You gotta read the deficit commission report to believe it!

[flamin lib]

This thread lead me to check out the Deficit Reduction Commission report in its entirety because of Johnaires’ post here: http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=439&topic_id=76892 Thanks, John!

It’s only 66 pages long with a lot of blank pages but it’s detailed enough to get a good idea of the outcome and how it would affect all incomes should it be implemented. I really recommend you all peruse it.

Some of it is a bit arcane so I had to read bits several times as well as some detail that managed to escape me but 99% is plain language and when they use acronyms or governmentese there’s enough background to absorb the ramifications of the recommendations. It appears to be a truly bipartisan effort and I’m impressed! If fully implemented I think we’d all be happy with it and that says a lot!

Yeah, there are details that bother me but nothing that would be a deal killer in my opinion. Some of it is counter intuitive on the surface like cutting the marginal tax rates but that is offset by taxing unearned income at the same rate as earned income and eliminating exemptions that most Americans can’t take advantage of anyway. They also suggest eliminating “tax expenditures” which translates to subsidies to various interest groups like paying oil companies to drill wells, farm subsidies for not growing crops, and the like. The report also addresses off shoring jobs, corporate loopholes and some stuff I never even considered. The tax reform portion shifts revenues to the top 1/5th and marginally increases the burden on the next two quintiles while expanding the earned income tax credit.

Bloggers went wild on “cutting social security benefits” but in fact the report suggests increases for the bottom incomes while means testing the top incomes as well as expanding the SS base to 90% of incomes.

Bottom line is that it doesn’t lend itself to bumper sticker analysis. You gotta’ read it!

http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/TheMomentofTruth12_1_2010.pdf

[lldu]

1. Means testing makes this welfare. Just my opinion.

[tsuki]

3. And easier to attack later on. Divide and conquer. nt

[flamin lib]

9. So Warren Buffet should get full existing benefits instead of giving up

$100/month so those at the bottom can live above the poverty level?

Personally, my retirement accounts may net me close to $90k a year. Should I be treated the same as a minimum wage earner or the manual laborer who can't work past 62?

Read the report--there are things to pick at but in total it's not bad.

[Better Believe It]

18. So you think the deficit commission is proposing higher social security benefits.

And lower benefits that will only cover billionaires.

Did you also support the cut in the Social Security payroll tax in the "tax reform" bill passed?

Are you reading the same report that the rest of us are?

[flamin lib]

22. No, no, and yes. nt

[WinkyDink]

27. "Higher benefits"? WHAT are you reading?! LOWER benefits because based on phony "inflation" numbers.

LOWER benefits because the full-benefits age is RAISED.

The RETIRED Middle-Class will ALSO get hit by HIGHER TAXES on savings and MORE MONEY paid (i.e., taken out of the SS checks) to MEDICARE.

HOW YOU CAN POSSIBLY BELIEVE THAT A REPORT ON REDUCING THE DEFICIT WILL HAVE RECOMMENDATIONS RESULTING IN HIGHER PAYMENTS TO ANYONE FOR ANYTHING IS MIND-BOGGLING IN ITS NAIVETE.

[flamin lib]

31. Read the report itself. And take a deep breath before yelling through your

keyboard again. There is an exemption for those who cannot continue to work for reasons that do not rise to the level of a disability, for instance construction workers or manual laborers who can not perform their jobs past 62; this exemption actually lowers the age for full benefits. Lawyers, doctors, accountants and other white coller professionals can work to 69 with no problem and many probably won't need SS anyway.

None of your dire predictions are in the report. There is a shift of first dollar coverage to medigap insurance providers which, worst case, might increase deductibles but nothing about increasing premiums.

I find it highly amusing that the very same liberals that want to decrease the income divide bitch and moan when the method of doing so might impact them.

[Cleita]

33. Yes, he should because then he can't complain that

he's supporting some lazy ninety year old who won't get a job.

[flamin lib]

43. You are aware thar Buffet is giving 99% of his fortune to charity, right?

So is Bill Gates and they have challenged the top 400 to give half of their fortunes to charity as well. They've gotten several takers.

Rich people can be as charitable and patriotic as anyone else.

[Cleita]

50. Well, you are talking to the wrong person here because

I'm not into charity. I find it selective and leaves many needy people out in the cold. I prefer government socialism that covers everyone. Apparently, Bill Gate's anal retentive control on his education charities isn't producing the results that he desires yet that money in the right hands could. I'm not dissing rich people. I just want them to pay their share of taxes and let the people decide who the needy are. People and municipalities having access to the necessities of life shouldn't hinge on the choice to give or not to give from those who have too much.

