Spring has come to recession-era America, which means that all across the nation, millions of old people are emerging from hibernation and hobbling out to their mailboxes in search of their long-awaited Social Security stimulus checks. The first round of payments provided by the American Recovery and Reinvestment Act has just been mailed out. So while the big banks may be raking in their trillions, U.S. elders--along with recipients of SSI and veterans’ benefits--will soon have a whopping $250 to protect them from the ravages of the economic meltdown.
And it looks like we’d better make it last, since it’s the only increase we’re likely to see for a long, long time. For the first time in more than 30 years, according to forecasts by the Congressional Budget Office, there will be no cost-of-living adjustment (COLA) to Social Security next year. In fact, because of low inflation, there probably won't be a COLA before 2013.
And it might not stop there, since the straw man of Social Security “reform” is yet again raising his scruffy head. The phony crusade to “save” Social Security from bankrupting the country and destroying the lives of our grandchildren has gained new traction during the recession. This manufactured crisis is already being used by conservatives (apparently with some cooperation from the Democrats) in a quest to cut old age entitlements--in effect taking money away from elders to pay for the Wall Street bailout.
A report released by the Trustees for Social Security and Medicare will surely add fuel to this manmade fire. The report projects that the Social Security system will remain solvent for "only" 28 years--downgraded from 32 years in the previous report--due to a reduction in payments into the system's trust fund as a result of the recession’s job losses.
This means that in terms of solvency, the giant government program is still running 28 years ahead of Citibank, Bank of America, and the other behemoth private financial institutions run by the high-paid geniuses of Wall Street (and much longer, if you count the years when the bubble was expanding). In addition, the Social Security trust fund is still in better shape than it was a decade ago, according to the Center for Budget and Policy Priorities.
None of this, of course, will stop proponents of entitlement cuts from brandishing the new trustees' report as a weapon. Within hours of the report’s release, a new post on the Cato Institute’s blog was warning that it “shows that the program’s financial crisis is growing worse while Congress has continued to duck the issue.” As for the proposed solution--even the financial meltdown that has decimated all of our 401(k)s is not enough to avert Cato from its true agenda: