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Tonight: Rep. Kuster Hears from NH Seniors

 Congresswoman Annie Kuster to Host ‘Telephone Town Hall’ to Hear from New Hampshire Seniors

 On the call, Congresswoman Kuster will discuss her work to protect Social Security and Medicare

Rep Annie Kuster in US HouseWASHINGTON, D.C. – Tonight, March 25th, Congresswoman Annie Kuster (NH-02) will host a live telephone town hall to hear directly from New Hampshire seniors about the importance of protecting Social Security and Medicare. Seniors from throughout the district will participate in the call, and will also discuss other issues that are important to seniors in the Granite State.

During the call, Congresswoman Kuster will take questions from her constituents, and will discuss her own legislative efforts to protect the programs that New Hampshire seniors rely on like Social Security and Medicare.  Among other topics, the Congresswoman will discuss her opposition to using chained CPI to calculate Social Security, a move which could significantly reduce benefits for our seniors; how closing the Medicare Part D Donut hole has saved New Hampshire seniors thousands of dollars in prescription drug costs; and her ideas to create additional savings for our seniors by allowing the government to negotiate for cheaper prescription drugs for Medicare recipients.

Granite Staters Rally At Sen Ayotte’s Office In National Day Of Action To Protect Social Security

Ayotte Dec. 3, 2013Statement from New Alliance for Retired Americans President Lucy Edwards at the National Day of Action event in Nashua NH 

As the president of the New Hampshire Alliance for Retired Americans, a grassroots volunteer group of senior citizens representing 13,000 NH retirees, I am here today with others fighting to save our Social Security and Medicare benefits from any “grand bargain” between the President and Congress.  Right now in Washington DC, a committee of House and Senate members is trying to agree on a budget that could pass both houses of Congress and get the President’s signature.  Our junior Senator, Kelly Ayotte, is one of these members and that is why we are here today.

For many of us, including me, cuts to these earned benefits would mean the loss of our economic security in retirement.  Do not be fooled by those who tell you that there are no seniors in NH who are all or mostly dependent on Social Security for their income, or for whom turning Medicare into a voucher program to buy insurance on our own would most likely mean increased ill-health and even early death.  We’re out here today because we must be getting the word out. This is not some political game played in DC, this is very real and very frightening to many of us.

And let me say that I and my fellows worry about our children and grandchildren as well.  We are not “greedy geezers!”  When a politician says to me that any changes to the programs will not affect anyone over 55, the first people who pop into my mind are my daughters and their husbands!  When a politician says to me that raising the eligibility age for these programs would be fine because people are living longer, I think of all the people I know who have been without health insurance until now, and wonder if they will even be able to work til 65.

What we really need in this age of the 401(k) and “you’re on your own” retirement plans, and proposals such as the Chained CPI, is something like Senator Harkins’ bill, the Strengthen Social Security Act of 2013, which would fit a Consumer Price Index for us seniors to our true costs, including healthcare costs.  The Chained CPI would cut benefits now AND in the future, leaving us with shrinking incomes just at the time when we need the funds the most.

We are here to remind Senator Ayotte of this, and even more important, to remind our fellow citizens that we need to fight for our rights, including the right to a secure retirement.  Don’t let a “grand bargain” steal what we worked so hard for!

Thank you all for coming!

Lucy Edwards

(You can follow the NH Alliance for Retired Americans on twitter @NH_ARA and via their blog)

NH’s Congresswomen are united in opposition to cuts to Social Security

As part of last month’s agreement to end the 16-day government shutdown, a Conference Committee on the 2014 Budget was created. The committee was tasked with shaping an agreement on a federal budget for fiscal year 2014.  These negotiations will determine the financial security for millions of seniors.

New Hampshire’s Congresswomen Carol Shea-Porter and Annie Kuster are standing strong against proposed cuts to Social Security and Medicare.  Both oppose the use of a ‘chained CPI’ to calculate the cost of living for Social Security.  This week Carol Shea-Porter and Annie Kuster both signed onto to a letter (below) to co-chairs of this newly formed budget committee.

“The conference must reject policy reforms that place Medicare and Social Security benefits on the chopping block,” Shea-Porter and lawmakers wrote. “Too often, we hear of proposals to drastically slash benefits provided through these critical programs. These proposals are presented under the guise of fiscal responsibility, but would jeopardize the livelihood and health of the millions of seniors who depend on Social Security and Medicare.”

