A 2014 CBS News Poll asked the following question: “Overall, do you think the benefits from Social Security are worth the cost of the program for taxpayers, or are they not worth the cost?”
Worth it–73% Not worth it–21% Unsure/No answer–6%
Social Security is a classic Hot-Botton topic. It fits right in with Fracking and The Safe Act. The difference is that Social Security is not as divisive as the other two; it has an overwhelming approval rate. Sure people have proposed tweaking the details, but a large majority of Americans feel the nearly 80 year old program is worth the cost.
That feeling was evident at Rep. Tom Reed’s Town Hall Meeting in Big Flats, NY (Chemung County) on Tuesday, May 26. Rep. Reed is the architect of the current House of Representatives’ movement to block Social Security from adjusting how our pay-roll deductions are divided between the “Social Security Retirement (Old-Age and Survivors Insurance–OASI) Fund” and the “Social Security Disability Fund.”
Congressman Reed, in answering the question “How can you justify a 20 percent cut in Social Security Disability if there is adequate funding in the Retirement Fund,” began by blaming Treasury Secretary Jack Lew for not being concerned about the approaching 20 percent cut in Disability benefits. You can hear the question and his response here:
You heard Rep. Reed explained how he “hammered” Treasury Secretary Jack Lew to explained why there were no mention of Social Security Disability in his testimony or in the budget. Finally, Reed explained, he got Lew to admit that the only plan was to “to take from retirees from social security and move over $260 billion to the Disability Trust Fund to take care of the disability recipients.” He then said it was like robbing Peter to pay Paul.
He uses the “robbing Peter (Retirement Fund) to pay Paul (Disability Fund)” metaphor a lot. We, the workers who pay into Social Security, are BOTH Peter AND Paul. We are hoping to be Paul (retired) and not Peter (disabled) but that is not guaranteed. We have paid into both funds and if we unfortunately qualify for disability benefits then we should get them. The money in both funds belongs to all you contributed. If we don’t get the full earned disability benefits, the government in effect robbing Paul (disabled) to pay Peter (retirees). When disabled workers qualify for retirement, they stop being paid by the Disability Fund and start being paid by the Retirement Fund.
Please note that the Disability Trusts Funds grew steadily from 1993 to 2008. The income received in 2009 was lower than in 2008. The Bush recession really took hold and, with fewer people working, the Trust Funds received less revenue. That should have surprised no one, especially our elected officials.
I have also heard the Jack Lew story many times. The following is Rep. Reed’s three and a half minute questioning time (not the 5 minutes that he stated) with Secretary Lew. Listen to it, ask yourself if Reed really ‘Hammered” Lew, and check out the amount of money mentioned that needs to be moved from the Retirement Fund to the Disability Fund. Also note why Lew said that the “reallocation” of funds is necessary.
Remember that Rep. Reed told the Big Flats audience that he got Secretary Lew to admit that “the official White House position is that they were going to take from retirees of Social Security and move over $260 billion into the Disability Trust Fund.” That is not what Lew admitted to. In the C-Span video that figure was $35 billion! There is quite a difference between $260 billion and $35 billion. I have not been able to find either figure. The fact is that both Reed and Lew spoke of $35 billion, not $260 billion.
It doesn’t sound to me that the White House didn’t see this crisis coming. Lew spoke that the technicians had studied the situation and realized that only short term solution –reallocate the money between the Trust Funds–can alleviate the I think my favorite line was that “Long term policies take a long time to have an effect.” Lew also said more than once that he was looking forward to work with Congress to strengthen Social Security.
Is Rep. Reed looking forward to work with the Congress? I don’t think so.
Later in the Big Flats Meeting, a woman, who had never been to a Town Hall Meeting before, and hadn’t planned to speak, rose and politely lambasted Rep. Reed for his part in cutting the meager Disability benefits by creating a “False Crisis”.
For someone who whose speech was impromptu she was right on the money. She had was off on some minor details. There are about 37,000 New York 23rders on Disability, but the 20 thousand something was a good guess.
I need to point out that when she said that the reallocation has been done many times before, Rep. Reed was quick to point out at it has been done 11 times. He made sure he added that it money had gone both ways, from the Retirees to the Disabled AND the other way around. I find that interesting that he pointed that fact out, since in a press release this year indicated that it the Retirement Fund bailed out the Disability Fund all eleven times:
“Finally, I heard nothing tonight about how to protect the Social Security Retirement Fund from the impending insolvency of the disability fund. It isn’t fair to raid the retirement fund yet again for what would be a twelfth time. I want to be part of finding a long-term solution that protects retirees, the disabled, and our seniors.”
He also, near the end of the video clip, denounces the concept of eliminating the payroll deduction cap. He uses the example of a person making a ” Hundred Trillion dollars ($100,000,000,000,000)”, and there is no payroll cap. First the only money that goes to Social Security is based on a person’s action pay–from American companies–not money he gets from investments or from foreign countries. Second, Reed is saying that the Trillionaire would be getting benefits that would negate payments made into the funds and would not help Social Security at all. Sounds logical, but his statement is contradicted by the ultra-conservative Heritage Foundation, in an AARP article , has said:
If millionaires pay Social Security taxes on all of their salary income, the maximum annual benefit payment could reach over $150,000 a year. This development would not bankrupt the program.
The issue of eliminating the Payroll Cap is not new. People have different opinions of eliminating it or raise it to, as some on the recoding said to “$250,000”. Both ideas have been kicked around, and that will probably be a way to enhance Social Security if congress every gets around discussing the “Crisis’ with the executive branch.
You may have heard in the second video someone suggest reading the book “Social Security Works”, which you can buy at most book outlets. “Social Security Works” has a well researched website on the history of our Social Security system, and ideas strengthen it.
Social Security is important to many. This blog has many articles about it affect the people and the economy of our congressional district. It has also chronicled Rep. Reed’s comments about disability, and some were not as caring as he sounded at the Town Hall. Look at Rep. Reed’s voting record on other programs helping the people in his district, including the SNAP program, WIC, and unemployment insurance. Those votes indicates that Rep. Reed is not sympathetic for those going through difficult financial times.
The two videos above did not show the whole Big Flats conversation on Social Security. The following one show the whole the whole 9 plus minutes of Social Security discussion.