Category Archives: Medicare/Medicaid

Do Unto Them What They Want To Do Unto You

January 2, 2013

Let’s Apply The chained-CPI concept of Raising Revenue to How We Pay Our Government Officials

Those least able are being asked to make a greater sacrifice than others who are able

Some of you who have been keeping up with budget talks, especially the so-called “fiscal cliff” arguments, may be aware of one of the measures being discussed to reduce the deficit. It’s called the chained-CPI method of figuring cost of living raises (COLA) for, among other things, people who receive benefits from social safety net programs

Sophie Quinton’s article in the National Journal sums up nicely what the chained CPI is.

Here’s how the new metric would save money: Social Security, federal pensions, and military and veterans’ benefits are indexed to rise each year with inflation; so are tax brackets, exemptions, deductions, and credits. But experts say the consumer price index the government currently uses overstates how rising prices affect household spending.

The Bureau of Labor Statistics has come up with a more accurate measure, which accounts for consumers’ tendency to switch to cheaper categories of products when prices rise. Rather than looking at a fixed set of goods—as the standard formula does—the new measure looks at how the set of goods changes, and then “chains” two consecutive months of consumption data together.

The chained CPI rises a little more slowly than the current measure. So if the chained CPI were used to calculate cost-of-living increases, it would mean smaller increases to Social Security checks each year. If the chained CPI were applied to the tax code, it would move taxpayers into higher tax brackets faster. SOURCE

There are at least ten things wrong with this method as Daniel Marans explains over at FDL news and they all impact the most vulnerable segments of our population, especially the elders on fixed incomes. I know we are all expected to contribute our fair share to lowering the deficit, but as Lambert Strether notes, this is hardly a “fair share” for some of us.

A “sacrifice” where some give up luxuries and others give up necessities is in no way “shared.” A marginal sacrifice for the rich is not commensurate to core sacrifices for the rest of us. But the tropes of official Washington carefully brush this reality away. SOURCE

Let’s not forget either that it was the spending of drunken sailors in the GOP under Bush/Cheney, along with conservative Democrats that started putting us in the fiscal hole. Spending that was aimed at benefitting wealthy corporations rather than those now being asked to saddle this undue burden on their source of income. Now is not the time to hit the poorest amongst us with benefit cuts and especially on the backs of those Social Security beneficiaries whose source of benefits DO NOT contribute to the deficit. Even the conservative’s darling, Ronald Reagan, pointed this out when he was President.

As much as those who continually and falsely shriek that the deficit is the biggest threat to our children’s future, there are ulterior motives behind this bogus pronouncement as Paul Krugman and others have duly noted:

Contrary to the way it’s often portrayed, the looming prospect of spending cuts and tax increases isn’t a fiscal crisis. It is, instead, a political crisis brought on by the G.O.P.’s attempt to take the economy hostage. And just to be clear, the danger for next year is not that the deficit will be too large but that it will be too small, and hence plunge America back into recession. SOURCE

The point of all this being that many of those who live off of our taxes rather handsomely seem too eager to reduce certain benefits that impact the poorest amongst us while leaving other areas alone, like the Defense budget. Why voters keep sending some of these yokels back to Washington is the height of foolishness but that seems to be where we are at these days. Voters appear ready to “throw the bums out” with the exception of their bum.

But most people would be in agreement I think if we started measuring “the bums” income by their performance and adjusting it accordingly. Clearly our representatives would be inclined to perform their duties more fully if the people had a direct means of rating their performance and legislation was in place that allowed the IRS to deduct their wages based on their performance. Likewise, their income would be raised based on how their constituents felt they were benefitting them as a whole.

MAYBE WE NEED TO CHANGE THIS?

Once a year people could vote on-line or by mail, registering their opinions on how effective they felt their representatives were performing. A rating system on a scale of 1-10 could be devised and unless they scored anything better than a 6, their pay would either remain unchanged for scores of 4-6, and lowered incrementally with scores lower than 4. The voters would be given the means to make their selections either on-line or by mail. At the end of each year, when employers are handing out W-2′s, attached would be a form that scored their congressperson’s performance along with a pre-paid postage envelope.

