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Durbin on the deficit commission

Local and national reaction to Senator Durbin’s support for the Simpson-Bowles deficit plan – and more on what raising the retirement age for Social Security really means – at Huffington Post.

Call on Durbin: No Social Security cuts

Members of the Illinois Alliance of Retired Americans and the Strengthen Social Security Campaign delivered a letter to Senator Richard Durbin this afternoon calling on him to reconsider his statement yesterday that he would support raising the retirement age to 69.

“The increase will be devastating for future retirees and especially discriminates against African-Americans, women and low-wage workers,” the letter said.

It amounts to a 13 percent benefit reduction, on top of a 13 percent reduction under 1983 legislation that will raise the retirement age to 67 by 2022, said John Gaudette of Citizen Action Illinois.

The groups point out that while life expectancy has increased by five years for upper-income men in the last quarter-century, it’s risen by just one year for lower-income men – and it’s fallen for lower-income women.

Without Social Security, more than half of older women would fall into poverty, they say.

“There are sensible solutions to help reduce the federal deficit, as well as improve Social Security long-term solvency, but cutting Social Security benefits is not one of them,” they write. “Social Security has not contributed a single penny to the deficit.”

(For more, see Durbin Defaults and Obama tax plan – a threat to Social Security?)

Downstate uranium plant fuels Social Security debate

A labor conflict at a downstate uranium plant is fueling calls from Social Security supporters for removal of a second member of the President’s Commission on Fiscal Responsibility.

As noted here last week, the commission’s co-chair, former Senator Alan Simpson, has come under fire for insulting Social Security supporters.

David Cote

Now the Steelworkers Organization of Active Retirees is calling on President Obama to remove Honeywell CEO David Cote from the commission, citing the company’s lockout of 230 workers at a uranium processing plant in Metropolis, Illinois.

Members of USW Local 7-669 were locked out June 28 after they rejected a contract proposal from Honeywell that would eliminate health care for retirees and raise employee’s out-of-pocket healthcare maximum to $8,500.

The union offered to continue operating the plant while negotiations were underway, particularly out of safety concerns, according to Huffington Post. The company locked out the union employees, the New York Times reported.

“Cote is proposing to end health insurance for retirees who were for years exposed on the job to hazardous materials, including substances listed as carcinogens by the Department of Energy,” SOAR wrote to President Obama (pdf) last week.  “Cote’s proposal to terminate their health insurance is cruel and inhuman.”

In June, Honeywell reported second-quarter profits of $468 million, a 4 percent increase that exceeded expectations.  “The recovery is happening,” Cote said at the time, according to Market Watch.

As CEO of a major military contractor, with billions of dollars in defense contracts, Cote’s role on the deficit commission is to fight off attempts to reduce spending on major weapons system.  According to Talking Points Memo, he has “pushed back” against efforts to examine redundancy and cost overruns in weapons programs.

Instead he has called for freezing pay for service members and charging them for their health coverage, according to TPM.

Meanwhile, a veterans group joined calls for Simpson’s removal after he “blamed disabled veterans for the country’s fiscal situation,” singling out veterans receiving disability for Agent Orange-linked ailments.

Vote Vets joined groups ranging from OWL to NOW to the AFL-CIO to the Alliance of Retired Americans, who called on Obama to remove Simpson following insulting comments to other Social Security supporters.  As TPM details, Simpson is a long-time proponent of cutting Social Security.

“Don’t expect major media coverage” of the “Senator Trash Mouth” contretemps, writes William Greider at the Nation.  “The prestige newspapers are on board for this deal,” he writes, as “leading newspapers…dutifully repeat the establishment’s falsehoods and distortions about Social Security.”

Greider takes Matt Bai of the New York Times to task for some of the same arguments that Terry Savage trotted out in the Sun-Times this weekend (that Social Security’s surplus has been swallowed up by the federal deficit); at Huffington Post, Robert Kuttner calls Bai’s column “dishonest.”

In the same issue of the Sun-Times, Francine Knowles‘ reporting on growing insecurity among those approaching retirement provides a reality check to Savage’s ideological fulminations – showing both the increased importance of Social Security, and the danger of turning it over to stockbrokers.

Seniors defend Social Security

Senior citizens and their supporters will protest the appearance of the leading proponent of Social Security privatization at a Chicago fundraiser tomorrow.  The action is part of a growing effort to defend the nation’s retirement insurance program.

The Illinois Alliance of Retired Americans, the Main Street Alliance, Citizens Action Illinois, and Chicago Jobs With Justice are among the groups calling a rally for noon tomorrow (Wed., Sept. 1) outside the Four Seasons Hotel, 120 E. Delaware, where Representative Paul Ryan (R-Wisc.) will speak at a fundraising luncheon for Joel Pollak, Republican House candidate in the 9th district.

Ryan’s controversial Roadmap for Recovery proposes privatizing Social Security and Medicare as part of a deficit reduction plan.  According to Media Matters, the deficit reductions claimed by Ryan depend on budget tricks.

