Saturday, October 27, 2012

Unemployment Crisis (Solution) - Post #2, A New National Lifestyle

This is the second installment of a 20 page article written about a new and low cost way to solve our unemployment crisis.  First, please read the Oct. 21, 2012 post "Our Unemployment Crisis (Solution):  Work, has its Nature Changed Permanently?"  Then read the Oct. 26, 2012 post "Unemployment Crisis (Solution) - Post #1, A New National Lifestyle," next.  Finally read this post and hopefully the future ones I will be putting here about twice a week.  This installment outlines various desirable changes in lifestyle which could be introduced more easily if this idea were implemented.


NEEDED – A NEW SET OF ATTITUDES & BEHAVIOR

     Human beings basically appreciate order and are resistant to change. However, if a need to change a living pattern can be amply demonstrated, and the social leaders encourage that change, people will try rather radical new ways and ideas with a minimum of protest. We have only to look at the sudden [recent] change in the China situation, or our new fuel conservation practices to appreciate the persuasive power of leaders and the media. [Some things persuade by their very nature. Consider the massive acceptance worldwide of the digital revolution and cell phones.]
     Therefore, this plan proposes that the American people be encouraged to institute the following changes in their thinking and behavior.
     1. Wasteful consumerism should be deglamorized as a way of life—we are fast running out of the resources to support it. [Food scarcity is increasing, water supplies are failing, fish resources are decreasing, timber and other resources are being mined, and world populating is still growing at an unsustainable rate.]
     Aside from the psychological pressure to buy, buy, buy, caused by current advertising practices, the high cost of repair services and lack of “free” time prevent many people from recycling and repairing their still useful possessions.
     Considering current knowledge regarding agribusiness practices and food processing, not to mention prices, more and more people desire to grow and prepare their own food but are short of time and energy. A change in this area could result in significant energy savings for transportation and over-processing.
     Keeping up with the Joneses is a significant motivator, and Robert Townsend who wrote Up the Organization (1970) has some good points to make on the subject of executive salaries and off-the-job status competition. He feels that $35,000 [CPI adjusted for 2012, $207,000.  All subsequent wages are CPI adjusted to 2012.] is a desirable ceiling for executive wages, and that only outstanding performance or creativity should entitle them to more in the form of a bonus. If off-job status competition is eliminated, and the expenses in terms of conspicuous consumption removed, $35,000 to $40,000 [2012, $207,000 to $237,000] is enough to provide a very comfortable and efficient living standard for our busiest executives.
     If it were fashionable and practical in terms of maintenance, people would be perfectly happy with a new car every five years instead of a new one every other year. The public [and the government] is finally convincing Detroit that it would rather [be better to] have smaller cars as well.
     2. We should be encouraged to increase our consumption of services and reduce our consumption of goods, thereby maintaining acceptable employment levels but reducing the use of non-renewable natural resources. A pubic policy expanding the availability of leisure time and encouraging creative and constructive uses of that time could have this effect.
     The availability of larger blocks of free time could greatly expand the recreation sector of our economy. Moderately affluent families (especially the many who have achieved that status through the full-time work of both husband and wife) could spend much more time and money on vacations, recreation, projects [and social service volunteer activities]. This in turn would create more employment in resort and rural areas.
     No longer would our prime recreation sites be deluged on Labor Day and deserted the following week. The summer vacation season could run closer to five months than to the current 10 weeks, thus bringing greater prosperity to the coastal resort cities and poverty stricken areas of great natural beauty
like Appalachia. Many other leisure activities such as music, drama, and art could grow in importance at little cost to our natural resources. [Much more time could be available for worthwhile activities like mentoring, community service, parkland cleanup, and school repairs and painting.]
     3. The [cultural norm] that education should occupy one block of a person's life, work occupy the next, and leisure the last should be eliminated. [In adulthood, the ability to take periods of time off to study, retrain, conduct personal projects, or enjoy recreation should have a valuable effect on improving the general health and reducing ["Obamacare,"] Medicare and related expenses.]
     The world and technology are changing so fast that education must become a lifetime process. Adolescents should have a chance to work part-time, youths should not be forced to choose a life-time career before they know anything about life, middle-aged people should not be forced to keep their noses to the grindstone or cooped up in the house with the kids [or dependent parents], and the elderly should not have to sit idly on hands that are experienced and still capable.
     Some social and technology experts have suggested that in the future most people will work at three distinct careers in their lifetime. Under this proposed system people could easily train for a moderately demanding and reasonably well-paid job which would allow them to begin their families and establish a decent home. At a later time, perhaps in their thirties, they could upgrade their skills or embark on a new, more demanding career—i.e., medicine, law, etc. Finally as conventional retirement age approached (the fifties) they could reduce their level of work in their regular occupation and take up and develop expertise in a new, less demanding form of work that would keep them busy, happy, [and contributing to the economy] well past our current retirement time. [This is not meant to suggest that the current Social Security age requirements should be raised, but rather to suggest that older people working part time would still be contributing to the national economy. Many do not realize that above a certain income people have to pay taxes on any Social Security paid.]
     4. The idea that a person (particularly a man) doesn't “have it” if he hasn't started up the career ladder by age 30, and is “over the hill” by age 35 must be eliminated. [This will have to be reexamined in today's context.]
     The proper rearing of young children should be a major concern of parents of both sexes in their 20s and 30s. After the children have left the nest is the time to bury oneself in one's career. If young men didn't have to worry about getting their foot in the door and more older women were in the higher positions of responsibility, young men could be better fathers and their wives would be able to improve their own potential as human beings through work, education, [and creativity].
     5. The boredom and frustration of assembly line work should be alleviated by encouraging factory workers to learn other skills and by enabling them to work part-time without loosing seniority and job security.
     The same could also be said for routine forms of skilled labor and technical or clerical work. It would give the workers the money, security and time to pursue important personal projects and [achieve] life goals.