Too many people never make it to the polls on election day because they feel their vote never makes an impact. To a certain degree they are right. But having this direct means of effecting their representative’s wages with very little effort or expense on their part would see many of these people coming out of the wood work to express their views.

There of course would be those political blocs trying to influence their assessments similar to what we already have in the form of non-profit entities that we get regularly inundated with from TV and radio ads, postal mailings, e-mails and social network sources. The concern here is not unlike the one we currently face where the Citizens United court decision that allows unhealthy amounts of money to overwhelm the means by which we get information from.

We may just have to trust that the electorate will make the call that best serves their needs. Where there are those who may not like certain specifics on how their congressperson votes but are ideologically linked to them that prevents them from voting them out of office, they may be more inclined to use this more precise method of conveying their wishes while still supporting them in their elective status.

It’s time to reverse the worry element, where congressional and state legislative leaders need to lose sleep about their source of income being reduced rather than those of us they are supposed to fairly represent. Polls routinely show strong support for social safety net programs, especially regarding Social Security benefits. If this support gets expressed in how the income of our state and national representatives will be determined we just might find that the concept of democracy, that was intended when this union was formed over 225 years ago, will once again have its proper place in how we are governed.

BONUS: Here’s a little quiz that asks, How much do you know about the ‘fiscal cliff’?

Ruth Marcus: Let the Elderly Just Eat (Cheaper) Cake!

Posted by lbwoodgate in Budget Crisis, Medicare/Medicaid, seniors/aging Tags: balancing budget on backs of elderly and poor, benefit cuts in social programs, chained CPI, congressional performance, Consumer price index, cuts to Medicare/Medicaid, cuts to Social Security, deficit issues, Paul Krugman, safety net cuts, Social Security

9 comments

Can I Sell You Some Cheap Ocean Front Property in Yuma?

October 15, 2012

Hey young people! A word of caution for those taking the bait being offered by the Romney/Ryan plan to Privatize Social Security & Medicare

After being laid off in the fall of 2009 and concluding that at age 61 I was not going to get rehired in the severe recession competing with 5 other applicants, I decided instead to take the money in my 401k I had earned over the last 18 years, pay off all of our bills except the mortgage, roll the remainder into an IRA and go into to semi-retirement. I figured I could find some part-time work that would allow me to have a little spending money and within a couple of months I would be eligible to collect early Social Security benefits. I’m thankful my wife still has what seems to be a secure job as a registered nurse for the local school district because with both of us out of work this could have gone south real quick. Luckily too, both of our adult children are out on their own and are doing relatively well for the time being. It wasn’t what we planned for our lives but then things seldom work out the way you want.

We were more fortunate than a lot of people who found themselves unemployed in this Great Recession. I know, I know. The recession is actually over and we’re waiting for the job situation to recover. Wall Street is making record profits but Main Street has yet to fully recover. We could have been one of those poor souls that lost their home and health care coverage along with their jobs. But a monthly stipend from my IRA and $1500 a month in Social Security benefits along with my wife’s salary allows us to maintain the resources we need to remain solvent. Now if our luck and what savings we have will only last until we die.

Until earlier this year I was able to afford health insurance by adding myself to my wife’s benefit plan. But that changed when the school district replaced the insurance provider to keep costs down after state funding started drying up from the budget planning failures of Texas state legislators. The deficit the state faced last year “was created by a deal to lower property taxes while transforming the state’s business tax. It has never generated as much money as expected.”

When the new policy raised premiums and deductibles while lowering benefits, it became a financial impracticality to pay nearly $400 a month to keep me on it. This was my mothly premium but the new policy didn’t cover expenses until I cleared a $3000 deductible. I have instead been tucking a large part of that money into a separate account and using it sparingly until I am eligible for Medicare late next year. We keep our fingers crossed that a catastrophic health crisis doesn’t occur before then.

