Benefit Security Coalition

Social Security Switching to Electronic Payments in 2013

administrator — Mon, 14 May 2012 15:38:17 +0000

Posted: 5/14/2012

The Treasury Department announced that they will discontinue mailing out paper checks to beneficiaries receiving federal benefits (including Social Security) next year.

Once in effect, people who receive Social Security, veteran’s benefits, railroad pensions and federal disability payments will need to choose between direct deposit and a debit card to receive their benefits.

This switch is mandated by a Treasury rule issued in December 2010, with the main purpose of reducing the costs required to mail out paper checks. However, this change will also help reduce fraud, as there will no longer be checks floating around for people to steal.

Note: If you are currently receiving your benefits electronically then this change will not affect you.

People who are receiving federal benefits by check will need to switch to electronic payment by March 2013. You can choose to get your payments by direct deposit to a bank or credit union account or to a Direct Express® Debit MasterCard® card account.

If you choose the debit card option, then once you receive your debit card your benefits will be deposited directly to your card each month. The debit card can be used at any retailer that accepts MasterCard, or cash can be withdrawn from any ATM. There will not be any fees for using the debit card to make purchases, and beneficiaries can make one free ATM withdrawal each time a payment is registered to the card. Additional withdrawals will cost 90 cents each, and the owner of the ATM may also impose fees.

Some of the benefits of receiving electronic payments include:

Electronic payments are safer. According to Walt Henderson, the director for the Treasury Department’s electronic funds transfer division, over 540,000 federal benefit checks were reported lost or stolen in 2010. Having your benefits deposited directly into your bank account will eliminate the possibility that your check will be lost or stolen.
Perhaps the biggest reason is how much money will be saved by switching to electronic payments. This switch is expected to save the federal government approximately $120 million per year. Social Security alone is expected to save $1 billion over the next 10 years!
Other benefits include eliminating the need to go to the bank each month, or having to find/hire someone to go to the bank if you are unable to get there yourself.

As with any change, there are concerns as well. One of the biggest concerns is that people who don’t have bank accounts will not transition to debit cards easily. And of course, debit cards can be lost or stolen, which brings the chance of fraud back into the equation. As a result AARP is requesting that some people be given exemptions from the requirement that they must switch to electronic payments.

Currently, there are a few exceptions. For example, people who are age 90 or over will not be required to switch to electronic payments. Other exceptions will be made in extreme, rare cases, such as if using a debit card would be a hardship for an individual.

The federal government is trying to educate people well in advance of the switch. For more information about the upcoming change, the government has created a website, www.GoDirect.org and a toll-free phone number, 1-800-333-1795, people can call for assistance.

http://www.socialsecurityretirementincome.com/social-security/social-security-electronic-payments/

Louis Ambrose on Capitol Hill – May 9, 2012

administrator — Tue, 17 Apr 2012 15:04:24 +0000

The Benefit Security Coalition will be on Capitol Hill on May 9, 2012 to meet with Congressmen and their staff and will deliver approximately 20,000 constituent petitions.

Executive Director Lou Ambrose will discuss the current Social Security crisis and present a strong case for reinstating Cost of Living Adjustments to help Senior Citizens cope with the nation’s economic downturn.An Executive Report detailing the results of Mr. Ambrose’s Capitol Hill visit will be issued in early June.

FOR IMMEDIATE RELEASE: DIRECTOR’S REPORT

administrator — Wed, 02 Nov 2011 13:50:03 +0000

On October 28, 2011, Executive Director Edwin Pierson of the Benefit Security Coalition traveled to Capitol Hill and delivered 28,253 petitions to Congressman Mac Thornberry of Texas.

Congressman Thornberry’s staff expressed their appreciation for the vital policy support generated by Benefit Security Coalition members and showed genuine concern about how the current economic situation is affecting Senior Citizens and the need for serious COLA reform.

As Executive Director of the Benefit Security Coalition, Mr. Pierson wishes to thank each and every member for their petitions and for the financial support they have provided over the last 6 months. Furthermore, he stated that without the dedication and generosity of Benefit Security Coalition supporters, our highly successful 2011 Congressional Legislative Initiative to protect the COLA Senior Citizens have earned would not have been possible.

3.6% COLA Increase for 2012

administrator — Mon, 24 Oct 2011 12:27:00 +0000

Cost-of-Living Adjustment (COLA) Information for 2012

Monthly Social Security and Supplemental Security Income (SSI) benefits for more than 60 million Americans will increase 3.6 percent in 2012.

