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AFL-CIO wants Congress to say no to cuts to Medicare, Medicaid

CHARLESTON, W.Va. -- National and state leaders of the American Federation of Labor and Congress of Industrial Organizations want Congress to let the George W. Bush tax cuts for the top 2 percent of all Americans expire. Labor leaders also want Congress to "say no to benefit cuts to Medicare, Medicaid and Social Security."

The annual financial benefits coming into West Virginia from each of these programs include: $5.7 billion from Social Security, $3.5 billion from Medicare and $2.4 billion from Medicaid.

The AFL-CIO released a new state-by-state study last week, detailing how many Americans would be impacted if Congress cuts benefits in these programs.

Information nationally, and for all 50 states, can be found at: www.aflcio.org/StateFactSheets.

Nationally, 55.4 million people receive $725 billion a year from Social Security benefits, while 48.7 million receive $541 billion for health coverage from Medicare and 64.4 million receive $355 billion for health coverage from Medicaid. 

These benefits provide a "critical lifeline" for West Virginians today:

  • 443,911 West Virginians receive monthly Social Security checks, including 93,663 workers with disabilities and 41,030 children.
  • 373,450 get health-care coverage from Medicare.
  • 416,858 get health-care coverage from Medicaid, including 199,023 children and 41,741 senior citizens.
  • Increasing the eligibility age from 65 to 67 for Medicare would "substantially increase total health-care costs, with the burden falling on individuals, employers and state governments," the AFL-CIO study states.

    Those extra costs would be twice the net savings the Medicare age increase would give the federal government, according to an August 2011 study by Paul N. Van de Water published by the National Center on Budget and Policy Priorities, based in Washington.

    The AFL-CIO study also criticizes the impacts the Bowles-Simpson plan, supported by many members of Congress, would have on Social Security benefits.

    The proposed changes would cut the cost-of-living adjustment by 0.3 percent a year for all current and future Social Security beneficiaries. By the time retired workers reach 80, those cuts would amount to 5.1 percent of benefits received today, a loss of $852 a year.

    The changes would reduce benefits for "medium earners" by more than $2,875 a year, when Bowles-Simpson is completely phased in.

    "Social Security has never added a penny to the deficit and should not be part of any deficit reduction negotiations," the AFL-CIO study points out.

    The AFL-CIO also supports "scrapping the cap."

    The cap exempts Americans from paying any Social Security taxes on annual earned income over $110,100 in 2012. The AFL-CIO wants all earnings to become subject to Social Security payroll taxes.

    "High earners should contribute the same percentage of their income to Social Security as everyone else," the study states.

    Richard Trumka, president of the national AFL-CIO, said, "Working people, jobless people and retirees, who just voted for a middle-class economy [in last month's presidential election], shouldn't have to sacrifice their health care and retirement security so that the richest 2 percent can continue getting more tax breaks.

    "It's time to protect Social Security, Medicare and Medicaid benefits that support our working families. It's time to eliminate tax breaks for the richest 2 percent. That's fair, reasonable, and good public policy."

    Two weeks ago, the Economic Policy Institute released a statement, signed by more than 300 economists and social insurance experts, opposing efforts to reduce annual cost-of-living adjustments that increase Social Security benefits.

    Based in Washington, EPI is a nonprofit, nonpartisan think tank created in 1986 to broaden economic policy discussions to include the needs of low- and middle-income workers.

    The oldest beneficiaries, who are often the poorest beneficiaries, and people who receive disability benefits for more than 20 years would see the largest cuts.

    The EPI argues statistical analyses based on spending patterns by the general population, which are used to calculate COLAs, are likely to "understate the impact of cost increases faced by Social Security beneficiaries, because seniors and disabled people spend a greater share of their incomes on out-of-pocket medical expenses than do other consumers."

    In recent decades, health costs have risen dramatically faster than overall inflation, the EPI adds.

    Reforms advocated by the AFL-CIO study include reining in the costs of health-care growth, making the health-care system itself more cost-effective, promoting the rights of workers to bargain collectively for wages and benefits and moving manufacturing plants back to America.

    Reach Paul J. Nyden at pjnyden@wvgazette.com or 304-348-5164.


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