But I digress. The point I want to make here is to alert Americans, especially those in their twenties, thirties and forties, to view with suspicion the Romney/Ryan plan to privatize Social Security and make Medicare a voucher system. Despite Paul Ryan’s claim as being “indisputable fact” that bankruptcy for both of these safety net issues are inevitable, evidence by more rigorous authorities say nothing could be further from the truth. According to information put out by The Progress Report

[T]he possibility of Medicare going bankrupt is — and historically has been — greatly exaggerated. In fact, if no changes are made, Medicare would still be able to meet 88 percent of its obligations in 2085. Social Security is fully funded for another two decades and could pay 75 percent of its benefits thereafter. There is also an easy way to ensure the program’s long-term solvency without large changes or cuts to benefits.

What is an indisputable fact is that these programs that were instituted to keep more people out of poverty and serve as a means of last resort for people who fall between the cracks in our economy have been attacked by wealthy financial interests since their inception. In his book, The People’s Pension, Eric Laursen has detailed how specific politicians, lobbyists, and groups “have waged a steady battle to discredit and undermine” Social Security. They have aggressively pushed proposals to cut, privatize or dramatically transform” this trust fund for elder citizens.

Wall Street has been trying to get their hands on the billions in the Social Security trust funds for years. They assure us that putting your money into the stock market will see greater returns than what you’ll see after decades of payroll deductions applied to the government-managed system that has reliably paid benefits for more than 75 years. In his article, The Solvency of Social Security, Stephen J. Foster, Jr. points out what should be an obvious fact even to the casual observer.

Wall Street is known for gambling with other people’s money which has led to the Great Depression in the past and the 2008 recession. If you have a 401(k), you have experienced firsthand what can happen to your retirement portfolio when it is entrusted to Wall Street. People with IRA’s, 401(k)’s and other types of retirement accounts watched helplessly their savings disappear as the stock market took a historic tumble.

After clearing most of my debt and depositing the remaining $140,000 from my 401k into my new IRA on January 1st, 2010, the DOW was sitting at 10,428.04. Last Friday it closed out the week at 13,328.85, which was down 281 points from what it started at the beginning of the week. The DOW has gained just over 2900 points since I opened that IRA. My investments were primarily low risk investments. However, when things really started looking bad after Republicans refused to raise the debt ceiling in 2011 and the country’s credit rating was lowered as a consequence of this dysfunctional action, I shifted everything into the safer areas of bonds and money markets.

We all know the stock market is volatile and that there will be ups and downs but even with my safe investments that were being handled by a professional money management agency I have lost roughly 4% of my overall investments into the stock market from the time I opened my IRA account. Clearly Wall Street has done well while my resources are losing ground.

A 4% loss over three years isn’t much when you are just beginning your life and putting some away in your twenties or thirties but for those of us who are at retirement age or getting close to it such losses hurt, especially as your health deteriorates from age and the costs of health care and insurance increase faster than the rate of inflation.

Ups and owns in the stock market are expected but over a 40-50 year period you can realize significant gains. But when our economy takes serious hits like it did in 2000 and 2008 people like myself watched their 401k’s take tremendous losses. My 401k lost a third of its value in each recession. I never did fully recapture those losses before I was laid off in 2009.

I worked 18 years building up a retirement fund and under normal circumstances would have accumulated about $350,000 at the rate I was going. Instead, because of two economic recessions within 8 years of each other where the DOW lost more than half of its value nine months before I was let go, I wound up with less than half of that. How much more would I and others have lost if the economic crisis reached Great Depression levels? Perhaps all of it.

The only people who really do well in the stock market are very wealthy people who can afford to take the losses that occur when hard times hit. The average investor is likely to suffer irreparable economic consequences at the most vulnerable times in their life as an aged retiree. Stephen J. Foster rightfully points out that once the wealthy financiers get their hands on your money they offer no guarantee that you will come out ahead. In fact, in rough times when markets are down, as your investments dwindle they lose very little because they are using your money to gamble with.

