Fiscal Commission Public Forum 6 of 7

Erskine Bowles: Thank you and please start.
Karen Higgins: Good evening.
I want to thank the commission once again for extending the
invitation to the National Nurses United to discuss this
important fiscal matter facing not only the commission but
facing America.
My name is Karen Higgins, and I am the co-president of the
National Nurses United, and I'm an intensive care unit nurse for
the past 33 years.
National Nurses United is the largest union in
United States history.
With 155,000 members and counting,
we are concerned about any policy that affects our members
and the patients that we serve.
That is why everything on the table before this commission is
of great concern to us.
However, we believe that the promises that were made to the
working Americans through Social Security and Medicare must be
kept off the table.
Medicare saves lives and is the nation's only single payer
program saves money by eliminating wasteful insurance
industry profits from the healthcare equation.
That is why we believe expanding Medicare to everyone would be a
positive impact on the economy in the long-term.
However, since we understand that Social Security is the most
likely target for cuts, we intend to discuss why
we actively campaign against such cuts.
Social Security is the most successful social program in
our nation's history.
Without it, the poverty rate for seniors would
jump from 10 to 48%.
As a nurse, on a daily basis in an intensive care unit,
I have the misfortune of meeting a lot of seniors across,
in our community.
And the problem is is that what we're seeing is the seniors are
struggling even with what they have with
Social Security at this time.
And they come in, and the issue is being putting food on their
table, putting roofs over their head,
or paying for their medications, as they struggle,
and one of the things we see them doing is not taking their
medications and end up in the hospital in worse shape.
And we see couples that are seniors that are basically one
of the couple will give up their medications and not be taking
care of themselves in order to help the other member,
the one that needs more care season is struggling.
And what we're seeing is then the healthy one ends up in the
hospital and struggling.
So, as a nurse, this is huge.
And to think that we would even see more cuts in Social Security
is devastating.
On a personal level, my mother, who is 82 years old,
has been a widower since she was 45 years old,
brought up six children, worked two to three jobs in order to do
that, now is a senior citizen living on an income of less
than $12,000 a year.
So it amazes me that we can think that anyone could live
on even less than that.
When people are living in poverty,
it's bad for the economy.
The people on Social Security live on the money that they
receive and will help stimulate the economy.
The money of the general fund is borrowing from the trust fund
belongs to our members, it belongs to the American people.
It is a solemn and sacred promise to workers.
We will not tolerate statements calling United States treasury
bonds issued to American citizens as worthless IOU's when
the same treasury bonds are held by China and Japan and they are
obligations we wouldn't dare default on.
Why then are they worthless if they are belonging to the
American working families?
And we feel this is a betrayal to awful us.
Members of the commission, as nurses, like many others,
we can't afford cuts in Social Security.
We have fought hard for a middle class family sustaining income,
but we keep getting demands to gut our pension plans.
Our 401 values plummeted during the economic decline.
The so-called progressive price indexing would gut or remaining
retirement security.
The middle class is hurting enough and we can cannot take
any more uncertainties or any more cuts.
Raising the retirement age is across the board is a benefit
cut for us as nurses.
Currently about half of our bedside nurses are working with
physical injuries that are related to our work from
lifting, and a substantial of them are from lifting patients.
We, as nurses, lift on average 1.8-tons every day.
It's ludicrous to think a 70-year-old woman can
lift 1.8-tons.
OSHA reported that even the strongest workers can only lift
about 30 pounds in the way that nurses lift patients.
And nursing is considered ranked among the most dangerous jobs in
America according to the Bureau of Labor statistics.
Finally, We are a female dominated occupation,
and as such, we are well aware that in our society on average
woman still earn 77 cents to every dollar a man earns.
Yet, we live longer, we are more likely to take time out of the
workplace, and we are more conservative investors than men.
So women rely more heavily on Social Security.
And studies have also shown at this point that elderly women
already are more likely to be living in poverty without any
cuts made now to Social Security.
So in conclusion, members of the commission,
you must keep cuts of Social Security and
Medicaid off the table.
National Nurses United is part of 13 million members
of the AFLCIO.
We'll be going to congress with that message.
We intend to collect promises from members that the government
will keep its promises to us.
Erskine Bowles: Thank you very much.
Karen Higgins: Thank you for this opportunity.
Erskine Bowles: Let me ask is the remaining panelists to please keep your
comments to four minutes, if you would.
Karen Higgins: Thank you.
Carl Blake: Chairman Bowles, Chairman Simpson,
distinguished members of the commission,
on behalf of Paralyzed Veterans of America and the millions of
men and women who have honorably served in this nation's armed
forces, I'd like to thank you for the opportunity to be here
today to present some comments on the Department of Veterans
Affairs and the programs with which it administers.
My name is Carl Blake.
I am the national legislative director for Paralyzed Veterans
of America.
It is no secret that this country faces a very harsh
reality when it comes to our fiscal future.
Rapid growth and federal spending,
coupled with an economic downturn that has secondarily
impacted federal revenues has set us on a course that appears
unsustainable, and yet PVA is here today to emphasize why
continued growth in federal spending for the programs
managed by the VA is imperative.
While such a position seems to fly in the face of deficit
hawks, we want to slash all federal spending.
VA is unlike most federal programs that
are being considered.
Ultimately, the most important point to make is that both the
discretionary council within the VA and the mandatory accounts
support programs that are an earned benefit provided by
the VA through veterans.
These programs were not paid into like many social welfare
programs, and they are not managed as (inaudible)
benefits like many of those same programs.
The price for veterans healthcare and benefits was paid
by the service and sacrifice of the men and women who have
served this nation in uniform.
To recommend that in the interest of fiscal
responsibility that veterans benefits should be reduced
serves only to degrade the value of the service provided
by a veteran.
Moreover, it suggested this country is not wholly obligated
to provide healthcare and benefits to the men and women
who have served and who continue to serve even today.
We also remain concerned that cuts in any of the programs
administered by the VA will have a direct and immediate impact on
veterans and their families.
To recommend the discretionary funding for VA healthcare
programs be reduced would mean that without question,
the VA would have to cut the number of veterans it will serve
or reduce the services it will provide.
Additionally, any recommendation to reduce compensation payments
paid to veterans for injuries sustained in defense of this
country simply suggest that while the United States is sorry
for the grievous wounds incurred in service,
it has to limit its obligation to veterans because it cannot
afford to compensate them for their sacrifices.
Such a consideration is simply unconscionable.
We offer without equivocation that no one in this country
would support such a notion, and we urge the commission not
to support such a suggestion, as well.
PV also believes that a viable VA healthcare system provides
relief to an overloaded private healthcare system and actually
saves this country money on healthcare spending.
The veterans health administration is the largest
direct provider of healthcare services in the nation.
In fact, in the current fiscal year alone,
the VA is expected to have more than 8 million veterans enrolled
and provide direct service to nearly 6 million veterans,
and yet it is widely regarded as the most cost effective and cost
efficient healthcare system in the nation.
It sets the standards for quality and efficiency,
and it does so at or below Medicare rates,
while serving a population of veterans that is older, sicker,
and has a higher prevalence of mental health and related problems.
Refunding for this myriad of programs to be reduced,
this patient population would simply track into the higher
cost private healthcare world at a much greater expense to
federal programs that also provide for their needs.
Mr. Chairman, once again, I sincerely appreciate the
opportunity to advocate for the protection of the Department of
Veterans Affairs in efforts to reset the fiscal course
of this country.
The VA supports the veterans population which has already
carried is heavy burden for this country.
These men and women certainly cannot be expected to further
add to this burden.
I thank you again for the opportunity to submit my
statement, and I'd be happy to provide any additional
information that you might request.
Erskine Bowles: Thank you. Are you a veteran?
Carl Blake: Yes, sir, I am.