For John Gaudette of Citizen Action, the bigger trick is the notion that Social Security is a component of the federal deficit – or that the program faces any kind of imminent financial crisis.

“There is no crisis,” he said.  “It’s one of the healthiest programs we’ve got.”  Social Security is fully funded for the next 25 years, and with no changes could pay 80 percent of promised benefits after that, he said.

With a simple fix – raising or eliminating the income cap on Social Security payroll deductions (currently incomes above $108,000 aren’t taxed) — “you don’t have a problem.” he said.  “You don’t ever have to worry about Social Security.”

He sees the attack on Social Security as the final phase of a generation-long drive by corporations and conservatives to minimize the role of government.

One reason for concern is the Obama administration’s National Commission on Fiscal Responsibility, which some Social Security supporters (including William Greider and Robert Kuttner) view as a vehicle to cut benefits.  The commission is holding hearings and will issue a report after the November elections.

“We hope the White House has learned from health care reform and financial reform” about the dangers of “negotiating preemptively,” Gaudette said.  “If they want to negotiate at all, it should be from a position of improving Social Security,” he said.

He points to the presence of Senator Richard Durbin and Representative Jan Schakowsky (Pollak’s opponent) on the commission as reassurance that voices in the support of the program are represented.  But tomorrow’s action and similar efforts are aimed at “letting them know that we are watching.”

Local supporters are working with the Strengthen Social Security Campaign, a coalition of 60 national organizations which opposes privatization and benefit reductions, including an increase in the retirement age.  The group calls for increasing benefits for the lowest-income recipients.

Recently the coalition demanded the resignation of former Senator Alan Simpson as co-chair of the fiscal responsibility commission, after he sent an insulting e-mail to the executive director of the Older Women’s League.  The administration instead accepted Simpson’s apology.

Tomorrow’s action will also highlight a new report (pdf) from Social Security Works which shows that nearly 2 million Illinois residents receive Social Security retirement, disability, and survivor benefits – and the program is responsible for lifting 772,000 state residents out of poverty.

Deficit forum: deliberation or manipulation?

Archon Fung of Harvard writes in Huffington Post of his disappointment over criticism of America Speaks’s forums on the federal deficit.  (Newstips talked with Fung eight years ago about his fascinating research on local school councils and community policing in Chicago.)

“It was distressing that many left intellectuals leveled withering scorn at this event because they viewed it as a vast right-wing conspiracy to manufacture public consent to slash public programs,” Fung writes.  Progressives need to support more opportunities for public deliberation, he says.

Fung cites votes by participants in favor of raising the cap on earnings taxable for Social Security, instituting a carbon tax and a securities transaction tax, hiking payroll taxes and a 5 percent surtax on incomes over $1 million, and cutting the defense budget.

“By the end of their deliberations, it was clear that most participants wanted to reduce the deficit primarily by raising taxes and cutting defense, not by slashing Social Security, Medicaid, or Medicare.”

In fact, they did vote to slash Social Security benefits; Fung omits participants’ support for raising Social Security’s retirement age to 69, reported in a press release from America Speaks.  This would reduce benefits for everyone, and would hit low-income workers especially hard, since they don’t live as long.

They also voted to cut spending on health care and domestic programs by “at least 5 percent,” according to America Speaks.

Or did they? They seem to have actually voted against health cuts, according to Roger Hickey of the Campaign for America’s Future, also in Huffington Post.  Following the process online, Hickey says 71 percent voted for no cuts, 21 percent for 5 percent cuts.

Fung’s figures: 65 percent wanted to cut health care spending by 5 percent or not at all; America Speaks says “reforms that were preferred by participants” included “reduc[ing] spending on health care and non-defense discretionary spending by at least 5 percent.”

Thus Hickey’s call for America Speaks to provide a full report with complete voting results.

Hickey says some progressive positions emerged despite “misleading background information.”

Chief among this was the failure to identify Social Security as an independently-financed program – and the failure to ever mention the program’s huge surplus.

The Center for Economic Policy Research surveyed participants as they left the forums in four cities (including Chicago) “to determine the extent to which the process educated participants about the economy” and found that “even after this lengthy process, most of the participants were poorly informed about important aspects of the budget debate” – most notably Social Security.

Less than a third of participants surveyed were aware that Social Security trustees currently project that the program can pay all scheduled benefits for the next quarter century, according to CEPR.

CEPR notes the extremely limited options participants were provided regarding health care – with no proposals for cutting the growth of health care costs available.

Hickey looks in some depth at the organizers’ framing of Social Security, Medicare and Medicaid, and growth vs. austerity (and reports a “rebellion in the ranks” which demanded an option of voting for Medicare For All).  At Firedoglake, David Dayen looks at presentations on healthcare, Social Security, and tax increases, with a “cumulative effect [tending] towards social safety net cuts rather than tax fairness.”

