U.S. Congress: GOP Stewardship of Their Legislative Responsibilities Disappointing; Must Cease Blaming and Punishing the 99%

U.S. Congress: GOP Stewardship of Their Legislative Responsibilities Disappointing; Must Cease Blaming and Punishing the 99%

Yet again the GOP is playing games to force votes that, if successful, would continue to cut programs and services to the 99% under the guise of performing their duties: exercising the power of the purse under the U.S. Constitution–extending the debt limit (which should not exist these days because cash coming into the Treasury from FICA and FERS are immediately taken and their respective accounts are issued Treasury securities that will be redeemed with cash in the future). The so-called debt limit should be automatically raised now and not used as a dubious bargaining chip to pass unacceptable GOP proposals in any form. (Passing a form of an unacceptable plan, that is, incrementalism, must also be rejected.)

The Congress must accomplish its mission responsibly. I cannot expect the process to be perfect, but I can expect that these legislative responsibilities are carried out fairly and equitably for all those who reside within the United States of America. The vulnerable and suffering are our fellow human beings; help is what is needed not condemnation or punishment. The Affordable Care Act is the law and must be implemented on time.

Because the GOP only wishes to work for the 1% only, no further negotiations, appeasements, or discussions can be had with that party until and unless they are prepared to do the work on behalf of all of the people of the United States. The debt limit should be passed as a separate bill; appropriations bills should be passed for the entire fiscal year, not embarrassing fits and starts.

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Barack Obama: Obama Administration Releases its American Jobs Act Proposal

The Obama Administration provides a statement to Congress, section-by-section analysis, and text of the bill at the White House website.(http://www.whitehouse.gov/the-press-office/2011/09/12/message-president-congress-sectional-analysis-and-text-american-jobs-act)

FICA: President Barack Obama Seemingly Is Using the Payroll Tax Cut as a Way to Weaken Support for FICA-Funded Programs; President Should Use General Funds to Provide Needed Economic-Crisis Assistance

President Barack Obama’s proposal to extend the Federal Insurance Contributions Act (FICA) tax cut harms the idea that FICA is a special-purpose tax to fund Social Security and Medicare. I feared the President’s proposal last year, knowing that his further proposals to extend would happen. Currently, the Congress requires the Treasury to arrange for an equivalent amount of cash to go to FICA-funded programs, which makes up for the “loss” due to the FICA tax cut. [P.L. 111-312, sec. 601(e)]. This tax cut seems to be a neat way of having the increase (not much ($934 on yearly average)) of cash to the citizenry, while having the Treasury ensure that the contributions to the FICA-funded programs are not reduced.

However, what the President has done is introduce the idea that the FICA tax is not a special-purpose tax for Medicare and Social Security, but rather the notion that FICA can be used for general current-revenue purposes. This change is subtle but very dangerous. While the current President can be said to support Social Security and Medicare, this very same FICA tax cut could be used to force cuts or substantially change both programs (by a future President who can be said to be opposed to FICA-funded programs). Therefore, I became seriously concerned when the so-called Democratic President used a GOP talking point to attempt to shame GOP congressional members to support an extension of the FICA tax cut (emphasis below mine).

Pass this jobs bill, and the typical working family will get a $1,500 tax cut next year.  Fifteen hundred dollars that would have been taken out of your pocket will go into your pocket.  This expands on the tax cut that Democrats and Republicans already passed for this year.  If we allow that tax cut to expire — if we refuse to act — middle-class families will get hit with a tax increase at the worst possible time.  We can’t let that happen.  I know that some of you have sworn oaths to never raise any taxes on anyone for as long as you live.  Now is not the time to carve out an exception and raise middle-class taxes, which is why you should pass this bill right away.  (Applause.)

The President is seemingly using the economic crisis as a way to begin the process of breaking the overwhelming popular support of the FICA-funded programs. The issue that some wealthy politicians face is the enduring support of FICA-funded programs. Because of how the U.S. manages its cash–using FICA funds in general revenues and issuing a nonmarketable Treasury bond (a promise to repay) in exchange for the cash–general revenues that are artificially low (due to the FICA borrowing) will have to be increased in order to pay the bonds redeemed by FICA-funded programs when the number of beneficiaries exceeds the proceeds collected from the FICA tax.

The President, when he deals with FICA-funded programs, must be carefully observed.

Third Way: Evaluating Group’s Document “Saving Social Security”; Proposal to Raise Retirement Age Also Denies the Fact of Aging

As I wrote in the previous post, Third Way advocates working up to 70. I stated previously that people should enjoy life activities before the hardships of aging set in.

In the Washington Post today, yet another reason why additional years of work should not be so forcefully advocated.

Many industries find themselves in a quandary. They often need older workers for their expertise, yet they also may need to accommodate their physical disabilities and their desire for more flexible schedules. And as workers stay on the job longer, they may need training in new technologies or work procedures.

In addition, the whole idea is to transfer the knowledge of the present working generation to the generations behind them. This article indicates that that effort is not happening, and only bad results can occur because of it.