The next installment will outline the plan itself and suggest who might find it most desirable and where it might first be tested experimentally.

Friday, October 26, 2012

Unemployment Crisis (Solution) - Post #1, A New National Lifestyle

By G. Lee Aikin, July 2012

This post is the first installment of a 20 page article.  After posting all the installments it will be made available as a complete document.  Meanwhile, FIRST please read my Oct. 21, 2012 post "Our Unemployment Crisis (Solution): Work, has its Nature Changed Permanently?" for background.

I have seen that people from many parts of the world appear to have been reading these installments.  Places like Poland, Russia, Latvia, Indonesia, China, etc.  I would be very grateful if you would leave some comments regarding your impressions and if you think this might work in your country, or if you plan to do something political with the idea.

                                     CONTENTS
Introduction
1. Economic and Social Indications and Problems
2. Needed -- A New Set of Attitudes and Behavior
3. A National Quarter System Could be the Answer                                        
4. Sample Lifestyles Under a National Quarter System                            
         A Young Suburban Family                                                                  
         An Inner City Family                                                                            
         A Government Worker Approaches Retirement           
         An Urban Wage Earner Escapes the City                                                 
5. Advantages to Businesses                                                                         
6. Labor/Management Cooperation                                                              
         Sample Labor Contract Language                                                      
7. An Improved National Economic Indicator (RNP) is Needed             
         Collecting the Data                                                                               
         Social Utility of the RNP                                                                    

This idea was first written and developed after the oil crisis of the early 1970s.  Some dollar figures may be from that period. A few items were updated for later crisis periods. On rereading, I was amazed at how little had changed in terms of basic problems in almost 40 years. Brackets [ ] are used where new information is needed or updated for 2012. This is a semi-final draft, your thoughts and input will be much appreciated. After posting all the installments I will make this available as a single document.     Lee Aikin, gleeaikin@yahoo.com

