Dean Baker: Saving Social Security: Stopping Obama’s Next Bad Deal

[Better Believe It]

Saving Social Security: Stopping Obama’s Next Bad Deal
By: Dean Baker
December 20, 2010

President Obama insists that he is a really bad negotiator, therefore the deal he got on the two-year extension of the Bush tax cuts and the one-year extension of UI benefits was the best that he could do. This package also came with a one-year cut in the Social Security tax.

This cut will seriously threaten the program’s finances if next year, the Republican Congress is no more willing to end a temporary tax cut than this year’s Democratic Congress.

Before we even get to this juncture the Republicans will have another opportunity to impose a really bad deal on President Obama. Sometime in the spring the government will run up against its debt ceiling. This will prevent the government from any further borrowing.

Since the government has a substantial deficit, with spending exceeding revenue, hitting this limit would mean that the government would not have sufficient funds to pay for all its programs. It also would mean that the government could not pay interest or principal on debt that is coming due, in effect requiring it to default on its debt.

The prospect of defaulting on the debt will create a similar outbreak of shrill warnings of disaster. This would likely to lead to scenario in which President Obama signs whatever debt ceiling package House Republicans hand him, even if it includes the privatization of Social Security and Medicare and major cuts and/or elimination of other important programs. The argument from the administration will be that they have no choice.

Please read the full article at:

http://my.firedoglake.com/deanbaker/2010/12/20/saving-social-security-stopping-obamas-next-bad-deal/

[Scurrilous]

1. K & R

:kick::woohoo: :kick: :woohoo:

[TheWraith]

2. More lies and misinformation from the Firebaggers.

Who believe that President Obama is the enemy and Grover Norquist is our friend.

[Better Believe It]

3. Right. General tax revenues won't be used to fund social security. Thanks for the real story.

Everything is just fine. Now move along folks .... nothing to see here.

Obama is beating the crap out of the Republicans.

Trust me.

Just move along now and tend to your business.

[TheWraith]

4. I'm sorry that calling lies and misinformation what they are bothers you.

Fact is that general tax revenues have always been on tap to fund Social Security, since the SS Trust Fund is packed to the brim with US Government securities.

[Better Believe It]

11. Do you know what U.S. Government securities are and what is meant by general tax revenues?

[girl gone mad]

5. It was the administration's decision to convene a deficit commission..

who called Grover Norquist to testify.

Your hypocrisy here is extreme.

[TheWraith]

6. Your tu quoque is rather laughable.

A bipartisan commission set up to listen to people about the deficit without prejudice or preconception... listens to someone about the deficit.

Meanwhile Robert Kuttner, the new darling of the people who claim a payroll tax holiday will destroy Social Security, advocated back in September for a payroll tax holiday. A TOTAL one, not just a temporary cut.

[Better Believe It]

10. The statement you made misrepresents Kutter's position and is just plain wrong!

You wrote:

"Robert Kuttner advocated back in September for a payroll tax holiday. A TOTAL one, not just a temporary cut.

I can understand why you failed to provide any links to verify your claims regarding Kuttner.

That's because you have none.

Kuttner never supported funding Social Security out of general revenues. That was a key part of the Obama/Republican tax cut proposal and the most dangerous successful attack on Social Security in its entire history! You ignored that "minor" fact.

Instead, Kutter proposed a six month tax holiday for social security taxes that would be paid for by a surtax on people making over 10 million dollars a year.

So you didn't know that .... or did that fact not fit your narrative?

Here's what Robert Kuttner actually wrote which you conveniently neglected to include in your post:

"Propose a six month tax holiday for payroll taxes. Ask for the Republicans' support. This would provide direct tax relief to working people and lower the cost of creating jobs. It would provide more of a tonic to the economy and more practical help to American families than any of the Republicans' proposed tax cuts. Make up the loss to the Social Security trust funds with a temporary surtax on people making over $10 million a year."

So Kuttner proposed making the rich pay billions into the Social Security trust fund that they otherwise would not pay. That sounds good to me! In fact, how about ending the CAP on Social Security taxable income and making the millionaires and billionaires pay their fair share every year!

I hope you're not opposed to doing that "TheWraith".

[BlueIris]

7. Good luck with that, crazy optimists.

So far, exactly no attempts to stop the Admin's horrifying agenda have succeeded. We are stuck with this shit. Awful.

[sasha031]

8. K&R

:kick:

[Liberal_in_LA]

9. kick