[Cleita]

29. Not just your opinion but

a fact.

[Statistical]

36. Means testing wasn't recommended by the report. Of course you knew that. n/t

[flamin lib]

40. Yeah, but it's short hand for changing payment amounts for people with

large enough alternate incomes.

Like calling myself an atheist instead of a Whiteheadian pantheist because it conveys the idea without the 5000 word explanation.

[madfloridian]

2. Actually

http://www.huffingtonpost.com/2010/11/10/deficit-commission-proposal_n_781905.html#s179447&title=It%20Would%20Cut%20Social%20Security%20Benefits%20For%20Current%20And%20Future%20Retirees

"It Would Cut Social Security Benefits For Current And Future Retirees

The chairmen’s plan would increase the Social Security retirement age and limit yearly cost-of-living increases to the rate of inflation rather than of wage growth. The cut in annual increases would affect current retirees -- which was supposed to be off the table. Their benefits would go down by about 3 percent after they’ve been retired for 10 years, and about 6 percent after they’ve been retired for 20 years.

And the retirement age increase is just a particularly cruel way of cutting benefits. The age at which the elderly can retire on full Social Security benefits is already increasing to 67 by 2027. The chairmen’s plan would “index” the retirement age to increase in longevity, meaning it would hit 68 in about 2050 and 69 in about 2075.

Sen. Bernie Sanders (I-Vt.) had this to say about it: “It is reprehensible to ask working people, including many who do physically-demanding labor, to work until they are 69 years of age. It also is totally impractical. As they compete for jobs with 25-year-olds, many older workers will go unemployed and have virtually no income. Frankly, there will not be too much demand within the construction industry for 69-year-old bricklayers.”

[Peregrine Took]

4. Very interesting - thanks for posting. n/t

[flamin lib]

7. You need to read the actual report.

The age increase is phased in and and in 2075 would be 64 for early benefits and 69 for full benefits (income adjusted). There is actually an age decrease in eligibility for full benefits to 62 for health reasons not meeting disability. People in the top income quintile would lose some benefits, next less (a few $hundred/year) and the bottom quintile would gain $5-700 a year plus the lowest benefit would be 12% of poverty. It's not much for me to give up $200 a year for some one making minimum wage to retire above the poverty level.

[flamin lib]

35. That should have read 125% of poverty. nt

[madfloridian]

49. It is cutting present retiree benefits. I find that inexcusable.

Especially when the wealthy are being catered to and pandered to by this administration.

It is NOT okay with me.

[gratuitous]

8. I think this is very true

And, because the Commission blew its deadline and didn't follow its own rules, you can bet that the administration will feel free to pick and choose the recommendations as it pleases, rather than implementing all of them. What do you want to bet the raising of capital gains tax rates will somehow not be deemed worthy of consideration, but raising the retirement age and cutting social security benefits will become the holy grail of deficit reduction?

By the way, anyone who notices that the Commission report isn't valid will be dismissed as a nitpicker, and deemed Not Serious About Deficit Reduction. As such, those critics and observers can be safely ignored by the chattering class, which will likewise throw its weight behind deficit reduction ideas that don't affect them or their fat wallets.

[OHdem10]

5. Means Testing SS is a Dick Army Dream. Down the slope to

ending it.

How can you increase the amount for lower income and
means test the upper.

Increase the lower income, sounds good but the secret
is how they pay for it??? I am all for it, but
have been around a long time.

[Better Believe It]

6. You're kidding .... right? If not I think your flame just went out!

:)

Read it more carefully again. The commission plan clearly calls for the deficit to be cut on the backs of working people and the elderly.

[flamin lib]

10. Read the tax portion. Read the Defense portion. Read the SS portion again.

the tax burden on the top 20% of incomes goes up 50% (from 50% of revenues to 76%). Taxes on unearned income more than double (from 15% max to regular income bracket). SS tax base goes to $163k/year.

My flame burns bright an' you Better Believe It.

[WinkyDink]

16. You DO realize many Middle-Class families/earners have saved some "unearned income"?

This is, of course, designed to get MORE from the RETIRED MEMBERS OF THE Middle-Class, many of whom live on SS AND INTEREST.

I DON'T NEED THOSE TAXES RAISED, TYVM.

