Social Security – Sheila Kennedy

About That Social Safety Net…

It isn’t just the relatively recent transformation of the GOP base into a racist cult that distinguishes America’s political parties. There are plenty of actual policy preferences that divide today’s Republicans and Democrats.

One of the most significant is their approach to America’s social safety net (such as it is).

Heather Cox Richardson recently quoted Senator John Thune, the second ranking Senate Republican ,for his public confirmation of a Republican plan to hold the needed raise to the debt ceiling hostage– in order to force cuts to Social Security and Medicare.

Thune’s statement is consistent with positions advanced by Florida Senator Scott, whose widely-publicized “GOP agenda” included sunsetting both Social Security and Medicare. Richardson quoted research from 2019 showing that Social Security was a “major” source of income for 57% of Americans–and polling showing that 74% of Americans oppose reducing Social Security benefits. Further evidence of popular opinion: deep-Red areas voted for Medicare-For-All in the recent midterms.

Over the years, Republicans have adamantly opposed virtually all efforts to extend the social safety net–they screamed “socialism” when Medicare was adopted, they vowed to “replace” the Affordable Care Act, and the party’s attacks on Social Security have become increasing vocal. Thanks to gerrymandering, the GOP has been able to thwart proposed expansions of the country’s social safety net, and thanks to its increasing extremism, Party spokespersons have become ever more willing to publicly touch that “third rail” of American social policy.

As regular readers of this blog know, my own policy preferences are very different; research has convinced me that we could combat a number of the social problems we face by instituting national health care and replacing most of our tattered and under-inclusive social supports with a Universal Basic Income. (My extended argument for the latter is here.)

Since I consulted the UBI research, there have been a number of pilot projects testing the concept. The Washington Post recently reported on several of them in a magazine article titled “Universal Basic Income has been Tested Repeatedly. It Works.” The article is lengthy, and it includes descriptions illustrating the ways in which specific individuals benefitted from participation in one of the pilot programs.

If you just learned about guaranteed income in the past few years, chances are it was from the presidential campaign of Andrew Yang, who got a lot of attention for his proposal that the government offer $1,000 monthly payments to all Americans. But versions of this concept had been circulating for decades among academics and progressive activists. And as the country shut down in the early days of the pandemic, the conditions appeared ripe to try something new, something radical. Pilot programs launched in Los Angeles, in New Orleans, in Denver, but also in historically less progressive cities like Birmingham, Ala.; Columbia, S.C.; and Gainesville, Fla. In March 2020, even a vast majority of congressional Republicans backed a $2 trillion stimulus bill that included unconditional cash payments for tens of millions of Americans. Since then, the Mayors for a Guaranteed Income coalition, which grew out of SEED, has swelled to more than 90 members and three dozen programs; a $15 million donation from Twitter co-founder Jack Dorsey helped fund many of the pilots.

Now, though, as the country emerges from the pandemic, the guaranteed income movement sits at a crossroads. The pilot programs have created scores of stories like Everett’s about how a small amount of money led to massive change in a recipient’s life. And a growing body of research based on the experiments shows that guaranteed income works — that it pulls people out of poverty, improves health outcomes, and makes it easier for people to find jobs and take care of their children. If empirical evidence ruled the world, guaranteed income would be available to every poor person in America, and many of those people would no longer be poor.

As the article concedes, however, empirical evidence is not what moves policymakers–not Republicans, certainly, nor certain Democrats beholden to fossil fuel magnates (yes, Joe Manchin, we are looking at you…)

At the end of 2021, an extension of the expanded child tax credit — which was seen by many advocates as a key steppingstone to guaranteed income — was blocked by a Democrat representing the state with the sixth-highest poverty rate in the country.

As the article notes, without a radical revision of our approach to a social safety net, “America will continue to be home to one of the worst rates of income inequality of any rich nation in the world.”

Rather than recognizing the numerous social problems that are exacerbated by that inequality, today’s GOP remains fixated on eliminating the minimal security measures that do exist, in pursuit of still more tax cuts for the obscenely wealthy.

And they are no longer pretending otherwise.

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GOP’s Targeted Messages

Republicans’ skill in “messaging” has been a consistent theme of comments on this blog.

One of those skills is the ability of the GOP to tailor its communications–telling one group of people one thing , while assuring a different group (wink, wink) that the party has absolutely no intention of doing precisely what it is promising others it will do.

A recent illustration can be seen in an exchange between Rick Scott (The Florida Senator with a private-sector history of engineering Medicare fraud) and Mitch McConnell, aka the smarter but most evil man in America.

