195,000 jobs but the unemployment rate remained at 7.6%. This better than expected number, along with upward revisions of the April and May jobs numbers led to some speculation by Wall Street analysts to speculate that the Federal Reserve would start to back away from part of its stimulus program.

But hold your horses on the optimism. The reality is that this an anaemic recovery with flat growth and low productivity, as Dean Baker points out in his article:

First, it is important to remember the size of the hole the economy is in. We are down roughly 8.5 million jobs from our trend growth path. We also need close to 100,000 jobs a month to keep pace with the underlying growth rate of the labor market. This means that even with the relatively good growth of the last few months, we were only closing the gap at the rate of 96,000 a month. At this pace, it will take up more than seven years to fill the jobs gap.

It is easy to miss the size of the jobs gap since the current 7.6% unemployment rate doesn’t seem that high. However, the main reason that the unemployment rate has fallen from its peak of 10% in the fall of 2009 is that millions of people have dropped out of the labor force and stopped looking for jobs. These people are no longer counted as being unemployed. [..]

This gets to the type of jobs that have been created in the upturn. Over the last three months, three sectors – restaurants, retail trade, and temporary help – have accounted for more than half of the jobs created. These sectors offer the lowest-paying jobs, with few benefits and little job security. [..]

Workers take these jobs when there are no better alternatives available.

There is also the impact of sequestration that has yet to have its full impact on the economy and Congress seems content to leave in place with one side blaming the other. There is little chance that a budget or any significant legislation will get through this Congress:

Do you see the problem here? The president’s adversaries lament his lack of warmth and his remote intellectualism; his supporters see the same quality as an analytical and cool-headed virtue. This could be a cute “the president is from Mars, Republicans are from Venus” thing – if it weren’t for the fact that several important issues this summer, including the budget and food-stamp funding, hinge on whether these two crazy kids will ever figure it out. At the base of their problem is an absence of mutual respect and a lack of legislative sportsmanship.

Until the players figure this out – and there’s no sign they ever will – we’re going to be stuck in an endless loop of revisiting these unhelpful battles that drag on for years. This summer is the last chance for any legislation to get through. Starting in the fall, the campaigns for the 2014 midterm elections are going to start, and the window for serious legislative action will have closed – at which point you can kiss any progress on major bills goodbye. [..]

the sequestration cuts are not a question of “one side” winning or losing. They’re a question of the nation, the economy and the American people losing. They’re a question of poor people losing: Meals on Wheels will suffer, as will those living in federal housing.

No one, so far, is winning at all. Even more concerning, it’s not abundantly clear that anyone in Washington knows how to play the game anymore.

Voters need to start making greater demands on their congress critters and start threatening to throw them out for ones who will represent the people and not Wall Street and their own self-interests.

Obama Losing Democratic Support on Social Security Cuts

Cross posted from The Stars Hollow Gazette

Eight of the 14 Democrats who are up for reelection in 2014, three from red states, have taken a stand against Pres. Obama’s proposed Social Security cuts:

The majority of Senate Democrats running for reelection in 2014, including three running in red states, have broken with President Barack Obama and are opposing his effort to cut Social Security benefits, imperiling the austerity project known as the “grand bargain.” [..]

Democratic Sens. Kay Hagan (N.C.), Mark Begich (Alaska) and Mark Pryor (Ark.), all running in states won by Republican Mitt Romney in 2012, have publicly opposed the president’s effort, going so far as to co-sponsor a Senate resolution against chained CPI last week. Sens. Al Franken (D-Minn.), Jeff Merkley (D-Ore.), Jack Reed (D-R.I.) and Brian Schatz (D-Hawaii), running in bluer states, also co-sponsored the resolution. [..]

Other Senate Democrats up for reelection who didn’t sign the resolution were still unfavorably disposed toward chained CPI. Sen. Jeanne Shaheen (D-N.H.) opposes the cost-of-living cut, her office confirmed to HuffPost, and has said Social Security should be off the table in debt talks.