“As you work with your colleagues on the conference committee for the Fiscal Year 2014 Budget, we urge you to support policies that prioritize America’s seniors and the benefits that they have earned over a lifetime of hard work,” Kuster and other lawmakers wrote. “While we understand that you and your fellow conferees will have to make difficult decisions to find common ground, we believe that any compromise the conference produces must protect Medicare and Social Security for current and future generations.”

Shea-Porter has strongly defended the role that Medicare and Social Security play in providing a secure retirement for millions of Americans. In February, she wrote to President Obama urging him to reject proposals to cut Medicare, Medicaid, and Social Security as he works with Congress to address our nation’s fiscal challenges. She has cosponsored the Strengthening Social Security Act of 2013, legislation that would improve benefits for current and future Social Security beneficiaries, and has spoken out against chained CPI and other cuts to benefits that seniors have earned through a lifetime of hard work. Social Security is also a vital safety net for people with disabilities and family members of workers who have died.

Kuster is deeply committed to protecting and strengthening Medicare and Social Security for Granite State seniors who have worked hard their entire lives and paid into these safety net programs. During her first months in office, Kuster sent a letter to President Obama urging him to protect Medicare, Medicaid, and Social Security as he works with Congress to address our nation’s fiscal challenges.

Kuster is a cosponsor of a House resolution opposing the use of Chained CPI for calculating the cost of living adjustment for Social Security benefits. She has also highlighted the harmful impacts that mindless, across-the-board budget cuts – known as sequestration – are having on programs like Meals on Wheels that serve hungry New Hampshire seniors. Earlier this year, Kuster held a telephone town hall with thousands of Granite State seniors to discuss her commitment to protecting the programs they count on.

As of December 2012, the average monthly benefit for those receiving Social Security was $1,215. Over the course of a year, this averages out to $14,580. The idea that we should balance the budget on the backs of seniors relying on less than $15,000 is simply wrong.

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The full text of the letter is below:

November 20, 2013 

Dear Senator Murray and Representative Ryan,

As you work with your colleagues on the conference committee for the Fiscal Year 2014 Budget, we urge you to support policies that prioritize America’s seniors and the benefits that they have earned over a lifetime of hard work. While we understand that you and your fellow conferees will have to make difficult decisions to find common ground, we believe that any compromise the conference produces must protect Medicare and Social Security for current and future generations.

In the aftermath of the disgraceful and avoidable government shutdown you have an opportunity to develop a bipartisan budget that reduces our debt and deficit in a responsible manner. To make good on this opportunity, the conference must reject policy reforms that place Medicare and Social Security benefits on the chopping block. Too often, we hear of proposals to drastically slash benefits provided through these critical programs. These proposals are presented under the guise of fiscal responsibility, but would jeopardize the livelihood and health of the millions of seniors who depend on Social Security and Medicare.

What the conference committee does in the coming weeks will shape the outcome of the FY 2014 budget process. Now is the time to send a clear message to the American people: While arriving at a solution to a budget impasse does require difficult choices, it does not require Americans to surrender their hard-earned benefits.

Medicare and Social Security are central to the health and retirement security of our nation’s seniors. Millions of Americans who have paid into these systems are counting on these investments to be there for them. That is why we urge you and your fellow conferees to support a responsible conference agreement that protects these bedrock promises we have made to our seniors.

We thank you for your attention to this matter. We hope and expect that your deliberations will be successful.


Expand Social Security, Don’t Cut It

Recently Richard Kirsch posted an article on The Next New Deal website.  The article ‘Block a Grand Bargain with Bold Progressive Solutions to and Medicare’ warns of what seniors and progressives have feared for a while cuts to Social Security and Medicare.

During the campaign season almost every politician said they would vote to protect Social Security and Medicare.  As a political observer it is political suicide to come right out and say you want to cut benefits to millions of seniors.

Should any political party attempt to abolish Social Security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history.
Dwight D. Eisenhower

In spite of opposing cuts to Social Security on the campaign trail, President Obama is in favor of making changes to it.

“To put us on solid ground, we should also find a bipartisan solution to strengthen Social Security for future generations. We must do it without putting at risk current retirees, the most vulnerable, or people with disabilities; without slashing benefits for future generations; and without subjecting Americans’ guaranteed retirement income to the whims of the stock market.”

Republican leadership understands how Social Security works.