Recently, Scott unveiled an 11-point plan that he identified as the GOP’s agenda–the party’s “to do” list once it retakes control of Congress. As Dana Milbank introduced a discussion of Scott’s plan in the Washington Post,

Suppose, for a moment, that the head of the Democratic Senatorial Campaign Committee, the group overseeing the 2022 campaigns of all Democratic senators and Senate candidates, announced that Democrats, if they keep congressional majorities after November’s elections, would enact a plan that would raise taxes on working families more than $1 trillion over 10 years.

Further suppose that this top Democratic official also pledged that the Democratic majority would “sunset” laws that provide Americans with Social Security and Medicare, military retirement benefits, veterans programs, unemployment compensation, student loans, deposit insurance and more. Additionally, the Democrats would require U.S. businesses to shut down $600 billion a year in foreign trade and abandon countless billions in overseas investments.

The cry from Republican officials and the Fox News echo chamber would be deafening. Socialism! Defund! Tyranny! They might not even have time left to blame President Biden for Russia’s Ukraine invasion or high gas prices.

Of course–as Milbank proceeds to document–that’s really a description of the bulk of the Republican agenda Scott outlined. (Anti-gay, anti-CRT measures comprise most of the rest.) It is worth noting that Scott is hardly a “rogue”–he heads the National Republican Senatorial Committee. However, the agenda he unveiled was so politically toxic that McConnell disavowed it.

Scott’s plan would eliminate (sunset) all federal legislation over five years. Scott assures voters that “worthy” laws would then be reenacted; presumably, policies that Republicans find “unworthy” would stay dead. As various pundits have pointed out, that would probably mean the end of Social Security, Medicare, Medicaid, and numerous other social programs that offend today’s GOP.

As Milbank writes,

Don’t just take my word for it. Here’s how McConnell recently described the Scott plan: “We will not have as part of our agenda a bill that raises taxes on half the American people and sunsets Social Security and Medicare within five years.”

About that provision raising taxes on half the American public: Analysis of Scott’s tax plan by the Brookings Tax Policy Center and the Institute on Taxation and Economic Policy found that the “Republican plan would raise taxes by $100 billion a year, or more than $1 trillion over the standard 10-year budgeting time frame. Almost all of it would be shouldered by households with income of $100,000 or less.”

As a column in Common Dreams explained, Scott introduced his tax proposal by saying “All Americans should pay some income tax to have skin in the game, even if a small amount. Currently over half of Americans pay no income tax.”

To the mega-rich Scott — and his fellow Americans of ample means — this proposal no doubt seems entirely reasonable. To Americans who understand how our overall tax system works, Scott’s proposal just seems cruel.

All Americans, for starters, pay some taxes. They have “skin” in the game. They may not pay any federal income tax. But if they work, they pay federal payroll tax. If they don’t work, they still pay sales tax on goods they purchase. They face other state and local taxes as well.

Analyses of the plan found it would “increase taxes by more than $1,000 on average for the poorest 40 percent of Americans.”

“Low-income families with children would pay the most,” notes the Tax Policy Center analysis, “Achieving Scott’s goal would slash their after-tax incomes by more than $5,000, or more than 20 percent.”

Meanwhile, points out a Patriotic Millionaires analysis, those “uber-wealthy Americans who avoid federal income tax thanks to a series of loopholes that allow them to claim little to no income” would continue to face no more than a minuscule tax on their mega millions under the Scott “11 Points.”

“In the end,” the Patriotic Millionaires sum up, Scott’s plan amounts to “a wink and a nod to his wealthy donors to keep stealing.”

No wonder McConnell wanted to shut Scott down–the official GOP message machine keeps telling people that Republicans will cut taxes. Poor people don’t understand that only wealthy folks will see those cuts–and that they are the ones who will pay for them.

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When Voters Can’t Connect The Dots…

Thousands–probably, millions–of words have been written about Republicans’ religious devotion to anti-tax beliefs. Unfortunately, that dogma is matched by a pervasive lack of understanding of how tax dollars are spent, and what citizens get for our money.

There are plenty of. wasteful programs, of course, not to mention subsidies that have long outlived whatever merit they may once have had. These wasteful and unnecessary programs allow politicians to make the case that all taxes are theft. It then follows that any and all efforts to reduce taxes are by definition laudatory.

Which brings us to Donald Trump’s recent plan to end or defer the payroll tax.

As a number of media sources have explained, payroll taxes support Social Security and Disability Insurance. Social Security’s Chief Actuary, Stephen C. Goss, evaluated the Trump proposal; he concluded that it would end Disability Insurance in mid-2021 and destroy Social Security by mid-2023.

