Sanders writes: "The American people should not be fooled by the misinformation that will be spread at these 'grassroots' gatherings backed by some of the most powerful Wall Street, insurance, and corporate CEOs in the country."
Senator Bernie Sanders is interviewed by a Reuters reporter, 11/28/06. (photo: Reuters)
Don't Let Wall Street Billionaires Destroy Social Security
08 September 12
eptember 7 is an important date for New Hampshire. On that day, Wall Street billionaire Pete Peterson will kick-off his 2012 national campaign to cut Social Security and other vitally important programs with a "town meeting" with a town meeting at St. Anselm's College in Manchester at 5 p.m.
The American people should not be fooled by the misinformation that will be spread at these "grassroots" gatherings backed by some of the most powerful Wall Street, insurance, and corporate CEOs in the country.
The goal of these "town meetings" is to convince the people of New Hampshire and the rest of America that the only effective way to address the deficit crisis is to balance the budget on the backs of the elderly, the children the sick and the poor.
Don't believe it!
First, let us never forget how we got into our current deficit crisis.
In January of 2001, when Bill Clinton left office, this country was enjoying a very healthy $236 billion SURPLUS projected to increase in the coming years.
Under President George W. Bush and his fellow "deficit hawks," the United States went to war in Afghanistan and Iraq and "forgot" to pay for the wars which will end up adding some $3 trillion to our national debt.
Under George W. Bush and his fellow "deficit hawks," the wealthiest people in this country were given huge tax breaks which cost $1 trillion over a 10-year period. There was no offset for those tax breaks. They were simply added to the deficit.
Under George W. Bush and his fellow "deficit hawks," an overly-expensive Medicare prescription drug program written by the insurance and drug companies was signed into law. This program, which explicitly prevented the government from negotiating lower drug prices with the pharmaceutical industry, was not paid for and will end up adding some $400 billion to our national debt over a 10-year period.
Now, having run up huge deficits, our born-again "deficit hawks," on behalf of their billionaire allies, want to cut Social Security to save money.
What's wrong with this picture? First, despite Wall Street and right-wing misleading rhetoric, Social Security, which is funded by the payroll tax, has not contributed one nickel to the deficit. Second, the Social Security Trust Fund today, according to the Social Security Administration, has a $2.7 trillion surplus and can pay 100 percent of all benefits owed to every eligible American for the next 21 years.
Why should we vigorously defend Social Security, prevent any cuts and, in fact, make sure Social Security is solvent for the next 75 years? The answer is obvious. In these highly volatile economic times, when millions of Americans lost their life savings in the 2008 Wall Street crash, Social Security, through good economic times and bad, has paid out every penny owed to every eligible beneficiary. In other words, it is a guaranteed benefit and that promise has always been kept.
In the 77 years since President Franklin Roosevelt signed Social Security into law on August 14, 1935, the retirement and insurance program has been one of the nation's most successful anti-poverty programs. Before Social Security existed, about half of America's senior citizens lived in poverty. Today, less than 10 percent live in poverty. Further, Social Security provides much-needed assistance to people with disabilities as well as widows, widowers and orphans.
Let's be clear. The deficit and national debt are serious issues, but we must not balance the budget on the backs of the elderly, the children, the sick and the poor. This would not only be immoral, it would be bad economic policy.
While our billionaire friends may not like them, there are much fairer ways to reduce the deficit. At a time when the wealthiest people in this country are doing phenomenally well and their effective tax rate is the lowest in decades, the top 1 percent must begin paying their fair share of taxes. At a time when large corporations are enjoying record-breaking profits, we have got to eliminate the huge corporate loopholes which result in a massive loss of federal revenue. At a time when we have tripled military spending since 1997, we must take a hard look at a bloated and wasteful Defense Department.
To keep Social Security's finances sound in the future I have introduced legislation - identical to a proposal that President Obama advocated in 2008 - to apply the payroll tax on incomes above $250,000 a year. Under current law, only earnings up to $110,100 are taxed. The Center for Economic Policy and Research has estimated that applying the Social Security payroll tax on income above $250,000 would only impact the wealthiest 1.4 percent of wage earners.
While we often take Social Security for granted, we must not forget that Social Security today is providing dignity and security to tens of millions of Americans at very modest administrative cost. It is a program that is working and working well.
Now is the time to defend Social Security against billionaires, right-wing Republicans, and some Democrats who want to cut this program. Let's send them that message in New Hampshire on September 7.