     Things Fall Apart is a Nigerian writer's book about the effect on his people of the change from tribal to modern life. Many would agree that a book “Things Fall Apart” could just as well be written about what is happening in this country and economy today.
     Not since the beginning of the Great Depression almost 50 [90] years ago has there been such an upheaval in our peacetime economic and social life. Certainly the Civil Rights Movement and Youth Revolt of the sixties affected many people. Yet there were numerous pockets of normalcy where people tisk-tisked over their TV sets [PCs], but were otherwise unaffected.
     Now no one is immune. Whether it is the housewife at the meat counter, her husband at the gas pump, [or the family facing foreclosure or unemployment] everyone knows there is a [worldwide] crisis brewing.
     The gloomy predictions of rising [or continuing] unemployment and [high] food prices, gas and fuel costs, and possible world-wide depression are, of course, the culmination of years of poor [or nonexistent] planning and ostrich-like behavior [not to mention downright criminality by corporate and financial elites]. Many of these signs and symptoms have received public attention in the past and that continues to this day.
    Temporary improvements in international politics [and national policies] can bring about improvements in the short-range picture, but the long-range economic picture is most definitely on a down-hill grade.

ECONOMIC AND SOCIAL INDICATIONS AND PROBLEMS

     1. We are running out of resources. More and more we have to import raw materials. The winter of '72-'73 saw fuel and power crises in numerous areas of the country; only our mild winter kept them from being more serious. This year, of course, the problem finally became startlingly apparent to even the most short sighted. Meteorologists suspect that warm winters will soon be a thing of the past. [I will need to develop paragraphs on greening the energy picture and the climate change issue, also the impact of fracking on gas and oil recovery.]
     2. We have a continuous unemployment problem which only appears to be alleviated when large numbers of our young men [and women] are in the army. [and even that is not working any more and will get worse as we downsize the military] All predictions are for considerably higher rates of unemployment in the near future. [No one could have predicted the dot.com bubble, the McMansion/housing bubble (perhaps fueled in places like Florida and Las Vegas with money laundering activity) or the outrageous unregulated behavior of the major world financial institutions, and how they temporarily increased economic activity and employment.]
     There are predictions for considerably higher rates of unemployment in the near future [as is now seen in Europe and the Middle East] [Well those chickens have come home to roost now, and we will not have any housing boom to bail out this situation any time soon. Of course we also have a change in expectations. Years ago 6% was considered a reasonable unemployment level, but now people are looking for under 5%. This is probably unlikely without a significant change in the way we conduct our economic life.]
      3. Pollution has become a major problem. Every day we consume more, waste more and throw out more. Until recently wasteful consumption has been promoted as a virtue—at last we are discovering that it is a foolish, intolerable vice. [Famously , or infamously, President Bushes response to what people could do to help us recover from 9/11 was “shop.” We even have a The Worlds Longest Yard Sale, 700 mile from Michigan to Alabama, and others of 250 and 70 miles. I think that people are discovering we have too much STUFF and are sensibly trading it around. Of course, this does nothing for manufacturing, but it is good for the environment, and our garages.]
     4. Although agriculture is finally coming into its own as a major economic strong point for our country, the migration to urban areas continues as more and more small and medium-sized farmers are forced off the land. This in turn is having the effect of converting our agricultural practices from soil conserving to soil mining, as well as forcing small units out of production completely. [The “locovore” movement is a welcome counter to these trends, but corn ethanol and genetically modified crops have significant impacts on the food situation that need to be altered.]
     5. Youth alienation, [unemployment] dropping out of school and establishment life, juvenile delinquency, etc. are rampant. Although youth may have been the first to sense that something was deeply wrong with our way of life, everyone else is finally reaching similar conclusions. [The computer driven social media revolution has accelerated this move and has even become worldwide as seen with The Arab Spring. Youth unemployment is much higher than for older people and is creating worldwide instability.]
     6. While B.A.'s in liberal arts are a glut on the market, good laboratory [and computer] technicians and auto mechanics are hard to find. Our school systems are obviously failing in the area of technical education and economic adaptability. [A sensible idea has been suggested that the vocational education track should include small business management classes.]
     7. In former times youth was needed for productive work at the age of physical maturity. Our present system of child (read adolescent) labor laws and continuous schooling to the age of 18, or to the age of 22 or more for white collar and professional work, is against nature and our youth is rebelling [I saw that many in the Occupy movement were young and unemployed.]
     8. The increasing number of elderly and ill persons is creating vast problems of wasted human potential and excess institutional facilities. [Much needs to be done in developing creative solutions to these issues, and this plan should make a useful impact.]
     9. Homes are breaking up, children [and women] are beaten and abused and women kill themselves and their offspring at a shocking rate in this country. [A 2004 study by the Center for a New American Dream indicated that nearly half the Americans surveyed are willing to accept a smaller paycheck to have more time with their families and for leisure activities.]
     10. A few years ago at the meetings of the White House Conference on Children and Youth, it was found that delinquent behavior among the children of businessmen and executives had become a major problem. [This is probably not a problem that has been improved by the astounding growth in the ratio of top CEO and other upper management wages compared with that of their low level employees. While 30 or 40 years ago this ratio was about 40 to1, by the time the economy was tanking in 2007 these ratios ranged from 400 to 1 up to 1,000 to 1. Although these ratios have diminished measurably, they still are far from the level that seemed quite comfortable for the upper class 40 years ago. The Occupy movement has it right. We are the 99%, and the 1% has still run off with most of the marbles. The argument of some politicians against restoring the Bush tax cuts at the top by 4.5% is symptomatic. McCain had it right, GREED, GREED, GREED.  Or is it a guilty fear of the future.  Candidate Romney has even suggested removing ALL taxes on dividends and interest.  I guess paying taxes at the 14% level is too much for him.  He would rather pay 4%.]
     Despite these many indications of fundamental ills, those attacks which have been made on the problems have only occurred on a piecemeal basis. In essence, we have been applying band-aids to bomb victims. [We have been operating on the assumption that material wealth is all important. We need to consider that perhaps non-material items like time, entertainment, leisure and creative activities, and friendships can substitute very nicely for some aspects of material wealth. Thus we could maintain a high level of national well-being at a lower costs in nonrenewable resources.  My Sept 4, 2012 post "Are You Better Off Today vs. 4 Years Ago: 'Better' Defined," hints at this concept.]
     The only comprehensive approaches to change have come from extreme leftists and militants [and tea party conservatives], but their suggestions would disrupt the status quo of too many citizens and hold the threat of far too much chaos to be acceptable. Nevertheless, by now there can be little doubt in anyone's mind that fundamental and broadly based changes are needed in the way we conduct our economic life. [The concerns of the Occupy movement seem more centered on the great disparity in wealth, but changing that would only fix part of the overall problem.]