The 3.6 percent cost-of-living adjustment (COLA) will begin with benefits that nearly 55 million Social Security beneficiaries receive in January 2012. Increased payments to more than 8 million SSI beneficiaries will begin on December 30, 2011.

Gallup Poll: Perry’s Social Security Position Hurts

administrator — Fri, 16 Sep 2011 20:33:46 +0000

Friday, 16 Sep 2011 11:33 AM By Martin Gould

Republican voters are split on whether Rick Perry’s hardline views on social security make him a better choice for president or a worse one.

One-in-five say they are more likely to vote for the Texas governor because of his opinion that the social security system is no better than a Ponzi scheme, USA Today reports.

But the same number say they would be less likely to mark their ballot for him, according to a Gallup Poll sponsored by the paper, that was taken after Monday’s candidates’ debate in Tampa. The one thing the GOP voters are united on is that by a majority of more than two-to-one, they believe his position on social security would hurt him in a general election.

“It’s not going to help him in the primary, and it would indeed hurt him in November,” Republican strategist Charles Back told USA Today.

“If you criticize the Social Security program but have a solution that makes sense and that would preserve benefits for the currently retired and those near retirement, that it’s not necessarily a political liability in the general
election.

“But it looks to me like he has some work to do on the issue.”

http://www.newsmax.com/InsideCover/gallup-poll-perry-social/2011/09/16/id/411278

The Debt Ceiling, Social Security Benefits and the Danger of political games

administrator — Mon, 15 Aug 2011 22:26:39 +0000

Written by Anthony Reeves

Jul 26, 2011 Today, I received a phone call from one of my clients who was asking how long her case would take to go to a hearing. I get these calls all the time so this call wasn’t anything out of the norm. However, on this day, her concern wasn’t over getting thrown out of her home, frustration with excessive delays, or the need for money. In her words, she was “concerned that the government may stop spending money on August 3 for Social Security benefits.” Her words really caught me off guard. I’ve always believed that Social Security is such an integral part of the fabric and landscape of the American socioeconomic fabric that few politicians would dare take any steps toward jeopardizing it. However, after thinking for a second, I started to look at this situation differently. A lot of things are occurring now that I would not have anticipated. I would never have anticipated the emergence of the Tea Party movement. I would never have anticipated seeing an African-American President in my lifetime (even though, I’m glad I did). I would never have anticipated seeing politicians with no political experience and known questionable backgrounds voted into office. So with that backdrop, I came to my question: “Is the Debt Ceiling issue real or are politicians playing politics with Social Security Disability benefits?” As the August 2, 2011 Debt Ceiling deadline looms, the President said these words that many Americans who are receiving Social Security Disability benefits are terrified to hear: “I cannot guarantee that those checks go out on August 3rd if we haven’t resolved this issue…….this is not just a matter of Social Security checks. These are veterans’ checks, these are folks on disability and their checks. There are about 70 million checks that go out.” -Obama on CBS Evening News. For the 6.4 million survivors, 8 million disabled workers, and 35 million retired workers who receive the billions of dollars in Social Security benefits, this statement from the President is not only shocking but also horrifying. The fears are real but facts are an acceptable source to combat any misunderstandings or misgivings. In April 2008, the Congressional Research Service prepared a Report for Congress on the debt limit. In this report, a few things truly stand out: 1.While the debt limit has never caused the federal government to default on its obligations, it has at times caused great inconvenience and has added uncertainty to Treasury operations. 2.The debt limit has been raised in 2003, 2004, 2005, 2006, and 2007. 3.Unless federal policies change, Congress would repeatedly face demands to raise the debt limit to accommodate the growing federal debt in order to provide the government with the means to meet its financial obligations. So, in the grander scheme of things, the debt limit has been increased regularly with little incident or fanfare. In other words, if Congress and the White House follow historical trends, an agreement will be reached, the debt limit will be raised, and benefits will be distributed uninterrupted. So what makes this debt limit so special?? Why are political blows being thrown like a Mixed Martial Arts fight in the Octagon?? The simple fact is nothing. There is absolutely nothing special about this debt ceiling limit. Even more so, the discussions are focused on the same age-oldcomplaints: spending cuts and taxes. The President wants spending cuts and tax increases. The Republicans don’t want any new revenue (i.e. no new taxes). The Democrats don’t want any proposed cuts to Medicare and Social Security. So, in the end, the truth is the debt ceiling has everything to do with your benefits and nothing to do with your benefits. Unfortunately, the reality is, the truth depends upon who you talk to. More importantly, the truth, also, falls on who you believe. Will your benefits continue? I am fairly confident that they will. Don’t freak out over the political grandstanding. In the end, the machine will keep rolling but any time you know the political pundits have to take a few jabs along the way.

