In this week’s debate between Michigan Gov. Rick Snyder (R) and Democratic challenger Mark Schauer, Snyder ignored the advice Sgt. Joe Friday in “Dragnet” always proffered to witnesses and suspects, “Just the facts” when it came to his record on education, jobs and the economy. That’s alright. The good folks at You Got Schooled 2014 have the facts that Snyder ignored.
Rick Snyder: “They are giving parents choice because we have had a lot of failing schools, and the point was to give parents the opportunity to give their kids an education, create competition.”
Mark Schauer: “The first thing I will do is put the money back [Snyder] took from public schools. It is irrefutable.…Charter schools were allowed to expand with no oversight. That was a big mistake by this governor.”
Traditional public schools perform better than charter schools, even when poverty is taken into account.
“According to the Free Press’ review, 38% of charter schools that received state academic rankings during the 2012–2013 school year fell below the 25th percentile, meaning at least 75% of all schools in the state performed better. Only 23% of traditional public schools fell below the 25th percentile.“Advocates argue that charter schools have a much higher percentage of children in poverty compared with traditional schools. But traditional schools, on average, perform slightly better on standardized tests even when poverty levels are taken into account.” —“Michigan Spends $1B on Charter Schools but Fails to Hold Them Accountable,” Detroit Free Press
More than 80% of Michigan charter schools are run by for-profit companies.
“Michigan has more for-profit charter schools than any other state in the country. ‘We’re an anomaly in the nation,’ says Western Michigan University professor Gary Miron. He says over 80% of the charter schools in Michigan today are operated by for-profit companies, while the national rate is 35%.” —“Three Little-Known Facts About Charter Schools in Michigan,” Michigan Radio
On$1.7 billion business tax cut:
Snyder: He thinks business owners shouldn’t be taxed on income beyond what regular folks pay. He said, “We made a fair system to encourage job creation.”
Schauer: “Yes, I will repeal the job-killing pension tax. It is wrong, it is bad tax policy and it is breaking a promise.…Our ‘accountant governor’ is missing some columns on his spreadsheet and it is called people.”
Snyder shifted the tax burden from businesses to individuals, so low-income individuals and seniors saw their taxes increase the most.
“A major tax shift approved by the Michigan Legislature in 2011 made the state’s tax system significantly more regressive by cutting business taxes by 83% while increasing taxes for individual taxpayers by 23%, with a net loss of state revenue. Low- and moderate-income families were hardest hit, as many of the credits and deductions intended to reduce their income tax burden were reduced or eliminated, most notably a 70% cut in the state Earned Income Tax Credit—a refundable tax credit that has been shown to lift children and families out of poverty, increase employment and reduce the need for public assistance.” —“Losing Ground: A Call for Meaningful Tax Reform,” Michigan League for Public Policy
Snyder’s tax increases included a new tax on pensions.
“A big and controversial part of that income tax increase was the taxing of public and private pension income. That change alone was expected to raise for the state, and cost pension-receiving taxpayers, about $343 million in fiscal year 2012–2013.
“The changes are phased in, with those reaching the age of 67 in 2020 or after facing more taxes.
It’s an election year and we are quickly approaching the time when working families will have the opportunity to go to the polls and vote against a whole host of extreme candidates who support policies that limit rights, make it even harder to afford a middle-class life and pad the pockets of their corporate buddies. One of the “Worst Candidates for Working Families in the 2014 Elections” is Senate Minority Leader Mitch McConnell (R-Ky.).