People like Romney and Ryan like to tout the notion that people can do better when they manage their own money but they would be hard-pressed to find evidence of that with most people who work all their lives. Unless wages allow enough to stick aside most people live from paycheck to paycheck to make ends meet. And we all know wages for 95% of wager earners have not kept pace with the top 5% over the last 30 years.

If the payroll deductions for Social Security and Medicare were eliminated low and middle-income families would indeed have a little bit more money in their pockets but it wouldn’t necessarily go into a savings or a retirement plan in an economy where prices are rising faster than most people’s wages can keep up with. As much as it may hurt during those times when families are struggling to provide basic essentials for themselves, without the deductions going toward future social security benefits and health care coverage, adult children would suffer even worse, especially during economic hard times, when faced with caring for their aging parents down the road.

So I would ask all those young people who Mitt Romney and Paul Ryan are appealing to – are you willing to risk this small percentage of your earnings each payday in the uncertainty of a volatile market or put it towards a financially secure, long-term investment? If you opt for those markets, how much time and energy do you think you will have to make sure your investments are as sound as they can be? When even professionals fail to read the tea leaves in the markets each day, how much better will those of us with an untrained eye do making such decisions?

When asked in a recent interview “Why should younger people of lower- and middle-incomes be especially concerned about Social Security?” Eric Laursen conveyed the following:

So many of their traditional sources of retirement income are eroding. Millions of younger workers will not be able to rely on employer-based pensions or from sales of their homes. Also, the stock and bond markets, which were supposed to be a vast new source of wealth through 401(k)s and IRAs, are treacherous. Health insurance costs and student loan payments eat away at what savings they’ve managed to acquire. Employment itself is a lot more volatile. Social Security is the one thing they have that is guaranteed. SOURCE

It’s a pipe dream to believe that the volatile stock market offers more security for the average working American than a secure fund backed up by the full faith and creditof the U.S. Treasury. One that wealthy investors want you to believe in order to increase their own capital wealth. By itself it will not meet all the creature comforts many people are used to but for an average worker, Social Security replaces about 40 percent of annual pre-retirement earnings, constituting about two-thirds of income for the average older beneficiary. Even more revealing is the fact that Social Security amounts to 90 percent or more of the income for one-third of seniors.

Making the government look like a bogey-man on this issue is part of a deception to extract even more of the remaining wealth from the 98% so when they lose their life savings and have to fall back on vital government assistance programs, they can be accused by people like Romney of being “dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them” rather than accepting responsibility for the failure to be honest with the American people about the risks involved with privatizing Social Security and Medicare.

Social Security is Under a Fierce Attack From Wall Street

Top Ten Lies About Social Security

The great Social Security lie

Historical Background and Development of Social Security

Posted by lbwoodgate in Medicare/Medicaid, Society and Politics Tags: 401(k), future of social security and medicare, Individual Retirement Account, Medicare, Paul Ryan, privatizing social security and medicare, Romney's 47%, social safety nets threatened, Social Security, Wall Street

9 comments

If Assisting the Economically Deprived is Immoral Then Jesus Was a Pimp

June 13, 2012

“Nor was there anyone among them who lacked; for all who were possessors of lands or houses sold them, and brought the proceeds of the things that were sold, and laid [them] at the apostles’ feet; and they distributed to each as anyone had need.” - Acts4: 34 &35

When early christian communities formed and they shared equally all their worldly possessions, who would have thought that this gesture would be viewed by some as a source of immorality. The notion that we all share much in common has a tradition that goes back beyond the time of the gospels but which has been slowly eroding since corporate personhood came into being back in the 19 century, making a handful of people very wealthy. Laws protecting their monopoly on wealth were successfully challenged at the end of that century and into the early decades of the 20th century.