Social Security Checks Could Be Delayed Without Debt-Ceiling Deal

administrator — Wed, 13 Jul 2011 16:20:07 +0000

President Obama’s stark warning that Social Security payments may not go out next month is a choice the administration has to make, but entitlement benefits could be withheld if the cash flow dries up over an impasse in Washington on raising the debt ceiling.

Obama issued the warning on Tuesday when he said Social Security payments and veterans’ checks, among other payments, could be at risk if negotiators don’t reach a deal to raise the debt limit above $14.3 trillion by Aug. 2. That’s when the Treasury Department says the government will stop being able to borrow money.

The warning rippled through Washington, though some continued to question whether the administration was over-hyping the consequences of creeping too close to the cut-off date for borrowing.

Meanwhile, seniors are left wondering whether they’ll get their promised retirement benefits.

Washington is obligated to pay Social Security benefits, but a Congressional Research Service report last month revealed that the Treasury Department can delay them if necessary.

“Social Security benefit payments may be delayed or jeopardized if the Treasury does not have enough cash on hand to pay benefits,” reads the report, which notes that the Treasury occasionally needs to issue debt to pay benefits, and a failure to raise the ceiling could make that impossible.

A Government Accountability Office report several decades ago also said it is “generally recognized” that, in the event of a national default, the government would be precluded from honoring some obligations — including Social Security benefits, employee wages and other payments.

So far, the government is not at that point, and leaders in both parties are not showing the stomach for testing the fallout from failing to raise the debt ceiling. But the sides are conflicted about how much to increase the borrowing limit — with Republicans insisting the government stop spending an equal amount as it borrows, and Democrats calling for tax hikes to pay for the additional loans.

On Tuesday, Senate Republican Leader Mitch McConnell offered a Plan B, which could allow for an increase by Aug. 2 even if there’s no deal to cut spending.

Some lawmakers claim the administration could limp along at least for a short period by prioritizing payments, and in turn avoid default.

“I don’t know what to believe,” Boehner told Fox News in an interview after the latest White House meeting with congressional leaders Tuesday.

“The Treasury secretary is going to have options in terms of who should be paid and who shouldn’t,” he said. “Yes, there are some debts that have to be rolled over. But there’s going to be money available on August 3, and I think it’s way too early to be making some types of veiled threats like that.”

Washington has found ways to protect Social Security payments in the past. The Treasury Department in 1996 announced it did not have enough money to pay Social Security benefits for the month of March because it could not issue new debt. However, Congress passed a law allowing the department to temporarily issue securities in an amount equal to those payments, in such a way that would not count against the debt ceiling in the short-term.

The benefits were paid and Congress subsequently raised the debt ceiling from $4.9 trillion to $5.5 trillion. At the same time, Congress also locked off Social Security and Medicare funds from the purposes of “debt management,” according to the CRS report — though the move still doesn’t protect the payments if Treasury does not have the money to pay them.

Republican presidential candidate Newt Gingrich told Fox News that Republicans “should call President Obama’s bluff.”

“House Republicans ought to go in tomorrow or the next day, pass a $100 billion cut in spending and a $100 dollar increase in the debt ceiling so it is exactly balanced. That takes us all the way through to September. They should call that ‘the Social Security payment guarantee bill.’

“Then they should say to the president. Here we’ve taken care of August. All you have to do is get Harry Reid and the Senate Democrats to pass it. You sign it. We can guarantee every senior citizen their Social Security check,” Gingrich said.

• POLITICS BLOG: Americans Split on Debt Ceiling Fix
• TAXPAYER CALCULATOR: How Much Raised Debt Ceiling Costs You?

Social Security COLA At Risk

administrator — Tue, 14 Jun 2011 17:29:24 +0000

June 2, 2011

By GoozNews

The following appeared this morning in The Fiscal Times:

Liberal groups are gearing up to fight a potential change in the Social Security cost-of-living adjustment, which deficit hawks are pushing to include in the budget and debt-ceiling deal currently being negotiated between the White House and Republican and Democratic congressional leaders. A recent report from the successor organization to the president’s deficit reduction panel says the move, if applied to all beneficiaries, could save the system $300 billion over the next decade.