1. He opposes wage increases, prevailing wage laws and black lung benefits. He also refuses to support legislation to secure pensions for mine workers and retirees. [Courier-Journal, 8/27/14; The Nation, 6/20/14; The Associated Press, 7/3/14; S. 468, introduced 3/6/13]
2. McConnell has voted against laws that would help stop outsourcing and has even voted for tax breaks that reward corporations for exporting America’s jobs overseas. [Senate Vote 181, 7/19/12; CNN, 7/19/12; The Wall Street Journal, 9/26/10; Senate Vote 63, 3/17/05; The Washington Post, 3/20/05]
3. He said that the government should cut Social Security, Medicare and Medicaid—programs the working class depend on. [The Wall Street Journal, 1/6/13]
4. McConnell is out of touch with Kentucky’s working families, who are seeing their incomes fall behind the cost of living. He’s worth more than $27 million but blocked and voted against legislation to raise the minimum wage. [The Washington Post, 4/30/14; Washington Post candidate wealth profile, 2010; S. 2223, Vote 117, 4/30/14]
5. He supported massive tax breaks for the wealthy while voting against funding to keep teachers in the classroom. He sponsored legislation to permanently reduce the estate tax for the wealthy and extend the Bush‐era tax breaks for the richest Americans and opposed legislation that would give aid to states facing financial trouble to keep teachers in the classroom. [The Washington Post, 9/13/10; Chicago Sun-Times, Editorial, 2/5/10; H.R. 1586, Vote 224, 8/4/10]
6. Instead of helping jobless workers get back on their feet, McConnell blocked legislation extending unemployment insurance benefits. [Politico, 2/6/14]
7. While 40 million Americans are being crushed by student loan debt, he blocked the “Bank on Students Emergency Loan Refinancing Act” that would have enabled millions of Americans with expensive student loans to refinance into more manageable payments. [S. 2432, Vote 185, 6/11/14; The Huffington Post, 6/11/14]
8. McConnell has consistently voted against laws that would make it easier for Kentucky workers to get good pay, decent benefits and real job security. [Lexington Herald-Leader, 6/21/07; Senate Vote 227, 6/27/07; Senate Vote 243, 12/28/12; Congressional Record, 12/28/12; CQ, 12/28/12]
9. McConnell blocked and voted against the Paycheck Fairness Act, a Democratic bill aimed at narrowing the pay gap between men and women. [Politico, 4/9/14; S. 2199, Vote 103, 4/9/14]
10. Many Americans believe that Washington is broken and too many politicians are playing political games instead of coming together to solve problems for working people. McConnell called himself a “Proud Guardian of Gridlock.” [Political Transcript Wire, 2/2/06]
11. According to the Washington Post, “Mitch McConnell raised the art of obstructionism to new levels. When McConnell and his united GOP troops couldn’t stop things from getting through the Senate, they made sure the Democrats paid a heavy price for winning.” [The Washington Post, 1/30/11]
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The annual reports from the Social Security and Medicare Trustees released today “have good news for all Americans,” said AFL-CIO President Richard Trumka.
Social Security and Medicare will be there for us and our families if elected leaders listen to the American people and reject calls to cut benefits. Instead of undermining these crucial programs, we must build on their success and adopt measures to strengthen and expand them.
Richard Fiesta, executive director of the Alliance for Retired Americans, said the most important lesson from the Social Security report “is that Social Security has a large and growing surplus. Today’s report projects Social Security’s cumulative surplus to be roughly $2.8 trillion in 2014, growing to about $2.9 trillion around 2020.
Trumka noted that while “America’s most important retirement program” will remain strong for many more years to come:
It has become increasingly clear, however, that strengthening Social Security for the future must include improvements in benefits. Social Security remains the sole retirement income plan that is broadly available and that Americans can count on to provide secure lifetime benefits.
The Medicare report, Fiesta said, “reminds us once again that the Affordable Care Act is controlling health care costs.” He said:
It is great news that the life of the Medicare Trust Fund has been extended by another four years to 2030. Attempts to repeal health care reform would only undo the progress we have made in controlling health care costs.
The Social Security Trustees reported once again that the Disability Trust Fund can pay full benefits until 2016, with enough revenue after that time to cover about 80% of promised benefits. Trumka said:
Congress should act soon to ensure disabled workers and their families will continue to receive the benefits they have earned. This can be done by allocating a larger share of current payroll tax contributions to the Disability program, as has been done many times before. Congress should reject calls to misuse this opportunity to undermine the sole source of disability income protection that is working well for America’s families.
Current and future retirees must be wary of those politicians who will use today’s Social Security and Medicare Trustees reports as political cover for radical changes that would put seniors, the disabled and the families of deceased workers at risk.
Next year, the millions of Social Security recipients will see the smallest cost-of-living adjustment ever—just 1.5% or about $19 a month. If the politicians—and their billionaire friends who don’t want to pay the same taxes workers do—who are pressing hard for the “chained” CPI benefit cut had their way, the adjustment would be even smaller than 2014’s historic low.
