Deck the halls, this holiday season, with scenes of hunger.
A new report neatly exposes the monumental hypocrisy of America’s most politically active corporate leaders.
Struggling families all across America now have less food on their tables. Budget cuts that kicked into effect November 1
have lowered the nation’s average federal food stamp benefit to less than $1.40 per person per meal.
Austerity American-style is squeezing elsewhere as well. Seventy
percent of local agencies that service seniors have had to cut back on
Meals on Wheels deliveries. The “sequestration” federal budget cuts that
began this past March
have also shut out 57,000 preschoolers from Head Start.
More cuts are looming, as lawmakers on Capitol Hill near still
another budget deliberation deadline, this one midway through December.
The next federal program in the cross-hairs? Maybe the biggest of them
all: Social Security.
Average Americans, of course,
don’t want Social Security cut. Over three-quarters of Americans, polling
shows, oppose any Social Security cutbacks.
If anything, average Americans have become even more committed to
keeping Social Security whole — and for good reason. Social Security
currently stands as America’s only retirement bedrock.
Not too long ago, pensions also used to deliver real retirement security. But the nation’s biggest corporations have
cut back
on traditional pensions. In 1980, 89 percent of Fortune 100 companies
guaranteed workers a “defined benefit” at retirement. By last year, only
12 percent offered that level of security.
Companies
have replaced
traditional pensions with 401(k)s, and many giant firms — like Walmart —
don’t even offer a guaranteed match on employee 401(k) contributions.
The predictable result? Among Americans between 50 and 64, the bottom 75
percent by wealth
average just $26,395 in retirement assets.
Overall, says Boston College’s Center for Retirement Research, the
nation’s “retirement deficit” — the difference between what Americans
have saved up for retirement and what they need to maintain their
standard of living once retired —
now totals $6.6 trillion.
The most relentless pushing for cutting Social Security has been coming from the nation’s “corporate statesmen.”
So, amid all this retirement insecurity, who actually thinks that
cutting Social Security would be a good idea? The most relentless
pushing for cutting Social Security has been coming from the nation’s
“corporate statesmen.”
These corporate leaders — the nearly 200 CEOs who run the influential
Business Roundtable and the over 135 chief execs who bankroll the
two-year-old lobby group known as “Fix the Debt” — seldom ever mention
“Social Security benefits” and “cuts” in the same sentence. They speak
instead in euphemisms. The nation, they intone, cannot afford the
current level of “entitlement” spending.
In the name of “saving” Social Security for future generations, these
CEOs are urging Congress to enact “reforms” that range from lowering
the annual Social Security inflation adjustment to upping the Social
Security retirement age to 70.
These two changes,
point out Sarah
Anderson of the Institute for Policy Studies and Scott Klinger of the
Center for Effective Government, would slice the average Social Security
beneficiary’s lifetime benefits by about 20 percent.
That prospect, Anderson and Klinger note in a new report released
last week, does not terrify America’s CEOs in the least. These CEOs
don’t need Social Security. They already have their retirement security.
In fact, these CEOs are sitting on what figures to be the biggest
retirement bonanza in modern human history. The CEOs of the Business
Roundtable are holding an average $14.6 million in their corporate
retirement accounts, enough to pay out a $86,043 monthly benefit once
they retire.
Some CEOs will be pocketing even far larger pensions than that. David
Cote, a key mover and shaker in both the Business Roundtable and Fix
the Debt, is holding $134.5 million in his Honeywell retirement account.
That tidy sum will gild Cote’s retirement at an incredible estimated
rate of $795,134 a month!
The typical American worker within 10 years of retirement, by
contrast, now has only enough in saved-up personal retirement assets to
generate a monthly retirement payout of just $71. If Social Security
benefits shrink, notes the Center of Budget and Policy Priorities,
millions of older Americans will slide into poverty.
CEOs like David Cote may not need Social Security. But why are these
CEOs driving so hard to cut Social Security for people who do?
Several reasons may play here. The corporations these CEOs run don’t
pay much in the way of corporate taxes today. They want to pay even less
— and the less the federal government spends on Social Security and
other “entitlements” like Medicare, the less pressure on lawmakers to
seriously tax corporate income.
CEOs also have a personal tax-time reason to want to see Social
Security cut. Americans this year pay Social Security payroll tax on
only the first $113,700 of paycheck income. This tax ceiling rises each
year with inflation.
But if we eliminated the ceiling entirely — and taxed CEO paychecks
at the same rate as the paychecks of average workers — 95 percent of the
expected Social Security budget shortfall over the next 75 years would
disappear.
America’s CEOs don’t particularly care for this approach to fixing
Social Security’s fiscal future. They’d much rather just cut Social
Security benefits.
The American public clearly disagrees. Americans —
by a 66-29 percent margin — last November told pollsters they favor eliminating the ceiling on income subject to Social Security tax.
America’s CEOs have pumped tens of millions into lobbying efforts to
quash ideas like this elimination of the Social Security tax ceiling,
note Sarah Anderson and Scott Klinger in their new
Platinum-Plated Pensions report. These CEOs are preaching “shared sacrifice” instead.
We all must swallow hard, their pitch goes, and accept less from
Social Security. Will these CEOs be able to get this pitch past
Congress?
Platinum-Plated Pensions will certainly complicate their
effort.
After all, as Anderson asked last week, how can CEOs who hold
“retirement fortunes larger than the operating budgets of most mid-size
American cities” ever expect anyone to take them seriously when they
start lecturing the rest of us about “shared sacrifice”?
© 2013 Inequality.org
Sam Pizzigati edits
Too Much, the
Institute for Policy Study's online weekly newsletter on excess and inequality.
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