By Sonali Kolhatkar
October 18, 2022:
Information Clearing House
-- Inflation
continues to rise in the United States.
Although gas prices have recently
fallen since their record high over the
summer, the cost of groceries
rose by 11.4 percent over the last year,
and there is
no expectation that they will fall back to
reasonable levels. Prices overall have
risen by
8.2 percent, according to the U.S.
Bureau of Labor Statistics’ Consumer Price
Index report covering September 2022 as
compared to the same month last year. While
most working Americans are not getting hefty
wage raises to compensate for inflation,
seniors will see their Social Security
benefits—which are pegged to inflation—rise
next year. Starting in January 2023,
beneficiaries will see an
8.7
percent cost-of-living adjustment (COLA)
bump in their Social Security checks.
Conservatives are scoffing at this
automated increase, as if it were a special
treat that the Biden administration has
cooked up to bribe older voters. Fox News
reported that there was a “social media
backlash” against White House Chief of Staff
Ron Klain’s
tweet lauding the upcoming increased
COLA benefits for seniors. The outlet
elevated comments by the conservative
America First Policy Institute’s Marc Lotter,
who
retorted to Klain, “Nice try Ron.
Raising benefits next year does not help
seniors with the higher prices they are
paying today or the higher prices they’ve
been paying since you took office.”
But Social Security benefits have risen
automatically with inflation
since 1975 by design, precisely so that
the livelihoods of seniors are not beholden
to partisanship. This is an imminently
sensible way to ensure that retired
Americans, who spent their working lives
paying Social Security taxes, can have a
basic income.
If conservatives are complaining that an
8.7 percent bump is not enough to counter
inflation, one might expect them to demand
an even greater increase to Social
Security benefits.
But, as is often the case with
conservative economic logic, hypocrisy
abounds. Bloomberg Government reporter Jack
Fitzpatrick recently
reported that several House Republicans
who are vying to chair next year’s House
Budget Committee if their party wins a
majority in the November 2022 general
elections are crafting plans for reductions,
not increases. They hope to leverage
negotiations on raising the 2023 debt
ceiling by demanding cuts to Social Security
and Medicare—programs that the GOP loves to
deceptively label “entitlements.”
Fitzpatrick, using conservatives’ nakedly
partisan language, said that Republican
negotiators “could subsequently put major
entitlement programs in play.” One of the
GOP members of Congress eyeing the committee
leadership, Georgia’s Buddy Carter, was more
forthcoming about his plan, saying, “Our
main focus has got to be on
nondiscretionary—it’s got to be on
entitlements.” Another Republican lawmaker,
Jodey Arrington of Texas, also hoping to
chair the crucial committee, understood the
value of discretion when discussing cuts to
programs favored by his constituents. He
warned his Republican colleagues against
getting too specific because “this can get
so politicized.”
But Republicans have been demanding cuts
to so-called entitlement programs for at
least the past seven years running, in
2015,
2016,
2017,
2018,
2019,
2020, and
2021.
Oddly, the Washington Post’s fact checker
Glenn Kessler found no evidence to back
up Democratic Senator Patty Murray’s recent
claim that “Republicans plan to end Social
Security and Medicare if they take back the
Senate.” Awarding Murray four
“Pinocchios”—the Fact Checker column’s
highest possible
rating for lies—Kessler assured readers,
saying, “Don’t worry, seniors: There is no
such plan.” (In the hundreds of comments on
the piece, many readers called out Kessler’s
obvious service to Republicans in helping to
hide their agenda.)
Social Security is one of the best, most
popular government-funded programs in the
nation. I recently explained its workings to
my parents who emigrated from the United
Arab Emirates to the U.S. a year ago. The
custom they are familiar with in countries
like the UAE is that of a “gratuity” or
severance, paid to retiring workers—a
lump-sum tip—based on their salary and
number of years worked.
I explained that in contrast, U.S.
workers pay a small percentage of their
wages into the Social Security fund their
entire working life. Upon retirement,
workers draw a monthly sum based on their
salary, years worked, and the current cost
of living. While this may not sound as
enticing as receiving a large sum of money
at once, the monthly payments will never run
out and last from retirement until death. My
parents were duly impressed.
This year, to mark the 87th anniversary
of Social Security,
Data for Progress found in a poll that
the program remains extremely popular and
that a majority of voters want to increase
benefits.
Those surveyed also worried that Congress
could cut current or future benefits, or
privatize the program. Most had not heard
about Republican plans for cuts, however,
suggesting that the efforts to hide the
GOP’s real agenda have generally worked.
And, most were in favor of a very simple
solution to ensure that Social Security’s
funds don’t run out as revenues have
dropped due to increasing inequality,
and life expectancy has increased: make the
wealthy pay their fair share. Social
Security payroll taxes are
capped at $147,000 in wages currently
(and beginning in 2023 will increase a
modest 9 percent to
$160,200). That means those earning a
million dollars a year in 2022 pay the same
amount into Social Security as those earning
$150,000.
Removing the cap ensures that the fund
will remain solvent and stable.
Social Security, in spite of some flaws,
is also one of the nation’s most progressive
programs, helping to further racial and
gender justice among older Americans.
According to the
Center on Budget and Policy Priorities
(CBPP), “Social Security is a particularly
important source of income for groups with
low earnings and less opportunity to save
and earn pensions, including Black and
Latino workers and their families, who face
higher poverty rates during their working
lives and in old age.”
Furthermore,
CBPP finds that “Social Security is
especially important for women, because
they tend to earn less than men, take more
time out of the paid workforce, live longer,
accumulate less savings, and receive smaller
pensions.”
In spite of enduring Republican desires
to cut the program, it is not nearly as
generous as it ought to be. A
global comparison of government
retirement benefits by the Organization for
Economic Cooperation and Development (OECD)
in 2019 found that the U.S. ranked 24th on
the ratio of worker benefits to earnings.
This is below average for OECD countries,
and lower than the benefits paid by
countries like Turkey, Greece, Estonia, and
Latvia, in spite of the U.S. being the
richest nation in the world.
In other words, there is a basis for the
conservative critique that an 8.7 percent
increase in Social Security benefits slated
for 2023 is insufficient. But the solution
is to make benefits more generous,
rather than to cut the program as
Republicans aim to do.