The money that goes into Social Security is not the government’s money. It’s your money. You paid for it.”Mitch McConnell

The major issue that seems to be pushing changes to Social Security comes from this widely held myth that ‘Social Security is bankrupting America’.  However the truth is quite the opposite and Senator Bernie Sanders knows it.

“Social Security has nothing to do with the deficit.” —Bernie Sanders

Now that the government is back open with a temporary band-aid (Continuing Resolution) this idea of a ‘grand bargain’ is once again alive.  As part of the Continuing Resolution passed by Congress it mandated that both houses of Congress would meet in a ‘committee of conference’ and hammer out a real long-term budget.   This round of budget negotiations opens up so many different cans of worms.  There is the forced budget cuts known as the Sequester, reforms to ‘entitlements’ (Social Security, Medicare), the Keystone Pipeline, immigration, and many more.

The idea of a grand bargain needs very careful treatment. As Kirsch said in his post, progressives should to go on the offense when it comes to Social Security.

By putting forward simple, broadly popular, progressive proposals that actually enhance benefits and add money to Social Security and Medicare, we enable Democratic allies in Congress to set the agenda and counter claims that they are not taking action to address the real solvency problems. And we also help set the agenda for the inevitable future deal to address both programs’ financing. 

Here are two simple, popular, powerful proposals. On Social Security, make the richest 5% people pay into Social Security on all their earnings, just like 95% of workers now do. Use the new revenue to both boost Social Security benefits – which are too low – and extend the solvency of the Social Security Trust fund. On Medicare, slash the cost of prescription drug prices just like the Veterans Administration and all our global competitors do, saving hundreds of billions of dollars in the next decade.” (Emphasis added)

Finally someone has a solution that ends this debate about Social Security that fixes it for decades.  By eliminating the cap on income for Social Security, millions of dollars would be added to the trust fund.  This would allow Congress to strengthen Social Security so much that the trust fund would have “enough money to pay all benefits from 2033 to 2049”.

Changes that would strengthen Social Security and provide better benefits to seniors have already been submitted to both houses of Congress (H.R.3118, S.567). Kirsch says this “would boost benefits in two ways: changing the way benefits are calculated (designed to particularly help low-and-moderate income seniors) and changing the inflation adjuster Social Security uses to the CPI-E, which more accurately captures what seniors pay. This is exactly the opposite of the chained CPI proposed by President Obama, which undercounts what seniors typically purchase.”

Congresswoman Carol Shea-Porter (D-NH) has been a strong advocate for strengthening Social Security.  In a recent email newsletter she stated why protecting Social Security is so important.

“More than one-third of Granite Staters over 65 would be living in poverty if they did not receive Social Security. And it’s not just seniors who benefit from this program.  Over one-third of beneficiaries in New Hampshire are spouses and families of workers who become disabled or die prematurely, including over 20,000 children.”

The other earned benefit that people on the hill like to talk about is Medicare.  Kirsch also suggests that we enlarge the Medicare program to help everyone.

Using its (Medicare’s) enormous purchasing power to get the same kind of low drug prices paid by the Veterans Administration or every other country on the globe. While estimates of the savings vary, they clearly would be substantial, tens of billions each year, much more than the cuts to Medicare included in the President’s budget.”

Again this type of solution has already been proposed in Congress.  Kirsch goes on to say that this solution “would work to make the point that we can strengthen Medicare by stopping the drug companies from ripping off the country”.

While we stand with the President on most legislative issues, we need to be cautious as we move forward with changes to Social Security and Medicare.  We cannot accept any type of cuts to earned benefits or quick fixes that add only a few years to the programs.  We need strong straightforward solutions that push to increase benefits, not erode them.   We need to stay united in our efforts to protect Social Security and Medicare for our seniors now to ensure that the program is there when the next generation retires.

“Let Them Eat Cat Food”: The Truth Behind The GOP’s Ten Year Push To Cut Social Security

marie antoinetteAs the latest GOP-caused national crisis begins to coalesce around the Tea Party’s demand for Social Security cuts… here are some facts worth remembering:

  1. Even though President Obama included chained-CPI in his FY14 budget proposal, it wasn’t his ideaChained-CPI – which incrementally reduces Social Security benefits – was first proposed in 2003 by then-Federal Reserve Board Chairman Alan Greenspan as a way of cutting the federal budget deficit.  (Read Greenspan’s testimony to Congress here.)
  2. Almost exactly a year later, Greenspan was back before Congress, arguing that “Congress should make President Bush’s tax cuts permanent and cover the $1 trillion price by trimming future benefits in Social Security and other entitlement programs.”
  3. The American public has never supported the Bush tax cuts. Just months after the first round of tax cuts was passed, in 2001, a Washington Post poll found that 57% of Americans wanted to roll back the tax cuts in order to preserve the federal budget surplus. (Yes, we had a surplus, back then.)
  4. The Bush tax cuts primarily benefited the folks at the top of the food chain.  The top 1% received more tax benefits than the bottom 80% of taxpayers combined.
  5. Even Bush’s own economists disavowed the idea that lower taxes improve the economy.  Back in 2006: “Even under favorable assumptions, making the tax cuts permanent would have a barely perceptible impact on the economy.  Under more realistic assumptions…the tax cuts could even hurt the economy.”

So here we are, 12 years after the public said “repeal the tax cuts”… 10 years after Greenspan suggested using chained-CPI to reduce the budget deficit… nine years after Greenspan explicitly told Congress to choose between tax cuts and Social Security… seven years after Bush economists reported that his tax cuts would likely hurt the economy…

..and there’s a faction of the Congress insisting on even more tax cuts… and Social Security cuts… or they’re going to blow the economy to smithereens.

As you’re watching events unfold in Washington, over the next few weeks, remember this fact, too:

By 2010, even Alan Greenspan thought the Bush tax cuts should go away.


Got the aspirin bottle handy?

In his 2003 testimony to Congress, Greenspan also suggested a third path: increased immigration.  “Short of a major increase in immigration, economic growth cannot be safely counted upon to eliminate deficits and the difficult choices that will be required to restore fiscal discipline.”

(But it turns out that that same small faction in Congress doesn’t like immigrants, either.)


Don’t know what the chained-CPI brouhaha is all about?  Read the latest report from the National Committee for the Preservation of Social Security and Medicare here.

Here’s how I look at it:

Chained-CPI is a vivid example of the “race to the bottom” that unions have been trying to stop for years.  It assumes that when personal finances are tight, consumers will alter their purchasing behavior and buy cheaper products.  Then, since they’re spending less, Congress figures they’ll need less money in Social Security benefits.

It’s the image of a senior citizen, trying to make ends meet, who gives up buying beef because she can only afford chicken… and then her Social Security benefit drops, so she gives up chicken and buys tuna… but with the next benefit drop, she can’t afford tuna anymore.

It’s the cat food thing.

(And BTW… given that about 12% of our nation’s jobs are in retail… I gotta wonder about the idea of “solving” a federal fiscal crisis by slowly strangling consumer spending.)

Meanwhile, down in DC, Simpson and Bowles Work To Wreck Social Security

It’s probably going to get lost in today’s news, now breaking out of Boston, but…

SocialSecurityposter1Down in DC today, Erskine Bowles and Alan K. Simpson are scheduled to announce yet another of their “debt reduction” plans. Yes, it includes chained-CPI; yes, it includes cuts to Medicare. What is doesn’t include is much in the way of new revenues. Here’s how the Washington Post describes today’s plan:

“seeks far less in new taxes than the original, and it seeks far more in savings from federal health programs for the elderly.”

Yeah, this public policy debate is going in the wrong direction.

Here’s a better suggestion: Let’s return to the good ol’ days when investment income was taxed at the same rate as wage income.

Why does US tax policy give preferential tax treatment to dividends, just because investors don’t have to get their hands dirty in order to receive the income? America is supposed to be the land of Horatio Alger (“pull yourself up by your bootstraps, work hard, and you’ll get ahead”). If our tax code is going to have different standards for earned versus unearned income, shouldn’t the “hard work” type of income be the one we prefer?

Instead, ever since the Bush tax cuts, dividends have been taxed at a much lower rate. And that economic distortion has led to all sorts of bad outcomes. (Read “What Mitt Romney Taught Us about America’s Economy” here.)

According to Congress’ Joint Committee on Taxation, this backwards tax preference will cost $616 billion in revenue over the next five years. (It’s one of the largest “tax expenditures” in the tax code.)

So, let’s call that $1.2 trillion over the next decade… and we’re well on our way toward debt reduction – without any cuts to Social Security or Medicare. Toss in another $516 billion worth of estate taxes (I’m doubling the five-year cost of that tax preference, as calculated by the Joint Committee). Maybe throw in $315 billion from ending the special tax treatment for life insurance annuities. And we’re well over $2 trillion in deficit reduction—all without a single cut to a single government program.

