And On The Seventh Day He Rested

Ted Nugent writing in the Washington Times:

President Franklin D. Roosevelt created Social Security 75 years ago. As with many other Fedzilla programs, Americans got suckered into believing Social Security was a healthy, wealthy and wise program.

Social Security is bloated, broke and busted. FDR’s New Deal turned out to be the Rip-off Deal. ...

The only way to truly reform Social Security is to sink it. ...

Eliminating Social Security isn’t our Sputnik moment. It’s our sink-the-Bismarck moment. ...

First, we need to pass whatever law is needed to keep the Jesse James-like hands of Congress off the dollars collected from Social Security. No more stealing.

Second, we need to take the cap off of the Social Security tax. Currently, only the first $107,000 earned is taxed. We need to take the lid off and tax all income. We need the money. Yes, that will be a tax increase for some Americans. This is pain and real sacrifice.

Third, there must be means-testing. If a retired person or couple has more than a certain amount in assets, they will not receive Social Security or will receive limited benefits. This will be a huge sacrifice, but tough times require tough people who are willing to sacrifice for the future good of the nation.

Fourth, we need to raise the retirement age now. It is a fact that people are living longer. Retirees today will collect more from Social Security than what they paid in, while the pool of workers paying into Social Security is shrinking . That is an upside-down, unsustainable model. Shovel on more personal pain and sacrifice.

Fifth, people in the work force will be required to continue to pay into Social Security in order to pay for the masses of baby boomers retiring, but the people younger than 45 will not receive Social Security. We will have sunk the Bismarck by the time they would have reached the age to receive Social Security.

Early Out Retirement Offer Goes Out

There are reports here and here that the Social Security Administration is offering early out retirement to all of its employees. Social Security has offered early out retirement to certain groups of employees in the past but it is hard to imagine that this universal early out offer is something other than an effort to avoid furloughs forced upon the agency by budget problems.

That's A Relief

There are signs that the threat of a government shutdown is receding a bit, for now. Remember, that there is no deal yet on appropriations (and some House Republicans may balk at the deal in the works since it looks like their leadership is doing most of the blinking), the deal that may be in the works would be temporary and that appropriations are only one way in which a government shutdown could come. Congress must also pass an increase in the federal borrowing ceiling within a little more than a month and there are plenty of Republicans who have pledged never to vote for that and many House Democrats who are uninterested in taking the heat for voting for this. Probably, even an impasse on the debt ceiling would not affect Social Security since it barely contributes to the deficit.

Update: The Washington Post indicates that the proposal freezes appropriations for almost all agencies at 2010 levels. This is much better than the massive cuts in funding for the Social Security Administration initially proposed by the House of Representatives. That proposal would have put the Social Security Administration into a tailspin. However, this new proposal freezes the agency's budget at a time when the demands placed upon it are soaring because of the aging of the baby boom generation. Inevitably, this means that public service will deteriorate.

Lockbox Revisted

From The Hill:

Senate Democrats want to put the Social Security trust fund in a lockbox and insulate it from a broader budget-cutting package designed to reduce the national deficit.

It’s a revival of the concept that former Vice President Al Gore (D) made famous when he sparred with George W. Bush over a proposal to invest a portion of Social Security funds in the private market. ...

Senate Budget Committee Chairman Kent Conrad (D-N.D.), who is at the center of bipartisan talks, said he wants to prolong the solvency of Social Security to 75 years. ...

But Conrad does not want Social Security to be part of a broader proposal to reduce the $1.6 trillion federal deficit.

“It might be useful to have Social Security treated on a separate track because it is not part of the deficit reduction package,” Conrad told The Hill before the Presidents Day recess. “I think it should be separated."

Why Did The House Of Representatives Vote To Cut Off EAJA Payments?

If you wonder why the House of Representatives decided to cut off funding for attorney fee awards under the Equal Access to Justice Act (EAJA) for the rest of the fiscal year, take a look at the deliberations.

EAJA Deliberations

Doing What You Won't Defend

Lambda Legal, "the oldest national organization pursuing high-impact litigation, public education and advocacy on behalf of equality and civil rights for lesbians, gay men, bisexuals, transgender people and people with HIV", says that it expects that the "executive branch will continue to enforce [the Defense of Marriage Act (DOMA) which prevents federal recognition of same-sex marriages] until it is repealed by Congress or struck down by the courts ..."

If this is accurate, and I expect it is, this puts the Social Security Administration in an awkward position. It must apply DOMA but if this is appealed to the federal courts, the Department of Justice will not defend what Social Security has done. I understand the logic that gets you to this position but how do you explain to a widow or widower that they cannot get Social Security benefits because theirs was a same-sex marriage -- even though the widow or widower has read that the Attorney General is unwilling to defend such a result?

What Is Behind The Effort To Halt EAJA Payments?

If you have wondered what is behind the vote in the House of Representatives to suspend payments under the Equal Access to Justice Act (EAJA) which forces the Social Security Administration to reimburse attorney fees for most claimants who prevail in federal court, take a look at this and this and this. This has nothing to do with Social Security. It appears to be people who are unhappy with the federal court successes of some environmental groups. They wish to inhibit the litigation by making it harder for the attorneys working for their adversaries to get paid.

Inspector General Report On AFGE Allegations

From a recent report by Social Security's Office of Inspector General (OIG):

In April 2010, the president of the American Federation of Government Employees (AFGE), National Council of SSA Field Operations Locals, testified before the Subcommittee on Social Security, House Committee on Ways and Means, that SSA had banned its employees from explaining MOE [Month of Entitlement] choices with claimants. The AFGE president urged members of Congress to direct SSA to eliminate this “gag order.” In response to AFGE’s allegations, SSA reported to the Subcommittee, “We have not banned our employees from explaining month of election (MOE) choices. While we do not attempt to influence a claimant’s MOE choice, our technicians do provide information about different MOE options.” ...

[OIG speaking about the results of their investigation into the AFGE allegations] We do not believe SSA’s revised MOE policy bans employees from explaining pertinent information—including MOE options—to retirement claimants. Rather, the new policy states that claims technicians should only provide certain procedural calculations when a claimant specifically requests that they do so. Many claims technicians with whom we spoke agreed with limiting some of the information previously provided to retirement applicants, as it was confusing and overwhelming. However, over half of the claims technicians who responded disagreed with the removal of break-even points. In fact, some continued to provide this information to claimants without a specific request—contrary to the new policy. Although we did not determine whether break-even points were beneficial to claimants, we believe the Agency needs to explain more clearly its rationale to claims technicians if it believes these are no longer relevant for retirement applicants.