When those of us who are fortunate enough to still be employed look at our pay stubs, we see hefty deductions for FICA. Most of us have undoubtedly thought about how nice it would be to have those dollars right now. Reasonably informed adults, however, who realize that they will need Social Security at some point, understand that deferring instant gratification is in their long-term best interests. (It’s true that some small portion of the population would be able to invest on their own behalf, but since most people couldn’t or wouldn’t, massive poverty among the elderly would result.)

Those who don’t know what the payroll tax deduction pays for see it as just another tax to attack.

I understand that tax policy can be complicated. When I pontificate about Americans’ lack of civic literacy, I’m not suggesting that we all need to know the ins-and-outs of the various ways government assesses us to pay for services–but it would be helpful if people recognized that we need to pay for services that are widely popular and obviously needed at the local, state and federal levels.

Actually, it would be more than helpful if Americans could agree on the essential components of both our physical and social infrastructure. At the local level, there’s a public outcry if streets, roads and bridges aren’t properly maintained. Whatever our concerns about policing, a vast majority expect local government to provide for public safety. Most of us think cities should provide public transit, garbage and snow removal, and a variety of other services.

Survey research leaves no doubt about the popularity of federal social welfare programs like Social Security and Medicare. Survey research also tells us that far too many Americans fail to connect the dots between the taxes they pay and the services they demand.

Should thoughtful and competent individuals and organizations monitor government. programs to ensure that our tax dollars are being wisely and appropriately spent? Absolutely. Are there programs that should be eliminated? You betcha! But ensuring the efficiency of public administration is a far cry from across-the-board anti-tax dogma–and a very far cry from uninformed and dangerous efforts to keep today’s dollars by selling the future short.

As usual, Trump and his administration are counting on the ignorance of his supporters. And to be fair, eliminating the payroll tax is (marginally) less dangerous than drinking bleach…

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Kicking Them When They’re Down

A few days ago, I referenced President Obama’s efforts to console family members of the worshippers gunned down during bible study in Charleston, and said I found it impossible to imagine Trump trying to comfort anyone.

Not only does he not console– or even empathize with–people who are suffering, Trump’s instinct is to kick them when they’re down. Just as he insisted that John McCain wasn’t a hero “because he got caught,” he considers Americans who are disadvantaged “losers” –his favorite epithet. And “losers” have absolutely no claim on his sympathies (assuming, in the absence of any evidence, that he has the capacity for sympathy) or on government largesse. To the contrary.

Time Magazine recently reported on the difficulties disabled poor people are experiencing buying groceries during the pandemic. As the story noted, it can be difficult getting to the store in normal times, but in some states–where “stay at home” orders keep the elderly and “medically fragile” residents from venturing out, it has become a huge problem– because unlike other Americans, recipients of the Supplemental Nutrition Assistance Program (SNAP) aren’t permitted to use those benefits for grocery delivery in most states, including Indiana.

Speaking of food stamps, Vox and a number of other media outlets recently reported on the administration’s effort–in the middle of a pandemic that has triggered massive unemployment–to cut over 3 million people from the rolls.

The Trump administration is proposing bumping 3.1 million people off of food stamps (about 8 percent of the total program) through the federal rule-making process — cutting out Congress.

The rule cracks down on “broad-based categorical eligibility,” or BBCE, a policy that enables states to enroll people in food stamps (formally called the Supplemental Nutrition Assistance Program or SNAP) if they’ve already applied for other benefits limited to low-income people, most notably Temporary Assistance for Needy Families (TANF). The claim (which doesn’t have much basis in evidence) is that this provision is easy to game and keeps benefits from going to the neediest people.

In fact, Trump and his administration seem to be mounting a positive vendetta against Americans who have the nerve to be disabled and/or needy. Another recent proposal from the Social Security Administration would cut $2.6 billion dollars over the next decade from the two programs that anchor the disability safety net: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI).

Recipients of these safety net programs aren’t exactly living high on the hog: the maximum amount that SSI will provide to a disabled beneficiary is just 74 percent of the federal poverty level — currently $12,490 for an individual– and the average for SSDI was just $14,855 per year.

Speaking of vendettas, Trump is clearly intent upon destroying the nearly 250-year-old Postal Service, evidently because he is convinced that the post office delivers Amazon purchases at a loss. (That–like so much of what Trump believes–is demonstrably untrue.) And he hates Jeff Bezos, who also owns the Washington Post.

Trump blocked a bipartisan plan to provide $13 billion to the post office, which was already struggling due to a 2006 Congressional requirement that it pre-fund employee retirement obligations to the tune of several billion dollars a year. Trump has now appointed a crony with no postal experience to be the new postmaster general, and is demanding a hefty raise in postal rates.