Erskine Bowles: Thank you for your service.
Carl Blake: Thank you, sir.
Erskine Bowles: Thank you.
Gary Therkildsen: Senator Simpson, Mr. Bowles, members of the commission,
thank you for taking time to listen to the public today.
My name is Gary Therkildsen.
I'm a federal fiscal policy analyst with OMB Watch,
who I'm representing here today.
Found in 1983, OMB Watch is an independent, non-partisan,
watchdog organization that advocates (inaudible)
accountability and transparency and citizen participation in
governmental processes.
OMB Watch recognizes the dangers posed by the unsustainability of
the long-term fiscal outlook.
However, the current atmosphere of deficit scaremongering poses
a different danger.
Poor fiscal policy that ultimately harms Americans and
does nothing to change the trajectory of long-term,
of the long-term budget situation.
Fiscal responsibility is not simply setting arbitrary limits
on federal spending for the sake of reducing the
federal budget deficit.
Rather, it is an assessment of the current economic and fiscal
environments in a determination of an equitable deployment of
national resources.
10.7 million Americans are without work right now and
millions more work part-time because they have no other choice.
The office of management and budget projects that until 2015,
unemployment will remain above 6% and will stay
above 5% through 2020.
All else being equal, reducing the federal budget deficit in
the near term will only worsen the situation.
In short, yes, deficits can be good things and fiscal
responsibility requires the commission to acknowledge this.
Cutting federal spending during a recession is fiscally
irresponsible for two reasons.
First, either by scaling back programs that provide
healthcare, nutrition and housing services to soften the
blows of the worst economic downturn since the great
depression or by crippling institutions to protect the
public from tainted food and led contaminated toys,
spending cuts now and the next few years will inflict undue
hardship on millions of American families.
Second, reducing the federal budget deficit may,
as it did in 1937, stifle a (inaudible) recovery
that's barely underway.
A result in double dip recession would keep many from reentering
the workforce and further suppress federal tax receipts,
ultimately exacerbating the deficit situation.
Federal spending is a powerful countercyclical tool that can
help put people to work and increase consumer spending.
Given the anemic growth and persistently high unemployment
projected over the next three years and with state budget
crisis still looming, the commission should seriously
consider a second large stimulus.
The recovery act is generated between 1.2 million and 2.8
million jobs, according to the congressional budget office.
A new stimulus package would help the economy expand by
putting more people back to work and increasing revenues,
thus allowing short-term deficits, which are largely,
though not totally, self correcting to come down faster.
Put in stark terms, we either increase the deficit or we
increase unemployment.
OMB Watch favors increasing the deficit in the short-term,
as higher employment will help to ensure
the deficit is temporary.
Once unemployment moves down and the economy is less fragile,
then and only then should we tackle the structural deficits
that remain.
I have two final comments on the options available to reduce the
federal budget deficit.
First, the commission should consider tax expenditures to be
the same as expenditures that occur through cash outlays.
In other words, when spending cuts or freezes are called for,
tax expenditures should be considered part of that
universe of spending.
Syracuse University professor and former head of the
Urban-Brookings Tax Policy Center, Len Berman,
estimates that freezing tax expenditures at 2012 levels for
three years and indexing the cap for inflation after that would
save the treasury about $3.5 trillion.
The 250 billion deficit reduction resulting from a
decade long freeze of non-security discretionary
spending is a pittance compared to the savings found in freezing
tax expenditures.
Second, without a comprehensive view of federal spending and its
impact, the commission and other federal budget makers will not
be able to weigh all possible approaches to deficit reduction.
Currently, there is no single source of
federal spending information.
There is no dashboard of spending to which policymakers
can turn to see is the universe of federal policy initiatives,
the money spent on each, and the ultimate impact those programs
have on Americans.
Once authorized, such a federal spending transparency system
will take several years to design and implement and would
of course not be available to this commission.
However, a recommendation to create such a system would
prove invaluable to budget makers in the future.
Thank you.
Erskine Bowles: Thank you very much, and we are looking very closely at tax
expenditures, believe me.
Thank you.
Ashley Carson: Good evening. I'm Ashley Carson.
I'm the Executive Director of the Older Women's League
and our campaign socialecuritymatters.org.
Thank you, Chairman Bowles and Chairman Simpson and Dr. Rivlin,
for inviting us here to speak tonight.
A critical part of economic security for women,
especially older women, is Social Security.
That's a great deal of concern among women of all ages that
this commission will recommend cuts in Social Security.
I know you've said that any benefit cuts will not affect
current beneficiaries or those nearing retirement,
but it will of affect the generations to come.
It's not only older women who are concerned about the fate
of older women in America.
It's all women.
If this commission is truly here to protect future generations,
our daughters and granddaughters,
it will not act to leave them worse off than our
grandmothers are today.
Unfortunately, cuts to Social Security will do just that.
In the same way the public rejected privatization in 2005,
they reject any notion of cuts to Social Security either by
further raising the retirement age or by reducing benefits.
We know it's our money and all generations expect the
government to keep its promise.
The reality of the situation is that most female retirees are
not driving expensive cars and living in gated communities.
However, the faith in the American dream has us all
believing that that will be our fate.
Right now nearly half of women 65 plus who live alone are poor.
While the average Social Security benefit is $13,800,
women receive about $2,000 less on average.
It's above poverty but barely.
$11,800 is not enough to survive on,
and for a growing number of older women, it's all they have.
It's less than $1,000 a month to pay their rent and to pay for
everything else they may need.
Women face an incredible confluence of circumstances
in retirement.
First, women are paid less for the same work as their
male counterparts.
This adds up to hundreds of thousands of dollars
over a lifetime.
This means they have fewer dollars to save for retirement.
Less money contributed into Social Security and less money
at the end of each month to put away for retirement.
Women spend years out of the paid workforce caring for
children, an aging parent, a spouse or other loved ones,
and sometimes all of them at the same time.
Women receive no pay for this time and are not credited in
Social Security.
Further, women are more likely to work in part-time positions
which often do not offer retirement benefits and result
in lower take home pay.
Finally, women live longer, which means we have to make
our money stretch out and last longer.
Cutting Social Security won't remedy these problems,
it will only exacerbate them.
Adjustments to Social Security's retirement age sound to
non-experts like a work incentive or an appropriate
adjustment for longer healthier lives,
when it is simply an across the board benefit cut,
albeit disguised, which falls heaviest on those who are in
physically demanding jobs or who find themselves laid off
and unable to find employment.
While an economist, lawyer, or member of congress may find it
easy to delay retirement, the same cannot be said for auto
workers, coalminers, nursing assistants and housekeepers.
Due to the changing workforce, unemployment later in life,
and the vast increase in age discrimination claims,
it's clear that raising the retirement age for Social
Security is not a viable option for the American people.
Numerous studies have documented that improvements in life
expectancy, including life expectancy in retirement,
have been skewed in favor of those with higher incomes and
more education.
For men, most of the improvements in life expectancy
in recent decades have occurred among the higher income and more
educated, with lower income and less educated men seeing little
or no change.
In the case of women, overall life expectancy has stagnated,
with lower income women seeing declines in life expectancy and
upper income and more educated women seeing
modest improvements.
If we're going to be more fiscally responsible and reign
in our deficit --
Erskine Bowles: Can you try to wrap up, please?
Thank you.
Ashley Carson: Yes, sir.
We need to look at the causes of our deficit and fix those first.
Americans are quite willing to address the problems,
but Social Security isn't one of them.
Thank you for your time.
Erskine Bowles: Thank you very, very much.
Thank you all of you.
Speaker: Thank you.
Erskine Bowles: Next group, please.
Erskine Bowles: Thank you very much.
You can go ahead and start.
Virginia Reno: Thank you very much, and thank you for the opportunity
to be here this afternoon.
I'm Virginia Reno.
