Trading Social Security for Business Tax Cuts: Is This Really What Passes for Fiscal Responsibility These Days?
Bloomberg News is reporting that some White House advisors propose diverting even more payroll taxes from Social Security as a way to spur the economy. A 2% employee payroll tax deduction was already included in the stimulus bill passed in December. That means $112 billion dollars will be diverted from Social Security this year alone. Just six months ago the White House promised this approach was just temporary even though we all knew that, in this town, tax cuts are rarely reversed. President Obama is now setting the table for extending some of those stimulus provisions. Will that include the employee payroll tax diversion from Social Security?will the administration renege on their promise made just six months ago?
?Some of the steps that we took during the lame duck session, the payroll tax, the extension of unemployment insurance, the investment in — or the tax breaks for business investment in plants and equipment — all those things have helped. And one of the things that I?m going to be interested in exploring with the members of both parties in Congress is how do we continue some of these policies to make sure that we get this recovery up and running in a robust way.? President Barack Obama, Joint Press Conference
The administration may also now double-down and add even more payroll tax diversions from Social Security–this time for business stimulus. Diverting revenue from Social Security to provide more employer tax breaks is not fiscal responsibility. But it does pander to conservatives who get the tax cuts they crave, while simultaneously crippling Social Security?s funding stream and fueling the fiscal hawks Social Security crisis campaign. For conservatives it?s a political winner, for millions of middle class Americans and their families it?s a fiscal failure:
?The talks reflect the political constraints the White House is operating under with the Republican majority in the U.S. House pushing to cut federal spending. A hiring stimulus based on a tax break for employers may appeal to Republican lawmakers, many of whom have called for measures to help businesses. The idea of cutting the employer contribution to payroll taxes also has recently been under discussion among Republican members of Congress, said Douglas Holtz-Eakin, who was chief economic adviser to the 2008 Republican presidential nominee, Senator John McCain of Arizona.? Bloomberg
So, once again it appears some in Washington, including some White House advisors, follow Fed Chairman Ben Bernanke?s infamous claim that the federal government should follow the lead of bank robber Willie Sutton and use Social Security as the piggy bank to solve our economic woes.
“Willie Sutton robbed banks because that’s where the money is, as he put it,” Bernanke said. “The money in this case is in entitlements.”
American workers have successfully funded the Social Security program for 75 years and that critical linkage between contributions and benefits is what keeps Social Security a self-funded program. Proposals like this threaten the program?s independence, forcing Social Security to compete for limited federal dollars.Targeting Social Security?s funding to provide economic stimulus is a uniquely dangerous and foolhardy approach. While December?s 2% payroll tax cut successfully diverted billions from Social Security, some suggest it may not have succeeded in creating the stimulus projected:
?The way things are going at the moment, all the payroll tax cut will do is offset the rise in gasoline and food prices, rather than provide a boost to real spending.” Capital Economics senior economist Paul Dales.
Weakening Social Security should not be a political bargaining chip this White House is willing to play in order to appease those whose borrow and spend fiscal policies got us here in the first place.
Here We Go Again- GOP Offers Social Security Privatization Legislation
Republican members in the House have introduced legislation which would take your Social Security contributions and give them to Wall Street. For those in Congress who routinely target safety net programs, like Social Security and Medicare, this Social Security plan is the perfect companion legislation for the GOP/Ryan Budget. Ryan?s CouponCare plan would put insurance companies in charge of seniors? healthcare while the so-called ?SAFE? act would put Wall Street in charge of your retirement savings.Do you feel safe??This Social Security proposal is political opportunism at its worst. Supporters use the current fiscal crisis–which Social Security has not contributed to in any way– as an opportunity to defund a program many of these members do not support in the first place. The privatization of Social Security does not have support among any age-group or political affiliation once you step outside the Beltway but it remains goal #1 for those who want Wall Street in charge of billions of hard-earned American tax dollars. Max Richtman, NCPSSM Executive Vice President/Acting CEOThese privatization proposals aren?t about fiscal responsibility because neither will save the federal government money. The transition costs for converting Social Security into a privatized system would cost trillions of dollars while the GOP/Ryan plan for Medicare adds $13 in waste for every dollar saved. Meanwhile, millions of Americans lose their guaranteed benefits in exchange for a ride on the Wall Street roller coaster and coupons for their healthcare. Let?s not confuse what this debate is really all about because privatization is a political goal not fiscal responsibility.For so many House Republicans who worked hard last fall (before Election Day of course) to convince American voters they haven?t and weren?t proposing Social Security privatization, this legislation certainly now destroys that claim. It?s only been six months since the GOP regained control of the House and they?ve wasted no time pushing to privatize both Medicare and Social Security, at a time when millions of Americans are still suffering in an economic crisis these programs did not create.
