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What Will a Billion Dollars Buy You? … Redux

We first asked this question just over a year ago about multi-billionaire and anti-Social Security scold, Pete Peterson.   Back then he had just started spending the fortune he’s promised to invest convincing Washington that Social Security is to blame for our fiscal woes.  While he hasn’t spent the entire billion dollars yet, it’s clear he definitely owns a large share of the inside-the-Beltway thinking.

Here’s where some of that money has gone:  millions to groups who deliver his anti-entitlement message as their own, a propagandist movie CNN airs as a legit documentary, a “news service” the Washington Post  used without identifying it’s funder, (until called on it), “loaning” Peterson-paid  staff  to the President’s fiscal commission and now funding yet another seemingly bi-partisan, unaffiliated effort to keep the spinners spinning.  Meet the new Moment of Truth Project, led by the New America Foundation which collected up to $999,999 from the Peterson foundation.  

Claiming, “the era of deficit denial is over”, this project gives Fiscal Commission Chairs, Alan Simpson and Erskine Bowles, new jobs now that the Commission has finished its work without issuing a final Committee report.  The “Truth” Project’s kickoff event is a virtual who’s who of Washington fiscal hawks and commission members who voted in support of the Chairmen’s fiscal recommendations.  Not surprisingly, those who voted against the Chairmen’s fiscal proposals were not invited to next week’s shindig.

So, Bowles and Simpson move from Presidential Commission Chairs to Peterson Foundation-funded advocates.  The connections  between these groups and the fiscal commission were shocking even in this era of pay-to-play politics. Maybe in that light, this is just an extension of that growing hand-in-glove relationship between those with a political mission and the money to sell it and those who have the power to deliver.  

So, that’s what led us to ask the question again... What does a billion dollars buy you?  Apparently, in Washington these days -- quite a lot.

Social Security Administration Cuts on the Way…

The House and Senate have passed the GOP stop-gap budget plan cutting $4 billion in federal spending over the next two weeks.  This plan averts a government shutdown on Friday but leaves agencies like the Social Security administration facing furloughs, office closures, and delays in processing claims.   The GOP wants these cuts extended for the remainder of the year and the SSA has already warned employees of furloughs if that happens.  Here’s a sample of what this budget proposal means for SSA and its beneficiaries:  Total Reductions in House GOP Proposals:  $981 Million – Current budget shortfall in SSA (due to the freeze at 2010 funding) $125 million – Additional reduction in budget proposal $500 million – Internet Technology reduction $118 million – Computer Center reduction  $1.724 billion in Total SSA Operations/Systems reductions  What does that mean for Social Security beneficiaries? For every week that SSA employees are furloughed:
  •  100,000 people will not have their retirement, survivors or Medicare applications processed causing workers to wait longer for their hard-earned benefits during this period of economic uncertainty, and causing widows and surviving children to face continued uncertainty during a stressful time
  • 73,000 disability applicants will wait 30 days longer than the already unacceptable wait of almost 4 months
  • 18,000 disability applicants making an appeal will wait until 2012 to present their appeals to a judge
  • 115,000 new and 231,000 replacement Social Security numbers will not be issued, leaving workers without the documentation they need to start a new job or open a bank account
 This is exactly the “starve the beast” politics promoted by those opposed to programs like Social Security for decades.  Social Security works for millions of Americans each year, yet it’s still under constant assault.  Defunding the agency as proposed in this budget resolution fulfills that political goal while also hurting millions of American seniors, the disabled, survivors and their families at the same time.

Social Security Administration Cuts or Social Security Administration Cuts – the new GOP Budget Options