I'm Vice-President for Income Security at the National Academy
of Social Insurance.
We have over 800 members in our organization,
and each are experts in their field and each speaks for
him or herself.
My remarks today will focus on Social Security and draw on two
recent reports that we have come out with.
The first is a poll of America's views on Social Security.
Our second is a report on we call Fixing Social Security.
It has policy options and cost estimates for about 30 ways to
improve Social Security's finances,
to balance its finances, and about a dozen ways to improve
the adequacy of benefits for vulnerable and
low income groups.
I have just a few key points I want to make in our
short time today.
First, Social Security is affordable.
As a share of the economy, it will rise from just under 5% of
the entire economy now to about just over 6% when all boomers
are retired, and it will remain about 6% of the economy for the
rest of the next 75 years.
It's clear a 1% increase in the share of the economy
is highly affordable.
Second, Americans depend on Social Security heavily.
As others have said, without it, nearly half of our elders would
be poor, but it's also a bedrock of security for the
broad middle class.
Third, Americans value Social Security as our
poll report finds.
They say they would rather pay more for it than see
benefits cut.
Our poll found that Americans value -- say they value it for
themselves, for their families, and quite frankly for the
stability it provides to millions of other people.
This was true in the responses from republicans, democrats,
and independents.
The Americans also said they support improving benefits in
modest ways for vulnerable groups.
In our Fixing Social Security report,
there are several options that would target benefit
improvements for particularly vulnerable groups.
They include long service, low paid workers,
widows of low income couples, and children of deceased workers
who want to go to college but have lost parental support that
would enable them to do so.
So, how could we fix Social Security?
Well, I think it is useful to think about this problem as a
problem of revenue shortfall, and a revenue shortfall that
is not now, but out in the distant future.
We need a 75 year revenue plan to match our 75 year forecast of
the future of this program.
Through most of its history, Social Security has had tax
increases scheduled out in the future,
but that has not been the case since 1990.
Policymakers could act now to schedule FICA rate increases out
somewhere in that future between now and 75 years from now to
keep the system in balance.
I'd like to mention three options quickly from our
report that would move us in that direction.
First, one could broaden the base by lifting the cap on
earnings that are subject to taxes,
get it back to covering 90% of wages as it did in the past.
Second, we could broaden the tax base by treating all salary
reduction plans or so-called flexible spending accounts like
we treat 401K plans.
What does that mean?
That means they would become subject to FICA taxes but would
remain exempt from income taxes.
Both of these base broadening changes are consistent with past
congressional intent and both could improve the fairness of
the system.
Senator Alan Simpson: I must ask you to stay within the four minutes,
because we've been here since 1:00,
and we're going to stay --
Virginia Reno: I'm done.
Senator Alan Simpson: Please.
Virginia Reno: I will.
The last point is with this base broadening,
modest FICA rate increases in the distant future, 12 years,
40 years, could put the system in balance.
The result would be assuring workers that they will have
the benefits that they hope to receive,
and it consistent with what the American people say they want.
Thank you.
Senator Simpson: Thank you very much.
Frank Wresley (sic): Mr. Simpson, my name is Frank Wresley (sic),
and I'm here as a representative of
the eight plus million people who have lost their jobs
during this recession.
I speak on my own behalf and from my own experience
and knowledge.
In 1978, representative Augustus Hawkins and Senator Hubert
Humphrey co-authored the Full Employment and
Balance Growth Act.
The four goals of that act were full employment,
growth in production, price stability,
and balance of trade and budget.
That act was allowed to expire in the year 2000.
The federal reserve still submits yearly Humphrey Hawkins
testimony to congress and is still ultimately responsible
for price stability, but congress, the U.S.
Treasury Department and the presidency have neglected their
parts in achieving these goals for too long.
The data that I present to you comes from the Bureau of Labor
Statistics and the St. Louis Federal Reserve.
From the year 2000 to present, U.S.
employment for manufacturing durable goods has shrank from
10.8 million people to 7.1 million people,
and nondurable goods manufacturing employment
has shank from 6.4 million to 4.5 million.
Total employment in the production of goods has
shrank from 24.6 million to 17.9 million.
This represents a net loss of 6.7 million jobs.
This is not a cyclical phenomenon.
This is a structural change brought about by a government
that has ignored principles set forth by its own members of over
30 years ago.
If you wanted to look at one thing to observe this lack of
principle, you would look at the price of gold.
From 2002 to present, the price of gold in dollars has gone from
$300 an ounce to over $1,200 an ounce.
Some people look at gold as an inflation hedge.
I look at it as a government screwup hedge.
And there have is been too many screwups to tolerate since
Humphrey Hawkins was thrown in the waste basket.
What must change to get back to the spirit of
Humphrey Hawkins act?
I'll start with number 3, price stability.
To achieve price stability in the United States,
the auction yields on all maturities of debt sold by the
government must be at least 2% above the current year over year
change in the consumer price index for all urban customers
as published by the Bureau of Labor Statistics.
The federal reserve and other market players may adjust market
rates as they see fit, but the federal government must never
again use lower interest costs as a means of lower deficits.
I believe that the federal government must begin selling
forward year tax receipts, also known as fighters,
to augment the deductions already,
the interest deductions already set forth by congressional
statute, which include mortgage interest payment and corporate
interest payment.
A forward year tax receipt, also known as FYTR,
is a receipt sold by the U.S.
Treasury Department for taxes paid today that are due some
time in the future.
Like U.S. treasury bills and bonds, fighters would have a
rate of appreciation and a duration.
However, unlike treasury bonds that guarantee payment in cash
to the owner at maturity, the owner of the FYTR must have the
tax liability to be offset when the FYTR reaches maturity.
If the value of the FYTR at maturity exceeds the tax
liability of the owner, then the owner would receive from
the treasury the difference in the form of additional FYTRs.
The rate of appreciation for the longest duration of FYTR must
always be set by the treasury secretary with the explicit goal
of maintaining full employment in the United States.
Obviously everyone knows about China's trade deficit with us
and their purchase of treasury bills and bonds.
This presents a conflict between monetary policy
and fiscal policy.
Interest rates on government debt can't rise to contain inflation.
To rectify this the normal way is to ask China to revalue the
currency, but that's completely up to them.
I suggest instead that we lower the after tax cost of private
capital formation in the United States by selling FYTRs.
Senator Alan Simpson: I thank you very much, Mr. Wresley (sic). Now, please.
Dr. Margaret Flowers: Thank you.
Thank you Chairman and staff for this opportunity and for
your time and attention.
I'm Dr. Margaret Flowers, and I'm speaking on behalf
of Physicians for National Health Program.
We are the leading physician education research and advocacy
organization for a national single payer system in the U.S.
I want to comment briefly on the contribution of healthcare cost
to our deficit, some evidence based remedy for that,
and I did submit written testimony with
some backup information.
So I hope that you'll have an opportunity to look at that.
In terms of healthcare and comparing our nation to others
around the world, we were number one in only one area,
which is that we spend the most per capita per year on
healthcare, and for this we get very poor value on return.
We have about a third of our population that is either
uninsured or under-insured, leaving them financially
vulnerable to bankruptcy and foreclosure should they
have an illness.
In addition, for the healthcare dollar,
we have poor health outcomes.
We're ranked 37th in the world, and we have the highest number
of preventable deaths of the industrialized nations,
which is about estimated a few years ago to be
100,000 preventable deaths per year in this nation.
Healthcare costs are a leading contributor to our deficit,
currently rising at 2.5% faster than our GDP,
and unfortunately the legislation which was
recently passed, (inaudible), is actually estimated to increase
our healthcare costs more than if we had done nothing at all,
while still leaving tens of millions of our people
with nothing.
So the other point that I wanted to make is that if we actually
spent per capita what the other industrialized nations spent,
we would be seeing a budget surplus in this
nation right now.
