Over the last few days the debate in our national media has centered around the president's budget proposal in which he offered to cut Social Security with a chained CPI formula, promulgated by deficit scolds (Fix the debt) , defined by Paul Krugman that reduces benefits to all citizens.
It seems that whenever Social Security is talked about in any form, the discussion centers around how to cut benefits to "shore up" the finances of the life saving program that lifts millions of Americans out of poverty since its inception and not how to expand it.
This is what we were voting for: Party Platform.
Preserve promise of Social Security; don't privatizeBold by diarist.
We believe every American deserves a secure, healthy, and dignified retirement. During their working years, Americans contribute to Social Security in exchange for a promise that they will receive an income in retirement. Unlike those in the other party, we will find a solution to protect Social Security for future generations. We will block Republican efforts to subject Americans' guaranteed retirement income to the whims of the stock market through privatization. We reject approaches that insist that cutting benefits is the only answer. President Obama will also make it easier for Americans to save on their own for retirement and prepare for unforeseen expenses by participating in retirement accounts at work.
Democrats believe that Social Security and Medicare must be kept strong for seniors, people with disabilities, and future generations. Our opponents have shown a shocking willingness to gut these programs to pay for tax cuts for the wealthiest, and we fundamentally reject that approach.
A New Report by New America Foundation you can read http://growth.newamerica.net/... makes the case that the inside the beltway conventional wisdom that has dominated our politics is wrongheaded and and destructive. NAF is the first liberal organization to not only reject the Obama Administrations idiotic plan to gut the New Deal, but to say "Hell No, Expand it." with a new benefit. This is where the debate in our media should be centered on. How is it that we can afford to have two wars on credit cards, bail out the banks after they crashed the world economy, and allowed Wall Street to take in 121% of all the gains post melt down but we must cut Social Security? No. Just no.
The conventional wisdom about Social Security is profoundly misguided. According to today’s mistaken consensus, the U.S. as a society cannot afford to allocate the money to pay for the present level of Social Security benefits for retirees in future generations. The solution, it is widely argued, is to cut benefits either directly by means testing or indirectly by raising the retirement age or all owing inflation to erode their real value over time. In this narrative, tax favored private savings vehicles like 401(k)s and IRAs should be expanded in order to compensate for the allegedly necessary cuts in Social Security. This consensus is not only misconceived in its diagnosis but also mistaken in its prescriptions and potentially disastrous in its consequencesThe main proposal in the report is to expand Social Security by adding a new benefit, called Part B, that would give a flat $11,699 per year to all retired workers. This would be added on top of regular Social Security benefits, which would be defended from any new cuts in the future. IRA's and 401(k)s have been shown to be dangerous and a sure way for people to lose their lifetime savings. While it is good to diversify and not only rely on Social Security for your retirement income, many Americans do not have that option.
Retirement security is often thought of as three legged “stool” consisting of Social Security, employer retirement plans, and private savings. Social Security has been far more stable and successful than the other two legs of the stool. The reliance on these other legs of the system has resulted in a retirement security crisis for most Americans, shifting costs and risks onto individuals, even as the benefits of these programs go overwhelmingly to upper income earners. Yet the current debate is arbitrarily restricted to the chief public component of the American retirement system, Social Security.In reforming America’s retirement security system, we should build upon what works. Instead of compounding failure by expanding private benefits, a category that includes rapidly disappearing defined benefit pensions, employer provided 401(k)s and individual retirement accounts (IRAs), we should substantially expand the successful, purely public Social Security program.
This plan would call for a tax hike since Social Security is anticipated to suffer a budget shortfall in 20 years. In 20 years. If we do nothing. A Flat 11,999 raise to every American would be a great idea to run on. We had Bush campaign on his massive tax cut on the promise that it would put more money in American's pockets. How did that multi-billion dollar give away avg out for Americans? The typical tax payer saw a 400 - 500 dollar increase in their return. Now we have the opportunity to say "Hey! Let's give every American a raise!." These are earned benefits, not entitlements. Social Security is what Americans have worked for and paid into for their entire lives. This concept of actually increasing earned life time benefits instead of being a "Very Serious Person" and contending that they have to be cut is a winner both on a policy level and a political one. We should be formulating policy on what is good for the American people, not on what makes David Brooks get all jello like on the inside.