Now let’s apply a little “dynamic scoring”. (Haven’t heard of it? It what the GOP used, back in 2001, to argue that the country could afford the Bush tax cuts. Just assume that the tax code changes will improve the economy, and that will generate even more tax revenues.) Ok, you’re right… “dynamic scoring” didn’t work so well with the Bush tax cuts. But remember the Clinton tax hikes? Remember how the economy improved and the budget went from deficit to surplus?

Add in a little “dynamic scoring” (of the tax-HIKE variety) and… Presto Change-o! Suddenly, we’re doing a whole lot better than Simpson-Bowles.


Also in the message mix, today: a great, big “oops!” for the two Harvard economists whose research has bolstered the GOP’s austerity agenda. Turns out they made a mistake in their spreadsheet analysis. Yes, this is the very same analysis that Paul Ryan used, during last year’s presidential campaign, to argue that our slow economy was caused by national debt. [Hello? Most of us out here in the real world think the economy’s hurting because so many people are out of work.] Yes, these are the same two economists who testified before the Simpson-Bowles Commission.

Here’s the kicker: their mistake was discovered by researchers at the University of Massachusetts Amherst. Yes, public-funded higher education still works!


Watching the news this morning, we’re seeing incredible acts of dedication and bravery. Special thanks to everyone whose jobs take them into danger, all those who protect the rest of us. Thoughts and prayers are with the family of the MIT Police officer who was killed; with the MBTA officer who was injured; and with everyone else whose lives have been forever altered by the events of the past few days.

Writing this from the security of my own home, I salute you all.

Barry Goldwater explains: why Chained-CPI is such a big, hairy deal

Bactrian Camel by Just_Chaos via flikrBack in 1958, Barry Goldwater explained his opposition to a bill this way:   “If the camel once gets his nose in the tent, his body will soon follow.”

In other words: a tremendous – unwanted – change can be started by a little tiny encroachment… and then the rest of the change will come right along behind it.

Those of us in the union movement have seen this strategy in action, too many times to count.

Recognize this scenario?  Workers used to have fully-paid health insurance.  Then management insisted on a small “contribution” toward the cost.  Then premiums were “shared”.  Now, in too many workplaces, there is no health insurance at all.

How about this one?  Workers used to have employer-sponsored pension plans.  Then employers insisted on moving to 401(k) plans.  Now, very few jobs (other than at the CEO level) offer any type of retirement plan at all.

Or this one?  Union workers used to have job security.  Then employers insisted on contract amendments so they could hire part-timers or contractors “in emergencies”.  Now, some worksites are staffed entirely by part-timers or contract employees, and job security is very, very hard to find.

As Barry Goldwater described things: It’s the camel’s nose, creeping in… and the rest of the camel soon follows.

And that’s why union leaders are reacting so strongly to proposals that would change Social Security benefits by tying Cost of Living Adjustments (COLAs) to “chained CPI” (rather than the usual Consumer Price Index).

Union members have had enough experience with this strategy; by now, we recognize a camel’s nose when we see one.

The idea of “privatizing” Social Security has been rattling around the Republican Party since Barry Goldwater ran for President.

But it hasn’t happened yet – despite the recent best efforts of George W. Bush and Paul Ryan.

So during debt limit negotiations in the summer of 2011, the Republicans took a different tack.  Rather than trying to get the camel in through the tent door… they just asked for a little, tiny change to the way that Social Security COLAs are calculated.  Just one little, tiny change.

That debt limit crisis was resolved – with the camel’s nose still outside the tent – by the deal we all know as “sequestration”.  And since that time, the Fiscal Cliff has passed and a possible government shutdown has been avoided.  But that one little tiny change to Social Security has remained a Republican priority.

The White House held a press briefing the day before President Obama’s budget was filed.  One important point from that briefing was never covered by the mainstream press:

[S]enior administration officials characterized the official adoption of Chained CPI as both a recognition that rounding out a grand bargain will require making concessions to the GOP, and as a final gesture of good faith to Republicans in Congress… But the officials also stressed that Chained CPI will never become law unless Republicans respond (in unlikely fashion) by agreeing to limit tax expenditures benefiting high-income earners.  If they don’t, it will mark the end of Obama’s two-year quest to secure trillions of dollars in deficit reduction on a bipartisan basis.