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Comments
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I would think that one of the best ways to achieve that wold be to increase SS payments. We are simply creating the mony anyway, and feed ing to the bankers is just plain wrong.
With those obscene sums, every under-water mortgage could have become a national asset with homeowners allowed to remain in their homes (thus maintaining home values, across the board while also securing a property tax base). My point is that the bailout should have transferred all that valuable real estate and established it as part of a national asset bank. Instead, the banks got the $ AND the real estate and everyone else is left to pick up the tab. First, through the actual money delivered to the very culprits who engineered the bubble, and second, in the form of diminished home values. And STILL this ilk thirsts for more blood.
By creating (courtesy of Koch Brothers think tank logic) the illusion that Social Security is broke, a pretense is put in place that calls for agencies of correction. This is precisely the approach used to gut the U.S. post office and privatize its considerable assets. A similar approach is being directed at public schools.
As recent articles by Matt Taibbi expose, the ethos of the hostile takeover is operating on Steroids. Any PR used to dress up the grand heists is like passing out cognitive Opium to the naive masses.
The problem, Midwest Tom, is not that we are "creating money" but rather that we are creating money as debt instead of printing it debt free (as, for example, Lincoln did during the Civil War or the colonies did prior to the American Revolution). Unfortunately we have given up control over the money supply to the private banks so that all money at this point is essentially created as gov't debt (issuing treasury bonds which are IOU's and thus create debt -- principle and interest). The answer is to create genuinely publicly owned financial institutions and have the federal government take back the power to issue money debt free. In fact, instead of loaning the banks more than the total amount of the current US debt the government could have used this money to pay off the debt in its entirety which would immediately save us nearly 1/2 a trillion dollars in interest payments every year.
HEAR!HEAR!Well said!
I'm just a lowly free lance musician and way away from Vermont too and I contribute to Bernie as well because I feel like Thom Hartmann that Senator Sanders is America's senator. Weneed more like him.
I expect to see right-wing bill after right-wing bill quickly passed through both Houses of Congress constantly, and the only thing preventing those bills from becoming law will be IF Obama is in the White House and IF he's willing to stand in their way and use his veto pen.
Otherwise, as wildly unpopular as conservative ideology is right now, don't be surprised if, once again, the right-wing neo-nazis get every single thing they want for the next few years.
P.S. Thank you for the earlier "Nod."
We certainly need to work at saving medicare, and it will NOT be easy. We must have some statesmen and women, preferably retired so they are not beholden to any moneyed interests. They should A S A P get to work on solving that problem.
But NO way should Wall Street be involved, and neither should Paul Ryan.
Keep him as far away from Medicare and Medicaid.. We need people with BRAINS AND HEARTS
Between the two, we actually 'know' very little, these days. What is True, Actual, Real...is deliberately misrepresented, or obscured in clever ways, to influence the Public or prevent the Truth from being known.
...For good reason. Much of 'the Truth' is pathetic, reprehensible, malfeasant, embarrassing... ...
Athough the "Fund" nominally contains a large surplus, that collateral is in the form of bonds representing principal and interest that are owed to the government by itself.
That debt has been incurred because, in previous years, Social Security receipts from insurance payments always exceeded expenditures for benefits. So each year when there was a surplus, the excess income was borrowed and diverted to fund expenditures for unrelated government purposes. The government annually issued bonds -- often referred to as IOUs -- to the "Fund", equal to the amount borrowed that year, plus interest on the cumulative amount it had borrowed in previous years.
Nowadays, since Social Security annual expenditures are exceeding income from insurance payments, the "Fund" is experiencing a rising deficit, which has to be met by liquidating some of the bonds. The only way to liquidate the bonds -- backed only by the "full faith and credit of the United States" -- is through a combination of government borrowing from the public and use of available federal revenues. Doing so contributes to the federal deficit.
Thus the bonds are actually superfluous, since the government is both debtor and creditor. The situation is analogous to raiding one's piggy bank, spending the money, and issuing IOUs to oneself for the amount borrowed, plus interest..
Thank you for writing. Please allow me to explain how a bank operates and how Social Security operates.
The federal government regulates banks, and guarantees the safety of deposits, up to a certain maximum. And the banks have to invest their deposits in a safe way, by requiring collateral. In contrast, Social Security, rather than having to invest any surplus premiums in low-risk collateralized investments, is legally able to immediately expend any surpluses for unrelated Treasury purposes.
