Proposed Tax Deal Goes against FDR's Vision for Social Security

December 10, 2010

President Obama announced a tentative deal with Congressional Republicans on Monday to extend the Bush-era tax cuts at all income levels for two years. The package would reduce the 6.2% Social Security payroll tax on all wage earners by two percentage points, to 4.2%, for one year. However, the package would cost about $900 billion over the next two years, and would be financed entirely by adding to the national debt. The deal would also extend unemployment benefits at their current level for 13 months, through the end of 2011.

 

The Social Security payroll tax cut is estimated to cost $120 billion per year, and is a provision that Senate Democrats say could ultimately be the undoing of Social Security. Allowing the payroll tax to expire in a year will mean that workers will see a nearly 50% jump in payroll taxes as the rate reverts back -- an event that is likely to be described as a tax hike. According to The Huffington Post, reducing a person's responsibility to contribute to Social Security also deprives the program of the political and moral capital that has kept the program intact despite fierce opposition from a determined investor class. In arguing against the deal, Nancy Altman, head of the group Social Security Works, noted that such responsibility was put into place by FDR for just that purpose. To see more from FDR on the topic, go to http://huff.to/gVorby. Altman said that dividing the stimulus evenly by simply sending an equal check to every worker would be far more desirable. Both the Senate and the House are expected to debate and vote on the proposal next week.

 

Amidst Talk of Tax Cuts for the Rich, Republicans Block $250 Checks for Seniors

A proposal to provide seniors an emergency payment of $250 was blocked on Wednesday by Republican-led opposition in the House and Senate. The measure would have provided the one-time payment to 58 million Social Security recipients in lieu of an annual cost-of-living adjustment (COLA). This is the second consecutive year that Social Security beneficiaries did not receive a COLA. Senior advocates note that the Consumer Price Index in Social Security, which measures the rate of inflation, does not accurately reflect the rate of inflation faced by seniors who spend a huge amount of their income on health care. Alliance members sent more than 5,400 e-mails letting their representative and senators know that they were counting on them to vote in favor of the payment. The bill, S. 3985, required 60 votes to shut off a filibuster in the Senate, but failed 53-45. No Senate Republicans voted for it. For a Senate vote tally, go to http://bit.ly/h1XTqt.  

 

The proposal also failed in the House for passage under House Suspension Calendar rules. There, the measure came up short, 254-153, with 141 Republicans voting against it. Under those rules, two-thirds of members present and voting were necessary for the bill, H.R. 5987, to pass. For a tally of the House vote, go to http://bit.ly/hdtk52. In arguing for the $250, Rep. Earl Pomeroy (D-ND) mentioned the Alliance’s support on the House floor. “This legislation is critical to retirees, but unfortunately, congressional Republicans overwhelmingly chose to oppose it,” said Edward F. Coyle, Executive Director of the Alliance.

 

Doc Fix Averts Cut in Medicare Payments to Doctors

Yesterday, the U.S. House passed a one-year “doc-fix” which averts a 25% cut in Medicare payments to providers which would have otherwise gone into effect on January 1st.  The vote came one day after the Senate unanimously approved it. The Medicare and Medicaid Extenders Act of 2010 includes extensions for a number of Medicare programs. It extends the Medicare Therapy Cap exception through the next year, allowing Medicare beneficiaries to obtain medically-necessary physical and speech therapy. Also, the Qualifying Individual (QI) benefit, which covers Medicare Part B for low-income individuals, was set to expire this year, but passage of the Act will allow it to continue through next year. “Seniors can now be assured that they will continue to have access to their doctors,” said Ruben Burks, Secretary-Treasurer of the Alliance.

 

Hawaii Alliance President Honored

Al Hamai, President of the Hawaii Alliance for Retired Americans, recently won an award for outstanding community service from the Hawaii Pacific Gerontological Society.  The Society praised the Hawaii Alliance’s work, under Al’s leadership, in “organizing the disparate retiree organizations of various union groups into one voice.” To see more, go to http://bit.ly/hevZFs.

 

Community-based Events in Missouri, Illinois and an Event with Rep. Fudge in Ohio

The Missouri Alliance for Retired Americans Education Fund organized a forum on Social Security and the Deficit Commission for 100+ community-based seniors at Lafayette Park United Methodist Church in St. Louis on Monday. Speakers included Dr. Nancy Kinney from the University of Missouri-St. Louis, Kate Lovelady from the Ethical Society of St. Louis and Sam Burnett, regional board member from the Alliance. On Tuesday, in below freezing temperatures, 43 community-based seniors from the Illinois Alliance gathered at Progressive Baptist Church in Chicago to learn about the impact of the Fiscal Commission’s report on Social Security and Medicare.  Illinois Alliance Treasurer Katie Jackson urged them to join the fight to preserve Social Security, and Mr. Burnett led attendees in calling Illinois senators and encouraging them to vote for the $250 check to Social Security recipients.

 

In Ohio on Monday, 40 seniors in downtown Cleveland braved the snow and ice to help protect Social Security. They joined Rep. Marcia Fudge (D-OH), staff from the offices of Reps. Dennis Kucinich (D-OH) and Betty Sutton (D-OH), and two state Representatives. Rep. Fudge spoke and took questions for 25 minutes, urging Congress to stand strong against tax cuts for the rich.

 

Obituary: Elizabeth Edwards, Tireless Health Care Advocate, 1949 - 2010

Elizabeth Edwards, a successful advocate for health care reform, lawyer and author, passed away on Tuesday from complications due to breast cancer at the age of 61. “Elizabeth Edwards was a model of dignity, and she never stopped campaigning for better health care in the U.S.,” said Barbara J. Easterling, President of the Alliance. Mrs. Edwards had addressed Alliance members at the 2007 Legislative Conference in Washington, DC.

 

 

*For the newest fact sheet “Health Care Benefits for Seniors in 2011,” go to http://bit.ly/gesRSR.


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