Turner: Entitlements? Not Social Security

Social Security cards Social Security cards Photo Credit: iStock

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Sen. Daniel Patrick Moynihan told any Democrat who would listen that it is a lot easier to dismantle a federal program than to create one. An untiring and vocal defender of Social Security, Moynihan, who left us eight years ago, would have called out President Barack Obama for the harm he is doing to the old-age pension program.

Eight years of President George W. Bush and three of Obama seem to have left Social Security old-age insurance -- as originally conceived -- politically vulnerable. It began as social insurance, an earned benefit. It still is.

In general, workers get back what they and their employers put in. In normal times, employees put in 6.2 percent of what they earn -- underline "earn" -- and the boss contributes 6.2 percent. It's insurance.

It is entirely different from Medicaid, which pays for health care for the poor, and different from Temporary Assistance for Needy Families and food stamps. Those programs depend entirely on tax money.

It wasn't until Pete Peterson, a billionaire investment banker, and other plutocrats began crusading against big government that the term "entitlement" snuck into the national conversation.

Originally, entitlement meant welfare, and food stamps and Medicaid -- programs for the needy that provide benefits they do not and, well, probably cannot earn.

But Bush began mashing Social Security and welfare programs into one gooey ball, calling them all entitlements, needful of containment. This pleased his wealthy friends who pined to defame and unravel the whole Roosevelt New Deal that midwifed Social Security.

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Obama, for reasons never explained, gamely picked up the lingo of the right, calling Social Security, not the earned benefit that it is, but an entitlement that needs fixing. Obama began talking that way in one of his centrist phases.

Then Obama went further, and trumpeted employee and company contributions as a "tax," as in his "tax holiday" mantra. Yes, it comes out of a payroll tax, but it is still a contribution, and Social Security's friends should call it that. The holiday cuts 2 percentage points from the employee's contribution. The "tax holiday," as Obama and the Democrats call it, looks like it will be in effect through the end of this year.

It will cost the government $10 billion a month in lost employee contributions toward their old age insurance.

The House Democratic minority under Rep. Nancy Pelosi is crowing that it won't have to make up for the loss of revenue with other budget cuts.

So in the twisted rhetoric of Obama and congressional Democrats, Social Security ironically meets all of the odious standards of a giveaway as set in stone by the right: Democrats liken it to welfare funded by "taxes," and their holiday is driving the republic further into debt.

Note: Social Security under the current system will be in the black through 2036.

Now for a reversal of rhetoric. Leading Republicans are resisting the "tax holiday." Presidential candidate Rick Santorum said it will undermine the fiscal soundness of Social Security. Ditto House Budget Chairman Paul Ryan, R-Wis. They're right.

As Obama and Congress were pondering the "tax holiday," the head of the National Committee to Preserve Social Security and Medicare, Max Richtman, wrote to them: "The payroll tax cut undercuts the concept that Social Security benefits are an earned right that stems from contributions that workers make to the program." Richtman's pleas fell on deaf ears. The short-run politics of a "tax holiday" are too enticing. "The real test will be when they are supposed to put the 2 percent back," Richtman told me.

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Columnist Douglas Turner covers Washington for the Buffalo News. His email address is dturner@buffnews.com. Distributed by MCT Information Services.

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