Edward F. Coyle, executive director of the Alliance for Retired Americans, says, “I hope this news about next year’s Social Security COLA will cause politicians in Washington to reconsider their support for the ‘chained’ CPI.”
How can anyone look at an increase of around 1.5% and think ‘That’s too big?’ Clearly, these politicians need to spend more time talking to seniors who are struggling. Next year’s increase will be 1.5%. Imagine if it were even less. Then imagine if that smaller increase were to be compounded over time. That is the ‘chained’ CPI.
The “chained” CPI proposal would reduce cost-of-living adjustments for Social Security and prevent benefits from keeping up with inflation. At age 75, a senior’s benefits would be cut by about $650 per year (on average). At age 85, those benefits would be cut by about $1,150 per year, and at age 95, by about $1,600 per year. For more on what the “chained” CPI would do, go to the Alliance “chained” CPI fact sheet.
On the other hand, Sen. Tom Harkin (D-Iowa) and Rep. Linda Sánchez (D-Calif.) have introduced the Strengthening Social Security Act (S. 567 and H.R. 3118). The legislation would measure inflation not with the “chained” CPI, but with a more accurate measure of inflation for seniors (the CPI-E). It also would improve Social Security’s solvency by lifting the cap on earnings subject to the Social Security tax, so that all of America’s workers pay the same rate.
AFL-CIO Policy Director and Special Counsel Damon Silvers recently told Salon that the AFL-CIO opposes any benefit cuts to Social Security, Medicare and Medicaid.
The labor movement is going to fight to the death to stop cuts to Social Security and Medicare and Medicaid. Not ‘unreasonable cuts.’ Not ‘cuts without tax increases.’ Cuts period. We’re against all of them, we will fight them ferociously, and we will give no cover to any Democrat who supports them
But sometimes “cuts” hide in the form of other changes to earned benefits. Silvers gave the example of “Chained CPI,” which cuts Social Security by changing how benefits are calculated. “Chained CPI is the vampire of American politics,” Silvers told the Washington Post. “It keep being shot through the heart and it keeps reviving.”
Here’s another vampire idea that needs to die: raising the Medicare eligibility age to 67.
The argument typically goes like this: with modern medicine, people are living longer than they did when Medicare set the retirement age at 65, so why not raise the eligibility age to keep up with the times? After all, we need to save money!
This argument conveniently ignores what happens to the millions of 65 and 66 year olds who would no longer be able to access coverage through Medicare, which they have paid into throughout their entire lives.
Many of these seniors with low enough incomes will be pushed into Medicaid, shifting costs onto that other program. Some will have incomes high enough to be ineligible for Medicaid but low enough to qualify for subsidies to purchase insurance on the health exchanges on the Affordable Care Act.
But many more seniors will lose coverage altogether, according to the Center for Budget and Policy Priorities, because while their incomes make them ineligible for Medicaid or subsidies, health insurance companies will consider them to be extremely expensive. “Because exchange plans could charge the oldest workers three times as much as the youngest, unsubsidized premiums could reach $10,000 to $12,000 (in 2014 terms) for 65- and 66-year-old individuals and twice that for couples.” Even if every state implemented ACA completely, that’s about 200,000 more uninsured seniors, according to Matt Stoller of the Roosevelt Institute.
So for increased pressure on Medicaid and more seniors unable to buy coverage at all, how much money do we save? The Congressional Budget Office has updated numbers on that front: the net savings would amount to less than $3 billion a year, a paltry sum in the context of the federal budget.
Thursday, the CBO said the overall savings wouldn’t amount to as much as it had previously estimated. Instead of saving the federal government about $113 billion over a decade, CBO now figures it’s more like $19 billion over eight years starting in 2016.
It will keep people working longer, and that means it will cost their employers—and everyone with private insurance—more in insurance premiums to cover this older, sicker population. The thing is, people still need health care when they’re 65. There isn’t a magic two years between 65 and 67 when everyone is healthy and doesn’t need to go to the doctor.
If we are serious about raising revenue and dealing with our fiscal health, we ought to stop looking at seniors – who have earned Social Security and Medicare by paying into it through a lifetime of paychecks – and start looking at the complex web of tax avoidance schemes of the very billionaires and large corporations that are pushing these cuts to begin with.
