House Democrats “Get It”

2018-05-15T21:52:25+00:00December 9th, 2010|Social Security|

The House Democratic caucus has voted against consideration of the White House negotiated tax deal unless changes can be made.There is so much not to like about this ?deal? including the so-called payroll tax ?holiday? which GOP Senators have now acknowledged is no holiday at all and they fully intend to keep these cuts in place?draining $120 billion dollars a year from Social Security. Ryan Grim reports:

Republicans acknowledged that the expiration of the tax holiday will be treated as a tax increase. “Once something like this goes into place, a year from now, when it expires, it’ll be portrayed as a tax increase,” said Sen. Bob Corker (R-Tenn.). So in a body like Congress, precedents matter and this is setting a precedent. I think that certainly is going to create some problems down the road if it passes.”Given that Congress, under Democratic control, can’t gather itself to let tax cuts for the wealthiest Americans expire, members of both parties are convinced that letting the payroll tax rate revert back to its current spot will be near impossible. “Once you bring a rate down, if it goes back up, people will feel that. They’ll feel their paycheck being less and that argument” — that letting it expire amounts to a tax hike — “eventually is bound to be made,” said Sen. Mike Johanns (R-Neb.).“There’s always a tendency to continue those things… Once something comes in, it’s very difficult to change it,” said Sen. George Voinovich (R-Ohio.) He then volunteered, without prompting, that “It would be detrimental to the Social Security system, especially when it’s in bad shape.”HuffPost noted that some of his colleagues would likely treat the deprivation of Social Security funds as a benefit of such a circumstance rather than a drawback.“I suspect so, yes,” agreed Voinovich.

This is “starve the beast” politics all over again, taking $120 billion a year from Social Security?s funding knowing that fiscal hawks won’t replace it…forcing massive benefit cuts instead.Thank goodness House Democrats have put the brakes on. Now, hopefully they?ll ensure this flawed payroll tax plan is not included in any final tax plan.So, what about the Senate? The National Journal reports some Democrats have already expressed their opposition but others are on the fence:

?While some Senate Democrats, including Bernie Sanders, Tom Harkin of Iowa, Mark Udall of Colorado, Patrick Leahy of Vermont, and Russ Feingold of Wisconsin, have indicated they plan to oppose the package or are leaning toward doing so, they are outnumbered by Democratic supporters. Harkin was among Democrats who emerged from their Wednesday meeting sounding like he was more likely to back the deal.

Senate Democratic leaders have scheduled debate to begin as soon as today. Now?s the time to wake up your Senator?do they really understand what this proposal will do to Social Security? Send them an email from our Legislative Action Center and tell them the payroll tax ?holiday? is anything but for millions of American retirees and their families.