Republican leaders in the House apparently remember the political fallout from their last government shutdown in 1995 & 1996 and don’t want to risk that backlash again.  The National Journal reports House leaders will introduce a two-week stopgap funding bill tomorrow that mirrors the 2011 budget they passed last weekend (which, by the way, has no chance of passage in the Senate):
“This approach reflects Boehner’s deep-seated belief that the 1995 Gingrich-led Congress risked everything in its shutdown confrontation with President Bill Clinton, and in the aftermath Republicans not only lacked the stomach to fight for more spending cuts, they veered in the opposite direction and targeted federal spending to vulnerable districts to protect the GOP majority.”
The Hill newspaper provides a bit of a history lesson in this glimpse back at what the 1996 shutdown meant for the Social Security administration:
“During the 1996 standoff, the Social Security Administration (SSA) initially kept 4,780 employees on, because they were in positions necessary to ensure that various benefits, including Social Security, continued to be paid. The remaining 61,415 employees were furloughed, according to the CRS report.  However, the SSA realized shortly afterward that it lacked the manpower to answer phone calls from customers needing new cards or requesting that their files be changed to reflect a news address for benefit checks.  Another 49,715 employees were brought back to help run the agency.”
If history is any predictor, then a government shutdown is clearly not good news for the 50 million Americans who depend on their Social Security checks to arrive as expected and need experienced SSA staff available to handle problems. But what’s also bad news for Social Security beneficiaries is the GOP’s new alternative to a shutdown – SSA cuts which would also furlough workers, cut administrative funding and increase the backlog of claims.  In short, the Republican solution being offered to America’s retirees, the disabled and survivors is furloughs, cuts and backlogs through a government shutdown or furloughs, cuts and backlogs through a draconian stop-gap bill which provides political cover but no relief for the average American. The latest 2-week proposal is the same budget bill House Republicans passed to fund the remainder of this year. Same 9.3% cut to the SSA budget – same devastating affects – just a shorter time frame.  Here’s Nancy Altman’s, of Social Security Works, description of the House-passed bill:
...the Republicans in the House of Representatives want to strip away $1.7 billion from the already underfunded agency, money that is needed simply to keep offices open. If the Republicans' budget plan goes through, the entire agency, including all 1,300 field offices might have to close for a month. A letter in anticipation of this has already been sent out to all employees. The phones would not be answered, and claims processing would halt. Even worse, given the well documented need to replace SSA's aging computer system, the Republicans' proposed cuts threaten the whole program, if the current system and its backup were to fail before the building of the new system, already behind schedule, were completed.”
Social Security Subcommittee Ranking Member Rep. Sander Levin(D-M) sums it up best:
“This Republican proposal is as irresponsible as it is shortsighted.  To jeopardize a lifeline for half a million new Social Security beneficiaries in order to score short-term political points is simply bad policy…It’s a perfect example of how little House Republicans seem to care if their rigid ideological crusade hurts real people.”
Lastly, you can see a full breakdown of SSA impacts under the GOP funding bill and the SSA letter urging a preparation for furloughs.

