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That would include, unfortunately, many kossacks here who whined, cried, and denied the dynamics of the Game of Sux plan embodied by now President Obama back during the Democratic primary:

Paul Krugman explained in Dec 3, 2007:

Why I get mad at Obama about Social Security

By putting these programs on the table in this debate for any reason this president is hereby giving into this same kind of RW framing that he he did in 2007. There were doubters then, but these are facts.

I think an apology is in order for all the harassment Paul Krugman endured for being right about this during the primary. The proof is in the pudding, but also the broken campaign promises:

Sign the Social Security works petition against the chained CPI and the indisputable FACT that switching to it is a cut. Here are the citations from the House of Representative's Chief SS actuary. To turn this reference around(Rove), I'll state that some may try and fail to deny this data with their own fantasy premised math, but they are not entitled to the math and there it is compiled by someone with all the actual relevant data. They're also not entitled to their own version of economic reality regarding the CPI and inflation or how inflation is understated for seniors because their health care costs are higher. That is, at least for anyone who knows anything about why seniors costs of living are higher and it has trended upwards over the years.(Which are not taken into account with CPI-U or CPI-W. Only with CPI-E which is not used yet but should be.)

Also, I'm going to tell you a secret; there have been no COLA increases for the past two years and seniors are hurting because of it. This pretty much blows away these excuses I hear around here that these changes are taking place in the future so they don't matter as much. Do seniors still rely on SS income to get by in the future? I would bet on it and I would also bet on this harsh reality being more harsh in the future.

This cut the president supports will also hurt those suffering the most:

Social Security COLA Cut Will Drive Single, Senior, African American Women Into Poverty

Nancy J. Altman confirms this data and also has a thirty-year background in the areas of private pensions and Social Security. She knows Social Security like the back of her hand, much more so than the president so let's hope that if this default goes down that the president will at least listen to her as SS recipients don't have to suffer under a default as he said.

If the debt limit is not raised, Social Security's Board of Trustees could and should exercise its right to redeem (cash in) as many of Social Security's bonds as needed to pay benefits. Every dollar of principal (though not accrued interest) that the federal government would be required to pay to redeem the bonds would reduce the total debt subject to the $14.3 trillion limit. That would make room under the debt ceiling and allow the government to borrow an additional dollar from the public to replace every dollar of principal paid by the government.

That set of transactions would not violate the statutory debt limit, because the total amount of federal debt would remain exactly the same before and after. It would ensure that all benefits are paid in full and on time. And it would not reduce the funds available to the government for its other operations in any meaningful way. (Any accrued interest paid on redeemed bonds would be small, because it is normally paid semi-annually and was just paid to Social Security on June 30.)

What the president and the speaker do not seem to understand is that Social Security is a real pension program backed by very substantial and real assets. The law requires employers to establish trusts for the assets of their private pension plans. Similarly, the Social Security trust funds exist to protect American workers and their families, and to make sure that benefits are paid in the amounts required by statute. Social Security's trust fund reserves should be used to ensure that all benefits are paid in full and on time to workers and their families who have earned them: retired workers and their families, workers who have become disabled (including the many veterans seriously wounded in the Iraq and Afghanistan wars) and their families, as well as the children and spouses of workers who have died prematurely (including the 9/11 families).

It also occurs to me that many Kossacks are desperately scrambling to defend the idea of means testing obviously because it's part of the Gang of Six plan to do just that for Medicare. So why not perchance to dream, go the full Monty, and pretend Medicare can be just like a progressive income tax system? Call it a failure of definition and application of the needed principles to keep political support for these precious New Deal and Great Society programs alive.

Think Progress's Igor Volsky references a piece from NPR's Julie Rovner explaining the difference between means testing and income relating while getting to the heart of the matter. There is a bigger problem with income relating Medicare and SS more which is what this is all about.

Call It What You Want, Asking Rich People To Pay More For Medicare Is A Slippery Slope To Privatizing The Program

Call it what you want, but Food Stamps and Medicaid have at least one thing in common — they’re constantly on the chopping block. That is, because these programs predominately benefit lower-income Americans who don’t have much political clout in Washington and tend to vote in smaller numbers than their higher-income counterparts, they are more vulnerable to cuts than broad based entitlements like Medicare and Social Security. “Income relating” Medicare would undercut political support for the program and help build momentum for the kind of Paul Ryan reforms that would privatize and destroy it as a government program.