In the 2nd installment I will look at attitude and behavioral changes that can improve our economic life and happiness, and in some cases our environment.]


Sunday, October 21, 2012

Unemployment Crisis, Worldwide (Solution): Work, has its Nature Changed Permanently?

Does our current employment emergency represent a world wide, permanent systemic shift?

In the 4 years since this article and the 5 installments have been posted, I have had a number of visitors from countries like Germany, Russia, Latvia, Poland, France, Ukraine, Great Britain, Sweden and China.  I would very much appreciate receiving comments from people who are trying to interest governments or businesses in trying the idea, and their experiences.

During the bitter 2112 US election cycle much was made of the failure of President Obama or his administration to move unemployment below 6% over the preceding  4 years.  In the beginning of his Presidency, no one really knew how severe the overall economic situation had become.  For the first 4 months after inauguration jobs continued to disappear at a rate approximating 800,000 per month.  Large sums of money were approved to promoted economic and hiring activity, but much of that money is still sitting in storage with banks and corporations.  Why on earth is that true??

I propose that there has been a marked and probably permanent change in the employment dynamic for the developed world.  This explains why both we and Europe, and even some areas in Asia, are in or facing an economic crisis.  At least in the US, the rapid escalation of top wages relative to workers and the middle class means less money in the hands of the people who are likely to use most of their income to buy the kinds of goods and services that support production and service businesses.  For banks to sit on the funds made available during the emergency has only worsened the situation.  The worldwide information and automation revolution is also making its impact.  Here is my theory and explanation, plus a unique, far reaching, but simple plan to quickly lower unemployment. 