If a bank employee or trustee were to allow diverting depositor funds to risky investments that are not collateralized, they could be prosecuted. Worse, if a bank employee were to divert investors' funds to his/her personal use, he/she could be prosecuted for embezzlement.
Yet Social Security trustees can legally borrow, then expend, rather than invest, Social Security funds, as Congress dictates, for unrelated federal spending. The only collateral or protection for those borrowings is the Social Security bonds, protected only by the "full faith and credit of the United States".
During the big fracas over the imminent need to raise the debt ceiling, Obama publicly warned that if Congress failed to raise the debt ceiling, Treasury would probably have to reduce current Social Security payment-checks. If there were really $2.7 trillion sitting around, there would be no danger that that could happen.
Thank you for taking an interest in, and commenting on, the intriguing U.S. political system from down under.
To comment a bit further: Despite the odd way the Social Security system operates, it has up to now greatly benefited all parties, including workers who suffer health setbacks and retirees, especially the long-lived ones.
During most of its years, this system, akin to a Ponzi scheme, experienced annual surpluses, which have been a bonanza to the politicians. Those surpluses provided them with some spending money they could use to fund their favorite federal programs without having to raise taxes, reprogram existing revenues, or increase the deficit. Alas, this shell game is now over, and the politicians need to incur the pain of finding revenues to fund the growing annual deficits in Social Security, caused both by increasingly fewer workers per retiree as the population ages, and increasing longevity of retirees.
Sadly, the U.S. population is rather uninformed about what's going on, largely because of their being dumbed down, propagandized, and misinformed by the corporate media and by many politicians in Congress and the White House. The latter are being legally corrupted by money-in-politi cs, turning the USA into a corporatocracy. Their corruption is the central cause of why we have a dysfunctional Congress and for its inability to deal with pressing national issues on behalf of the 99%.
With big money purchasing the politicians (from both camps) who in turn gave a nod to deregulation (the decimation of Glass Steagall under Bill Clinton) and allowed the graft known as Derivatives & Swaps to spread to the point that it's now alleged that 40% of our nation's economy is vested in "Finance," money has indeed morphed into the GRAND illusion.
Because our government makes deals with the Fed to print money, you are correct that it acts as both debtor and creditor. As has been shown both by Ellen Brown and the Bank of North Dakota, were the government to work this arrangement with "itself," rather than through a private entity like the Fed, it would shore up a huge surplus in the form of interest $. Instead that profit goes to the privateers.
END THE FED!
That having been said though, she has never called for a return to the gold standard and those that confuse the issue of ending the fed (with which i agree completely) and creating genuinely publicly-owned financial institutions and having the gov't take back the power to print money debt free has nothing to do with the gold standard which is simply a distraction.
I deeply resent having to subsidize religion by paying taxes they, like any other business, should be paying.
GOOD CALL. This time you're right for TWO reasons:
1. We need to gut military spending
2. We need to raise taxes on the rich a whole hell of a lot.
If we actually want to lower the national debt rather than just paying it lip service we MUST do both of those things.
Thanks!
P.S. You're right about 3 things! We need to spend A WHOLE HELL OF A LOT MORE on our public schools too!!!!
GOOD IDEAS!!!
The Fed "lent" more than 15 Trillion to the private banksters (something only discovered due to Sanders and Kucinich pushing for Fed audit language being included in Dodd/Frank. Had this money been used to fully pay off (repurchase)the US debt we would now be saving more than 1/2 a trillion dollars a year in interest payments. We could then have used this money to reinvest in a huge national public works program to rebuild our crumbling infrastructure and build a new 21st century one (including high speed rail, a "smartgrid", energy efficiency retrofits on all public buildings to start with, etc.) which would have put everyone back to work in the real, productive economy, and put us back on a progressive economic course.
On the list:
1. Raise the Social Security cap to $250,000 as Bernie Sanders wisely suggests.
2. Add a Tobin (or Robin Hood) tax to Wall Street transactions
3. Penalize corporations that off-shore their profits or deploy disingenuous tax shelters
4. Cut back the MIC by 50% and close some of the estimated 1000 bases that exist all over the world
5. Tax wealth at a higher level than 15%
6. Re-institute the Estate Tax
7. Give the public back a share--like 10% of its air waves so that bona fide political candidates do not have to put their souls in hock (to deep pocket interests) to share their platforms with the public
A good start to which i would add:
1) make it more expensive to invest outside the US than inside
2) force US based corporations to pay US prevailing wages abroad if they outsource jobs
3) Implement a national public works project rebuilding our infrastructure and make all contracts subject to Davis-Bacon prevailing wage laws
4) Create publicly owned financial institutions and have the gov't take back control of issuing money debt free
5) give workers control of their union pension funds to invest in things like affordable housing instead of turning these funds over to wall street money managers
OBAMA/BIDEN 2012
The alternative is the loss of our country to those out to buy it.