There may be a temptation given the rising cost of healthcare
to cut our social insurance programs, Medicaid and Medicare.
I urge you not to do this.
It would be a mistake.
Medicare has reduced poverty among our elderly by over 60%.
In addition, Medicare -- the administrative costs of Medicare
are rising more slowly than that with private health insurance,
and we would see worsened health outcomes if we were to take away
these programs.
We know that data shows that once our population reaches
the age of 65, we start to see a decrease in health disparities.
So it would be important not to raise that any higher.
I wanted to just make the point that Medicare and Medicaid are
not the cause of our healthcare cost crisis.
It's really they are the victims of using a fragmented and
experimental market based model of financing our healthcare.
It's not possible to take health care costs off of our public,
you know, social programs and shift them onto the individual
and expect that they are magically going to become
sustainable or go away.
So we advocate for a national single payer improved Medicare
for our system.
This is the only type of system that has built in cost controls,
and I outline those in my remarks of global budgeting,
negotiation for prices, negotiating pharmaceutical
costs, being able to recognize outliers,
being able to allocate our health resources on a rational
basis instead of a profit basis.
We would also see some benefits to business,
reducing the burden of healthcare costs on our small
businesses, creating a more healthy and productive
workforce, increasing our competition in the global
market, and we also see a benefit to families in terms of
having more discretionary income to spend on things other than
healthcare, more security, not having to make decisions between
paying for medication and care or paying for other necessities
in their life, like food and shelter.
Given the multiple benefits that I've outlined in my remarks,
it's no surprise that the majority of the public and
physicians favor a national single payer health system,
and you saw this recently on Saturday with the America Speaks
events when the public did demand -- and I was at the
one in Detroit.
You know, the single payer being an option,
and 71% of the participants voted to make no cuts to our
Medicaid and Medicare.
So, in closing, Medicare for all saves lives, it saves money.
We urge you as a commission to make this recommendation.
We have the ability to have the best healthcare system
in the world, and we look for you to do that.
Thank you.
Erskine Bowles: Thank you very much.
Kevin Zeese: Good evening, co-chairs and staff.
Thank you very much for your stamina.
I'll be as brief as I can.
I provided written testimony.
My name is Kevin Zeese with ProsperityAgenda.US.
Before considering any cuts in Social Security Medicare,
this country's most important social programs that every
American relies on for their health and well-being,
the commission should focus on where wealth has been
concentrated, as well as the misspent discretionary spending.
To do so means confronting the true sources of debt: Two wars
fought on borrowed money; uncontrolled military spending;
hundreds of billions in corporate welfare;
tax cuts for the wealthiest in corporations;
as well as deregulation of banks that led to the
need for bailouts.
The wealth devise widest points (inaudible) 1920's.
This funneling of wealth occurred because of policies
that funneled wealth to the top.
In fact, during this most recent expansion of 2002 to 2007,
the top 1% captured two-thirds of income growth.
To balance this, the commission needs to go where the money is
as a result of more fair tax on the wealthiest is important.
Either funneling of wealth to the top was due to taxpayer
subsidies, tax breaks, and corporate welfare to
concentrated corporate interests and tax break
to the wealthiest Americans.
This is a major source of the national debt.
From 2001 to 2008, tax cuts for the wealthy cost the U.S.
treasury $700 billion, all right to the national debt.
There are 7500 households in the United States with annual
incomes over 20 million.
Over the last two decades, this group has paid less in taxes.
The top 400 has seen their tax brackets plummet from 51% in
1955 to 16% in 2007.
The most recent (inaudible) are available.
A tax on the wealthiest could raise $105 billion,
and they wouldn't even feel it.
100 years ago Teddy Roosevelt suggested that we need to focus
on concentrated wealth by dealing with the graduated
inheritance tax.
The failure to have the estate tax in 2010 will cost an
estimated 14.8 billion.
I urge this commission to endorse the responsible estate
tax act so we can raise billions of dollars while exempting
99.75% of Americans from paying any exempt, any estate tax.
This commission should also look at a tax on financial
speculation, a modest tax on financial transactions could
easily raise more than $150 billion a year,
a .5% tax on stocks and trades,
a .02% tax on future derivatives and default swaps
would have impact on investors.
The (inaudible) raised $40 billion by just
taxing stock trades.
We could raise over $150 billion a year.
Regarding cuts and discretionary spending,
most discretionary spending, in fact more than half,
goes to war and weapons.
The commission must look at this budget if it's going to find a
way to control our fiscal problems.
One challenge you face is the DOD budget is unaudittable.
You should require a way to make sure this budget auditable,
and the commission should recommend reform so we know
what the money is being spent on.
In 2008 the general county office found that we were $300
billion in overruns on weapons spending.
Just by cutting, not allowing cost overruns on these
contracts, we will save significant resources.
And of course two wars being fought on borrowed money,
costing us trillions of dollars, the afghan war with 1 million
per soldier, to keep one soldier in Afghanistan for one year,
costing $7 billion a month needs to be reconsidered,
and the thousand military bases in outpost also need
to be looked at.
Regarding -- let me move on to corporate welfare.
This is an area where hundreds of billions of dollars a
year is spent.
We don't even know how much is spent on corporate welfare.
And we continue to spend it.
This needs to be looked at, how much is being spent.
Some is being spent on when (inaudible) profits in the oil
and gas industry, tens of billions of dollars
are being spent in that area.
On Social Security Medicare, this is an area that really
can't be cut.
In fact, they need to be expanded.
People are going to be living in poverty in retirement,
especially with the drop in the stock market.
We've seen people lose their savings.
They need Social Security.
It has a surplus.
It's a contract with Americans and can't be broken.
On Medicare, if we control health costs,
we control the future deficit.
The only way to control deficits and debt is to
control healthcare costs.
The only way to control healthcare costs is to expand
and improve Medicare so it covers all Americans.
It's the private insurance industry that's causing
so much waste.
We would save $400 billion a year by going to a Medicare for
all single payer system.
Thank you very much for your time.
Senator Alan Simpson: Thank you. I appreciate that greatly. Thank you all.
Speaker: Thank you.
Senator Alan Simpson: You can have the next group, please.
Thank you. Go ahead.
Nicole Tichon: Thank you.
First of all, I'd like to apologize for my informal shoes.
We have a broken foot/dog out of control situation going on,
so please excuse my informality.
Chairman Bowles and Chairman Simpson and distinguished
members and staff, of course, thank you for the opportunity
to be a part of this critical conversation.
My name is Nicole Tichon, and I represent the U.S.
Public Interest Research Group.
We are a nonprofit, non-partisan,
public interest advocacy group, and we represent all of our
state organizations and our citizen members
across the country.
Our perspective on reducing the debt and deficit is founded on
the principle of accountability for tax dollars,
whether the recipient is a government agency,
its contractors or the industries that benefit
from taxpayer bailouts.
We released two reports to reduce the deficit through
policies that not only advance the public interest but also
reduce the deficit.
The first trillion report we released was back when
the commission first started its work,
and the next trillion report was released today across the
country in conjunction with this hearing.
The reports which are available on our website at USPIRG.org,
we focus on five areas for deficit reduction.
One is reducing wasteful spending on
contracts and supplies.
Two, making polluters and financial speculators pay
for the damage they create.
Three, ending wasteful corporate subsidies.
Four, better collecting existing taxes.
And five, reducing costs to administer Medicare.
I'll highlight some of these examples from our most recent
report, which like the commission looks at debt
reduction, looks at a debt reduction horizon of 2015.
So, category one: Reducing wasteful spending on contracts
and supplies.
Much of what the government does is through private contractors.
So it makes sense to root out waste within government
purchasing and contracts.
We've seen a lot of common ground across the political
spectrum to do so.