Over the past few centuries patterns of labor and employment have undergone profound changes. In the 1700s the Western world was predominantly agricultural. People mostly worked small tracts of land, at times for long hard hours, but also with seasonal slow periods. Women as producers of thread, cloth, clothing, bread and other foods often worked more continually than their menfolk.  For example, in England many people raised sheep and their womenfolk spun yarn for the fabric industry, until machinery and cotton production changed that dynamic.

As the industrial revolution advanced, more and more people, including children, were pulled into the grinding labor and long hours of textile mills, coal mines, steel mills and other large manufacturing enterprises. Slavery in our South and elsewhere flourished with the invention of the cotton gin and the manufacture of sugar.  Conditions in the North and in Europe for "free" workers were often almost as bad, with fewer beatings but even less food and housing security.  Luddites even revolted, at times violently, against the machine.

Eventually people organized and rebelled successfully.  Also, some legislators were struck by the damage of long hours to both children and adults and instituted labor reforms. Whether by the slave revolt in Haiti or the labor strikes and union formation in our own country and Europe, working hours were gradually reduced. From 6 days and 10 to 16 hours per day, to our current standard of 35 to 40 hour weeks has been a long fought struggle.

Now many are in a severe unemployment crisis. There are those who say we just have to consume more and make more. But, we all seem to have so much STUFF, a lot of it from China, that many are coming to realize they really don't want or need more STUFF.  In fact, there are several monster yard sales like the 700 mile yard sale for 4 days in early August each year so people can get rid of their STUFF.  With so much efficient, low-cost production throughout the poorer countries, where will "first world" reemployment come from? There has also been a shift in the kinds of workers needed, with new kinds of training and education needed as outdated kinds of work are lost.  Even for manufacturing jobs returning to the US, greater efficiency will reduce relative need for workers.  In the US our schools have fallen behind in teaching for the new economy.

I believe that we have reached a new period in the history of production and labor. In Europe the average amount of time for paid vacations is mostly much higher than in the US--France-38 days, Sweden-32 days, Italy 31 days, Denmark-30 days, Germany-27, Britain-26. In the USA the average is 13 days. Even Japan provides 15 days, and Canada 19. Has the efficiency of world production increased so much in recent years that the 35-40 hour, 49-50 week work year can no longer provide full employment in developed countries?  That would certainly appear to be the case in some European countries with unemployment above 20%. 

While there is tremendous long-term employment potential for renewing aging infrastructure, producing renewable energy sources, developing the new oil shale fields like the Bakkan, caring for the elderly, etc., this will not be a quick fix. Nor will people necessarily be willing or able to run up the municipal or national debt needed to finance some of this employment. There is also resistance to running the risks of rapid oil development without adequate safeguards.  Thus it seems we need solutions that can be implemented quickly, and at the same time reduce unemployment and increase a sense of job security.  Insecure people do not spend much money on non-essentials, nor take time out to learn new, more marketable skills.

Some states, municipalities and businesses have tried to avoid firings and layoffs by requiring all employees to NOT work a few days each month. That is helpful but not a very efficient way to save some jobs and money. However, it would be far better for employees to have longer prescheduled periods when they could make productive use of their enforced time off. Then they could plan things like career education, home renovation, large gardens, or short-term seasonal specialty work.

School systems have already learned to deal with the summer unemployment of most of their teachers. The individual teachers usually know if they will return to their job after the summer break. In some systems teachers can choose to be paid 1/10th of their salary for each of the 10 months they work, or 1/12th of their salary monthly over the entire 12 month year, even when they are off for the summer months.

If governments or businesses need to cut back on employment because of lack of revenue or reduced sales, they should consider the model developed by schools and teachers. They should determine if they have slower periods when their employees could take one or more months off without disrupting employer needs.  Then workers could be paid full salary while actually working, or an equivalent fractional salary for all 12 months of the year.  [Managers dealing with the US Sequester might consider this as a voluntary option rather than across the board unpaid leave for everyone.]

