Cuts have become a favorite congressional pastime in Washington. Even while the budget deficit continues to shrink, there are those who want to slash more and more. For some reason, however, corporations making record profits are not being targeted. Instead, it is America’s retirement safety net.
U.S. workers have done their part, contributing to Social Security and helping their employers weather difficult economic times by accepting lower wages and reduced benefits. Now that companies have emerged from the storm stronger than ever, though, hard-working Americans are still being expected to give more.
How is it that at a time when big business is only paying a tenth of the taxes it did in the 1950s that regular people are expected to foot the bill in times of economic crisis? The corporate tax rate has been slashed in half during the last 10 years alone. Yet today, some on Capitol Hill and in statehouses are targeting workers to carry even more of the burden. Why should those who make the least be expected to do so? It just doesn’t make sense.
For example, workers’ pensions in California, Illinois and Michigan are in danger because state governments are not fully funding their portion of pensions because they are doling out so many corporate tax benefits. The nation’s 155 largest companies only paid 1.8 percent of their total income in state taxes in 2011 and 2012, even though the average rate was 6.56 percent. The result is a shortfall of as much as $60 billion in state revenues. Detroit’s bankruptcy was not caused because of its pension system. Instead, it is trade deals like NAFTA that gutted their tax base combined with sweetheart tax deals and bad debt schemes that are bleeding them dry.
What does it mean for working people? Well in Detroit, the average municipal retiree set to collect a whole $19,000 a year could lose out as part of the city’s bankruptcy while the city continues to dole out $6.6 billion a year in corporate subsidies and pays $283 million to build a new professional hockey arena.
Thankfully, not everyone in power is buying into such public policy fiascos. Sen. Elizabeth Warren (D-Mass.) is sponsoring legislation that would actually expand Social Security. That said, she realizes it is not the full solution to America’s retirement woes.
“Social Security isn’t the answer to all of our retirement problems,” the lawmaker wrote in a recent AlterNet piece. “We need to find ways to tackle the financial squeeze that is crushing our families. We need to help families start saving again. We need to make sure that more workers have access to better pensions.”
She added, “The absolute last thing we should do … is allow [Social Security] to begin to be dismantled inch by inch.”
Our elected officials face a crisis of conscience. Do they remain on the path of least resistance and continue to coddle the corporate class and their billionaire benefactors? Or do they stand up against big business and for their constituents to help ensure that workers can have a financially secure future?
The statistics show the powerful have plenty. It’s time to stick up for regular people.