July 20, 2011
Sen. Bernie Sanders on Wednesday congratulated Sens. Tom Coburn, Mike Crapo and Saxby Chambliss on their very significant victory in negotiating a deficit-reduction plan that achieves their long-term goal of dismantling every major social program relevant to working families. The so-called Gang of Six plan that the Republican senators negotiated calls for massive cuts in Social Security, Medicare, Medicaid and virtually every program important to working families, the sick, the elderly, the children and the poor. "While I am sure that they did not get everything that they wanted, I think it's fair to say they won about 80 percent to 90 percent of what they fought for," Sanders said. "Despite President Obama's campaign promise not to cut Social Security benefits, the Gang of Six plan, which he apparently embraced, calls for massive cuts in that vitally important program."
Under the Social Security proposal, a new formula for calculating cost-of-living adjustments would cut a typical 75-year-old's yearly benefits in 10 years by $560. The average 85-year-old would see a $1,000 a year cut in 20 years. Furthermore, the proposal demands that Social Security be solvent for a 75-year period, which could include additional cuts. The proposal also cuts Medicare by $298 billion over 10 years and makes massive cuts to Medicaid.
While the spending cuts for programs that working people desperately depend upon are enforced by specific spending caps, there is no such enforcement or clarity regarding the $1.1 trillion to be raised in revenue over 10 years.
"What happens if that revenue target is not reached? There is no language that deals with that. Where does the revenue come from? That very important issue is kicked to the tax writing committees with no guarantee that hundreds of billions of dollars in new revenue will not come from the pockets of low- and moderate-income Americans," Sanders said. "While nobody knows for certain what provisions might be adopted, there is reason to expect that some of the areas that the House and Senate will be looking at include the home mortgage deduction for middle-class families, taxes on health care benefits, and increased taxes on retirement programs such as 401(k)s and IRAs. In other words, while there is a reasonable degree of specificity in terms of cuts there is only vagueness in terms of revenue."
Sanders, a member of the Senate Budget Committee, has advocated an approach to deficit reduction that matches increased revenue with spending reductions. "At a time when the wealthiest people in this country are becoming wealthier and are paying the lowest effective tax rates in modern history, when corporations are making billions of dollars and making nothing in taxes at all, Sanders said at least half of a deficit reduction package should come from ending tax breaks and tax loopholes for the wealthy and large corporations. With military spending having nearly tripled since 1997, we must take a hard look at cutting unnecessary and outdated military programs," he said.