“Chained CPI is like the vampire of American politics,” Silvers said. “It keeps being shot through the heart and it keeps reviving. The reason it keeps coming back is because it has billionaires behind it.”
Naturally, the network’s anchors didn’t much like the sound of that. CNBC is one of Wall Street’s main TV mouthpieces, and it is in Wall Street’s interest that Social Security and Medicare are perceived as “entitlements” instead of the earned benefits of workers. After all, they want our politicians to balance the budget and “fix the debt” on our backs, not by raising taxes on their large incomes and investments.
The exchange Silvers had with CNBC anchor Simon Hobbs crystallized this clearly.
Damon Silvers: We’re being really clear. We’re not going to give cover to Democrats who think it’s a good idea to take away economic security from our most vulnerable citizens. We’re extremely clear about that and not embarrassed about it whatsoever. We want a really clear message out there. If you cut social security benefits or medicare benefits to our seniors, to our most vulnerable people in the country, you are going to get no support on it. It only treating them fairly there will be any progress going forward.
Simon Hobbs: Are you as clear on the reality that if you have don’t cut entitlement benefits this country may well go bankrupt?
Damon Silvers: That’s frankly not true. That’s a lie put forward by billionaires who don’t want to pay higher taxes. Social Security is the best funded aspect of our retirement system today and Medicare’s long-term issues are integrated with the long-term issues of our health care system. Neither program is overgenerous. In fact both programs are undergenerous. The only people who believe what you said are people not counting on those programs and who are worried their very large incomes will be taxed.
Detroit public workers have already made sacrifices to keep the city afloat, including a $160 million in annual savings from a 10 percent pay cut, health benefit reductions, and a 40 percent cut in future pension benefits, Orr is making public worker pension cuts a key part of Detroit’s restructuring.
Remember, Orr was appointed by Gov. Snyder to be “emergency financial manager,” a position that does not answer to voters yet can overrule any local elected official. Michigan repealed the governor’s ability to appoint such managers in 2012, but Snyder and the legislature simply passed the law again.
My name is Donald Smith and I worked for the city of Detroit for more than 29 years.
Over close to 3 decades of service to the city earned me a pension of about $800 a month. After taxes and health care expenses are taken out, I am left with very little money each month to pay my rent, buy groceries and to cover my medical prescriptions.
Because of your decision to force Detroit into bankruptcy, I am starting to wonder which of my basic I needs can live without. I did not bankrupt Detroit – in fact, I went to work every day to make it a better place to live. So I can’t understand why you would ask retirees like me to give up the pension benefits we earned.
If you believe that we can afford to make do with less, then you must not know us. That’s why I want to invite you to my home so you can get to know me and see what life is like for retired city employees. I hope you’ll join my family for dinner and hear what really matters to us in Detroit.
We are willing to work around your busy schedule. We look forward to sharing a meal and our perspective with you.
Smith gets $800 a month from his public pension and $1,000 a month in Social Security. “Sometimes I have to make up my mind between getting my medicine and food,” he told WXYZ.
My grandfather spent 20 years of his life working in a Detroit factory.
He worked hard for what he earned. He trusted that sacrificing some of his pay to invest it in a pension would pay off after years of hard work. So that’s what he did. He retired, and his pension allowed him to provide for himself and my grandmother.
He and his coworkers knew that the pensions that they invested in were a valuable part of their income, not just a handout from their employer.
Right now, in Detroit, Emergency Financial Manager Kevyn Orr doesn’t see pensions the same way.
A quick review: In 2011, Gov. Rick Snyder and his allies in the Republican-controlled legislature passed a bill allowing entire cities to be taken over by “emergency financial managers.” These EFMs, appointed by the governor, were allowed to completely overrule decisions made by local elected leaders.
What Orr isn’t saying is what these workers sacrificed to protect their pensions. They accepted pay cuts, health insurance cuts and cuts to future pension benefits just to guarantee that the pensions they had worked a lifetime for would be there for them when they retired.
This is unacceptable, and we need to do better.
We can’t allow the wealthy elite like Snyder and Orr to take away hard-earned income from working families. Workers like my grandfather worked, saved, and sacrificed for years to make sure their pension would be there. It’s not a piggy bank for Orr and his rich friends to play with.