Sen. Chris Coons (D-Del.) has been open to the chained CPI cut, but insisted a “circle of protection” must be established for the most vulnerable Americans.

Alaskan Senator Mark Begich will introduced two bill that would protect Social Security benefits:

Begich plans to introduce the Protecting and Preserving Social Security Act and the Social Security Fairness Act of 2013 when he returns to Washington, DC next week. He says his plan has three points. The Protecting and Preserving Social Security Act would remove a cap on high income contributions. The cap is now at 113,700 dollars. Removing the cap would make high income earners pay into Social Security just like everyone else, he says. [..]

The second part of that bill would revise how SS payments are adjusted to better reflect how America’s senior spend their income. Currently, payments are based on a Consumer Price Index model that does not accurately reflect higher costs seniors pay, for medications, for example. The bill would create a CPI – E for elders.

The Social Security Fairness Act would remove penalties that are now placed on retirees who worked more than one job, paid into Social Security, but then retired under a different retirement system. Under current law, they are denied their Social Security benefits Many government workers and some teachers in Alaska fall into this category.

It’s about time the Democrats stood up to the Republican in the White House.

Frances Perkins, the Woman Behind Social Security

Cross posted from The Stars Hollow Gazette

“Out in the wilderness with a vision”

Frances Perkins was Franklin Roosevelt’s Secretary of Labor, the first woman to hold a cabinet position and she got there on her own merits. She served from 1933 to 1945 and was instrumental in getting many of the New Deal laws and programs off the ground and working. Her two biggest achievements were the Fair Labor Standards Act and the Social Security Act.

With cuts to Social Security being threatened by a Democratic president, Lawrence O’Donnell, host of MSNBC’s “Last Word,” paid tribute to Sec. Perkins, the architect of Social Security, on her 133rd birthday, the same day that Pres. Barack Obama proposed cuts and changes in these benefits.

The most important liberal you’ve never heard of: Frances Perkins

by Lynn Malka, The Last Word Blog

“The man gets all the credit in popular history, but the woman did all the work,” O’Donnell said. “Social Security was her idea. It would never have become law without her.” As the U.S. Secretary of Labor under President Franklin Delano Roosevelt, Perkins had immense influence on his policy decisions.

A chance meeting at a tea party with then-Supreme Court Justice Harlan Stone provided Perkins with the legal framework for her initiative, setting into place certain present day laws of the same nature.

“The Constitutionality of Social Security, Medicare, and the Affordable Care Act are all based on Frances Perkins’ novel use of the power to tax 78 years ago,” O’Donnell explained.

“Frances Perkins was a self-made woman,” O’Donnell said. “She did not advance her career by marriage. She didn’t flinch at challenges that everyone else considered impossible. Frances Perkins changed the world the old fashioned way-with hard work, persistence and passion. Tonight, this country owes a happy birthday nod to a uniquely American hero.”

In the second segment, Mr. O’Donnell imagines what Sec. Perkins would think about the current Social Security debate:

When the Social Security Act was passed in 1935, the highest concentration of poverty in America was among the elderly. At its signing, President Franklin Roosevelt said, “We can never insure 100% of the population against 100% of the hazards and vicissitudes of life but we have tried to frame a law which will give some measure of protection to the average citizen, and to his family, against the loss of a job and against poverty-stricken old-age.”[..]

In a speech in 1962, Perkins said of the Act, “Thousands and thousands of new problems arose in the administration which had not been foreseen by those who did the planning and the legal drafting. Of course, the Act had to be amended, and has been amended, and amended, and amended, and amended.”

It would not come as a shock to Perkins or Roosevelt that the benefits calculation formula would change as the years went on, but there were some principles that both Perkins and Roosevelt considered imperative in the design of Social Security. [..]