We applaud the administration's recent efforts to snuff out bad
contractors and wasteful contracts,
especially within the IT framework.
We also applaud the efforts of the bipartisan deficit
acquisition panel to make sure that the Pentagon spends dollars
more carefully and pays for services and programs that
provide the best value.
As a former contractor for the federal and state government
myself, I can personally attest to the amount of time and money
that's wasted when requirements are not accurately collected,
when rules aren't adhered to, or when projects are
not closely managed.
In examining the purchasing and inventory data of the defense
logistics agency, the Army, the navy and the Air Force,
GAO discovered that these organizations are wasting
billions of dollars purchasing items that went unused or were
never required, as much as 50% or more.
Category two, making polluters and financial speculators pay
for the damage they create.
We believe that when polluters and speculators make a mess for
the public, they should be responsible for cleaning it up.
And for risky activities, the best way to do this is to create
an insurance fund that will be ready when the need arises.
We've seen the result of irresponsible risk
taking in the gulf.
We've seen it on Wall Street time and time again.
One of the biggest problems we see is speculative,
high volume transactions driven by computerized
(inaudible) trigger trades seeking relatively
small margins.
Just yesterday the trading of Citibank was suspended due to
such trading.
Support for this tax comes far and wide,
including globe leaders, noble laureates, Warren Buffet,
and a broad coalition of consumer labor environmental
human rights and other organizations.
Most importantly, it's supported by the taxpayers.
In today's Wall Street Journal we saw that participants in
national town hall meetings that were put together with
assistance from a broad spectrum of groups, including AEI,
the conquered coalition and the Chamber of Commerce.
This resulted in a resounding 61% of the participants
supporting such attacks.
I have a couple more comments on ending wasteful subsidies.
Erskine Bowles: If you could wrap up, that would be great.
Nicole Tichon: Sure, absolutely.
Getting rid of gas and oil subsidies, closing the (inaudible)
interest loophole, ending the use of offshore tax havens for
tax avoidance and evasion, which could end up in collecting $500
billion by 2015 and reducing the cost to administer Medicare
through technology and making sure we give the best possible
deal for taxpayers.
We just basically wanted to say that regardless of the urgency
of our debt situation, the government needs to move forward
with an aggressive plan to hold itself accountable.
Erskine Bowles: Thank you very much. Thank you.
Nicole Tichon: Thank you. Sorry.
Erskine Bowles: Mary Kay, thank you for being here, and most of all,
thank you for giving us Andy Stern.
Mary Kay: Oh, it's our great pleasure and honor to
give you Andy Stern.
He is an incredible leader and I think will make a huge
contribution to this commission.
So, thank you.
I understand that the commission has received our testimony,
and I thought rather than making the case about the current
crisis for working people, I would just go directly to the
recommendations and highlight them at the end of the evening.
As I was preparing, I thought about the 2.2 million members we
represent and how they think about the year 2015 and their
own ability to balance their income with their increasing
debt and the debt that their children are incurring to
get to college.
And we look forward to this commission allowing the country
to have a honest conversation about what caused the economic
crisis that led directly to our deficit and that this crisis was
caused by 30 years of failed economic policies,
cutting tacks for the rich, which we believe has deepened
economic inequality to levels not seen before the great
depression and its lasting regulation that is provided for
50 years of financial market stability led directly to the
collapse of our financial markets,
and in the process destroyed $17 trillion in wealth.
We believe these outcomes were not accidents,
that they were the unavoidable consequence of policy decisions.
In fact, according to the center on budget and policy priorities,
the tax cuts enacted under President Bush,
the wars in Afghanistan in Iraq, and the economic downturn
together virtually explain the entire deficit over the
next 10 years.
Two of those policies, tax cuts and the wars in Iraq and
Afghanistan, account for nearly $7 trillion in deficits between
2009 and 2019.
The point is there is no crisis of entitlement spending,
and that means there's no reason to cut Social Security.
Second, SEIU wants to state unambiguously that pursuing
budget balance prematurely while the economy is weak risks
creating another recession.
And even more importantly, if we balance the budget but leave a
fifth of our workforce sitting on the side lines,
we have failed.
There is no economic or long-term security with
unemployment in the double digits.
So, as unpopular as it might be in this conversation,
we need to recognize that more spending now will create
good jobs, strengthen our economy and put us on the path
to sustainable deficit reduction.
If we choose the other path and start to reduce the deficit now,
we risk a poorer and more divided society over the long
run and an even greater danger in the short-term,
a deep recession that will ultimately only make our
deficit problems worse.
Third, some on this commission have said that everything should
be on the table.
We disagree.
Cuts in Social Security should not be on the table.
Given the fact that half of working Americans have no
requirement benefits through their work and that pension
funds were devastated by the financial crisis,
any conversation about Social Security must begin with the
question of whether Social Security provides an adequate
level of benefits and whether Social Security is adequate for
the working poor.
And I just wanted to pause here and talk about the
700,000 home-care providers that we represent that, on average,
earn between $14,000 and $20,00 a year and the family childcare
providers, 200,000 of whom labor in seven states and also earn
about that same amount.
None of those workers can look forward to a Social Security
check when they retire, nor have any hope of being able to retire
with dignity and face a choice of either working until they
drop or living in poverty as they age.
And that seems to me a focus that this commission should look
at in terms of how do we provide adequate Social Security
benefits for the people that I would submit are doing their
best to make ends meet by working hard for a living
and just need a fair shake.
So what we think should be on the
table is adequacy and fairness.
Once we get the economy growing again,
we will need to raise additional revenue and find the right
balance to a sound fiscal policy which means that all spending
must be on the table, including our defense budget.
America has become a much more unequal society.
Between '79 and 2007, the average after-tax income for the
top 1% rose by 281%.
So we think being able to raise additional revenue we should be
sure to tax those who have benefited by enacting a
financial transaction tax and other tax increases on the very
wealthy, which could generate several hundred billion a year
in revenue.
So I call on the members of this commission to see your mission
in its broadest terms.
Please judge your success in achieving the 2015 goal of
primary budget balance not just by where we stand as a nation
but where we stand as a collection of citizens,
of working families that make up America.
If family budgets are sound, if we have decent jobs,
if homes are not under the threat of foreclosure and we
have the ability to retire with security,
then I believe you will have succeeded in answering our call.
Thank you very much.
Erskine Bowles: Thank you, ma'am.
When I was thinking you for Andy,
I should have also thanked you for Lyla.
She's been an enormous help to us.
Thank you very much.
Mary Kay: Fabulous.
Speaker: Indeed.
Michael Fisher Jr.: To the Chairman and members of the commission,
thank you for the opportunity to testify to you today.
My name is Michael Fisher Jr., and I'm a public policy advocate
in the Washington office of the United Church of Christ Justice
and Witness Ministries.
My colleague Dr. Edith Rasell, an economist in our Cleveland
office, and I also submitted written testimony.
As with any good sermon, we bring a three-point message.
But I will begin by summarizing the painful and debilitating
situation in which many families find themselves today.
And you've heard these statistics.
One in eight people is on food stamps,
including one in four children.
One in nine families cannot make the minimum payments
on their credit cards.
One in seven mortgages is in default or foreclosure.
And over one quarter of the unemployed are facing
foreclosure or eviction.
In total, 44% of households have experienced either job loss or
reduction in hours.
As we know, nearly one in ten workers is unemployed.
But even this grim statistics fails to fully describe the
burden on our families.
Joblessness is not distributed equally across demographic
groups but falls most heavily on people of color, young workers,
and those without a college degree.
For these individuals, unemployment and underemployment
have reached levels that recall the great depression.
In addition to the financial effects,
the social and emotional impacts of un and underemployment have
created a mental health epidemic.
While some feel hopeful and eager for a new start,
the majority is stressed, depressed, angry,
and feeling hopeless.