In other words, don’t believe new National Republican Congressional Committee Chairman Greg Walden when he talks about chained CPI as “a shocking attack on seniors.”

How can it possibly be “shocking”, Rep. Walden?

Republicans have been trying to “reform” Social Security since Barry Goldwater ran for President, almost half a century ago.

And Barry Goldwater knew full well how to get a camel into the tent.


NH Citizens Alliance and NH Peace Action Oppose Chained CPI And Call For End To Pentagon Waste

As everyone already knows the President has released his budget and the masses have begun to revolt.  The main issue of the revolt is cuts to Social Security.  The cuts at face value appear minor but will result in  a significantly lower Social Security check for those who are already struggling to stay afloat.

Many organizations including the AFL-CIO have come out against the Presidents budget and specifically the ‘chained CPI’.  Today a New Hampshire based organization has come out opposing cutting Social Security as well as proposed a solution.

The first of two statements come from Will Hopkins, Executive Director of NH Peace Action. Hopkins is an Iraq war veteran from Company Cco3-172nd INF NHANG based in Iraq from March 2004 to February 2005.

Left Melissa Bernardin, Right Will Hopkins, at Senator Ayotte's office on 2-27-12 calling to 'Pull the Pork' on Pentagon Spending

Left Melissa Bernardin, Right Will Hopkins, at Senator Ayotte’s office on 2-27-12 calling to ‘Pull the Pork’ on Pentagon Spending

“Since 2001, Pentagon spending has skyrocketed, more than doubling over the decade. We spend tens of billions more on the Pentagon today than we did during either Vietnam or the Cold War, even adjusting for inflation. At a time when almost no one in Washington agrees on anything, almost everyone agrees it’s time to cut Pentagon bloat. Military leaders, national security experts — even some forward-looking Pentagon contractors — agree that reductions are necessary and coming.

“Reshaping the bloated Pentagon budget to fit our actual needs saves money to be invested in other priorities right here at home, and it can be done without jeopardizing our troops or our safety.  As a veteran whose boots were on the ground in Iraq, I resent that members of Congress are even considering gutting programs that benefit the American people, in order to keep outdated and unnecessary Pentagon programs and bloated CEO salaries. This should be an easy choice. Congress needs to Pull the Pork from the Pentagon instead of exploring options that hurt the pocketbook of American veterans.”

Echoing Hopkins is Melissa Bernardin, Coordinator for NH Citizens Alliance’s Campaign to End Pentagon Waste.

“There is absolutely no reason why Congress should even consider cutting benefits for seniors and veterans when there are clear examples of Pentagon waste that could be addressed first, like the amendment to eliminate the ‘missile to nowhere’ that Senator Kelly Ayotte introduced.

“It’s time for Congress to commit once and for all to ending Pentagon waste and instead shift that spending into housing, health care, education, and infrastructure repair. We are calling for a fundamental restructuring of our priorities so that we can pay for programs that create jobs and protect our communities.”

U.S. Senator Kelly Ayotte introduced and secured passage of an amendment in late March to eliminate the “missile to nowhere” program – a weapons system that the Army will never procure. Advocates say it is one of many examples of Pentagon waste that could be eliminated to allow Congress to instead use the budget in a more appropriate way for domestic priorities.

According to a recent Forbes article, several veterans’ organizations have come out against chained CPI, including Veterans of Foreign Wars (VFW), Iraq and Afghanistan Veterans of America (IAVA), AMVETs and the Blinded Veterans Association. U.S. Congresswoman Carol Shea-Porter was one of 107 House Democrats who signed a Feb. 15 letter opposing benefit cuts to Social Security, Medicare, and Medicaid.

AFGE Says The Presidents Budget Fails Working Americans

Budget includes proposals that would harm middle-class Americans 

WASHINGTON – President Obama’s fiscal 2014 budget marks a shameful abandonment of his campaign promise to protect the middle class and needy from tax increases or harmful benefit cuts, the head of the largest federal employee union said today.

“Instead of holding to its promise to protect the middle class and the working poor, the administration seems determined to contribute to a worsening of living standards for federal workers, disabled veterans, and the elderly,” American Federation of Government Employees National President J. David Cox Sr. said.

The budget includes proposals that would cut federal retirement benefits, cut Federal Employee Health Benefits, cut Social Security benefits, and cut federal jobs.  The budget also proposes to end the three year pay freeze with a 1% adjustment, an amount so low that it banks $18 billion in savings over ten years for the government to spend elsewhere.