But a hundred years later we are once again battling those elite few who would re-establish those conditions where people who work hard and play by the rules often find themselves on the opposite side of forces that control law making bodies and the courts. As a result, the disparity between the wealthiest and everyone else has grown significantly and more people are now finding themselves at or below poverty levels as the middle class slowly shrinks.

In his recent column, conservative economist Walter E. Williams attempts to make a case linking immorality to our current economic crisis. Though I would agree that the behavior of some that created our current crisis was deplorable and immoral, I would not be fingering the same people who Mr. Williams seems to be.

Like a broken record, Mr. Williams repeats a theme that he has hit on many times in his columns. He insists that the social contract the people have made with their government to provide for the weakest amongst us is akin to theft. Yet poll after poll seems to reflect the opposite and have most Americans in support of a payroll deduction that helps fend off poverty for those elderly, small children and handicapped individuals in our society that tend to fall through the cracks of a free market economy.

Greed Trumps Need

Without any regard for the recent actions of those who inhabit Wall Street and who carelessly risked the fortunes of many Americans, sending the global economy into a downward spiral, Walter Williams wants to prop up the red-herring about entitlement programs and their existence for being the source of immorality in our country. To Mr. Williams it’s the government who has robbed us of our jobs, homes and savings. The financial captains of Wall Street are mere victims of some invisible hand of the market and need to be protected against the regulations of government put in place to prevent abuses with our money. Yet another misperception by Williams and the libertarian theology he subscribes to.

Williams seems to be oblivious of the human element of greed that permeates much of the financial private sector and like many who support his ideological view, is convinced a strong ethical character pervades corporate America. To concede that greed by a few rather than need by many is the main factor in this country’s moral demise would be counter productive to the laissez-faire view that people like Williams hold. Greed in laissez-faire terms is just another name for fulfilling self-interests that motivate people to seek financial gain for themselves believing that society as a whole will also benefit. To people like Williams, Milton Friedman and Ayn Rand, the Gordon Gecko character in the movie “Wall Street” would be seen as a heroic figure.

But as Harvard professor Michael J. Sandel points out in his book on justice “Greed is a vice, a bad way of being, especially when it makes people oblivious to the suffering of others. More than a personal vice, it is at odds with civic virtue.(emphasis mine) In times of trouble, a good society pulls together. Rather than press for maximum advantage, people look out for one another. A society in which people exploit their neighbors for financial gain in times of crisis is not a good society. Excessive greed is therefore a vice that a good society should discourage if it can.” (Justice: What’s the Right Thing to Do? p.7)

Yet Williams never seems to point out the lapses in moral behavior by the bankers and wealthy investors within society and instead goes after a system that benefits those who are often the victims of greed. In doing so he makes a good case I think that calls his own morality into question.

One in five in poverty: 14.7million – or 20 per cent – of children in the U.S. live in families with incomes below the federal poverty level

In his book, “Justice: What’s the Right Thing to Do” Sandel points out a difference between two opposing views. One from the libertarian, laissez-faire side; the other from an egalitarian frame of reference:

“ … some of the most hard-fought political arguments of our time take place between two rival camps within it — the laissez-faire camp and the fairness camp. Leading the laissez-faire camp are free-market libertarians who believe that justice consists in respecting and upholding the voluntary choices made by consenting adults. The fairness camp contains theorists of a more egalitarian bent. They argue that unfettered markets are neither just nor free. In their view, justice requires policies that remedy social and economic disadvantages and give everyone a fair chance at success.” (p. 20)

Williams plants himself firmly in the laissez-faire, libertarian camp, whose approach to social issues rests primarily on the premise that “markets promote the welfare of society as a whole by providing incentives for people to work hard supplying the goods [and services] that other people want”. (Justice p.6) How exactly small children, the elderly and the mentally and physically handicapped are fairly represented in this scheme is ignored by people who think like Williams, unless of course we want to exploit them despite their limitations.