While the nation’s senior citizen retirement income program has taken a back seat to Medicare in the entitlements debate, virtually every conservative plan and even a liberal one for closing the long-term Social Security funding gap included a call to tinker with the benefit plan’s COLA. The proposal would shift the basis for the annual inflation adjustment for the retirement benefit from the consumer price index (CPI) for urban consumers, the standard measure of inflation reported each month by the Bureau of Labor Statistics, to an alternative measure from BLS, known as the chained CPI. Chained CPI adjusts reported inflation by assuming consumers will substitute less expensive goods when the price of a particular item increases significantly, such as substituting chicken for steak.

“That will come out of the beneficiaries of the future and there’s no justification for it,” said Eric Kingston, co-director of Social Security Works, a labor-backed coalition of 270 national and local organizations representing 50 million people. “To sell this as a technical adjustment to the American people would be a lie. If you [project] out 20 years, you’re looking at a 7.7 percent cut in benefit levels.”

Opposition to changing the COLA isn’t only going to come from the left. Conservatives are likely to see it as a tax increase, since moving to chained CPI would affect a number of preferences in the tax code, leading to about $70 billion a year in increased income taxes.

“Fact-Based Conversation”
The proposal could get aired this Friday at a hearing of the House Ways and Means Social Security subcommittee, which will consider the latest trustees report. The annual update of Social Security finances released last month showed the retirement system will exhaust its trust fund by 2036, a year earlier than previously thought. Unless other measures are taken, benefits that year would have to be cut by about one-fourth, since payroll tax-financed Social Security is self-funded and is not allowed to borrow money.

“This year’s annual report again sounds the alarm that Social Security will be unable to keep its promises to the hard-working Americans who pay into the system,” said Rep. Sam Johnson, R-Tex., who chairs the subcommittee. “Americans want, need and deserve a Social Security program they can count on and a fact-based conversation about how to get there.”

A number of the deficit reduction plans unveiled at last week’s Peter G. Peterson Foundation fiscal summit (the foundation’s funder, Pete Peterson, also provides financial backing for The Fiscal Times) called for changing the way Social Security benefits increase over time to reflect rising prices. Both the Center for American Progress (CAP) and Bipartisan Policy Center plans, left of center and right of center, respectively, called for making the change.

“It’s a gradual change,” said Christian Weller, a senior fellow at CAP and a professor at the University of Massachusetts at Boston. Coupled with other changes in the CAP plan – which increases benefits for lower wage workers, slows the rate of benefit increase for the top third of earners, and gives a special bump for those over 85 who are most likely to have exhausted other savings – “it makes the system more progressive,” he said. The CAP plan also raises additional revenue by levying the payroll tax on more of the wages of higher income workers.

The groups fighting any change in the COLA point to another alternative measure that is used by BLS – the senior citizen goods basket, also known as CPI-E. They claim that in most years, CPI-E, which gives extra weight to items like prescription drugs, rises faster than the regular CPI.

“Actual Substantive Change”
But that isn’t always the case, said BLS economist Malik Crawford. Last year, for instance, CPI-E rose at just 1.4 percent compared to 2.1 percent for regular CPI. It was also slightly lower in 2008, and slightly higher in 2007 and 2009. “The presumption that CPI-E will always be higher is not correct,” he said. “In fact, there shouldn’t be a presumption.”

But he added there’s no doubt that chained CPI would almost always be lower, sometimes significantly so. “That’s an actual substantive change in the market basket,” he said, cautioning that he was not speaking for the agency in rendering that analysis.

Adjusting the COLA – a longshot – is the only Social Security issue likely to be raised on Capitol Hill before next year’s presidential and congressional elections. Conservative plans to overhaul Social Security, which were authored by the American Enterprise Institute and the Heritage Foundation, would institute a flat benefit that’s lower for nearly half of beneficiaries, divert payroll taxes to individual accounts (Heritage would institute a new voluntary payroll tax on top of Social Security), raise the retirement age, and leave tax rates unchanged. Those plans are not much different than what President George W. Bush offered in 2005.

That plan went nowhere when negative public reaction contributed to the Democratic takeover of Congress in 2006. With most polls showing strong public support for leaving Social Security alone and raising taxes on the rich to make up for any shortfalls, most Republicans, already skittish about the public thumping GOP Rep. Paul Ryan’s Medicare plan took in upstate New York, are not likely to grab on to a political third rail twice in one election cycle.

Greater Piece of Income Pie
The other Social Security plans offered last week, both centrist plans and those on the left, rely on raising taxes, with most new revenue coming from raising the level of income subject to the payroll tax. Currently capped at $106,800, the tax today only hits about 83 percent of earned income instead of the 90 percent goal set in 1983. That’s because higher income workers (those earning above the cap) are grabbing a greater share of the national income pie than they did in the 1980s, when the last Social Security reforms – a deal struck between President Ronald Reagan and House Speaker Tip O’Neill – combined raising the retirement age to 67 with higher taxes.