That's pretty hard to rationalize. Why should seniors be forced onto a version of the Ryan Plan so the President can play reindeer deficit games of stupidity when it comes to the federal budget, economics, and electoral politics? Especially since the huge opposition to the Ryan plan was a positive development for Democrats until our President embraced much of it for this debt ceiling deal.

Getting back to Igosky's point, it's important for SS as well and why FDR didn't design the program as a welfare program because as you can see welfare programs are means tested and because they are actually means tested they are politically vulnerable to cuts. It sadly now doesn't matter who is in power(and now we know SS is less safe with a New Democrat than a Republican) as the Obama administration has put Medicaid up on the chopping block (one of the only truly effective parts of the ACA via Medicaid expansion) in the debt ceiling debacle going on right now proving the point(yes reducing benefits is cutting the program, lovers of knee jerk semantic defenses). The progressive benefits indexes are rather minor compared to the features of a real progressive income tax system and it's not funded with income taxes except tangentially when the government owes SS money from general revenue.

It does now from the Greenspan Commission deal in 1983 which raised payroll taxes to create the surplus in the promise that it would be paid back from the income tax base later, but generally that is not the case nor is it desirable or stable for the program. It's primarily funded separately by payroll taxes and the $106,800 cap is not only a cap on the amount of money for everyone taxed, but it's also a benefit cap so the rich won't get noticeably less benefits than a middle class worker and if they did, trust me we would hear about it. Why push this dynamic if one really cares about SS and the legacy of SS?

There's inherent contradiction out of many in the excuses people give when they want to legitimize either means testing or income relating SS, "So? It's already done slightly." That may somewhat be true, but why would we suggest messing with it more so the rich(those that pay payroll taxes or more well off) notice and complain while withdrawing desperately needed political support from the program?

Broken record time; SS does not belong in the debt ceiling debate, period. It contributes nothing to the deficit. It's is solvent till 2036(updated I believe from 2037) and will pay 80% of benefits after that date till 2050 with no changes at all being the scenario, which is just one of 4.

There's no immediate fix needed except possibly re-indexing the taxable wage base because of increasing earnings inequality and the percentage of covered earnings that are taxable decreased from 90% in 1982 to 85% in 2005 and projected to decline to about 83% for 2014 and later. Still this is no immediate problem and anyone who makes excuses for putting it up on the chopping block in this debate is doing a disservice to the most successful government program in history.

Not only that, by making these excuse one also in proximity supports the philosophy of Ayn Rand. They are supporting her by excusing the president putting SS on the table. Factually by doing so that actually supports the narrative that SS is a deficit driver and that it is an immediate problem. We must have principles and we must stand for something and not behind whatever a Democratic politician does who cannot negotiate a debt ceiling increase like most other presidents. This is a president who scoffed when many of us said this would happen once he extended the Bush tax cuts and here we are.

It's not Medicare, SS, or the seniors and workers that caused this situation. This is a failure of leadership from someone who promised to protect SS and Medicare and can't raise a debt ceiling like ever other president has while taking John Boehner's word when he was asked about this by Marc Ambinder during the Obama/Bush tax cut sellout that caused all of this.

THE PRESIDENT: Look, here’s my expectation — and I’ll take John Boehner at his word — that nobody, Democrat or Republican, is willing to see the full faith and credit of the United States government collapse, that that would not be a good thing to happen. And so I think that there will be significant discussions about the debt limit vote. That’s something that nobody ever likes to vote on. But once John Boehner is sworn in as Speaker, then he’s going to have responsibilities to govern. You can’t just stand on the sidelines and be a bomb thrower.

I think that just about says it all about this utterly predictable mess we're in.

Originally posted to Frustrati on Fri Jul 22, 2011 at 08:10 AM PDT.

Also republished by The Amateur Left, Dailykos Kossacks For Action, The Democratic Wing of the Democratic Party, and Social Security Defenders.

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