For some people in communities, recovery will take many years.
For others, the effects will persist for a lifetime.
For millions of people of all ages,
the whole and holy life that is God's vision for each of us have
been lost, at least for a while.
I cite these distressing statistics to remind us that
as long as our economy remains weak, the recovery uncertain,
and employment high, our nation's primary concern
must be to create jobs and get people back to work.
Therefore, our first recommendation to the
commission is to maintain the federal deficit.
This must take precedent over deficit reduction.
When the economy is once again on sound footing,
then we will need to substantially
reduce the deficit.
Until then however, a large deficit is necessary to promote
a strong economic recovery and reduce the unacceptably high
and destructive level of unemployment.
Moreover, a strong economy is a prerequisite for future
deficit reduction.
Second, over the long-term, additional revenues
must be found.
The 2001 and 2003 tax cuts for those with incomes over
$250,000 must be allowed to sunset at the end of the year.
In the short term, this additional revenue should be
used to stimulate the economy.
But once this down turn is behind us,
the added revenues will contribute to deficit reduction.
Third, the long-term deficit is largely driven by the
cost of healthcare.
The high and rising costs threaten both the physical
health of every individual and the fiscal health of our nation.
Small steps toward cost containment were made in the
health insurance reform bill enacted in March,
but much more needs to be done.
We hope the commission will make healthcare cost containment a
major focus of your work.
And we thank you for this opportunity to testify
before you today.
Erskine Bowles: Thank you very much.
And I assure you we will.
Before we hear from John Satagaj,
I just want to say that I had the privilege of heading the
Small Business Administration, and I came up here as the
biggest neophyte you've ever seen.
Nobody was more helpful to me than John was in Small Business.
So thank you so much.
John Satagaj: Thank you, Mr. Chairman.
And thank you, Mr. Chairman, for the opportunity.
My name is John Satagaj, and I am with the Small Business
Legislative Council.
Just a few quick points.
First, obviously, as most in the business community believe,
we need to bring the deficit down and we need to start now.
I haven't met a smart business owner that would warmly embrace
a tax increase.
That's just not going to happen.
We recognize that's the case.
And so I think about one thing that I can share that perhaps is
a little different insight into the process.
And it's why small business gets involved in these activities in
the wrong way.
And typically, nine out of ten times,
particularly on the tax side, it is you pick a threshold and you
say, you know what, 99% of the small businesses will be okay.
And the example would be, for example, the marginal rate.
If you pick $250,000.
On the estate tax, you put $3.5 million exemption.
And everybody says small business doesn't care.
Well, they care.
And typically for three reasons I see.
You get those businesses that are there that are the growing
businesses that are close to $250,000 or the $3.5.
Those are the ones that creates the jobs.
Those are the ones you want to help.
Second, it drives to bad business policy.
How many times do folks avoid a state tax by dividing the
business in various ways that do not make sense?
And third, there isn't a small business in America who doesn't
think, you know what, I can make $250,000, I can get there.
Or I can get to an estate of $3.5 million,
and I want to do that.
So those are the reasons why, typically,
we react negatively to things that are a little
too close to us.
And so my recommendation is, can we find something that doesn't
take it as close.
And just the other day, Senator Sanders introduced a state tax
reform bill.
And it's what I would call an aggressive
progressive estate tax.
It starts at $3.5 million as the bottom exemption.
The top rate for him is at a $500 million estate,
the top rate will be 65%.
It will be a 55% tax plus a 10% (inaudible) tax.
And I just wonder if he took the number from 3.5 to 10 million
what he would have to do in the other brackets to take care of
that and take small business out of that particular debate.
And my guess is it could probably be reached in an
easier way than we think.
So if it's going to come to that,
we know we're going to share the pain along with everybody else.
But if we get it to the point where small businesses aren't
saying, you know, this is right on my target list,
then I think you can ease some of that pain
of sharing the pain.
So my recommendation is, when you get looking at a threshold,
ask yourself once, well, can we take it up one notch higher and
what will we have to do somewhere else and
can we get there?
So that's my one recommendation.
Perhaps that's a little different than everybody else.
I wish you the best of luck.
And we plan to do everything we can do to help you all.
Thank you.
Erskine Bowles: Thank you, John. Thank you all very much.
Speaker: Thank you.
Erskine Bowles: Next group.
Thank you.
Go ahead.
Nancy Altman: Thank you so much, Chairman Bowles and Chairman Simpson.
I appear here in two capacities.
I'm the co-director of Social Security Works,
but I also was the former top aid to Allen Greenspan in his
capacity as chair of the so-called Greenspan Commission.
Erskine Bowles: And you did a fabulous job. Thank you.
Nancy Altman: Thank you so much.
It was a wonderful experience.
Now, press reports assert that this commission's recommendation
wills be taken up in the lame duck session without the benefit
of full hearings, open markups, or opportunity for amendment.
If this is true, this would be unprecedented with respect to
Social Security, including in 1983, and indeed unwarranted.
Throughout Social Security's long history,
Congress has always used the normal legislative process when
considering Social Security.
Another almost unprecedented action is discussing Social
Security in the context of over all budget deficit discussions.
Indeed, Congress has historically and appropriately
worked very hard to keep the mandatory Social Security
contributions of American workers, their employers,
and the related income clearly distinct and separate from the
federal government's general fund and related budget.
Social Security's monies are segregated in a trust apart
from the general fund.
The law requires that it be displayed off budget.
And as you know, the budget act expressly prohibited changes to
Social Security from being part of any budget
reconciliation process.
And this is how it should be.
Social Security is not simply a spending program.
It's a pension plan, sponsored by the federal government.
And its assets are held in a pension trust.
It has, as you know, no borrowing authority,
but instead can legally pay benefits only if it has
sufficient income and assets to cover the cost.
Consequently, if at any point in the future it has insignificant
revenue to cover the cost of benefits,
those benefits will be automatically reduced without
any action by Congress.
As a consequence, though it can project a deficit,
it can never actually run one.
Though the general fund must incur costs paying interest on
treasury bonds held in trust and must, if requested,
redeem those bonds, this should not be considered contributing
to the deficit anymore than I as an individual am contributing to
the deficit if I seek repayment of treasury bonds I hold
as an individual.
Social Security is projected to have a manageable shortful
still decades away.
This is an issue that should be addressed in a proper forum,
the House Ways and Means Committee and the Senate
Finance Committee, where the expertise resides.
There's no reason for haste or closed deliberations.
The importance of Social Security demands that proposals
receive very careful consideration.
Any kind of expedited procedure behind closed doors would be a
disservice to the American people.
The best policy is to maintain those benefits,
increase them for the most disadvantaged,
and eliminate Social Security's funding gap by a few carefully
crafted proposals, which are good policy
in and of themselves.
In my written statement, I provide such a plan.
Poll after poll has consistently shown that the American people
would prefer to pay more for Social Security than have those
benefits reduced.
In my view, this commission should defer to Congress and
Congress should follow the will of the people.
Thank you.
Erskine Bowles: Thank you, ma'am.
Even though I and me people refer to this as the deficit or
debt commission, it is the National Commission of Fiscal
Responsibility And Reform.
And the President did ask us to look at this as one
of our goals.
So that's why we're reviewing it.
Thank you.
Nancy Altman: And a if I could just say, I hope that when you do that you
think about, as I say, what poll after poll has shown.
Because I think it's not only good politics.
I think it's a very wise policy.
Stacy Sanders: Good evening.
Thank you for the opportunity to testify before the commission.
My name is Stacy Sanders, and I am the director of the Elder
Economic Security Initiative at Wider Opportunities for Women,
more commonly known as WOW.
WOW works nationally and in its home community of Washington,
D.C. to promote the economic well being of women
and their families.