Federal Retirement

The administration’s budget hits federal retirement benefits in three ways: denying pay adjustments, so the salaries on which retirement benefits are based are lower, increasing by 1.2% the amount of salary that employees hired prior to 2013 would pay for their benefit, and reducing the annual cost-of-living increase in Social Security and annuities by using an inferior measure of inflation.

These proposals are unjustified and deviate completely from the standards set by large private employers.  About 98% of private employers that provide traditional pensions charge their employees nothing for this benefit; the administration just keeps charging more and more each year.  The 1.2% contribution increase in the budget would be a permanent cut, even though it is presented as part of a fix to a temporary “problem.”

Regarding the proposed change to the chained CPI, Cox said, “This is no ‘technical fix.’ It is a benefit cut on some of the most vulnerable citizens in our country – the elderly who built this nation’s prosperity, disabled veterans who sacrificed their health and bodily integrity to this nation’s security, and federal retirees who labored under an agreement that their retirement benefits would be adjusted to maintain their living standards in old age.”

According to an analysis by the Center for Economic and Policy Research, using chained CPI for indexing income tax brackets would mean raising taxes 14.5 percent for those earning between $10,000 and $20,000 a year. Sixty-nine percent of the tax increases resulting from chained CPI-indexing would come from households earning less than $100,000, the Center said.

Switching to chained CPI will hit others equally hard. Federal retirees, whose average pensions under the Federal Employees Retirement System (FERS) are just $13,000, will suffer substantial declines in living standards under chained CPI. The average Social Security recipient, who at age 65 receives just $15,000 per year, will suffer cuts of $650 a year by age 75 and $1,130 a year by the time she or he turns 85.

Federal Employee Health Benefits Program (FEHBP) Cuts

The administration’s budget also calls for $8.4 billion in cuts to the government’s financial support for federal employees’ health insurance.  The changes sought by the administration would penalize the ill by charging them higher premiums, penalize families with more than two members by charging them higher premiums, and penalize those in high health care cost regions by charging them higher premiums.

“Adding FEHBP cuts to the pay freeze, furloughs, and retirement and Social Security cuts just defies comprehension.  The President actually says in his budget that federal employees “deserve our respect and gratitude.”  I would describe this package of cuts as evidence of disrespect and ingratitude, and I know that’s how all of our members feel as well,” Cox said.

Poultry processing

The budget also proposes an overhaul to the poultry inspection process that would leave one federal inspector responsible for examining up to 175 birds per minute – or three birds every second – as they whiz down the inspection line. AFGE, along with food safety and consumer watchdog groups, has been urging the administration to withdraw this rule change since it was first proposed in January 2012.

While the poultry slaughter inspection program does need to be modernized, AFGE is concerned that this proposal could have adverse impacts on both food safety and worker safety, Cox said.

“This proposal isn’t about food safety. Speeding up processing times is all about generating more profit for the chicken slaughter industry by moving chickens from the farm to your kitchen table as quickly as possible – regardless of the potential health consequences,” Cox said.


The American Federation of Government Employees (AFGE) is the largest federal employee union, representing 670,000 workers in the federal government and the government of the District of Columbia.

For the latest AFGE news and information, follow us on Facebook and Twitter.

What a choice! One year of investment tax cuts equals 10 years of Social Security cuts?

Choices to surviveBudgets are all about choosing priorities.  And here’s one choice: chained CPI?  Or eliminate the tax break for investment income?

When I looked at the numbers this morning, I was stunned.

Chained CPI is a way of recalculating – and permanently lowering – everyone’s Social Security benefits.  It has been a top Republican priority for years.  The White House Budget Director estimates that changing to chained CPI would save the federal government $150 billion over the next decade.

And how much does the federal government spend on tax breaks on investment income?  According to Congress’ Joint Committee on Taxation, tax breaks on investment income will cost $161 billion this fiscal year alone.

Go back and read that again.

Tax breaks on investment income cost the federal government more – in just one year – than chained CPI would save over an entire decade.

Budgets are all about choices.  For many American families, the choices are between food and heat, medicine or mortgage?  For Congress, as it debates this budget, the choices are about who pays – and who benefits.

I’m still stunned.  One year of treating investment income as if it was wage income would pay for ten years of the Republicans’ proposed cuts to Social Security benefits.

I’m still at a loss for words.  It is morally wrong, that this choice is even being considered.


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