Social Security and Capitol Hill

Now that the White House and GOP budgets are out it’s time for both sides to start explaining them.  The White House team has been on Capitol Hill testifying before Congress.  This is our favorite bit of testimony so far, between Sen. Bernie Sanders and  OMB Director, Jack Lew, on the role Social Security plays (or doesn’t as the case may be) in our national debt.  Go Bernie… House Ways and Means Committee Democrats came out swinging against the GOP budget provisions for Social Security.  Their news release said:
“The 2011 budget plan presented this week by the House Republican Majority strips $1.7 billion away from the Social Security Administration (SSA) for the remainder of the year, a cut so drastic that SSA would need to impose the equivalent of a month of furloughs.  The entire agency would have to shut down all operations for 20 working days.  The phones would not be answered, field offices would be closed, and claims processing would halt.  Over half a million new retirees, disabled workers and survivors would be forced into a backlog before they could receive the benefits they earned.”
And then, just in case you missed the full White House News conference yesterday, here are a few of President Obama's Social Security comments.  We clearly have work ahead of us:
THE PRESIDENT: Now, you talked about Social Security, Medicare and Medicaid.  The truth is Social Security is not the huge contributor to the deficit that the other two entitlements are.I'm confident we can get Social Security done in the same way that Ronald Reagan and Tip O’Neill were able to get it done, by parties coming together, making some modest adjustments.  I think we can avoid slashing benefits, and I think we can make it stable and stronger for not only this generation but for the next generation. Medicare and Medicaid are huge problems because health care costs are rising even as the population is getting older.  And so what I've said is that I'm prepared to work with Democrats and Republicans to start dealing with that in a serious way.  We made a down payment on that with health care reform last year.  That's part of what health care reform was about.  The projected deficits are going to be about $250 billion lower over the next 10 years than they otherwise would have been because of health care reform, and they’ll be a trillion dollars lower than they otherwise would have been if we hadn’t done health care reform for the following decade. But we're still going to have to do more.  So what I've said is that if you look at the history of how these deals get done, typically it’s not because there’s an Obama plan out there; it’s because Democrats and Republicans are both committed to tackling this issue in a serious way. THE PRESIDENT:  Well, we're going to be in discussions over the next several months.  I mean this is going to be a negotiation process.  And the key thing that I think the American people want to see is that all sides are serious about it and all sides are willing to give a little bit, and that there’s a genuine spirit of compromise as opposed to people being interested in scoring political points. Now, we did that in December during the lame duck on the tax cut issue.  Both sides had to give.  And there were folks in my party who were not happy, and there were folks in the Republican Party who were not happy.  And my suspicion is, is that we’re going to be able to do the same thing if we have that same attitude with respect to entitlements. But the thing I want to emphasize is nobody is more mindful than me that entitlements are going to be a key part of this issue -- as is tax reform.  I want to simplify rates.  And I want to, at the same time, make sure that we have the same amount of money coming in as going out. Those are big, tough negotiations, and I suspect that there’s going to be a lot of ups and downs in the months to come before we finally get to that solution.  But just as a lot of people were skeptical about us being able to deal with the tax cuts that we did in December but we ended up getting it done, I’m confident that we can get this done as well. THE PRESIDENT: Well, the fiscal commission put out a framework.  I agree with much of the framework; I disagree with some of the framework.  It is true that it got 11 votes, and that was a positive sign.  What's also true is, for example, is, is that the chairman of the House Republican budgeteers didn’t sign on.  He’s got a little bit of juice when it comes to trying to get an eventual budget done, so he’s got concerns.  So I’m going to have to have a conversation with him, what would he like to see happen. I’m going to have to have a conversation with those Democrats who didn’t vote for it.  There are some issues in there that as a matter of principle I don't agree with, where I think they didn’t go far enough or they went too far.  So this is going to be a process in which each side, both in -- in both chambers of Congress go back and forth and start trying to whittle their differences down until we arrive at something that has an actual change of passage. And that's my goal.  I mean, my goal here is to actually solve the problem.  It’s not to get a good headline on the first day.  My goal is, is that a year from now or two years from now, people look back and say, you know what, we actually started making progress on this issue. THE PRESIDENT:  This is a matter of everybody having a serious conversation about where we want to go, and then ultimately getting in that boat at the same time so it doesn’t tip over.  And I think that can happen. THE PRESIDENT: And all of us agree that we have to cut spending, and all of us agree that we have to get our deficits under control and our debt under control. And all of us agree that part of it has to be entitlements. But, look, I was glad to see yesterday Republican leaders say, how come you didn’t talk about entitlements?  I think that’s progress, because what we had been hearing made it sound as if we just slashed deeper on education or other provisions in domestic spending that somehow that alone was going to solve the problem. So I welcomed -- I think it was significant progress that there is an interest on all sides on those issues.
Actually,  most Americans don’t agree "entitlements" should be a part of this deficit conversation.

Tired of the Lies about Social Security? So are we...

National Committee’s Truth Squad Arms Americans with the Facts about Vital Seniors' Programs and Our National Debt

America’s seniors have a huge stake in the national economic debate. Unfortunately, fiscal hawks have launched a well-publicized misinformation campaign to persuade Washington that Social Security is to blame for our fiscal mess when, in fact, nothing could be further from the truth.  Social Security has not contributed one dime to our federal debt; however, it is being targeted to pay the price. To counter the misinformation, the National Committee to Preserve Social Security and Medicare has mobilized a Truth Squad to give seniors the facts about Social Security and Medicare and the roles these vital programs play in our budget debate. The Truth Squad campaign includes:
  • The “Whopper of the Week” highlighting the latest false claim plus our myth-busting response
  • Myth-busting fact sheet which details the Myths being spread and the Facts to rebut them
  • Social Security and Medicare Tool Kits to help activists engage
  • Online E-card to send to your members of Congress
  • Our Legislative Action Center with sample letters that can be emailed directly to Congressional representatives and your local newspaper
  • “Washington Watch”, providing the latest news on efforts to target Social Security & Medicare for cuts
  • Send a postcard to the White House in our “Cutting Social Security Makes No ‘Cents’ Campaign”
See more at:



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