National Radio Medicare/Social Security Radio Ad Campaign Launched this Week
Cutting Medicare and Social Security is NOT Fiscal ResponsibilityA new round of radio ads, part of the ?Hands Off Campaign? sponsored by The National Committee to Preserve Social Security and Medicare (NCPSSM), began airing June 6th on radio stations in six Congressional districts nationwide: Florida?s 9th & 22nd, Pennsylvania?s 3rd & 11th, Wisconsin 7th and North Carolina?s 11th. This is what our Executive VP toldhad to say about the Florida ad campaign:
?Congressmen Bilirakis and West both voted in support of the GOP/Ryan Budget bill, which would destroy Medicare as we know it. That vote is out of touch with the vast majority of Americans of all ages and political persuasions who do not want to balance the budget by cutting Medicare or Social Security. This ad campaign is designed to remind these members of Congress that Americans do not support trading away Medicare?s guaranteed coverage for a privatized voucher system that would double seniors? costs in the future.?Max Richtman, Executive Vice President/Acting CEO
Along with their opposition to cutting Medicare, a recent Social Security poll of likely Florida voters showed that strong majorities declare they?ll support the candidate who argues for protecting this vital program rather than cutting it to pay down the debt.The Florida radio buy is just one part of the National Committee?s ?Hands Off Campaign?. Launched earlier this year, the campaign continues to organize and inform older Americans about the ongoing budget debate in Washington and its impact on programs touching the lives of virtually every family. Other elements of the campaign include:
- Engaging our large and growing communities on Facebook, Twitter and our Blog ?Entitled to Know? in a number of ways to keep the pressure on.
- Thousands of E-cards have been delivered to the key political players in Washington who are deciding the fates of these vital programs.
- The National Committee?s Truth Squad busts myths and provides the facts about Social Security, Medicare and our fiscal crisis.
- National Committee members and supporters have delivered more than 1 million letters and petitions to Congress urging Washington to preserve Social Security and Medicare rather than targeting these vital programs to balance the budget.
The National Committee has a successful track record in protecting the Social Security and Medicare benefits paid for by American workers and retirees including the fight to defeat President Bush?s proposals to privatize Social Security. By engaging and informing America?s seniors through similar ad campaigns, member mobilizations and grassroots efforts nationwide, our members have said, loud and clear, they?re ready to fight against those in Washington willing to trade away the nation?s most successful government programs.
Senator Corker Says Medicare and Social Security are “Generational Theft”
The new GOP Medicare Strategy these days appears to be if you don?t like the message just shoot the messenger. Yesterday?s Senate Aging Committee hearing provided one glimpse into this approach.NCPSSM Executive VP/Acting CEO and LCAO Chair, Max Richtman , testified yesterday before the Senate Select Committee on Aging about Older Americans Act programs, like home healthcare, Meals on Wheels, long term care ombudsman and many others. However, rather than talking about these vital programs, ranking GOP member Sen. Bob Corker was much more interested in attacking seniors organizations like ours for not supporting his legislation setting a Medicare Kill Switch with arbitrary spending caps, or the GOP/Ryan Budget bill which Senator Corker voted for or even means-testing the programs, turning them into welfare programs.Attacking seniors? organizations for representing their members is nothing new. Fiscal commission co-chair, Alan Simpson, has made a career of it. However, it?s clear GOP members in Washington are feeling the heat from their constituents, young and old alike, who do not support destroying Social Security or Medicare under the guise of deficit reduction.Starting with raucous town halls nationwide this spring followed by the election of a pro-Medicare Democrat in one of the reddest Congressional Districts in New York, it?s clear the American people understand the GOP/Ryan Budget plan would destroy Medicare and they don?t like it, period.That?s a message no amount of spin will fix and no amount of name-calling will change.
Senate Says NO to Ryan/GOP Plan to Destroy Medicare
?We applaud the Senate for turning back efforts to pass a budget which is more about ideological politics than sound fiscal policy. Americans of all ages understand we don?t have to destroy vital programs like Medicare and Social Security to be fiscally responsible. That message has been delivered loud and clear in town halls nationwide, in poll after poll, and again last night in New York?s Congressional race, where Medicare played a key role in that outcome. The GOP/Ryan budget would turn Medicare into a privatized voucher system meaning future beneficiaries would lose Medicare?s guaranteed benefit. This budget would have also shifted the rising costs of healthcare directly to seniors, doubling their healthcare costs without adequately addressing ways to contain those costs. The trigger mechanism included in this GOP budget would force the creation of legislated benefit cuts in Social Security, while also fast-tracking those provisions through Congress. The GOP/Ryan budget would have had devastating affects on millions of Americans still struggling in our weakened economy. Thankfully, the Senate understands this and has rejected this fiscal approach.?
