The Fight to Protect Social Security
Editor’s Note: The Washington press corps often assesses how “serious” a politician is by whether he or she is ready to slash the benefits going to Americans via Social Security and Medicare, clearly the way to impress on “Meet the Press.”
President Obama’s center-right-dominated fiscal commission is currently pondering its own recommendations for how deeply to slash those programs, while showing a lot less interest in cutting military spending or raising taxes on the wealthy, as Kevin Zeese notes in this guest essay:
The bipartisan National Commission on Fiscal Responsibility and Reform, which was created by President Barack Obama earlier this year, is using exaggerated rhetoric to heighten deficit fears at a time when many economists say more government spending is needed to spur hiring and avert a second dip in the worst recession since the Great Depression.
The commission – co-chaired by former Republican Sen. Alan Simpson and President Bill Clinton’s White House chief of staff Erskine Bowles – is talking about cuts to Social Security, Medicare and middle-class benefits like the home mortgage deduction rather than focusing on three key causes of the deficit: massive war and weapons spending, giant tax cuts for the wealthy, and the faltering economy.
By contrast, 40 leading economists, including Nobel Prize winners, issued a statement calling for more government action in the short-term while treating the federal debt as a longer-range problem.
“We recognize the necessity of a program to cut the mid- and long-term federal deficit but the imperative requirement now, and the surest course to balance the budget over time, is to restore a full measure of economic activity,” the signers wrote.
“As in the 1930s, the economy is suffering a sharp decline in aggregate demand and loss of business confidence. Long experience shows that monetary policy may not be enough, particularly in deep slumps, as Keynes noted.
“The urgent need is for government to replace the lost purchasing power of the unemployed and their families and to employ other tax-cut and spending programs to boost demand.
“Making deficit reduction the first target, without addressing the chronic underlying deficiency of demand, is exactly the error of the 1930s. It will prolong the great recession, harm the social cohesion of the country, and continue inflicting unnecessary hardship on millions of Americans.”
The Obama deficit commission is working against this urgent need. And, in pushing proposals that will weaken the middle class the commission risks stirring anger among American voters who are already unhappy with the administration’s handling of the economy.
In my view, the time is now to build opposition to the commission’s expected recommendations and to urge Congress and the administration to cut programs that will not make the economy worse for most Americans. When I testified before the commission I urged:
-Cuts in military spending as this makes up half of U.S. discretionary spending and is filled with waste and bloat.
-Cuts to corporate welfare, especially to the oil and gas industry which is scheduled to received billions in tax breaks despite massive profits
-Tax the purchase of stocks, bonds and derivatives, areas where even a tiny micro tax could raise tens of billions annually.
-Tax the estates of the wealthiest Americans, raising more than $10 billion annually.
Click here to read my full testimony.
These are just a few of the areas where cuts in spending and higher taxes on wealth could balance the budget and avoid the need to cut Social Security and Medicare or raise taxes on the middle class.
Despite alarmist rhetoric, Social Security is in good financial shape for the next decades and merely raising the cap on Social Security taxes would make the program secure for the 21st Century. And the economy needs a stronger elderly economic class.
The disappearance of pensions, stock market losses, and savings transformed into debt have left too many Americans dependent on the measly $14,030 annual average benefits Social Security provides.
Medicare’s challenge is not the Medicare program itself but the cost of health care. Cuts to Medicare will worsen health problems for seniors and require more expensive emergency care.
Also, the new Obama health law does not do much to control costs and the President bypassed the real solution for affordable health care: ending the wasteful role of the private insurance industry and replacing it with a lower-cost Medicare-for-all system.
The commission is preparing its report for release after the mid-term elections in November, so the voters will have less influence on the recommendations.
If voters want to protect Social Security and Medicare – and insist on cuts in spending for weapons and war and demand getting more tax dollars from the wealthy who profited from the past decade’s bubble-and-bust economy inflated by tax cuts and deficit spending – they need to express their views now.
You can begin to respond to the deficit commission by writing to President Obama and your representatives in Congress by clicking here.
Beyond stopping the deficit commission from making matters worse, Americans will also need to focus on re-making the economy by narrowing the wealth divide that has allowed the richest 1 percent to hoard the nation’s wealth. There are also negative effects from the concentration of corporate power and from crony capitalism which diverts tax dollars into the pockets of the well-connected few.
But the immediate task at hand is to stop the deficit hawks from trying to balance the budget by slashing worthy programs, like Social Security and Medicare, while taking little or no action on issues like wasteful military spending and the historically low levels of taxation on the rich.
Kevin Zeese is executive director of Prosperity Agenda.
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