Daily Archives: January 27, 2011

House Majority Leader Eric Cantor Doesn’t Understand How Social Security Works

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Got an email from Democracy For America.

Steven –

Either House Majority Leader Eric Cantor doesn’t understand how Social Security works or he doesn’t care.

Just hours after President Obama said that Social Security cuts and privatization are off the table, Cantor said that Social Security had to be cut to balance the budget. But here’s the thing: Social Security does not and never has added a single dime to the federal deficit.

Let me try to explain this to Mr. Cantor. Social Security is paid for through the payroll tax. Currently, the payroll tax raises way more money than Social Security pays out and things are projected to keep going this way for another couple of decades.

The wars in Iraq and Afghanistan? They add to the deficit. Tax breaks for billionaires? They add to the deficit. Subsidies for big oil? They add to the deficit. Bailing out Mr. Cantor’s friends on Wall Street when they make a bunch of shady deals, cause a financial crisis and almost ruin the world economy? That adds a lot to the deficit.

Simply put, Social Security will run a surplus for decades. The rest of the budget runs a deficit. So, why are we even talking about Social Security?

Here’s why: Eric Cantor and his right-wing friends want to destroy the program. That’s the only reason we’re having this conversation. Join me now and let’s send Eric Cantor and other members of Congress a message — Keep Social Security safe, stable and secure.

Please sign the petition now.

Eric Cantor’s comments aren’t anything new. Right-wing Republicans have been trying to tear down Social Security for generations. It’s the holy grail of the right-wing.

Now Republicans are playing with fire — they’re threatening to shut down the government. They’re holding the debt ceiling hostage. They’ll do whatever it takes to put cutting Social Security on the table.

But America is a community. We stand up for one another — including our seniors. That’s why DFA has launched it’s biggest campaign ever to push back against the right-wing lies and spin and to push a real solution to keep Social Security safe, stable and secure forever.

See, right now people like Mitch McConnell and Sarah Palin don’t pay the same percentage of their income into Social Security that most Americans do — and big surprise — neither does Eric Cantor. That’s because the tax is capped at $106,800, but most Americans don’t know it. All we need to do is scrap the cap and make the payroll tax fair and equal for everyone to keep Social Security safe, stable and secure.

Join the movement to beat back the right-wing and keep Social Security safe, stable and secure.

When we stand up for our values of community, security and liberty, America wins.

-Arshad

Arshad Hasan, Executive Director
Democracy for America

Democracy for America relies on you and the people-power of more than one million members to fund the grassroots organizing and training that delivers progressive change on the issues that matter. Please Contribute Today and support our mission.

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The President Ignored the Elephant in the Room

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Robert Reich’s blog post The President Ignored the Elephant in the Room, discusses the State Of The Union address of  two nights ago.

But the President’s failure to address the decoupling of American corporate profits from American jobs, and explain specifically what he’ll do to get jobs back, not only risks making his grand plans for reviving the nation’s competitiveness seem somewhat beside the point but also cedes to Republicans the dominant narrative.

This may be the elephant to Reich, but I think there is a pink elephant that even Robert Reich seems to have missed.

To me, the talk of regaining competitiveness by having education as good as our competitors and innovation as good as our competitors doesn’t sound like enough.  If their education and innovation is as good or better than ours and they work for less money, I just don’t see how we are going to get the jobs back.

When I say their education is as good or better than ours, I am reminded that about 60% of the technical PhD degrees granted by our own universities have been going to citizens of these competitor nations.  This has been going on for more than 30, dare I say 40, years.  Add the number of PhDs from the schools in the competitor countries that I can guarantee aren’t giving 60% of their degrees to Americans, and you see the problem even more clearly.

It seems to me that we will have to come close to matching the competitor countries’ salary levels before we can really compete.  Will all the wealth of the U.S. be subject to this adjustment through lowering the value of the dollar relative to the competitor nations?  Or will only the wealth of the working class be lowered by lowering wages in fixed value (gold standard) dollars.  In the second scenario, the wages of the workers decline but their debts remain fixed.  So the wealthy get to collect the full amount that they lent. The wealthy can preserve their wealth and only the workers have to adjust.

The only saving grace that I can think of is to understand how Germany is managing to do so well with highly paid workers in the face of the same competition against which we are losing.  Germany has higher taxes and a more robust government safety net than even we do.  It looks like it would behoove us to find out what their secret is.

Perhaps the German secret will turn out to be the closer ties between German corporate profits and the success of their workers.  In that case, Robert Reich will have identified the correct elephant.  He ought to spell it out more clearly if that is what he is getting at.  There is no better way to make your point for a change in policy than to point to a successful example of the use of that policy.  If there is an example, we don’t only have to look at the abstract concept of tying corporate profits to worker success, but we can look at actual tactics for realizing the concept.