The Progress Report, 4/22/2005

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Fri, 29 Apr 2005 07:57:43 -0700

Progress Report: Massive Middle-Class Benefit Cuts

" American Progress Action Fund "

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The Progress Report

 

by Christy Harvey, Judd Legum and Jonathan Baskin with Nico Pitney and

Mipe Okunseinde

 

 

 

www.progressreport.org

4/22/2005

 

For news and updates throughout the day, check out our new blog at

ThinkProgress.org.

 

SOCIAL SECURITY

 

Massive Middle-Class Benefit Cuts

 

Last night the president proposed deep Social Security benefit cuts

for middle-class Americans. He formally " backed a specific plan to

reduce future benefits for tens of millions of Americans. " Yet in

presenting the idea of progressive indexation – a change in law that

will give workers less money by tying their benefits to inflation

instead of wage growth – President Bush described it as a system

" where benefits for low-income workers will grow faster than benefits

for people who are better off. " Here is the part he skipped: the plan

" would reduce annual benefits for an average wage-earner who is 25

today and retires in 2045 by 16 percent.… For an average-earner who

retires in 2075, the benefit reduction would be 28 percent. "

 

THE SHELL GAME: There are only two ways to improve Social Security's

solvency: either increase the amount of money going into the system or

decrease the amount of money leaving the system. If the president's

plan solves as much of the system's funding problem as the White House

claims it does, then it accomplishes this success through benefit cuts

or increases in the payroll tax. Last night, the president dishonestly

described his plan in a way that suggested it involves neither of

those two options. Not only did the president not acknowledge the

sweeping cuts that would be made under his plan, but his definition of

a " high wage earner " was equally as misleading. A worker making

$58,000 a year – who will see his or her benefits cut by 42 percent

under the president's plan – certainly could not be considered " affluent. "

 

WHERE'S THE BEEF?: In praising his plan, President Bush claimed that

it guarantees " future generations [will] receive benefits equal to or

greater than the benefits today's seniors get. " But that isn't an

improvement over the current system. The Social Security

Administration estimates that the system's reserves will be exhausted

by 2041; at that point, " benefits would be almost three-quarters what

is currently promised, and considerably higher in inflation-adjusted

terms than they are now. " Bottom line: " If nothing is done to Social

Security, the system will be able to meet the president's promise to

ensure that all seniors receive a benefit larger than current levels. "

 

ALL IDEAS ARE NOT ON THE TABLE: Bush was directly asked if he would

" consider it a success if Congress were to pass a piece of legislation

that dealt with the long-term solvency problem but did not include

personal accounts. " Bush responded, " I feel strongly that there needs

to be voluntary personal savings accounts as a part of the Social

Security system. I mean, it's got to be a part of a comprehensive

package. " His answer reveals the president is more concerned with his

ideological agenda than solving Social Security's problems.

 

BUDGET

 

Bush Speaks Softly, Congress Carries Big Axe

 

Last night President Bush proposed changing Social Security so

low-income Americans would never have to " retire into poverty. " Thanks

to the federal budget crafted by the president and passed last night

by conservatives in both houses of Congress, they won't have to wait

until they retire. Besides adding $5.3 billion in new, regressive

taxes that will hit middle- and lower-income Americans hardest, the

conservative budget features " cuts in scores of programs that middle-

and low-income families rely on. " Most notably, Congress voted to

slash Medicaid – the country's premier health program for the poor –

by $10 billion over the next five years.

 

THE MEDICAID " VICTORY " : The $10 billion in Medicaid cuts is

significantly less than what the president had asked to be included in

his budget, but will nevertheless be devastating for cash-strapped

states struggling to provide adequate care. Medicaid, already facing

increased costs " driven primarily by enrollment growth due to the

economic downturn, " was the single largest proposed reduction in the

Bush 2006 budget. Governors from across the country implored Congress

to hold back on the cuts, and seemed to gain some traction when the

Senate voted to strip Medicaid cuts and set up a bipartisan commission

to study the problem last month. That's why White House officials

counted the $10 billion blow to the country's poorest and neediest " as

a victory. "

 

BUSTING THE BUDGET: In the name of " fiscal discipline, " the budget

passed yesterday by Congress slashes funding for education, health

care and job training, but clears the way for $106 billion in new tax

cuts over five years. Conservatives wanted to make sure that much of

that money could never be used for anything useful, so $70 billion is

" shielded from a Senate filibuster, " including extensions of Wall

Street specials like the 2003 cuts to capital gains and dividend tax

rates. As the Washington Post notes, " the cost of those tax-cut

extensions would more than nullify the savings from the spending

cuts. " According to CBPP, the budget will actually " increase deficits

over the next five years by $168 billion, compared with the deficits

the Congressional Budget Office estimates would occur if there were no

changes in policies. " Take a look at an analysis by the Center for

American Progress that examines the state-by-state impact of the

federal Medicaid cuts.

 

THE POVERTY PRESIDENT: Last night, President Bush said the " whole

goal " of his Social Security plan was to make sure " nobody retired in

poverty. " Bush's sudden concern about " poverty " is touching, but

millions of Americans could use the help before they retire. In

President Bush's first term, poverty rose for three straight years,

especially for children. What does the new budget do to address this

problem? It slashes programs that provide health care to needy

children, scales back on a campaign pledge to increase Pell grants

which help low-income kids get an education and cuts job training

programs that help the unemployed lift themselves out of poverty. For

good measure, the budget also calls for a $600 million cut in the Food

Stamp Program, making it harder for more than 300,000 low-income

Americans to eat.

