The Catskill Chronicle

By Mort Malkin

Once upon a time, there was no Social Security in the US. Actually, it was not that long ago. Ever since the Social Security Act was signed into law by FDR in 1935, some few (or many) folks have tried to delete this eminent safety net. Early in its history some wanted to abolish it — the argument: “What are bootstraps for?” More recently, another few more have tried to entrust the Trust Fund assets of $2.7+ trillion to the care of Wall Street. These latter day prophets called it “entitlement reform.”

In 2004, John Kerry conceded the presidency to George W. Bush, even though the voting irregularities in Ohio, if challenged and corrected, would have given Kerry a margin of victory in the Electoral College. It’s still a mystery why Skull & Bones preferred one of their members over another.

George W, as president, announced that he intended to spend the political capital he had earned in the Election Day poker game. With a little encouragement from his vice president, Dick Cheney, George W went after Social Security and Medicare. Poppy Bush wouldn’t have minded — he was a well paid consultant for the Carlyle Group, a private Equity Fund with connections in Saudi Arabia. His fellow Seniors, however, minded very much and said so loud & clear. Even a few conservatives told their Congressmen, “And tell the government to keep its hands off my Medicare.” Dick Cheney, the famous bird hunter, must have been impressed by the skills of the Senior marksmen who shot down Bush’s privatization scheme so fast and accurately that it was dead before it hit the ground.

In 2012, the idea of allowing Wall Street to raid the $2.7+ trillion Trust Fund rose like a zombie among us when Mitt Romney selected Paul Ryan to be his vice presidential running mate. On Election day, the Seniors spoke and said they didn’t trust Romney, Ryan, or Wall Street. Thereafter, the Congressional House of Representatives, led by the just defeated Paul Ryan, said too many of the poor were getting Food Stamps and adding to the National Debt. Paul Ryan also blamed the “entitlements” the Seniors were receiving. Many of his colleagues in the Congress spoke of “entitlements” with a smirk in their voices as though the entitlements were free and undeserved.

The Seniors, however, remembered very well that every week of their working lives they had contributed t0 the Social Security Trust Fund by their payroll deductions. The “entitlements” were IOUs, to be repaid. They were not getting free lunch.

Medicare, being younger than Social Security, had a smaller Trust Fund — only about $300 billion. But that will be quite enough until the US catches up to the rest of the world and establishes a national, universal health care system — a Medicare for All. For now, we ought to have a public option in addition to the exchanges of private plans. Medicare should also be able to negotiate with pharmaceutical companies for lower prices for prescription drugs and for vitamins and supplements.

If there is to be any negotiation on Social Security, the Obama Administration must first talk the talk: start calling the benefits IOUs. Then, their starting negotiating position should be an increase in benefits to an amount so that benefits plus outside income adds up to at least federal poverty levels. If the White House must give in on something, it can reluctantly require that any senior who owns four homes (John McCain, take notice) or who owns three homes one of which includes a car elevator (Mitt Romney, you too), not be eligible for the increase in benefits.

If some politicians are still worried about where the Social Security Trust Fund will be 25 years out — an easy talking point — the answer is staring them in the face right now. Just remove the salary cap on which payroll deductions are taken. Require payroll deductions on the full salary, not just the first $113,700. The Trust Fund would stay solvent for more than a century. As things stand now, workers who makes less than $113,600 — that’s most of us — pay 6.2% of their salary, which the government promises upon its full faith and credit to pay back at age 65. Anyone who makes $227,200 pays only 3.1% of salary into the Trust Fund. It’s the prosperity principle, but not for the poor working classes. A progressive tax turned upside down — the more you make, the less you pay.

Social Security is wildly popular. Various polls show that over 80% of all Americans are in favor of Social Security and oppose all cuts to the program. No wonder — there are well over 40 million Seniors and even more children and grandchildren of Seniors. What an army of lobbyists. Exxon, Chevron, Peabody Coal, and Exelon must be green with envy. The corporations can offer politicians campaign money; the Senior team can promise votes.

A few paragraphs back, Gadfly, by taking problem-solving as a serious function of parody, suggested that the White House’s starting point in negotiations with the axe-wielders should be an increase in Social Security benefits. Lo, Senator Elizabeth Warren has made the suggestion that increasing benefits is the end point in negotiations. And behold, Senator Tom Harkin is introducing a bill with the particulars: raise benefits by $70 per month, and change the inflation index to reflect the food, rent, and living expenses needed by Seniors. Senator Sherrod Brown has signed on, and others are starting to hear from their constituents. The latest poll reports that 65% of Americans support increasing benefits (Public Policy Polling).

Writing satire is getting easier all the time nowadays. No creativity is required — just report the news straight.