Dayen reports from inside a forum in Los Angeles that “the entire event was absolutely designed to create a panic about the deficit among the participants.”  Fifteen minutes were spent on the current economic crisis and five hours on the deficit, he says, with speakers in informational videos heavily skewed toward deficit hawks.

He also has video from a protest outside the event – 40 people showed up to demand hands off Social Security, and at least some of them were among the 100 who participated in the deliberations.  MoveOn also called on members to attend and resist Social Security cuts, which may help account for some of the more progressive positions taken.

According to Ron Baiman of the Center for Tax and Budget Accountability, organizers did not keep commitments to him about including discussion of the larger economic context in their introduction to the deficit issue (see previous post).

Meanwhile, deficit hawks of the Herbert Hoover school reign in Washington and Europe, and as Paul Krugman opines, the results are potentially disastrous.

Bad news on Social Security

Pete Peterson, “the retired Wall Street billionaire who wants to loot Social Security,” has “created a digital news agency he dubs ‘The Fiscal Times’ and hired eight seasoned reporters to do the work there,” writes William Greider.

The agency is “jointly producing content” with the Washington Post – first out, an article shilling for Peterson’s agenda, a fiscal reform commission that could bypass Congressional debate to cut Social Security and Medicare.

“No serious newspaper would publish a piece from an obviously interested party like the Peterson Foundation as a news story,” comments Dean Baker. “Apparently the Post decided that its future no longer is in serious news.”

[More on the article’s bias from the Campaign for America’s Future, including a letter to the Post ombudsperson from a group of scholars and advocates.]

On Social Security: organize!

Bloggers Glenn Greenwald and Ezra Klein are having a bloggish dispute over whether to use anonymous sources.  But the subject at hand — the prospect of cuts to Social Security — is much larger.  And the real question is the best approach for advocates of social change to the new political environment.

As previously noted here, it started with veteran muckraker William Greider warning of a growing campaign by conservatives to sink Social Security, or at least trim its sails, in the name of “fiscal responsibility.”  This was a couple weeks before the White House “fiscal responsibility” summit was held on February 23.

Klein wrote on the 19th that such “din-raising” was probably not necessary, because his friends in the administration assured him that as far as they’re concerned, “entitlement reform” means health care reform.  He later wrote that “people in the White House” were telling him “there’s no intention to touch Social Security in the foreseeable future.”  He was being spun.

A few days later, on the morning of the summit, a New York Times piece offered a far different perspective, reporting that “persons who’ve spoken with” President Obama, including Senator Lindsay Graham, said “Obama is eager to seek a bipartisan solution to ensure the long-term solvency of Social Security,” but “opposition from his party’s left and from Congressional Democratic leaders” has led him to drop that effort, at least for now.  (The same day Robert Kuttner, Klein’s colleague at the American Prospect, gave a thorough overview to the issues in an op-ed for the Washington Post, highlighting the role of the “deficit hawk” Democrats who are suddenly so important.)

So, far from being safe in the steady hands of the administration, Social Security had been taken off the chopping block only in the face of opposition from outside the White House.

Last Thursday, David Brooks reported on calls from four (anonymous) “senior members of the administration” objecting to his depiction of Obama’s budget proposal as “liberal.”  Among their points: The President “is extremely committed to entitlement reform and is plotting politically feasible ways to reduce Social Security [spending] as well as health spending.”  (Perhaps Klein could suggest they have a talk with Kuttner?)

Hopefully Greenwald and Klein will come to an understanding over the proper treatment of sources.  But as far as regular folks are concerned, hopefully when opponents of Social Security organize to pressure the administration, supporters of Social Security will listen to Greider, organize, and raise a din.

Concern over Medicare, Social Security

Advocates for retirees are “keeping a watchful eye” on tomorrow’s White House summit on fiscal responsibility, said Steve Pittman of the Illinois Alliance of Retired Americans.

Concern has been heightened by mixed messages from the Obama administration and especially by a major effort to reduce retirement and medical benefits by groups warning of an impending “entitlement crisis.”

“It’s a good idea to start looking at a long term plan,” Pittman said. “But if it’s to answer the call of people saying we have to cut back programs like Social Security and Medicare because that’s the only way we will have a sound economy, that’s just flat wrong.”

While President Obama has said Social Security’s long-term shortfalls can be addressed by raising the cap on income subject to payroll taxes, his budget director, Peter Orszag, authored a 2005 plan to raise Social Security taxes and reduce benefits.

And while Orszag emphasizes that Socal Security’s problems are decades away and rising health costs are the immediate issue, many of Monday’s participants have worked to conflate the issues and push Social Security cuts.

Most prominent among them is former Commerce Secretary Peter Peterson, who is spending $1 billion of his Wall Street fortune to convince the public there’s an “entitlement crisis.” He’s been joined by a range of think tanks, including the Heritage Foundation and the Brookings Institute, and backed by a Congressional coalition.

With recent losses of stock market and home values by retirees and people nearing retirement, “there’s no way the solution is to cut health care benefits or the one retirement benefit that people can count on, which is Social Security,” said Pittman.

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