Tuesday, December 3, 2013

Dick Durbin, Still Passionately Committed to Cutting Your Social Security

There are few people (or few Democrats at least) in the Senate as passionate about cutting Social Security as Illinois's "liberal" senator Dick Durbin.

The State Journal-Register of Springfield, IL, reported earlier today that Durbin was pushing for cuts (for the umpteenth time) in a press conference after a talk at a local high school.
“Let’s have this debate,” Durbin told reporters after speaking with students at Springfield High School. “Let’s make this choice. I don’t want to wait 20 years and be in the same situation as our state pension systems. We have no choice but to make some really, really tough decisions.”

Durbin said he wants to lift the cap on annual earnings that can be taxed for Social Security to take in “roughly 85 to 90 percent of all earned income.” ….

Durbin also said the retirement age affects the long-term solvency of the system, but “whatever change we make should be made gradually over a long period of time.”
And, Durbin said, the cost-of-living adjustments (COLAs) should be based on need.

“Loretta and I should receive less in COLA than those who are living on Social Security alone,” Durbin said of he and his wife, who live in Springfield. “We both have income. … We shouldn’t get the same COLA as those who are struggling,” including those getting the smallest benefits and those at advanced ages “where they’ve expended all their savings.”
Durbin wants to lift the cap to cover 85% of all earned income. As of 2011, it covered 84% of total income. If you want to calculate the exact percentage, you can probably do so with the wage data from the SSA, knowing that the payroll tax cap only applies to income under $113,700. 
On the question of the retirement age, I've written before about how the average life expectancy at age 65 for the bottom half of earners, those who need Social Security the most, has been stagnant for the past three decades. And, for some demographics, life expectancy is falling.

Durbin also proposes means-testing, a conservative plan in progressive clothing. Daily Kos's own Joan McCarter has a great diary from two years ago on the fallacy of means-testing. At the simplest level, there just aren't enough wealthy seniors. To gain genuine savings through means-testing, you have to push the threshold for "affluence" pretty low. And with the looming retirement crisis, explained well by Senator Elizabeth Warren, the number of seniors living comfortably will be going down in the future.

Joan's piece also includes an excellent quote from Dean Baker and Mark Weisbrot's book Social Security: The Phony Crisis on the problem with the arguments for means-testing:
The justification for denying benefits to people who have paid taxes into the system is also questionable. We do not deny interest payments to wealthy owners of U.S. Treasury bonds, for example, and it is difficult to see how the payment of Social Security benefits to rich senior citizens is any less appropriate. Indeed, why single out senior citizens as a group for special treatment in this regard? If we think that the rich are getting too much of the economic pie, then they should be taxed more--not just the ones who happen to be over 65.
Durbin also told reporters that he wants any Social Security "fix" to be bipartisan as it was in 1983:
He said similar changes were passed — with his support when he was in the House — in 1983. “It bought 50 years of solvency for Social Security, and it was worth it,” Durbin said. “It was bipartisan, and it should be bipartisan again.”
I'm sure he does want it to be bipartisan. Remember, he served in the Catfood Commission (Simpson-Bowles) and supported the Simpson-Bowles plan. He's actually the only Democrat currently in office who voted for the original Simpson-Bowles plan. 

Durbin also contrasted his recommendations with the evil specter of "privatization." Many Democrats like to use "privatization" as a foil when they are pushing cuts to Social Security. However, "privatize or cut" is a false dilemma. As senators like Elizabeth Warren, Bernie Sanders, Tom Harkin, and Sherrod Brown have shown, there's another option: expanding Social Security.

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