While the country remains shut down because of irresponsible House Republican hostage-taking, progressive members of Congress and working families are looking ahead to fight against any proposed grand “bargain” that would include benefit cuts to Social Security, Medicaid or Medicare. Members of the Congressional Progressive Caucus (CPC) spoke Thursday before working families and allies, specifically rejecting any such cuts.
While some politicians and pundits are proposing the use of the so-called “chained” CPI to determine Social Security cost-of-living adjustments over time, progressives and working families realize that the “chained” CPI would actually cut the income of retirees and people with disabilities. Hostage-taking House Republicans keep changing their random demands to end the government shutdown, and their latest demand is for Democrats to agree to cut Social Security benefits or Republicans will keep hurting people through refusing to pass a clean continuing resolution.
Rep. Elijah Cummings (D-Md.) noted the problems with “chained” CPI: “The ‘chained’ CPI would result in very real and harmful cuts for seniors, the most vulnerable in our society. These cuts would only deepen over time while the cost of living goes up.”
Pointing out a better policy option, Rep. Mike Honda (D-Calif.) said: “Instead of talking about the ‘chained’ CPI or cutting benefits, my mom would say you just need to make the pie bigger, we’re just going to talk about one cut—and that’s cut the crap….Cut the crap, scrap the cap.” Currently, wealthy Americans don’t pay into Social Security on any income above $113,700. Scrapping that arbitrary cap would go a long way to shoring up Social Security’s future.
Rep. Alan Grayson (D-Fla.) made it clear where the CPC stands on these issues: “We will vote against any and every cut to Social Security, Medicare and Medicaid,” he said. “If it ain’t broke, don’t break it.”
Pension battles are heating up in cities across the nation as conservatives and Republicans are pushing to strip public workers of their retirement plans, often with little or nothing offered as a replacement. The primary argument, although a false one, is that these pensions are “too expensive” and that during times of fiscal woes, cities can’t afford them. In reality, these plans are often little more than veiled attempts to abandon commitments to workers and shift spending to more conservative priorities.
Working families had a victory in Tucson, Ariz., this month when a judge threw an initiative off the November ballot after it was determined that many of the required signatures gathered to put the question before the voters were improperly gathered. The initiative would’ve eliminated the city’s pension plan and replaced it with a 401(k)-style plan.
While there was a victory for working families in Arizona, pension plans in numerous other cities aren’t quite as safe. Here are five cities to watch as pension plans become a more prominent target of conservatives:
1. Cincinnati: A group of mostly out-of-state tea party activists, including the Liberty Initiative Fund from Virginia, succeeded in gathering enough signatures to put an initiative on the Nov. 13 ballot that is very similar to the one that just failed in Tucson. The plan, if passed, would eliminate the city’s pension fund for any future hires, replacing it with 401(k)-style private funds directed by individual employees, effectively privatizing the pension system. Many of the city employees who would be in the new plans are not eligible for Social Security and would have no safety net to fall back on if the stock market did poorly or they failed to successfully manage their new accounts.
2. Jacksonville, Fla.: The Pew Charitable Trust is partnering with the John & Laura Arnold Foundation and is expected to promote what is called a “cash balance” plan to replace the city’s current pension plan. If the plan mirrors what Pew proposed in Kentucky, it would amount to a significant reduction in retirement savings for future retirees, who would get a set cash amount based on years of service. This measure has not been officially proposed yet.
3. Memphis, Tenn.: The mayor’s office is proposing a series of pension changes that the local Fire Fighters (IAFF) call a barrage of attacks on workers. The proposed changes include setting a minimum age to receive retirement benefits, reducing benefits for employees who take early retirement and using a salary average to determine pension benefits.
4. Phoenix: Citizens for Pension Reform is gathering signatures for a ballot initiative that would switch the city’s pension plan from a defined-benefit plan to a defined-contribution plan and capping potential benefits for current employees. The switch, similar to the proposals in other cities, would amount to a benefit cut.
5. Tulsa, Okla.: The mayor is also suggesting making the change from a defined-benefit plan to a defined-contribution plan. The change would affect only new employees and would not include firefighters or police, who are enrolled in a state-managed retirement system.