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Tax Cuts Prelude To Social Security And Medicare Cutbacks

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Tax Cuts Prelude To Social Security And Medicare Cutbacks

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Reprinted with permission from AlterNet.

The wheels of justice might be turning with the guilty plea by Trump campaign and White House aide Michael Flynn and the reality that the presidents’ team are real targets, but that will not stop the GOP Congress and White House from gutting essential social safety nets.

The GOP tax plan, which passed the Senate 51-49 early Saturday with no Democrats voting yes, now moves to the phase where differences in the House and Senate bills get ironed out. That will prompt fierce lobbying and protests, but a major bill transferring wealth from the middle-class to the best-off Americans will be passed and signed by Trump.

If all the Republicans were doing was lining the pockets of the already rich, that would be bad enough—pick your adjective. But that’s not the endgame. Before the Senate voted, Senator Marco Rubio of Florida, a past presidential candidate, said the Republicans must make additional cuts to Social Security and Medicare, both federal programs for those over age 65 as well as people with disabilities and parentless children (such as Republican House Speaker Paul Ryan as a youth).

“We have to do two things. We have to generate economic growth, which generates revenue, while reducing spending. That will mean instituting structural changes to Social Security and Medicare for the future,” Rubio told Politico.combefore the vote.

That statement omitted that the Senate’s $1.5 trillion tax plan would trigger a federal law, known as PayGo, which limits Medicare to 4 percent of the annual budget. It is projected to impose $400 billion in cuts to senior healthcare in the next decade The PayGo trigger will “undermine the delivery of care to the 57 million seniors and disabled Americans who depend on the program,” wrote Max Richtman, head of the National Committee to Preserve Social Security and Medicare.

But even that attack on Medicare will not be enough for Republicans who want to return the size of the federal government—apart from the military—to what it was before the Great Depression of the late 1920s, which triggered Franklin Delano Roosevelt’s New Deal, which created Social Security. The heir to that program was the 1960s creation of Medicare and Medicaid, state-run healthcare for the poor and those in nursing homes.

“The tax bill is one enormous attack on our health,” wrote Social Security Works’ Nancy Altman and Linda Benesch before the vote. “It takes away the ability of those with large health care costs to deduct those costs from their [annual] taxes. It repeals the part of the Affordable Care Act that seeks to make health insurance affordable. The consequence of that is $185 billion less in health insurance subsidies and $179 billion in Medicaid cuts. All so Republicans can shower huge tax giveaways to their wealthy donors. And those tax giveaways trigger automatic cuts to Medicare.”

“The Republicans are trying to enact this assault on our health care as rapidly as possible while the American people are distracted by the holiday season,” they continued, before the vote and Friday’s guilty plea by Flynn. “When health care premiums go up, when Medicare gets cut, and when Medicaid gets cut, they will blame Obamacare–even though that is a shameless lie.”

As bad as this is, it will get worse if Republicans like Rubio and Ryan get their way.

“At a moment when 10,000 Americans are turning 65 every day, members of the Senate have stolen the retirement health benefits that Americans have earned over a lifetime to provide an unneeded windfall to the top 1 percent,” Richard Fiesta, Executive Director of the Alliance for Retired Americans, said. “They seem determined to create a retirement crisis that will take decades to reverse.”

Already on Saturday morning on CNN, Republican pundits were trotting out another well-worn lie—that Social Security was going broke and would not be there for today’s youths without drastic measures. (That lie follows their tax cut sales pitch, saying it will bring trickle-down prosperity for all. That line was used in the 1986 federal tax cut, which was followed by decades of wage stagnation).

The Republicans intentionally mislabel Social Security as an entitlement program. In fact, it is an earned benefit program where workers contribute via payroll deductions. It cannot spend money it has not collected under federal law. In the early 2030s, the large size of Baby Boom generation will prompt roughly a 20 percent cut in benefits unless the Congress enacts a revenue measure—such increasing the wealthy’s tax contribution to the program. Now, only the first $120,000 or so of income is taxed for Social Security.