Yeah, I'm sure Wall Street would just LOVE to get their hands on all that "free cash." Oh, don't worry, America, a melt-down like that couldn't POSSIBLY happen twice in one lifetime! How much did JPMorgan Chase 'lose' this year alone?
I'm not an economist, but at least I can balance my checkbook every month--which is more than these Wall Street "smart guys" seem to be able to do.
Robert Reich has referred to what Wall Street does as "casino capitalism." Makes sense to me. Hey, give me a bunch of money--say, $100,000--and I'll go to Vegas and lay it all down on one hand at the blackjack table. Oops, sorry, lost your life's savings--but I lost my own savings too, so you'd better pony up some more dough, 'cos I'm "too big to fail."
The Republicans and their big money backers would love to "privatize" whatever government money they can get their greedy hands on. Just look at what happened when Americans shifted to 401K plans for their retirement. Look too at the privatization of prisons and the horrible private health insurance we see. When corporate structures assume any government responsibility, the goal shifts to profiteering, not serving the needs of the people.
Social Security has been and continues to be a solvent and well-run government program. Americans should demand that these vulture capitalists stay the hell out.
You're ignoring the fact that the Republicans in Congress were holding unemployment benefits hostage to keep those tax cuts from expiring, and have been obstructing any jobs bill he's proposed.
Those who do things like manipulate election vote counts also do their best to lend them the imprimatur of legitimacy. It happens to be a fact that Left-leaning sites attract paid informants and/or observers. You're probably one of them. Go ahead and call that a conspiracy, but Homeland Security certainly has the funds to invest in this type of thing. Or do you wish to say that it's just my imagination that Cass Sunstein recommended this approach, or that a huge data bank facility is being built in Utah, or that phone conversations and emails are being read under the rubric of fighting terrorism?
Wrong era to argue your case, Sherlock.
Every time anyone criticizes Obama or the Dems---that is, tells it like it is---the negative marks mount up. People just will not see that the Dems are the problem as much as the Rethugs are. They're ALL bought and paid for!
Celeste, welcome to the cite...one of the problems you will soon discover (if you haven't already) is that there are far too many on this board that believe that "progressive" equals an uncritical supporter of the democratic party or that if one is critical at all of dems that one must be an evil rethuglican. It is a sad commentary on the state of progressive thinking
If "it's gone, people"--why are the Republicans so eager to give it to the banks to "manage"?
I understand that the top 1% of our population owns over 40% of equities. With privatization, millions of social security contributors would invest hundreds of billions of dollars into the stock market each year. The US stock market could appreciate 5% to 10% annually just based on these contributions. The rich would profit the most since they already own much of the market and Wall Street would make $billions from fees and their own trading.
Could privatization be a get-even-richer scheme for millionaires and billionaires?
Also, it is too risky for the average person to put social security contributions in the same basket with their personal investments, IRAs, 401(k) and their company’s pension funds (if they have them!). It defies the basic principal of investment DIVERSIFICATION . Social security funds should not be put into the stock or even the bond markets.
It is an odd mentality that focuses more on taking the money away from aging widows who have nothing else to keep them from homelessness, rather than upon the obscene wastes that go to war, graft, corruption in high places and Wall Street's (should be criminal) way of creating vast profits (out of nothing in the way of product or genuine labor) to thereby skim.
With priorities like yours, your best friends are probably sociopaths.
As Senator Sanders continue to point out...simply raise the cap on paying into Social Security and it is solvant for the next 75 years...problem solved.
Several decades ago, Margaret Thatcher claimed: "There is no alternative". She was referring to capitalism. Today, this negative attitude still persists.
I would like to offer an alternative to capitalism for the American people to consider. Please click on the following link. It will take you to an essay titled: "Home of the Brave?" which was published by the Athenaeum Library of Philosophy:
http://evans-experientialism.freewebspace.com/steinsvold.htm
John Steinsvold
“Insanity is doing the same thing over and over and expecting a different result."~ Albert Einstein
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