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Unless Congress Acts, Millions of Americans Will Soon Be Left With No Safety Net

Originally published at http://www.commondreams.org/views/2020/12/03/unless-congress-acts-millions-americans-will-soon-be-left-no-safety-net

I would have chosen the headline… “Because Congress will not act, millions of Americans will continue to see our miserable and underfunded safety net deteriorate even more.”

Again, it bothers me when authors write as if we are not dealing with a Congress that is packed with corporate sycophants but rather a group of sane and rational people who will do whatever is necessary for the average American if someone just explains it to them.

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Well, one house of Congress has already passed two Covid relief bills. The other house, controlled by Mitch McConnell, has refused to negotiate at all. Keep in mind, the Senate could have taken either bill, amended it, passed it, and put a conference committee together to iron out differences. The McConnell-run Senate chose not to do that.

sec’y treasury Munchkin has over 600 billion allocated in 2020 and not released.
Democrats, including progressives in DC, should be after him to either
come to congress and re-allocate to unemployment, another check
to everyone, etc.

a few scraps will fall off the table for the American people while the corporations and their owners pocket the cash–just as they did in 2008 and now again this year

NEWSFLASH

“Millions of Americans already have NO safety net”.

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Speaking of “safety net”: Bum-(bleep) NOBODY is talking about reinstating the FICA tax that funds Social Security. I will stipulate (grudgingly) that President Obama MAY have had good intentions when he partially suspended that tax in 2011-2012. But for anyone who believes that Trump’s intentions were benign when he did more or less the same thing this past September, I have some lovely ocean front property in northwest Georgia that I would be glad sell you at a discount. It isn’t ocean front now, but it soon will be.

Without going into the details, the very same Republican plutocrats who denied their role in the crash of 1929 were fighting against the Social Security program proposed by President Franklin Roosevelt even before the legislation creating the Social Security Administration in 1935 was passed. They have been trying to scuttle it ever since, the most recent serious attempt being that during the regime of George II, who famously called the Social Security Trust Fund “worthless paper” (a barefaced lie, although Georgy probably didn’t even know that). He also called the U. S. Constitution a “quaint” old document of little interest today, paving the way for the Trumpies to call for its suspension this very week.

Two other common lies about Social Security are that it is bankrupt and unable to pay promised benefits in the immediate future, and that the benefits paid increase the federal deficit. Look it up.

What IS true, according to Social Security officials, is that if benefits continue to be paid at the current level the fund WILL be exhausted in about three years IF the FICA tax is NOT reinstated. (The lost revenue in 2011-2012 WAS replenished out of general federal funds, which DID affect the deficit.) Social Security is basically a pay-as-you-go system and always has been, with sufficient reserves in the trust fund to deal with variations in expenditures from year to year, with one major exception:

In the early 1980s it became clear that the system would not be able to survive for future generations without some “retooling.” There was even a book with that word in the title. President Reagan, of all people, appointed a commission to undertake that retooling, appointing future Fed Chair Allen Greenspan to head it–a task he accomplished expertly. Unfortunately, Greenspan’s actions in the mid-1990s with regard to interest rates and new and unregulated financial derivatives paved the way for the Crash of 2008.

The retooling of the trust fund under Greenspan was designed to accommodate the sudden increase in the birth rate in the decades following World War II, commonly known as the “Baby Boom.” It has been as great a success as the Social Security system itself, according my generation the same relative standard of living as our parents. Assuming that the FICA tax is reinstated promptly, the trust fund can pay full promised benefits for another 14 years with no further adjustments, almost as far in the future as it could have done in 1983 when the Greenspan Commission began its work.

The Social Security budget is projected for 75 years in the future, the same as the US Postal Service but without the charge for medical insurance required of the USPS. (Medicare is financed by a separate and inadequate tax, significantly less than would be charged by private insurers so providing fewer benefits.) With very modest changes in the equation, Social Security could be retooled once more to provide full benefits to almost everyone alive today and a good many yet to be born.

But Social Security is not really a part of the so-called “safety net.” There are some details that attract myriad arguments, but it is considered to be retirement income insurance . It is paid for directly by Us the People, and hence we truly ARE “entitled” to it.