Obama’s mixed message on Social Security

By Will Parry

In a State of the Union address an hour and eleven minutes long, President Obama devoted a single 56-word paragraph to Social Security.  Here is the paragraph in full:

“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.”

The president’s statement was in part reassuring and in part troubling.

He is to be commended for defending the benefits of the millions who depend on Social Security today; for his opposition to “slashing benefits for future generations;” and for his rejection of any move toward privatizing the program.

On the other hand, his call for a “bipartisan solution” to strengthen Social Security should be weighed in the context of his recent bipartisan deal on taxes.  There has already been more than enough surrender of principle in the name of “bipartisanship.”  In dealing with the Republican Party, it is necessary to recognize that, with few exceptions, its members are ready to undermine basic Social Security protections in the name of tackling the budget deficit.  Few Republicans are interested in finding “bipartisan solutions.”

It is also troubling that the president did not confront the very grave threat of a raise in the retirement age to 69, supposedly to address a deficit Social Security had no part in creating.

Nor did Obama confront the implications of the impending one-year payroll tax “holiday.”  It’s estimated that the one-year cut will cost the Trust Fund $120 billion, an amount that will be replaced from general revenues.  This will be the first time in 75 years that the program will not be funded entirely by the dedicated payroll tax.  It’s an ominous precedent.

At the end of the one-year “holiday,” restoration of the 6.2 percent tax would amount to a bump of almost 50 percent in the deduction from workers’ paychecks.  This will surely be attacked as a tax “hike.”  A Congress that can’t let tax cuts for the wealthiest Americans expire will surely be reluctant to let the payroll tax revert back to 6.2 percent.  Continuing to replenish the Trust Fund with general fund revenues would aggravate the deficit and undermine public support for Social Security.

The president’s brief remarks surely reflected an awareness of the intense lobbying effort mounted by the Strengthen Social Security Campaign, a coalition of more than 200 organizations, including the Alliance for Retired Americans.

The coalition has been concerned about how Obama would react to proposals by the Simpson-Bowles fiscal commission to increase Social Security’s retirement age and to weaken its cost-of-living protection.

As the State of the Union date neared, “everybody and their cousin is talking to the White House about this,” said a Democratic strategist involved in the campaign.  “Nobody in the progressive world thinks the president ought to endorse the Simpson-Bowles Social Security stuff.  People feel very strong about it and have been working it very hard.”

The coalition is following through with a nationwide grassroots campaign to call on members of Congress to defend the integrity of Social Security.

Senators Saxby Chambliss (R-GA) and Mark Warren (D-VA) head up a group of 18 senators who believe the debt commission’s report is the best basis for bipartisan talks.  They plan to introduce a bill based on the commission’s proposals.  If the legislation clears the Senate, it will surely have momentum in the Republican-dominated House.

The danger is immediate, and a sustained grassroots campaign is essential.