[flamin lib]

21. If it's retirement account money it can be shelterd. If it's day to day

income not so much. Just as bankruptcy can't touch money in IRS recognized retirement accounts. You'll be taxed at the rate you withdraw it, not on gross amount. If SS is a major portion of income the tax increase should be marginal at most.

I know because my retirement accounts will net me much more than I earned working.

[earth mom]

11. Sorry, but the cat food commission will NOT do anything good for the people.

You can take that to the bank.

[flamin lib]

14. Just read the damn report. Then comment on it. nt

[WinkyDink]

24. Here's what I've read: "Alan Simpson." "Erskine Bowles."

Do you SERIOUSLY believe EITHER man will offer a series of proposals DIAMETRICALLY OPPOSED to their stated opinions and desires?
http://thinkprogress.org/2010/11/19/bowles-social-security-2037/

But since you like the report, here are the shameful Medicaid/Medicare cuts:

.Force more low-income individuals into Medicaid managed care.

•Increase Medicaid co-pays.

•Accelerate already-planned cuts to Medicare Advantage and home health care programs.

•Create a cap for Medicaid/Medicare growth that would force Congress and the President to increase premiums or co-pays or raise the Medicare eligibility age (among other options) if the system encounters cost overruns over the course of 5 years.

http://tpmdc.talkingpointsmemo.com/2010/11/deficit-commission-co-chairs-simpson-and-bowles-release-eye-popping-recommendations.php


Let me know what Obama says in the SOTU speech about "shared sacrifice."

[flamin lib]

28. TPM is a great source, but how 'bout finding that stuff in the 66 page

report? Like the OP says, it doesn't lend itself to bumper sticker analysis.

[doc03]

12. Their explanation of the new Chained CPI is "special"

Page 57 Recommendation 6.1 You see it takes into account if say apples get too expensive the consumer will switch to a less expensive product like maybe oranges. (Or say tuna fish gets too expensive you can go to cat food.)
Instead of a COLA to help you maintain your current lifestyle, the new formula assumes you will buy cheaper products to make up the difference so therefore you should get a smaller COLA increase. Who the hell thought up that one up?

[flamin lib]

13. I read the meaning as 180 degrees oposite.

As the food basket gets more expensive consumers are forced to buy less expensive alternatives making the cost of the basket artificially low.

The CPI adjustment would account for that downward adjustment.

I'll have to find the original BLS CPI recommendation to see which of us is right.

[doc03]

15. The way I understand it is you will switch to cheaper products

and therefore the COLA payment will be less. I have heard under that formula it will reduce the COLA about 1% below the current COLA formula because they assume you economise and buy cheaper products.

[flamin lib]

17. That may be. COLAs have been based on inflation, CPI and on

wage inflation at various times. The net change has been in the 1-2% range I believe.

If that is the case a 2% change in COLA will have little visible effect on individual recipients but the aggregate savings to the program could be dramatic.

If SS income is $1000/month and CPI/inflation/wages increase 4% the COLA would be $40 a month (480/year) and the 2% loss would account for $.80 a month. However the savings on 50,000,000 recipients could be of consequence.

Unless my math is as bad as it sometimes is . . .

[doc03]

23. The way I understand it

is the the new formula would reduce the 4% to a 2% COLA. Maybe I don't understand but I know I read it would reduce the current COLA payment about 1% each year. You live 25 years on SS you get an effective 25% cut.

[flamin lib]

42. No. The change in CPI computation would change the existing

CPI by about 1%. Using the new method, an existing CPI of 4% would be reduced by 1% of that 4%. The new method of calculation would result in a 3.96% CPI with the same raw data. Not a big deal at the SS check level, but a .04% savings over all recipients can make a difference.

[doc03]

45. If you say so, but I have heard several times that it would reduce

the COLA by 1% each year, perhaps the reports I have heard are all wrong.

on edit: Found this link, if the Chained CPI was used for the last COLA adjustment in 2008 the COLA would have been 5.2% instead of 5.8% a .6% reduction. It may not sound like much to you but that is a 6% cut in 10 years.

http://crfb.org/blogs/more-colas-and-cpi-e


I would also remind you that even though SS gets a COLA their Medicare payments also increase which takes most of it back.

[Hannah Bell]

20. I think they already did this once during the clinton era. they're going to do it again?

[doc03]

25. I seem to remember they changed it before myself? n/t

[flamin lib]

26. Yeah, they did. Changed from price inflation to wage inflation as I recall.

Wage inflation was lower by a % or two. This will change it back with a different way of computing consumer price index. It may make a 1-2% difference in COLA--to me worrying about this seems picayune considering the long term solvency of SS.