 

Under the Radar

 

IRAQ – A CHALABI FAMILY AFFAIR: Ahmed Chalabi – the one-time darling

of the neo-cons who still holds a tender spot in Vice President

Cheney's heart – has done it again. Though his bid to be Iraq's top

leader sputtered out months ago, Chalabi nevertheless captured a key

position in the newly formed government as acting oil minister,

overseeing the world's second largest proved crude reserves until a

permanent chief is found. " With his nephew also installed as finance

minister, Chalabi and his family appear to have a firm grip on the

country's purse strings, " the Associated Press reports.

 

FOREIGN POLICY – MORE BOLTON BULLYING: The Washington Post reports new

evidence that President Bush's United Nations nominee John Bolton

tried to manipulate intelligence and intimidate experts into following

his personal policy agenda. John S. Wolf, who served as assistant

secretary of state for nonproliferation and as President Bush's senior

envoy to the Middle East, told Senate staff members that Bolton had

indeed tried to punish two State Department officials because they

disagreed with him on nonproliferation issues. And Alan Foley, who ran

the CIA's weapons of mass destruction office, told the committee that

Bolton " tried to fire a national intelligence officer " who believed

Bolton was exaggerating evidence on Cuba.

 

GUANTANAMO BAY – FAKING IT: According to Reuters, " Authorities at

Guantanamo Bay staged interrogations of detainees for visiting

politicians and generals to give the impression that valuable

intelligence was regularly being gathered. " Former Army Sgt. Erik Saar

says, " the military chose detainees for the mock interrogations who

previously had been cooperative and instructed them to repeat what

they had told interrogators in earlier sessions. " The visiting VIPs

would then believe they'd seen successful interrogations in action.

(Instead of witnessing beatings or the use of attack dogs to

intimidate detainees, for example, visiting officials watched

cooperative detainees receive ice cream rewards.) Saar charges, " 'only

a few dozen' of the 600 detainees at the camp were terrorists and that

little information was obtained from them. "

 

SUDAN – CIA GETS BUDDY-BUDDY WITH GENOCIDAL GOV'T: The U.S. has

buddied up to the top intelligence chief in Sudan, Maj. Gen. Salah

Abdallah Gosh, maintaining a close friendship with the man who has

played a " key role " in directing the massacres in Darfur. Just last

week, according to the Los Angeles Times, the CIA ferried him to

Washington " for secret meetings sealing Khartoum's sensitive and

previously veiled partnership with the administration. " It's all part

of a Bush administration's plan to " forge a close intelligence

partnership with the Islamic regime that once welcomed Osama bin

Laden, " offering Sudan increased ties and " normalized " intelligence

relations in return for coordination in crackdowns on al-Qaeda

militants and other suspected terrorists. White House officials insist

the new ties won't lead to a softening of its policy toward Sudan, but

an October report by the nonpartisan Congressional Research Service

suggested just the opposite, stating the administration was " concerned

that going after these individuals could disrupt cooperation on

counter-terrorism. " Just this month, Deputy Secretary of State Robert

Zoellick " backed away from the Bush administration's assertions that

the mass killings and village burning amounted to genocide, " despite

the fact that " Darfur's death toll is likely to be even more appalling

this year than last, " according to the Washington Post.

 

MEDIA – WITH PRESS, WHITE HOUSE NOT COLOR BLIND: Breaking with

standard practice, the Secret Service has requested racial information

on journalists and guests scheduled to attend a reception for White

House correspondents tomorrow with President Bush. The Washington Post

reports that White House reporters were offended that " after

furnishing the customary information – name, date of birth and Social

Security number – they were also asked for the race of each person

expected to attend the small reception scheduled before the White

House Correspondents' Association's annual dinner. " Such policy " has

not been applied universally, " and anecdotal evidence " suggests the

Secret Service is more frequently asking for racial information from

journalists. " Just last month, for example, " the Orange County

Register reported that Cheney's staff requested race and gender

information before the vice president would meet with the newspaper's

editorial board. "

 

GOOD NEWS

 

Last night President Bush declared that Senate Majority Leader Bill

Frist and Family Research Council's Tony Perkins were wrong in saying

that the filibuster was an attack on " people of faith. "

 

DON'T MISS

 

TALKING POINTS: The Largest Benefit Cuts for the Middle Class in U.S.

History

 

MEDIA: Top CNN reporter Judy Woodruff announced yesterday she will

leave the network in June. The PR team will survive, but it won't be easy.

 

HEALTH CARE: Conservatives' privatization obsession blocks necessary

health care reform

 

ETHICS: Finally doing right on ethics rules

 

BUSH: President Bush … the egghead?

 

DAILY GRILL

 

" I was amazed by the report the other day that there is some $330

billion a year that goes unpaid by American taxpayers. It's a

phenomenal amount of money. " – President Bush, 4/28/05

 

VERSUS

 

" First of all, real rich people figure out how to dodge taxes. " –

President Bush, 8/9/04

 

DAILY OUTRAGE

 

According to a former Army translator, the U.S. military has staged

" mock interrogations " for Congress and other officials to " make it

appear the government was obtaining valuable intelligence. "

Cooperative detainees were rewarded with ice cream.

 

© Copyright 2005 by American Progress Action Fund. All rights reserved.