In contemplating whether are not Americans today are virtuous and moral he focuses almost exclusively on those who support taxing all wages to support Social Security, Medicare and Medicaid and how it accounts for nearly half of federal spending. Revealing as he does that monetary considerations outweigh social responsibility, Williams seems willing to allow suffering and depravations that accompany poverty. To me, this raises a moral qualm.

This notion is hit upon in Sandel’s book:

Taken to it’s extreme a libertarian’s “idea of self-ownership, consistently applied, has implications that only an ardent libertarian could love – an unfettered market without a safety net for those who fall behind; a minimal state that rules out most measures to ease inequality and promote the common good; and a celebration of consent so complete that it permits self-inflicted affronts to human dignity such as consensual cannibalism or selling oneself into slavery.” (Justice p103)

Charitable Giving

Williams would likely inject that charitable organizations would fill the gap where free market economies fall short. Though I agree that charitable organizations fulfill a great need, I am not as naive as he appears to be to think that such personal choices suffice to meet critical economic deprivations in this country. If this practice alone were sufficient to temporarily provide for those who fall between the cracks and find themselves destitute through conditions beyond their control, then the need for federal programs aimed at this population would likely never have arisen.

The fact is though that individual charities fall way short of meeting the needs of a growing population who lack the resources within a free market society to provide basic essentials for themselves and their families. When economic hard times occur as they often do, charities are pressed harder to provide not only for those who lack the means to actively participate in our economy due to age and physical limitations but also to fill the void at times when more people who can find themselves unable to when jobs dry up.

To add insult to injury, recent testimony from Frank J. Sammartino, the assistant director for tax analysis from the Congressional Budget Office shows that though the wealthiest give slightly more of their income to charitable organizations, only 4% of that goes to organizations devoted to helping meet basic needs while those who make below $200,000 give on average about 11%. The wealthy tend to give significantly more to health and education organizations. Institutions that they and their progeny can benefit from over other charitable organizations. Would billionaire David Koch have given over $500 million to cancer research had he not been diagnosed with prostate cancer back in 2004?

The Side Benefits of Public Programs

In the documentary “The Corporation”, Noam Chomsky points out the side benefits of public institutions, even when they run at a loss.

Public institutions … may purposely run at a loss because of the side benefits. So for example if a public steel industry, runs at a loss, it’s providing cheap steel to other industries. Maybe that’s a good thing. Public institutions can have a counter-cyclic property. So that means that they can maintain employment in periods of recession, which increases demand, which helps to get us out of a recession.

I bring this up here because the argument that spending in the public sector is always detrimental to our economy is not an absolute. In providing health care services to those in our society that have fallen through the cracks, even if it’s done at a loss, there are counter-cyclic advantages to this. Without federal aid in the form of Medicare and Medicaid most low and middle-income families would be hard pressed to provide the time and financial means to support a handicapped child or a spouse with a long-term illness or an aging parent who needs assisted living care. Without unemployment benefits able workers would find themselves deeper in debt before regaining employment. Their productivity at work could suffer from their need to deal with these issue monetarily and emotionally and those lost hours will have a negative effect on our economy.

And then there of course are those, especially the elderly, who have no family to speak of to assist them in their time of need. What are to be done with such people? A humane society will have to pay for their care but will they do so at a level that respects these disadvantaged souls or simply warehouse them and treat them as unclaimed freight?

Virtue Has No Self-Interests

Our system of entitlements in this country is a mark of a civilized society that seeks to remedy the shortfalls of our free market economic system. There are areas we can address that will reduce costs for necessary programs like Social Security, Medicare and Medicaid but they don’t have to reduce essential care for those who can’t afford what “the greatest health care system in the world” makes available for financially successful people. We can eliminate fraud within the private sector that costs billions each year, initiate some means testing, eliminate unnecessary medical tests that have been proven ineffective and notch up the rate people are taxed on to pay for these benefits.