Barack Obama and Third Way: Press Conference Comment Seems to Have Been Influenced by Third Way; Group Favors Keeping Image Only of Concern and Care for the Nonwealthy

If I needed confirmation that President Barack Obama is tied to the Wall Street-connected think tank Third Way, I would have that confirmation today. Interestingly, in the Third Way publication “The Case for Taking Up Entitlement Reform“, the following are considered “entitlements”–FICA- funded Social Security and Medicare, Medicaid, and federal employee pensions. I found the President’s statement bracing, yet I was not surprised; he is governing as a liberal Republican anyhow.

I do not believe for a second that cutting these programs will allow time to focus on the items that he mentioned. How can you move to cut spending from the lower income classes, and then have the audacity to use that you will be able to add spending with insufficient revenues?  This idea is unwise and fantastical.

A quote at his July 15 press conference appears to have been strongly influenced by a Third Way publication (emphasis for comparision purposes).

And so that’s where I’d have a selling job, Chuck, is trying to sell some of our party that if you are a progressive, you should be concerned about debt and deficit just as much as if you’re a conservative.   And the reason is because if the only thing we’re talking about over the next year, two years, five years, is debt and deficits, then it’s very hard to start talking about how do we make investments in community colleges so that our kids are trained, how do we actually rebuild $2 trillion worth of crumbling infrastructure.

If you care about making investments in our kids and making investments in our infrastructure and making investments in basic research, then you should want our fiscal house in order, so that every time we propose a new initiative somebody doesn’t just throw up their hands and say, “Ah, more big spending, more government.”

It would be very helpful for us to be able to say to the American people, our fiscal house is in order.  And so now the question is what should we be doing to win the future and make ourselves more competitive and create more jobs, and what aspects of what government is doing are a waste and we should eliminate.  And that’s the kind of debate that I’d like to have.

Here’s a quote from a Third Way publication “The Case for Taking Up Entitlement Reform” (compare with bolded words above).

Winning the economic future depends on progressive public investments—in innovation, children’s health, education, pure research, teen pregnancy prevention, space exploration, medical research, infrastructure, school lunches, and the arts and humanities. But left on autopilot, the nation’s budget will be swamped by entitlement and debt obligations that will crowd out everything. Scraps will be left for defense and domestic discretionary spending to fight over, and we know who wins that battle.

Third Way on “Entitlement Reform”– Assumption that Youth Do Not Care about Social Security, et al. to Trash Those Programs Disgusting, Unacceptable and a Breach of Trust

The Wall Street-backed think tank called Third Way has produced a memorandum (“The Case for Taking Up Entitlement Reform”) urging “entitlement reform”. [The word entitlement suggests welfare, but it does not apply to programs that the taxpayer funds through FICA like Social Security and Medicare (and incredibly federal pensions).] I strenuously disagree with the position of Third Way.

Like true scions of wealth, their position is that borrowing the surplus of the FICA-backed funds is essential to keeping the rich from paying their share of taxes. So rather than paying back what the country has borrowed from the lower classes, the theme is to gut the programs such that they continue to collect money from the working classes but remake the programs so that they do not have to pay out as much to those same contributors.

Third Way uses genteel language, but underlying all of those words is the idea expressed above. As such, Third Way is not a group that should be trusted. Higher-level political leadership is also undeserving of any trust to act properly without citizen intervention.

In the Third Way “entitlement” memo, I found all of the assertions to be disingenuous, but the one stating that young voters do not think Social Security will be there for them one of the worst. The use of youth to justify larcenous acts against FICA-funded programs is immoral and contemptible.

  • People from their first jobs pay FICA taxes.
  • Most people do not earn enough to make a comfortable retirement without Social Security.
  • Only the rich benefit from 401(k) programs.
  • Retirement for the college aged is far away. How Third Way could make such a broad assertion is irresponsible. Who can think about what life will be 40 to 50 years down the road? No one.

Simply because some decrepit polls supposedly opine some supposition does not mean that that assertion means to destroy the FICA-funded programs. Regardless of any polls, federal politicians have a fiduciary responsibility to administer the FICA-funded programs for the benefit of the beneficiaries. Proposing ways to reduce payments to beneficiaries (while collecting the full FICA payment) is unacceptable and a breach of trust.

If the country is declaring default on repaying their FICA debt, then the Congress should repay the working class citizenry in full immediately.

Third Way: Its Belief in 401(k)’s Is Not Well Founded; Pensions Are Better for the Non-Wealthy

A common thread of Third Way publications on federal pensions and Social Security is a strong faith in the 401(k)s. Because the private sector switched to them (at tremendous profit to executives and shareholders and tremendous cost to employees), Third Way strongly advocates for them. This move would absolutely come to the tremendous benefit of Third Way’s board of trustees, many of whom have Wall Street interests.

A PBS program, Frontline, outlined the situation in 2006. Having viewed the program, I take a dim view of Third Way’s proposals seeming to favor strongly flawed and expensive 401(k)s to make the Federal Employees Retirement System unaffordable (and ultimately transferred (at great profit) to Wall Street.

A thought: Suppose President George Bush succeeded in privatizing Social Security and then Wall Street crashed, wiping out Social Security funds. What would happen? I say at a minimum that profit-taking Wall Street firms should have all profits disgorged until such time that the Social Security program would have been made whole. If this result is uncomfortable, then Wall Street has absolutely no business handling Social Security or federal pension monies.