Kevin Drum over at Mother Jones writes about the plan saying:
How much would this cost? A little over 1 percent of GDP to fully fund current Social Security with no benefits cuts, and about 3.7 percent of GDP to fund the new Social Security B. Altogether, call it about 5 percent of GDP. That's....a lot. The authors suggest that current Social Security would be fully funded via higher payroll taxes, while Social Security B would be funded by "either general revenues or a new dedicated tax or taxes, which might include portions of a federal value-added tax (VAT)." The chart on the right compares the benefits under current Social Security vs. the NAF plan.
The basic contention here is that old-style corporate pensions are pretty much gone, and 401(k)-style programs are a disaster. So we should just ditch them entirely and beef up Social Security so that it's a sufficient retirement program all by itself. I still haven't been able to quite convince myself that 401(k)s are the disaster area that a lot of people say they are, but the evidence on this score is certainly fairly hazy. It's quite possible that 401(k)s really are failures.
The FICA cap should be raised and suddenly the budget shortfall that has all the deficit scolds quaking in their austerity boots with vanish. We should also consider levying a tax much like the Robin Hood tax on financial transactions in order to contribute to Social Security. It is insane that Capital Gains, and other earned interest benefits that rich people make just for having their money, is not subjected to the same standard as people who have to toil pay check to pay check.
We don't need further capitulation to right wing vapors that Social Security is going to bankrupt the country and that there will be nothing for the future. If Democrats are going to have any true path forward into winning back the House, progressing on civil liberties, climate change, and winning the future our children, then we have to stand up to our president and the neo liberals who have dominated this conversation. Let's try and take this debate back to where it should have been from the very beginning.
Expand Social Security - Don't cut it.
DailyKos Blogathon -- Week of April 8th
(All times are Eastern, diaries published by the Pushing back at the Grand Bargain group)
Monday, April 8
10:00 a.m. Roger Fox
12:00 noon eXtina
2:00 p.m. Guest crosspost by Yves Smith
3:00 p.m. poopdogcomedy
4:00 p.m. Horace Boothroyd III
6:00 p.m. slinkerwink
8:00 p.m. joedemocrat
Tuesday, April 9
Wednesday, April 10
Thursday, April 11
Friday April 12
1. Call your senators and representatives and tell them "Hell No!" with a priority on contacting senators. U.S. Capitol Switchboard at (202) 224-3121. You can find email contact information here
2. Contact the White House and tell them "Hell No!". Switchboard: 202-456-1414. Email contact page is here.
3. Petitions. There are a number of petitions available. Choose from the following or preferably sign them all.
a. White House petition calling for no cuts to Social Security.
4. Social Media. Share this diary and promote this blogathon on Facebook and Google+ using the buttons at the top of the diary. Send this out on Twitter and add the hashtags #HellNo and #NoGrandBargain.
Blogathon diaries you might have missedMonday:
Hell No! #NoGrandBargain: "Pushing back at the Grand Bargain" by Roger Fox
Hell No! Chained CPI will reduce eligability for EITC #noChainedCPI by Roger Fox
Hell No! Dan Pfeiffer: "The President's Budget Shows That He is Serious About Solving Deficits" by eXtina
Guest Crosspost, Yves Smith: Obama Wants to Be the President Who Rolled Back the New Deal by Yves Smith via joanneleon
IA-Sen: Tom Harkin (D) Needs Our Help Telling Obama Hell No To The Chained CPI by poopdogcomedy
Hell No! Stop crushing the poor by Horace Boothroyd III
Hell, No! Social Security Contributes Nothing To Deficit by slinkerwink
Hell No! No Grand Bargain: Chained CPI: Social Security Means So Much To So Many by joedemocrat