Earlier this week, as the tax bill was on a fast track to passage, an acquaintance told me that he was going to pay about $36,000 a year less in federal taxed under the Senate bill—based on making roughly $40,000 a month. RThis very successful lawyer said he didn’t need the additional income. He said he didn’t want to see Trump have a victory. But it is people like him will not be asked to contribute more to securing social safety nets, from various health programs to retirement income.

Grabbing the cash and running might be the way Trump made his fortune and what the GOP is delivering to the richest Americans. But even if Robert Mueller’s investigation of the Trump’s campaign collusion with Russia eventually brings down this White House, the Republicans ruling Congress remain and are more immediately targeting safety nets. They have the ability to swiftly create damage lasting for many years before justice catches up with the Trump mob.

That damage will remain for years—certainly until there’s a Democratic lock on Washington to enable corrective legislation. By then, you can bet the same Republicans who late last night voted for the tax plan will be yelling about excessive and irresponsible federal spending. But in the interim, starting with the tax bill’s anti-healthcare provisions, the GOP is willfilly imposing unnecessary hardship and serious stress on millions of Americans.

 

Steven Rosenfeld covers national political issues for AlterNet, including America’s democracy and voting rights. He is the author of several books on elections and the co-author of Who Controls Our Schools: How Billionaire-Sponsored Privatization Is Destroying Democracy and the Charter School Industry (AlterNet eBook, 2016).

 

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4 Comments

  1. Dominick Vila December 3, 2017

    I would not be surprised, if the GOP leadership already had some very serious talks with “Little Marco” for admitting the obvious. Gutting social programs, including Social Security, MEDICARE, MEDICAID, the ACA, and Public Education, has been a GOP goal for many years, but that does not mean they will overtly destroy those programs. The challenge for them is to find a way to undermine social programs without making it too obvious and eliciting the ire of millions of seniors, and the middle class. They are greedy, beholden to their wealthy donors, and arrogant, but they are not dumb. They know that touching SS and MEDICARE is political suicide, and very likely the only thing that would prevent them from increasing their majority in the Senate, hanging on to the House in 2018, and guaranteeing a major shift to the right in the Supreme Court. My guess is that they will wait to see if the anticipated financial bounty they expect materializes, and gives them cover to pursue their draconian agenda.

    Reply
  2. FireBaron December 3, 2017

    Here is a suggestion for resolution. We eliminate Congressional Pensions, forcing Congress to live on the same types of retirement the rest of us do. As a secondary function, enforce a mandatory 70 year old retirement age on them. Alabama has that law which prevented Moore from running for reelection as Chief Justice of the State Supreme Court. Unfortunately, it isn’t keeping him from running for the Senate.
    Yeah, I know this means it would preclude Dom and I from running in our respective states (not that we would have the proverbial snowball’s chance of winning), but it will also allow us to purge the House and Senate of a group of men who barely keep awake during sessions, and have to be told by their aides how they are supposed to be voting on any given bill.

    Reply
  3. Richard Prescott December 3, 2017

    We have already seen the GOP’s underling programs for the good of the country and the people. To attack Social Security and Medicare specifically and if that attack affects ANY senior citizen who paid into both programs would be tantamount to Grand Theft Larceny.
    To eliminate this open peril they would have to talk about implementation in terms of decades down the road, as anyone who has been working for at least 10 years has paid into both.
    And they want the “retirement” age to be 67 now, so assuming a person starts working at 18, ten years goes to 28, that would be 39 years from now for implementation.
    Somehow I don’t see that length of time in the GOP’s plans.
    So to sideways quote Marvin of the movie Red, why don’t the GOP just fire up the old Nazi gas chambers and kill off all the old folks now rather than dragging the agony out over many years.

    Reply
  4. Sand_Cat December 3, 2017

    And all this is a surprise because?

    Reply

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