The germ that infects the thought of people who feel they are unduly burdened to provide for the powerless in this country have a convenient view of morality that ignores the consequences of their actions. Once this germ infiltrates so deeply into the social mindset of a people, virtue suffers a blow. Securing individual wealth to the detriment of those who find themselves outside the means to provide for themselves may be “naturally” appealing to many but to assert it has greater moral value is a fundamentally flawed philosophy.

“We are not rich by what we possess but by what we can do without.” - Immanuel Kant

Economics and Morality: Paul Krugman’s Framing

Healthcare and Scalia’s Broken Moral Compass

Posted by lbwoodgate in Medicare/Medicaid, Social Discourse Tags: egalitarianism, federal aid for the poor, greed vs. need, justice, Laissez-faire, libertarianism, medicare/medicaid, Michael Sandel, Milton Friedman, morality in america, social safety nets, Wall Street, Walter E. Williams

11 comments

One Conservative at Least is Hearing the Complaints Coming From the OWS Protests.

November 16, 2011

“From tax write-offs for gambling losses, vacation homes, and luxury yachts to subsidies for their ranches and estates, the government is subsidizing the lifestyles of the rich and famous. Multi-millionaires are even receiving government checks for not working. This welfare for the well-off – costing billions of dollars a year – is being paid for with the taxes of the less fortunate, many who are working two jobs just to make ends meet, and IOUs to be paid off by future generations.”

It might come as shock to those on the right who read this that these are not the ramblings of an anti-Capitalist, left-leaning Democrat. They come from a report recently released from the office of ultra-conservative Oklahoma Senator Tom Coburn. Coburn states in his report entitled Subsidies of the Rich and Famous, that as “families across the country [are] struggling to make ends meet during these economically trying times, many are left with few options so they are turning to the government – some very reluctantly – for assistance.” Some may recall that it was Coburn who single handedly blocked the efforts of the full Senate in 2010 to extend unemployment benefits to the millions of people who had lost their jobs as a result of the financial collapse of the free-market.

Coburn is also part of the Republican bloc in the Senate where minority leader Mitch McConnell has stated that the “single most important thing we want to achieve is for President Obama to be a one-term president.” Thus, every effort where the Obama administration has attempted to alleviate the plight of “families across the country struggling to make ends meet”, has been blocked by Senator Coburn and the rest of the GOP.

Coburn’s report is not testament to any shift in political views regarding government aid. He still lamely claims that taxing the rich because they “are getting too much of the economic pie … is no different than taking a dollar from one pocket and putting it into another in the same pair of pants.” That would only be true if the wearer of those pants was also a millionaire. Entitlement programs and aid grants that provide a safety net for the poor and unemployed during tough economic times is hardly money that goes to people who really don’t need it.

But unlike many of his Republican/Tea party colleagues, Coburn appears to have seen the writing on the wall from the ever growing and popular Occupy Wall Street movement that has brought home the reality of the vast income disparity between the wealthy 1% in this country and everyone else.

His report is a worthy attempt to show that “welfare for the well-off – costing billions of dollars a year – is being paid for with the taxes of the less fortunate, many who are working two jobs just to make ends meet, and IOUs to be paid off by future generations.” His report aptly demonstrates that billions have been going to millionaires over the last decade for things like tax write offs in the form of farm subsidies to people who neither actively work or even live on a farm to some 60,000 wealthy individuals who have filed for Medicare Part B with modified adjusted gross incomes of $1,000,000 or more.

He also makes a great case for means testing of all entitlement programs like Social Security, Medicare/Medicaid and Unemployment benefits. In 2009 over 38,000 people with adjusted gross incomes of $1 million or more, collected $1,142,204,000 in Social Security benefits, an annual average of $30,780 for each recipient. Though that’s a wapping amount for most income earners it is only about 3% of those who made $1 million each year and about 0.30% for those who made over $10 million.