Plans could be made well in advance for those who would want pay for all 12 months while working fewer months. The reduced monthly payments would begin immediately while the money not paid would be put in escrow for payment during the months not worked. While it might be nice if we could have longer guaranteed vacations as in Europe, under current low employment conditions in the US, many would probably just be happy to have a secure if slightly smaller paycheck.  Other developed countries might find this type of system useful as well.

This kind of program could be implemented anywhere and at any time by a government or business that wants to save money while at the same time providing security and stability for their employees, and retain their trained workforce at times when short-term lay-offs may be unavoidable. However, if we are truly entering into a historic new phase in employment needs, then a more structured and widespread system of employment practices may be needed.

I have been observing the growth and development of employment problems since the 1970's, and researched and written a more broadly based, voluntary system for dealing with our overall changing employment needs. Temporary booms like the dot com and housing bubbles can provide an increase in employment for a few years, but they don't last. After considering a number of contemporary problems, I believe that significant positive changes could result from implementing a more balanced pattern for employment, education, and personal projects in what I call A New National Lifestyle.
------------------
I am in the process of polishing this comprehensive plan for our current conditions. This concept is entirely new, but I hope you will be interested and willing to read all the installments.  The five installments have been posted on Oct. 26, 27, Nov. 2, 4, and 5, 2012 There is a box in the upper left side of the post where you can enter your email address so you will be informed of all new post or significant updates.  I also hope you will provide useful comments and opinions which I can  use as I modify, update and expand this plan. If you choose to read it, I hope you will keep an open mind and remember that it is voluntary and democratic in implementation, and no more extreme than daylight savings time.  It appears that people in a number of European or other countries have read this.  I would appreciate hearing your opinions and whether this type of plan is being proposed or implemented anywhere.


Saving Social Security, Wage Cap, Marriage Penalty, Failure to Index (2016 figures)

Since President Obama was elected, politicking has been intense over the Fiscal Cliff, tax increases and reducing spending.  The newly elected Republicans have immediately shown their intent to attack SS by moving to reduce money available to SSI for disabled people.  Moreover, now that Trump's corporate giveaway Tax Bill has passed (Dec. 2017) we can soon expect attacks on Medicaid, Medicare and Social Security.  Below is the ammunition to fight to save and improve SS collections and fair payments.

[1/1/17]  Here is the latest information on the 2017 changes in Social Security payments, to you and by you.  The increase in payments was minuscule, while Medicare deductions increased a bit.  My SS this year will be the same as last year as a result.  The amount above which you must pay taxes has been raised, but the amount of pay above which you must have SS deducted has also increased.

[12/1/16]  With the election of Donald Trump, and with anti SS Paul Ryan in the House of Representatives we will need to follow their current activities.  See near bottom of this post for new details.

It is feared that our President might be persuaded to negotiate harmful changes to SS to appease Republicans in the House of Representatives.  One move to prevent bad changes has been the introduction of the Strengthening SS Act of 2013 (S. 567) by Senator Tom Harkin.  This bill would add income to correct for the increased costs for health care experienced by the elderly by implementing the CPI-E for the elderly.  Read this link for an explanation of details on S. 567.  [http://www.ncpssm.org/PublicPolicy/LettersTestimony/Documents/ArticleID/1144/Letter-Supporting-Strengthen-Social-Security-Act-of-2013  We hope it will be reintroduced in 2015.

Here is the bill itself which is harder to understand [http://www.govtrack.us/congress/bills/113/s567/text] .  The proposed "chained CPI" is exactly the wrong corrective.  Read below to have real facts when you argue with others and your elected representatives, that reductions are both unnecessary and very unfair.  It appears that chained CPI will be pushed more after the new Tax Bill's approval.