Trading Social Security for Business Tax Cuts: Is This Really What Passes for Fiscal Responsibility These Days?
Bloomberg News is reporting that some White House advisors propose diverting even more payroll taxes from Social Security as a way to spur the economy. A 2% employee payroll tax deduction was already included in the stimulus bill passed in December. That means $112 billion dollars will be diverted from Social Security this year alone. Just six months ago the White House promised this approach was just temporary even though we all knew that, in this town, tax cuts are rarely reversed. President Obama is now setting the table for extending some of those stimulus provisions. Will that include the employee payroll tax diversion from Social Security?will the administration renege on their promise made just six months ago?
?Some of the steps that we took during the lame duck session, the payroll tax, the extension of unemployment insurance, the investment in — or the tax breaks for business investment in plants and equipment — all those things have helped. And one of the things that I?m going to be interested in exploring with the members of both parties in Congress is how do we continue some of these policies to make sure that we get this recovery up and running in a robust way.? President Barack Obama, Joint Press Conference
The administration may also now double-down and add even more payroll tax diversions from Social Security–this time for business stimulus. Diverting revenue from Social Security to provide more employer tax breaks is not fiscal responsibility. But it does pander to conservatives who get the tax cuts they crave, while simultaneously crippling Social Security?s funding stream and fueling the fiscal hawks Social Security crisis campaign. For conservatives it?s a political winner, for millions of middle class Americans and their families it?s a fiscal failure:
?The talks reflect the political constraints the White House is operating under with the Republican majority in the U.S. House pushing to cut federal spending. A hiring stimulus based on a tax break for employers may appeal to Republican lawmakers, many of whom have called for measures to help businesses. The idea of cutting the employer contribution to payroll taxes also has recently been under discussion among Republican members of Congress, said Douglas Holtz-Eakin, who was chief economic adviser to the 2008 Republican presidential nominee, Senator John McCain of Arizona.? Bloomberg
So, once again it appears some in Washington, including some White House advisors, follow Fed Chairman Ben Bernanke?s infamous claim that the federal government should follow the lead of bank robber Willie Sutton and use Social Security as the piggy bank to solve our economic woes.
“Willie Sutton robbed banks because that’s where the money is, as he put it,” Bernanke said. “The money in this case is in entitlements.”
American workers have successfully funded the Social Security program for 75 years and that critical linkage between contributions and benefits is what keeps Social Security a self-funded program. Proposals like this threaten the program?s independence, forcing Social Security to compete for limited federal dollars.Targeting Social Security?s funding to provide economic stimulus is a uniquely dangerous and foolhardy approach. While December?s 2% payroll tax cut successfully diverted billions from Social Security, some suggest it may not have succeeded in creating the stimulus projected:
?The way things are going at the moment, all the payroll tax cut will do is offset the rise in gasoline and food prices, rather than provide a boost to real spending.” Capital Economics senior economist Paul Dales.
Weakening Social Security should not be a political bargaining chip this White House is willing to play in order to appease those whose borrow and spend fiscal policies got us here in the first place.
Here We Go Again- GOP Offers Social Security Privatization Legislation
Republican members in the House have introduced legislation which would take your Social Security contributions and give them to Wall Street. For those in Congress who routinely target safety net programs, like Social Security and Medicare, this Social Security plan is the perfect companion legislation for the GOP/Ryan Budget. Ryan?s CouponCare plan would put insurance companies in charge of seniors? healthcare while the so-called ?SAFE? act would put Wall Street in charge of your retirement savings.Do you feel safe??This Social Security proposal is political opportunism at its worst. Supporters use the current fiscal crisis–which Social Security has not contributed to in any way– as an opportunity to defund a program many of these members do not support in the first place. The privatization of Social Security does not have support among any age-group or political affiliation once you step outside the Beltway but it remains goal #1 for those who want Wall Street in charge of billions of hard-earned American tax dollars. Max Richtman, NCPSSM Executive Vice President/Acting CEOThese privatization proposals aren?t about fiscal responsibility because neither will save the federal government money. The transition costs for converting Social Security into a privatized system would cost trillions of dollars while the GOP/Ryan plan for Medicare adds $13 in waste for every dollar saved. Meanwhile, millions of Americans lose their guaranteed benefits in exchange for a ride on the Wall Street roller coaster and coupons for their healthcare. Let?s not confuse what this debate is really all about because privatization is a political goal not fiscal responsibility.For so many House Republicans who worked hard last fall (before Election Day of course) to convince American voters they haven?t and weren?t proposing Social Security privatization, this legislation certainly now destroys that claim. It?s only been six months since the GOP regained control of the House and they?ve wasted no time pushing to privatize both Medicare and Social Security, at a time when millions of Americans are still suffering in an economic crisis these programs did not create.