But despite the changes that the Act would no doubt be subjected to, Perkins remained adamant that Social Security would be everlasting: “One thing I know: it is so firmly embedded in the American psychology today that no politician, no political party, no political group could possibly destroy this Act and still maintain our democratic system. It is safe. It is safe forever, and for the everlasting benefit of the people of the United States.”

What would they think of the current debate on making cutbacks to the program now?

Say No to Cuts to Social Security

Cross posted from The Stars Hollow Gazette

President Obama formerly released his budget for 2014. As, expected it contained the cuts to Social Security and Medicare that have are an anathema to the left. As has been pointed out before on this site, these proposals for the sake a few dollars in revenue increases and a paltry $50 billion investment for infrastructure improvement. That is bad policy and even worse politics. If you don’t believe that, well here is a sample of the criticism from the right:

Americans for Tax Reform, the advocacy group that asks lawmakers to sign a formal “Taxpayer Protection Pledge,” said Tuesday that chained CPI violates the pledge.

“Chained CPI as a stand-alone measure (that is, not paired with tax relief of equal or greater size) is a tax increase and a Taxpayer Protection Pledge violation,” the group said in a blog post.

Anti-tax crusader Grover Norquist, leader of the organization, criticized the policy via Twitter on Wednesday. “Chained CPI is a very large tax hike over time,” Norquist wrote. “Hence Democrat interest in same.”

The Congressional Budget Office estimates (pdf) that chained CPI would reduce Social Security spending by $127 billion and increase tax revenue by $123 billion over 10 years.

When asked Friday if chained CPI represents a tax hike on the middle class, White House spokesman Jay Carney said, “I’m not disputing that.

Can you hear the political ads attacking Democrats with this? So much for electoral victory in 2014, Obama just sold that prospect for what? Trying to make the point that Republicans are intransigent? American already know that. A few dollars of revenue from tax reforms that will be changed the first chance the Republicans get, like the debt ceiling hostage situation? We seen this scene played out how many times with Obama caving to Republican demands because some vague fear about the economy.

Predictably the left is outraged and there are threats from left wing organizations to primary any Democrat who votes for chained CPI.

A party rift on Obama budget

Warren joins lawmakers in criticizing Obama budget

A coalition of prominent Democrats, including many from New England, slammed President Obama’s $3.8 trillion budget blueprint Wednesday for its proposed changes to the Social Security payment formula and Medicare, opening a widening rift between the president and members of his own party.

Senator Elizabeth Warren of Massachusetts said she was shocked by Obama’s proposal to recalculate the cost of living adjustment for Social Security beneficiaries by linking it to a different version of the Consumer Price Index, known as the “chained CPI.” [..]

“In short, ‘chained CPI’ is just a fancy way to say ‘cut benefits for seniors, the permanently disabled, and orphans,'” Warren fired off in an e-mail to supporters. She related the experience of her brother, David Herring, a military veteran and former small business owner who lives on monthly Social Security checks of $1,100. “Our Social Security system is critical to protecting middle-class families,” she wrote, “and we cannot allow it to be dismantled inch by inch.” [..]

Representative Edward Markey of Massachusetts called “chained CPI” an abbreviation for “Cutting People’s Income, a wrong-headed change that would go back on the promise we make to our senior citizens.”

“Tea Party Republicans may have pushed the president into many of these difficult decisions, but it still does not make this budget right nor fair, especially for those Americans who need help the most,” Markey said.

MSNBC’s All In host Chris Hayes discussed the chained CPI with Sen. Jeff Merkley (D-OR), Jonathan Alter, Heather McGhee, and Mattie Duppler, Americans for Tax Reform.

Transcript for this video can be read here

This a direct attack by a Democratic president on our earned benefits. Time to start calling and don’t stop until this deal is dead and buried.

The White House switchboard is 202-456-1414.

The comments line is 202-456-1111.

Numbers for the Senate are here.

Numbers for the House are here.

h/t Susie Madrak at Crooks and Liars

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