[Hannah Bell]

30. 1-2% a year, if that's what you mean, is huge over time.

If you get a 1% cola while real prices are rising 3% a year, that's a 11+% loss of buying power in 5 years.

The solvency of SS is just fine for years if the scamsters don't renege on the deal they made in 1983.

As things stand they're trying to renege covertly through fixes like this one.

[flamin lib]

39. No, that's 1-2% decrease in the amount of the COLA.

4% CPI increase gets 4% COLA. If CPI is decreased 2%, the cola goes down 2%of the 4%.

$1000 SS payment. 4% COLA = $40. 2% loss due to change in CPI computation=$.80.

Not so huge even over time.

[Hannah Bell]

19. Here's what I read:

Alternative minimum tax: Repealed.

Tax rates on all income to change thusly:

10/15% = 12% (+2 to -3%)

25/28% = 22% (-3 to -6%)

35% = 28% (-7%)

Defense is 2/3 of the discretionary budget but 1/2 of discretionary cuts will fall on non-defense discretionary items.

Cut wasteful spending like, e.g. job training programs, invasive species research, programs to encourage participation in math, science

SELL FEDERAL PROPERTY


I didn't care to read any further. Smoke & mirrors and the top brackets get lunch.

[flamin lib]

32. You seem to have missed the part about un-earned income, ie,

stock options interest payments that make up the great majority of the 1 percenter's income taxed as regular income and the part about exemptions that most Americans can't advantage of. Maybe you ceased to care about reading it before you got to the shifting 76% of tax revenue to the top 20% (up from 50%).

There is nothing about cutting the programs you mentioned, only combining duplicate programs (like Ann Richards did in Texas back in the good days).

Care enough to read and understand it.

[WinkyDink]

34. Perhaps you are unaware of how many Middle-Class Americans have SAVINGS that accrue INTEREST?

CD's? IRA's? Etc.?

[doc03]

47. Exactly I am a retired middle class American and I

rely on dividends and capital gains from the money I saved and worked hard to get over 40 years.

[Hannah Bell]

38. tax rates on the total package would still be 7% lower than now.

current rate for cap gains = 20%.

current rate for regular income = 35%, scheduled to rise to 39.6% next year.

I get the average of 20 & 35 as 27.8.

I get the average of 20 & 39.6 as 29.8.

I see that under this "reform" the 80-90% decile would be taxed more heavily than the top 1% -- BY THE COMMISSION'S OWN FIGURES.

[flamin lib]

41. Page 32, figure 8,

After tax income for top .1% falls 11.8%, top 1% 7.8%. That shortfall reflects the net tax revenue increases under the reform.

Other than that I'm confused by your computations--not saying anything is wrong with them, I just don't see the thought process.

[doc03]

46. Question: Why would someone that calls themselves

flamin lib try to minimise the proposed cuts in SS or even support any cuts in SS?

[flamin lib]

48. Because I try to rely on facts and try to understand as much as I can about what I post.

Having looked at the actual report and its recommendations I came to realize that SS is only a part of the suggestions in the report. Further, although I do not support these suggestions word for word, I can see that these cuts are not across the board but selective and taken as a whole are indeed minimal when one considers the increased benefits for those at the very bottom of incomes and those who cannot continue to work in their professions beyond 62 years.

Now, why would you wish to make this personal?

[pa28]

51. I read the report.

I guess I glazed over the part about shifting 76% to the top 20%.

Being interested in the issue I would appreciate a pointer.

:shrug:

[flamin lib]

53. Page 32, figure 8. It's 73%, my bad. nt

[PBS Poll-435]

37. The report that absolutely does not matter

Didn't get the votes to move to Congress. (Like we said)


Who gives a flying F?

[flamin lib]

44. Great discussion! Many concerns and great passions.

More than a few alternate facts too ;-)

Still, I hope everyone reads the report in it's entirety. There is a lot to disagree with in there but it's not the bugboo that was first hinted at.

Knowledge is power, arm yourself.

[PufPuf23]

52. You are an unapologetic moron in your assessment.

Bottom line: more paid in for less paid out in an insurance not entitlement program despite the fuzzies to sell the deal.

[flamin lib]

54. Thank you for the ad honinem, it really ads to the conversation.

Too bad we're not communicating in hard copy. If we were I could say,"I am sitting in the smallest room in my house with your critique before me. I shall soon put it behind me."