National Radio Medicare/Social Security Radio Ad Campaign Launched this Week
Cutting Medicare and Social Security is NOT Fiscal ResponsibilityA new round of radio ads, part of the ?Hands Off Campaign? sponsored by The National Committee to Preserve Social Security and Medicare (NCPSSM), began airing June 6th on radio stations in six Congressional districts nationwide: Florida?s 9th & 22nd, Pennsylvania?s 3rd & 11th, Wisconsin 7th and North Carolina?s 11th. This is what our Executive VP toldhad to say about the Florida ad campaign:
?Congressmen Bilirakis and West both voted in support of the GOP/Ryan Budget bill, which would destroy Medicare as we know it. That vote is out of touch with the vast majority of Americans of all ages and political persuasions who do not want to balance the budget by cutting Medicare or Social Security. This ad campaign is designed to remind these members of Congress that Americans do not support trading away Medicare?s guaranteed coverage for a privatized voucher system that would double seniors? costs in the future.?Max Richtman, Executive Vice President/Acting CEO
Along with their opposition to cutting Medicare, a recent Social Security poll of likely Florida voters showed that strong majorities declare they?ll support the candidate who argues for protecting this vital program rather than cutting it to pay down the debt.The Florida radio buy is just one part of the National Committee?s ?Hands Off Campaign?. Launched earlier this year, the campaign continues to organize and inform older Americans about the ongoing budget debate in Washington and its impact on programs touching the lives of virtually every family. Other elements of the campaign include:
- Engaging our large and growing communities on Facebook, Twitter and our Blog ?Entitled to Know? in a number of ways to keep the pressure on.
- Thousands of E-cards have been delivered to the key political players in Washington who are deciding the fates of these vital programs.
- The National Committee?s Truth Squad busts myths and provides the facts about Social Security, Medicare and our fiscal crisis.
- National Committee members and supporters have delivered more than 1 million letters and petitions to Congress urging Washington to preserve Social Security and Medicare rather than targeting these vital programs to balance the budget.
The National Committee has a successful track record in protecting the Social Security and Medicare benefits paid for by American workers and retirees including the fight to defeat President Bush?s proposals to privatize Social Security. By engaging and informing America?s seniors through similar ad campaigns, member mobilizations and grassroots efforts nationwide, our members have said, loud and clear, they?re ready to fight against those in Washington willing to trade away the nation?s most successful government programs.
Senator Corker Says Medicare and Social Security are “Generational Theft”
The new GOP Medicare Strategy these days appears to be if you don?t like the message just shoot the messenger. Yesterday?s Senate Aging Committee hearing provided one glimpse into this approach.NCPSSM Executive VP/Acting CEO and LCAO Chair, Max Richtman , testified yesterday before the Senate Select Committee on Aging about Older Americans Act programs, like home healthcare, Meals on Wheels, long term care ombudsman and many others. However, rather than talking about these vital programs, ranking GOP member Sen. Bob Corker was much more interested in attacking seniors organizations like ours for not supporting his legislation setting a Medicare Kill Switch with arbitrary spending caps, or the GOP/Ryan Budget bill which Senator Corker voted for or even means-testing the programs, turning them into welfare programs.Attacking seniors? organizations for representing their members is nothing new. Fiscal commission co-chair, Alan Simpson, has made a career of it. However, it?s clear GOP members in Washington are feeling the heat from their constituents, young and old alike, who do not support destroying Social Security or Medicare under the guise of deficit reduction.Starting with raucous town halls nationwide this spring followed by the election of a pro-Medicare Democrat in one of the reddest Congressional Districts in New York, it?s clear the American people understand the GOP/Ryan Budget plan would destroy Medicare and they don?t like it, period.That?s a message no amount of spin will fix and no amount of name-calling will change.
Senate Says NO to Ryan/GOP Plan to Destroy Medicare
?We applaud the Senate for turning back efforts to pass a budget which is more about ideological politics than sound fiscal policy. Americans of all ages understand we don?t have to destroy vital programs like Medicare and Social Security to be fiscally responsible. That message has been delivered loud and clear in town halls nationwide, in poll after poll, and again last night in New York?s Congressional race, where Medicare played a key role in that outcome. The GOP/Ryan budget would turn Medicare into a privatized voucher system meaning future beneficiaries would lose Medicare?s guaranteed benefit. This budget would have also shifted the rising costs of healthcare directly to seniors, doubling their healthcare costs without adequately addressing ways to contain those costs. The trigger mechanism included in this GOP budget would force the creation of legislated benefit cuts in Social Security, while also fast-tracking those provisions through Congress. The GOP/Ryan budget would have had devastating affects on millions of Americans still struggling in our weakened economy. Thankfully, the Senate understands this and has rejected this fiscal approach.?