Obama’s New Budget: Why He’s Cutting Social Security & Medicare

Dr. Jack Rasmus

Jack Rasmus

Obama’s bargaining strategy and tactics with regard to deficit cutting over the past three years have proven to be an unmitigated disaster. From the idea of seeking a ‘grand bargain’ with Teapublicans in the House of Representatives in May 2011, to the debt ceiling and sequester deals of August 2011 that resulted in $2.2 trillion in spending-only cuts and no tax hikes whatsoever on the rich, to caving in on the so-called ‘Fiscal Cliff’ this past January 1 agreeing to a deal to tax only the richest 0.7%—Obama’s bargaining strategy and tactics have proven a case example of exactly what not to do in negotiations.

Obama’s first error was to believe that by offering hundreds of billions in entitlement cuts back in the summer of 2011 in exchange for revenue hikes that Republicans would agree to raise taxes a mere year before the 2012 elections. Obama and the Democrats subsequently further believed that by linking $1.2 trillion in sequestered spending-only cuts in August 2011, as part of the debt ceiling deal, that Republicans would not allow $500 billion in sequestered defense spending cuts to take effect and would agree to some tax hikes in exchange. Obama then made the error this past December thinking Republicans would continue to discuss tax revenue proposals after they agreed to the minimal $60 billion in Bush tax cut extensions (aka ‘Fiscal Cliff’) on January 1, 2013.

But it’s only a sliver on a graph!–Or why liberal technocrats are wrong on Social Security.

by Jim Nichols

Something struck me as I was talking to members of my union at work (see: “Obama wants to do what!?!?!?!?!?”) and in the recent public comments from some public intellectuals and labor leaders.

As a union steward you get to know your people. Day in and day out. Through good and bad. You can see responses and reactions to political questions and challenges in a way that some some volunteer making a cold call door knock just before election day–never to be seen for four more years–or some opinion-poll questioner getting a person in the middle of screaming kids, and dinner on the stove, won’t notice or understand.

Boehner’s Plan for Fiscal Showdown—Cut Social Security COLA to Pay for More Tax Cuts for the Rich

by Damon Silvers

On Sunday night, House Speaker John Boehner made clear he would like to make a simple trade with President Obama. He asked the president to extend tax cuts on income between $250,000 and $1 million a year—a tax bonanza of nearly $400 billion over 10 years, about half of which would go to millionaires.

And how will we pay for this very expensive gift to the least needy among us? By cutting $122 billion in Social Security benefits from the neediest, including elderly seniors and people with disabilities who depend on the Social Security cost-of-living adjustment (the COLA) to keep inflation from eating away their benefits as they age and incur health care expenses. Moreover, this COLA cut affects current as well as future beneficiaries. Yesterday, press accounts said that President Obama offered to accept this cut to Social Security as part of a larger deal, which Boehner then rejected on Tuesday evening, saying he was going to take his “Plan B,” more tax cuts for the rich, to the House floor.  The AFL-CIO is calling on members of Congress and the president to oppose Boehner’s cuts to Social Security and his Plan B.   Here’s why: Boehner wants to cut the COLA through a technical change to the way the COLA is calculated, called the Chained Consumer Price Index or “chained” CPI. This index underestimates inflation for seniors and people with disabilities, according to 250 economists.

Call the White House at 202-456-1111; tell President Obama you oppose the “chained” CPI.

Tell Your Senators CPI Changes Are Scam to Cut Social Security

by Mike Hall
AFL-CIO Now Blog

There’s plan floating around Capitol Hill that would slash Social Security benefits as part of a deficit reduction package even though Social Security does not contribute a penny to the deficit.

That’s why you need to click here to tell your senators “Do not cut Social Security.”

Backers of the plan are disguising the cuts as so-called inflation adjustments. Don’t be fooled. Changing the way the Consumer Price Index (CPI) is calculated will reduce the cost of living adjustments that Social Security recipients count on to keep pace with inflation.