Steve Frey
Happy Leon Day! No, this is not a commemoration in honor of Leon Russell, Leon Panetta or even Leon Spinks. Leon is Noel spelled backward, and June 25 is a real holiday that marks the halfway point to Christmas.
Now if you are like me, you probably know someone who just loves Christmas. I have a Facebook friend who started putting up Christmas memes a couple of months ago, and you can now count on seeing one every few weeks or so.
The Hallmark channel will be showing Christmas movies from July 13 to July 26. Where else can you see “A Royal Christmas,” “A December Bride” or “The Sweetest Christmas” in the hottest month of the year?
When I was in the painting business one summer during college, my partner and I went to a home to give a quote and there, in the living room in July, was a fully decorated artificial Christmas tree. The lady looking for the estimate explained (a little embarrassedly) that it was just easier to leave it up all year long than to take it down and put it back up each Christmas.
Yeah, people love Christmas, and I bet someone you know celebrated Leon Day.
But this is not about Leon Day or Christmas, though it is about gifts and specifically “entitlements.”
While the world raged about tariffs, caged immigrant children and Mexico beating Germany in the World Cup, congressional legislators quietly discussed reducing benefits for Social Security, Medicaid and Medicare.
According to the Denver Post, the Republican House budget proposes to cut $537 billion out of Medicare over the next decade and reduce Medicaid and other health programs for $1.5 trillion in savings. Social Security gets more modest cuts of $4 billion over the decade.
This is where gifts and entitlements come into play. These folks derogatorily call Social Security, Medicare and Medicaid “entitlements” to get people to think they are gifts their constituents don’t deserve.
These programs are not gifts. Individuals support these programs over the course of 40 or so years through taxes, and if they were allowed to grow at a reasonable rate with compounding interest, they should provide retirees with a supplemental income and the medical care they need in retirement.
If you live in the NRV, you should be worried. No, check that, all Americans should be concerned. Without Social Security and health care, many Americans will literally starve and die, not necessarily in that order.
Well, you could also have the years before eligibility extended, so you have to work years longer. That way you will be exhausted before you starve and die.
Okay, it’s not all gloom and doom; you could live off your savings. To take four percent a year from savings and get $30,000 per year, you would only need $750,000 saved in your 401K or IRA.
How many of your neighbors have saved $750,000 for retirement? The median for family savings at retirement is $60,000, not $750,000, so the chances are slim you or your neighbors can swing retirement through savings alone. Plus, fewer and fewer people are getting a defined pension and with union influence being reduced by the SCOTUS, well, remember what the Soprano characters used to say—“forget about it!”
Have you saved and invested all of your tax savings from the tax cuts? Remember that 1.5 trillion cut that benefited mainly the rich and corporations? The House wants to replace those lost taxes by cutting Social Security, Medicare and Medicaid and thereby reduce the more massive deficit they just created.
So, they’ll lower taxes on mainly the rich to provide an impetus to cut social programs that middle class and poor people need to retire—or just live.
Just think how 1.5 trillion could have bolstered these programs!
But the President said he would not touch Social Security, Medicaid or Medicare when he campaigned, didn’t he?
Here is a quote from Newsweek last December: “President Donald Trump said last week that entitlement cuts will, ‘take place right after taxes, very soon, very shortly after taxes,’ despite promising on the campaign trail that he would not touch entitlement programs. ‘I’m not going to cut Social Security like every other Republican, and I’m not going to cut Medicare or Medicaid,’ he said as a candidate.”
So which is it?
Is the President on board with Paul Ryan, Mitch McConnell and the Republican House to cut these programs or will he refuse to cooperate and live up to his promise?
It is hard to know, based on past precedent, isn’t it?
The bottom line is that the tax cut of 1.5 trillion dollars will be hard to replace. The Republican majorities in the House and Senate are not going to want to return taxes to previous levels, and social support programs make up a large part of the budget, so those are areas they like to look at. But heck, the promise of increased business productivity will take care of that deficit—trickle down something or other—right?
Remember, the average person in the NRV is receiving $30 to $50 per month in additional pay through reduced tax withholdings. Is that worth the trade-off for cutting Social Security, Medicare and Medicaid or possibly taking benefits later at a reduced rate?
The looming November elections are critical.
But make no mistake—Social Security, Medicare and Medicaid are not “gifts.” They are programs you have committed your hard-earned taxes to over many, many years.
There are some who have received substantial gifts, though. Remember those corporations that received the significant tax cuts. They have given shareholders (a large number of whom are corporate executives for the companies) a gift through stock buybacks which benefit themselves but have failed to invest much money in expanding jobs, infrastructure or taxes for communities.
The wealthy that didn’t need the tax cuts can now use their added wealth to buy more shares and become even wealthier. It is the gift that keeps on giving!
Oh, well, we still have Leon Day. If you haven’t sent me a gift yet, I like good books, movie passes and restaurant certificates. I have enough ties! Just kidding—I love the tie, Aunt Helen!
Of course, we could give ourselves a huge gift in November by electing candidates who will support Social Security, Medicare and Medicaid. We could elect legislators who will put the needs of people ahead of corporate profits, wealthy contributors and lobbyists.
That way we could all hold onto the “Christmas Spirit” 365 days a year, and even into retirement. But first, we need to work on expanding those legislators’ Grinchy old hearts!
Steve Frey is a writer and CEO of Ascendant Educational Services based in Radford.