The Post Office employs 600,000 workers. It supports a $1.6 trillion mailing industry that employs close to another 7 million. (It also employs black workers at double the rate of the overall workforce.) Only someone as clueless–or heartless– as Donald Trump would try to throw another seven and a half million Americans out of work at a time when unemployment is at an all-time high.

The post office is also critical to American healthcare: in 2019 alone, it delivered 1.2 billion prescriptions, including almost 100 percent of those ordered by the Department of Veterans Affairs.

Those who are inclined to minimize the importance of the postal service might take a look at its performance during the current pandemic. Letter carriers are delivering much-needed items and at much lower cost than services like FedEx or UPS–everything from masks to stimulus checks. As states have migrated to vote-by-mail primaries, they’ve delivered the ballots. In fact, it isn’t much of a stretch to attribute the attack on the post office to Republican efforts to defeat vote-by-mail.

SNAP recipients, disabled people, poor folks, postal workers–to Trump, they’re all “losers” who can be kicked to the curb.

I think it was Maya Angelou who said “When someone shows you who they are, believe them.”

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“Trumped Up” Social Welfare Crises

There are two utterly incompatible approaches to the maintenance of social safety nets–and beliefs about the obligation of a society to its most vulnerable members.

On one side are those who recognize the obligation, who see the payment of taxes to support social programs and government services as the “dues” we owe to the “club” we call America. On the other side are those who reject that obligation, who insist that individual citizens (including, presumably, children, the elderly and the disabled) must be personally responsible for their own needs, and to the extent they are unable to do so, that private charity should fill the gap (despite copious evidence that charity is grossly insufficient to the task).

Those in the first category have legitimate differences about how we discharge our obligations to each other, about the efficiency of programs put in place, about the evidence we can reasonably require in order to separate out the truly needy from the merely greedy. But they understand that no society that ignores its neediest citizens can be “great” or even good–let alone stable.

Those in the second category tend to be financially comfortable (or better). Their incentive to ignore reality and the plight of others is rooted in their desire to keep more of what they have and their insistence that they have “earned” their good fortune and other folks could too if they really wanted to.

They are the ones who have controlled Congress. And as Robert Reich has written,

Republicans would love to get rid of Social Security and Medicare. But they can’t, because Social Security and Medicare are among the most popular of all federal programs. Besides, most Americans have been paying into them their whole working lives, and depend on them.

Since any overt attack on these programs would be politically suicidal, the Republicans have decided to do nothing–aggressively– to refrain from the “fixes” and accommodations to economic changes that all such programs require from time to time.

The trustees for Medicare and Social Security – of which I used to be one – say Medicare will run out of money by 2026, three years sooner than last projected, and Social Security will run out in 2034.

But this doesn’t have to be the case.

Here are three easy fixes to Social Security and Medicare that Republicans don’t want you to know about.

First: Raise the cap on income subject to Social Security payroll taxes.

This year, that cap is $128,400, meaning that every dollar earned above $128,400 isn’t subject to Social Security taxes.

As Reich points out, the CEO of a big company making $15 million dollars a year pays Social Security taxes on just $128,400 of that, while the nurse practitioner taking home $100,000 pays Social Security taxes on every dollar of his or her income.

Reich’s second “fix” addresses a situation that most of us find outrageous:

To help rein in Medicare costs, allow the government to use its huge bargaining power to negotiate lower drug prices.

Every other country negotiates these prices; that we do not is an unconscionable gift to big Pharma, which already benefits from the immense amounts through which taxpayers subsidize research. (Pharma already spends more on advertising, marketing, and lobbying than it does on research, so protests that lower profit margins would curtail research are disingenuous at best.)

Reich’s third “fix” is the least intuitive–and the most intriguing.

Third: To deal with a basic reason why Social Security and Medicare are running out of money, allow more young immigrants into the U.S.

The basic reason why Social Security and Medicare are running out of money is the American population continues to age and live longer – leaving a relatively smaller working population to pay into Social Security and Medicare.

What to do? Allow in more young immigrants. Immigrants and their children are the fastest growing segment of the working population, already contributing billions in payroll taxes every year. Instead of shutting immigrants out, allowing more immigrants into the country will help secure the future of Social Security and Medicare.

I have previously reported on the multiple benefits conferred by immigration; this is another.

If you belonged to a club in which some members refused to pay the dues that maintained the facility and its amenities, you’d terminate their membership. We can’t terminate the citizenship of people who are unwilling to pay their fair share, but we can save Social Security and Medicare. As Reich says,

Raise the cap, negotiate drug prices, and allow in more immigrants. Do these three things and you won’t have to worry about Social Security and Medicare not being there when you need it.

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