Granted, even some millionaires paid into the social security trust fund during their lifetime as wage earners. But with high unemployment rates today where there are fewer workers available to contribute their share through payroll taxes and the aging baby boom generation starting to retire, the strain on the trust fund has created a deficit in receipts for the first time in nearly 30 years. The system is capable of paying 100% of benefits until 2036 but if we don’t make necessary adjustment it will only be able to pay 75% of benefits after that. Means testing would reduce the payout to millionaires and even eliminate benefits for some, providing needed revenue for those wage earners who depend on Social Security benefits as their sole source of retirement funds. “Returning the purpose of the program to a need-based service instead of one available universally may help keep Social Security solvent for future generations”, says Coburn

Medicare/Medicaid is in even worst shape than Social Security because of the increase in high health care cost and fraud abuses by health care providers. For millionaires to apply for this entitlement program when their resources allows them buy some of the best health care coverage that the private sector offers is ludicrous. According to Forbes reporter Janet Novack last month, a “couple on Medicare with a $428,000 AGI will benefit from a 13 percent decrease in their Part B premium payments. At the same time, the majority of Medicare Part B participants who pay the lowest premiums will see their monthly premiums increase slightly, offsetting the first cost-of-living-adjustment (COLA) increase recipients have seen in about 3 years.”

To deplete these vital resources for low income and handicapped individuals in order to prevent a millionaire’s resources from diminishing is ludicrous. How many of these very wealthy people have referred to Medicaid/Medicare as a “socialist” program that is depleting tax payers of their hard-earned wages?

Fraud is apparently rampant within the Unemployment Insurance (UI) Program too. This entitlement program that also receives contributions from wage earners through their payroll taxes as well as employer contributions, serves to alleviate the loss of wages when workers have been laid off for reasons other than poor performance. Without these benefits many families would be strapped to pay for food and rent until they can find other work. Yet Coburn’s report showed there were those collecting unemployment benefits who were “also earning millions of dollars in the same year. In 2009, the Internal Revenue Service reported that 2,362 millionaires collected a total of $20,799,000 in UI. Eighteen individuals reporting an adjusted gross income of $10,000,000 or more also received $12,333 on average in UI in 2009, for a total of $222,000.”

Angela Wade, who has also reported on this at her Blue States blog has broken the benefits down cited in Coburn’s study to show just how much revenue is being lost for essential social programs to people who are far from being in need.

$18.15 million in child care tax credits

$74 million in unemployment checks

$89 million for preservation of ranches and estates

$316 million in farm subsidies

$608 million in business entertainment deductions

$9 billion in retirement checks

$21 billion in gambling losses

$28 billion in mortgage breaks for mansions, vacation homes and yachts

Though it is encouraging to see Senator Coburn present such a detailed outline of the waste of needed government revenue going to people within the top 2% of income earners in this country, it will be interesting to see if this just a head jerk to feign concern about the need to correct such abuses that occur through federal subsidies and policies that neglect to prevent unethical practices by those in the top tier income groups.

His conservative creds are still locked into the notion that “government policies intended to mainstream wealth redistribution are undermining these principles” that expects “everyone to contribute and to demonstrate personal responsibility”. Yet the expectations one sees coming from this study suggests that Coburn is not in the same camp with other Republicans who see the removal of existing tax subsidies as onerous “tax cuts”.

Coburn has boasted that this study is the first comprehensive effort that has revealed how nearly $30 billion in giveaways and tax breaks has fleeced the American taxpayer. We can only now hope that he will step up to the plate and vigorously defend this data and convince his fellow Republicans to step away from their pro-corporate entrenched view of supporting the haves to the detriment of the have-nots in our country. Or will we see him wilt in the face of the strong opposition from the right-wing extremists who have taken over the Grand Old Party of Lincoln?

Posted by lbwoodgate in 2012 Presidential Elections, Budget Crisis, Economy, Financial Reform, Health Care Reform, Jobs, Medicare/Medicaid, Occupy Wall Street Protest, Society and Politics Tags: billions in subsidies for millionaires, Coburn, fleecing American tax payers, gop gaming the system in favor of wealthiest 1%, Medicare, Mitch McConnell, Republicans, Senate, Social Security, Tom Coburn

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