Plans for shoring up Social Security rather than cutting benefits are taking on new urgency in the wake of a recession that has further eroded the three-legged stool that makes up American retirement security. The other two legs – defined benefit and defined contribution pension plans plus personal savings – have been severely eroded by changes in the U.S. economy, exacerbated by the Great Recession.

Defined benefit pension plans, which once covered 45 percent of the American workforce, now cover less than half that number, according to Dallas Salisbury, president of the Employee Benefit Research Institute. Between 1988 and 2008, the number of those participating in pension plans fell by a third, from 28 million to 19 million.

Defined contribution plans such as employer-matched 401(k) or 403(b) plans have grown, but savings are falling far short of what was previously guaranteed by pensions. Though the number of participants doubled to 66 million in the past two decades, the average plan had just $58,351 in 2009, which was $7,000 less than the pre-recession peak. The median plan – half the plans were smaller in size – had just $18,000 in assets. The wide gulf between the average and median level of assets in individuals’ plans suggest savings are heavily tilted toward higher income workers.

“Upwards of 60 percent of retirees will get a majority of their income from Social Security,” Salisbury said. “Average benefits are now in the neighborhood of $14,000 a year – a little more than what a minimum wage worker would earn, but not a lot.

“The U.S. does not have a particularly lucrative or generous public retirement system,” he added. “Across the developed world, there’s only one program that pays lower benefits than U.S. Social Security, and that’s the United Kingdom. This country has been very conservative in the level of commitments that it has made on the retirement income side.”

http://gooznews.com/?p=2901

Congressional Meetings w/ Congressmen Eliot Engel and Mac Thornberry

administrator — Sat, 04 Jun 2011 23:06:30 +0000

On June 30th, 2011 Executive Director Edwin Pierson held succcessfull meet with representatives of Congressmen Eliot Engel and Mac Thornberry presenting them with over 50,000 petitions calling on Congress to reinstate the Social Security Cost of Living Adjustment currently being denied to Senior Citizens.

A full report of our Congressional meetings has been published.

‘Chained COLA’ is the Stealth Social Security Benefit Cut

administrator — Tue, 31 May 2011 15:24:56 +0000

May 9, 2011 at 8:46 am by Jonathan Kantrowitz

Social Security’s yearly cost-of living adjustments (COLA) are targeted for reduction through a proposed “chained COLA” formula, and that could be a huge problem for those dependent on Social Security income. “COLA is an invaluable feature of Social Security,” says Merton C. Bernstein, LLB, a nationally recognized expert on Social Security. “Practically no private pension plans and state and local retirement programs provide comparable protection,” says Bernstein, the Walter D. Coles Professor Emeritus at Washington University in St. Louis School of Law. According to Bernstein, Republican “reformers” propose to reduce COLA claiming that the current method of calculating it overstates inflation. “This unrealistically assumes that people have the opportunity to buy lower priced substitutes when millions of people lack access to markets that offer such choices,” he says. The proposed measure — chained COLA — would reduce the benefit under the current formula by an additional 3/10ths-of-one-percentage-point every year. “This utterly arbitrary new element suggests that the name of the game is simply to reduce each year’s COLA and to do it by what they regard as unnoticeably minute amounts,” Bernstein says. “But such a conclusion, made by people with current jobs and full stomachs, does not capture how detrimental any reduction would be for beneficiaries. “Social Security is the largest part of income for most recipients; for almost 80 percent of them, it is half or more; for 60 percent, it is more than half; for 30 percent of recipients, it is all of their income. “To those heavily dependent on Social Security’s modest benefits, which average $1,100 a month, small subtractions would hurt, while for those currently employed with a reasonably good income, such reductions may seem too small to worry about. But those ‘small’ reductions accumulate.” After 5 years of chained COLA, benefits would be 1.5 percent behind price increases; after ten years, 3 percent. After 20 years, the benefit reduction would be 6 percent. Bernstein says that chained COLA would reduce benefits more every year while beneficiary needs grow because non-Social Security sources — work and other programs — typically shrink over time and one’s ability to perform services for one’s self diminishes with age. Bernstein discusses the new COLA proposal in his recent Huffington Post article “Upcoming Budget Battle: The Stealth Social Security Benefit Cut by ‘Chained Cola’

http://blog.ctnews.com/kantrowitz/2011/05/09/chained-cola-is-the-stealth-social-security-benefit-cut/