Through research, organizing, and advocacy,
WOW works to promote policy and programs that will allow
Americans the opportunity to be economically secure,
whether by securing a job with a self-sufficient wage or by
accessing critical benefits that allow seniors to age in place.
Through its programs, WOW works with coalitions in nearly 40
states and represents over 2500 advocates,
providers, policymakers, administrators, and others.
We recognize that the commission is tasks with a significant
challenge, to reduce the federal deficit.
Yet this goal ought to be considered in a broader context,
that of promoting economic security for Americans
of all ages.
And WOW encourages the commission to make its
recommendations with this broader focus in mind,
in particular, paying close attention to how its suggestions
will impact vulnerable groups, including low-income Americans.
WOW asks that the commission guarantee that its
recommendations do not harm low-income workers,
families, or elders.
Keeping this broader focus in mind,
of particular concern to WOW is how the commission's
recommendations will impact Social Security.
And today my comments will focus particularly on the adequacy of
Social Security benefits.
Although it was never intended to be the sole source of income
in retirement, Social Security represents all or most of many
elders' income.
And this is particularly true for older women.
Women who on average learn less during their working years
disproportionately rely on these benefits.
And in fact, three in ten older adults rely on Social Security
for more than 90% of their income.
And two out of five older women have only Social Security.
Without it, have of all seniors would live in poverty.
It's important to recognize that Social Security is not only a
program for retirees.
It's benefits provide a lifeline for persons with disabilities
and dependent survivors.
More than 1.3 million children would live in poverty without
Social Security.
And while its success as an anti-poverty program is made
clear by these statistics, WOW's elder economic security
initiative provides a framework and tools that allow us to
assess Social Security's success in terms of economic security.
Underpinning the initiatives is a tool called the elder index
that looks at the real cost of living in retirement and
incorporates the cost of housing, healthcare,
transportation, food, and other essentials.
In 2009, the average Social Security benefit for an older
woman was just under $12,000 per year
compared to $15,600 for an older man.
And our elder index demonstrates that a senior renter requires
nearly $20,000 annually to meet their basic needs.
Thus, those who rely solely or primarily on Social Security
benefits must make difficult sacrifices,
choosing among basic needs including food,
prescription medication, or energy bills.
The elder index is a bare bones measure of elder economic
security, and it is nearly double the federal poverty level
of $10,830 for a single older adult,
which brings to light a startling reality,
that far more of today's seniors are struggling to make ends meet
than is represented by today's poverty rates.
So today I ask that the commission turn its attention
away from Social Security and focus on the true sources of
the nation's deficit.
WOW encourages the commission to explore recommendations that
will foster job growth and stimulate the economy,
including building demands for consumer goods through
investments and low-income support programs and investing
in adult education, skill development, and job creation.
These recommendations will help to ease fiscal stress
and simultaneously benefit low-income populations.
Erskine Bowles: Can you please wrap up?
Stacy Sanders: Sure. That's it. Thank you.
Erskine Bowles: Thank you very much.
Bill Bently: Thank you, Chairman Simpson, Chairman Bowles.
I appreciate the opportunity to testify today before the
National Commission on Fiscal Responsibility and Reform.
My name is Bill Bently.
I'm the President and CEO of Voices for America's Children,
the nation's largest multi-issue children's advocacy organization
with a network of 60 member organizations in 45 states,
D.C., and the U.S. Virgin Islands.
The network is one of the nation's leading advocates
for children and youth.
We care very much about the future of our country.
And we applaud you for the efforts that you are
undertaking right now.
We know that it's difficult.
We believe deeply that every child in America should have
the benefit of every possible opportunity and support needed
to grow up healthy, productive, educated,
and ready to lead.
There's no doubt that the federal budget deficit must
be reduced to a level that approaches a more historical
level as a percentage of the nation's economy.
Children today are very much at risk.
Reducing the federal budget deficit is critical,
but there are other priorities that I submit are of equal
challenge to the nation.
Ghandi said once that poverty is the worst form of violence.
Children represent 25% of the population.
And yet 41% of all children live in low-income families,
and nearly one in every five in poor families.
The percentage of children living in low-income families,
both poor and near poor, has been on the rise,
increasing from 37% in 2000 to 41% in 2008.
And during this time, the overall number of children of
all ages increased by 3%, while the numbers who were low income
and poor increased by a staggering 33%.
Although Black, American Indian, and Hispanic children are
disproportionately low income, White children comprised the
largest group of all low-income children under age 18.
And every year, there are nearly one million documented cases of
child abuse in this country.
And while healthcare is available to most low-income
and poor children, more than eight million children
remain without coverage.
There are other statistics I could quote,
but I won't in the interest of time.
Children are at risk.
And reducing deficits, especially if Social Security,
Medicaid, or domestic discretionary spending is
targeted, would just exacerbate an already difficult situation.
As a percentage of Gross Domestic Product,
federal programs that provide a safety net to
children are shrinking.
And according to the Uurban Institute's kids' share analysis
of federal expenditures, from 1960 to the present,
outlays on children have increased in dollars and
as a percentage of Gross Domestic Product.
However, children are receiving a smaller share of the overall
domestic federal budget.
In 2008, the largest federal spending programs for children
were Medicaid, food and nutrition programs,
and Temporary Assistance to Needy Families, TANF.
Their report states that the Child Tax Credit, Medicaid,
and Supplemental Nutrition Assistance Program had
particularly high expenditures in 2008 as early responses to
the recession, as a downward trend is expected to continue,
unless current policies are altered.
And should this commission recommend a reduction in
domestic discretionary spending, the decline in spending on needy
children and their families will be even greater.
If I can leave the members of the commission with one thing
to consider, let it be that our children are an investment,
perhaps the safest investment we can make.
Since the last time structure reforms of entitlement in other
federal programs was seriously considered,
our knowledge of how young minds develop has grown.
We know that early investments in kids and their future health
are very much related.
We also realize that you're going to have to do something to
address the deficit situation.
We would only suggest that as you consider how you proceed
that you consider revenue increases as well as any
deficit recommendations that you all would develop.
Erskine Bowles: Thank you very much.
I will tell you that when we did the balance budget agreement in
1997, I think the proudest moment of my life was when we
got healthcare insurance for five million poor kids
as part of that.
Thank you.
Peter Dawson: Good evening. I would like to thank, first of all,
the commission for this opportunity to speak.
My name is Peter Dawson, and I represent the group of nearly
1.4 million people called One Million Plus People who
Disapprove of the Healthcare Bill and Speak Out America Now.
Unlike the healthcare law, we're hoping that our voices
will be heard.
And we thank you for the opportunity.
With 13 plus trillion dollars in national debt and another even
more disturbing but rarely mentioned 43 trillion in
unfunded Social Security and Medicaid liabilities,
our country is on the brink of financial ruin as a result of
fiscal irresponsibility on the part of our representatives in
Washington on both sides of the table.
Federal Chairman Bernanke has warned us, Admiral Mueller (sic)
has told us that this is the biggest threat
to our national security.
Last week be the G-20 countries have criticized us,
and the CBO came out with a report today that
only further supports this.
We're here to ask you to do a few simple things or what sound
like common sense things.
First, please stop spending money we don't have.
Individual homeowners and households and state
governments have to do it.
It's time for the federal government to be required to
produce a balanced budget each year.
Secondly, tax increases are not the answer.
They will stifle the recovery, cost us jobs,
and cripple the future economic growth of this country.
Business is already paying the second largest corporate tax
rates behind Japan.
Cut taxes to stimulate growth.
A national sales tax will only further fuel Washington's
addiction to spending.
Third, we need to get serious about government waste, abuse,
and fraud, i.e., we can ill afford to be spending $150,000
of stimulus money on salamander crossings in Vermont or $1.25
million on a squirrel bridge in Arizona.
$782 billion of taxpayer funds were spent with little results.
While, I know it is fashionable in Washington to demonize
business, no business would tolerate such results.
Fourth, we need leaders and not politicians to make the tough
decisions we sent them to Washington to make,
to stop the handouts for votes and focus on prioritizing our
needs based on what we can afford.
That does not mean being all things to all people.
Fifth, we need a permanent fix to Social Security and Medicare
and Medicaid, once and for all.
Yes, there will be shared pain, but without addresses such,
there can be no real progress in reducing our debt.
No more smoke and mirrors, approving reductions in fees for
services that are only offset by further legislation which
rendered them neutral.
Sixth, we need to repeal the healthcare law and replace it
with an alternative in line with what American people desire and
what we can afford.
At a time when the IMF is forcing Greece to privatize its
national healthcare and the UK is making dramatic reductions in
its socialized medicine, we are embarking on a program that will
cripple this country.
Health and Human Services says it will not reduce cost.
CBO has indicated another $115 billion in expenses,
combined with the $210 billion of doctor fix that was not
included, and the $500 billion that will be taken from a
bankrupt Medicare system, this leaves us with a deficit of $687
billion over ten years, before any unintended consequences.
We fear that this bill will be catastrophic.
Seventh, it's time to re-evaluate the Iraq and
Afghanistan war, to determine whether or not we can possibly
achieve the desired outcome or if there is a more efficient way
to protect our nation.
I thank you and wish you the fortitude to be Americans first
with party affiliations second.
Choose to be leaders not politicians.
Make the tough decisions.
Yes, there will be shared pain, but let our generation pay for
our sins and not allow it to become the curse
of our children.
God bless you, and God bless America.
Senator Alan Simpson: Let me ask a question of Ms. Altman,
because I think your group has distorted what I have done.
And Alex is a good man and very persistent charitable fellow,
and your remarks early on about lame duck and doing things in
secret are bizarre.
No one has ever suggested that.
And I want to correct that.
I don't need to, but I want to.
And then, as I say, I hope that as you continue to -- if you do
anything, that you use fairness with regard to me,
and when you play your tape play it all.
And what I said was we're trying to take care of the
lesser in society.
And today I have heard words like vulnerable, poor, deprived,
struggling, disenfranchised, hurting, beating down,
and those are the people I were talking about.
And then to take the word lesser and look like some evil thing is
totally unfair and pisses me off.
Nancy Altman: Let me say, first of all, I'm very happy to hear that these
recommendations -- there was not an agreement.
What the press has reported -- and I've talked to reporters
who've confirmed it for me, so I guess it's wrong -- that
Majority Leader Reid agreed with the White House,
that if 14 out of 18 members of the commission reach agreement,
that he will take it up in the lame duck session and if it
passes the Senate, Speaker Pelosi has agreed to take it up
in the House.
If that's not true, I think it's good for you to correct the
record to that because that's what even reporters are saying.
And I understand what you're saying.
I worked for Senator Jack Danforth when I was on the Hill.
I try to be an honorable person and follow his lead.
I believe that Alex was simply asking questions
and being very polite.
I don't think he was --
Senator Alan Simpson: He's a good egg.
I don't argue with what he does.
Nancy Altman: And we put the entire --
Senator Alan Simpson: Don't take the word lesser and keep using it as you have,
others have.
I'm tired of it, tired.
Nancy Altman: No, I have not.
We played the tape, and others picked it up.
I did not.
I understand what you're saying.
Senator Alan Simpson: I've been around a long time.
I get tired of a lot of things.
Erskine Bowles: I assure I've heard Senator Simpson speak on
this subject several times.
And he didn't mean anything derogatory by it at all.
Thank you all very much.
Speaker: Thank you.
Erskine Bowles: If the next group would come up please.
Heidi Hartman: Which seat should I pick here?
Erskine Bowles: Thank you. Go ahead.
Heidi Hartman: Hi. My name is Heidi Hartman.
I'm an economist with a Ph.D in Economics from Yale University.
I also have a MacArthur fellowship.
And I'm a member of the National Academy of Socialist Insurance.
I'm testifying today as the President of the think tank I
founded, The Institute for Women's Policy Research.
Unfortunately, I was alphabetized under
women instead of under institute, so here I am.
But I have the whole table to myself,
so I guess I'm lucky in that regard.
And I'm also testifying as the secretary/treasurer of
the National Council of Women's Organizations,
which is the coalition group of over 200 women's organizations
that represents more than 10 million women.
And I have copies of my written testimony,
which I would love to give to you because I think it's just
easier, especially at this time of day, if I just summarize it.
So I'm focusing strictly on Social Security,
and I want to argue that it would be a mistake to cut
Social Security benefits in any way, shape,
or form at this time in our history of the United States.
I'm especially interested and concerned about women.
And I know that you know most of this,
but just to make sure we're clear about it,
Social Security provides a critical income source
for women.
They receive benefits both as workers and as the spouses or
widows of workers.
And those benefits are incredibly important to them
because there are still women who do not qualify for their
own worker benefits.
You have to have worked essentially ten years,
and I have friends that haven't qualified for that.
I'm telling them, look, go get a job, anywhere, Wal-Mart,
I don't care, just get your ten years.
And they're not doing it.
So it's about 13 percent of women who do not qualify now
for their own worker benefits.
And some women, even though who work -- most women who work do
not earn as much as men.
The average today is 75% if you work full-time year round.
Most women do not work full-time year round.
They work fewer hours, they take years off.
We did a study that showed that over a 15 year period,
almost a third of women had taken at least four years off
during that 15 year period compared to only 4% of men.
So that's quite a disparity.
And of course, it's because women do the care giving.
And the spousal benefits, the widow's benefits,
the survivor benefits, of course they're equally available to men
but men do not take advantage of them.
Why don't men take advantage of them?
Well, because they earn more than their wives and they don't
take as much time off.
So they're always going to do better under their own worker
benefit than they will under their wife's benefit.
So when you add it all up, the 56 -- 7 million adults who are
getting Social Security benefits,
51% of the women get a family benefit.
They're taking advantage of that spousal or survivor benefit,
more than half of women.
51% of women, when you look at women of all ages,
and only 1.3% of men.
Now, there would be a way to fix this situation.
We could have completely equal pay between men and women,
and we could have men and women taking off equal amounts of time
to stay home with children or care for parents, or whatever.
But that's not the situation we have.
If men and women were completely equal,
then they would be equally availing themselves of these
spousal benefits of it might still be that families would
choose to have one person specialize in home and another
person specialize in work, but it wouldn't always be the woman
who specializes at home.
And because it is, these benefits are incredibly
important to women.
And yet, I always here that it's the spousal benefits that are
easy to get rid of.
That's a good way to save money, let's just get rid of them and
let's not substitute anything else.
So I just wanted to point out exactly how many women it is.
These figures are from the Social Security Administration
Annual Statistical Supplement.
Exactly how many women it is that are dependent on these
benefits, if we look just at retired worker benefits --
Erskine Bowles: Can you try to wrap up please, ma'am?
Heidi Hartman: Oh, okay. All right. So then let me turn to one thing.
Over time, women have become less dependent on spousal
benefits and family benefits by about 4%.
It used to be 38% who took benefits as workers only.
Now it's 44%.
So that is changing.
But because of this dependence, I think it's just absolutely
critical that we not think about cutting these benefits.
And I do want to just let you know,
as an officer of the National Council of Women's
Organizations, that most of the women's groups are opposed to
any cuts in benefits.
And we would argue that, essentially if you're looking
at Social Security as a way to solve the deficit problem,
the National Commission is basically barking up
the wrong tree.
As we heard today in Doug Elmendorf's presentation,
Social Security is a very small part of even the long run budget
deficit, and it's certainly not any part of the budget
deficit right now.
And it never has contributed to the national debt.
Thank you very much.
Erskine Bowles: Thank you ma'am.