One of the important political topics this year has been "saving Social Security".  Unfortunately, not much useful or specific information has been given out by either major party.  Both parties have assured older voters that they would only make changes for people retiring far in the future.  They seem to think that we retired people don't think or care about our children and grandchildren.  They are WRONG!!  As a retired person with 4 grandchildren, and as a political candidate,point of  I have made apoint of seeking specific fixes that would both "save" and enhance Social Security, as well as covering related tax based issues.

First of all, I strongly oppose raising the retirement age to 70.  Even if your work is a lower energy white collar position, by the time most people reach that age, the normal stresses of daily living, not to mention the stresses of aging make going to work every day more difficult than it was even at age 65.  In addition, some fair formula needs to be developed to enable people engaged in hazardous, unhealthy and debilitating jobs to retire at an earlier age after working in that field a certain number of years.  The types of jobs deserving that kind of consideration include underground mining, physically demanding construction, etc.

Of course we need to find ways to pay for Social Security since more people are retiring and relatively fewer people are coming into the job market to pay for it, not to mention their own future payments.  These facts have been a factor in the Immigration debate. A commonly mentioned target is the "wage cap" (also called tax max).  This figure is a ratio of taxable wages to all covered wages.  This was decided upon in 1983 after observing the effects of certain changes that had been made in 1977.  At that time it was decided that 90% was a fair target figure.  It has been argued that it should not be a higher percentage because there is a figure above which one does not get paid back with Social Security benefits.  In 1983 this was a bipartisan political compromise.

Then, jobs tended to be much more stable.  However, we have now seen many highly paid middle and upper management people loose their nice comfortable jobs and salaries.  Many of these jobs have had salaries seriously cut, been off-shored, or eliminated altogether.  Many of these people have experienced long periods of unemployment, accepted jobs with much lower pay than they ever dreamed would be their lot.  I'll bet many of them now wish more money had been put away for their retirement than happened with a 90% cap.  Even more painful is the fact that over time 90% has dropped as low as 82%.

Apparently the cap has been raised each year according to inflation (around 1 to 3%).  No one anticipated that top earners would have wages jumping 10% to 20% each year as has actually been the case.  Therefore, the caps shown below are much lower than they should be to maintain the 90% wage cap level.  We will be running out of full SS coverage sooner because of failure to maintain the 90% wage cap level.

The cap stands at about $118,500 for 2016, and an increase to $127,200 in 2017.  Money earned above that figure will not have funds deducted for Social Security.  However, due to the increasingly far higher income of top tier earners, the cap has hovered around 85% starting in the mid 1990s, and has drifted even lower to around 82% recently.  Charts I found at www.businessinsider.com show that since 1983 about 6% of employees had earnings above the tax max.  On the other hand, a chart also shows that since 1983, around 23% of individuals have earned more than the tax max for a year or more.  I wonder how many who lost their high paying jobs after the 2008 crash wish they had been paying a full 90% wage cap before 2008.  [There are many interesting articles and charts at this site for those interested in taxes and fairness.]

Therefore, although I was not elected as our "Shadow" Representative to Congress, I will continue to lobby that the cap should be immediately raised back to the 90% level, and then 1% per year added up to the 95% level and perhaps even higher.  This would add quite a number of years to the solvency of Social Security.  I have also given thought to the idea that there be a "floor", below which no SS is deducted from wages, but perhaps this would not work as these small annual deductions are part of what make even low income people eligible for SS benefits.  Although the "Shadow" Rep job is aimed at at lobbying Congress for Statehood, while one is talking with Congressional staff it is also useful to raise this issue which affects every person in DC who receives or hopes to get SS.  For that matter it affects everyone in the country with those expectations.

[Since I was not elected, although I received a respectable 31,000 votes, I now urge you to lobby your representatives, or the Representatives of your friends and outside DC relatives to make this change.  Both Republicans and Democrats agreed in 1983 that the 90% level was reasonable.  Therefore, restoring that level should not be considered a taxing increase (sorry, Mr. Norquist), but the keeping of a promise Republicans were actively involved in.  Don't let President Obama (or now President Trump) be persuaded to mess with SS in ways that hurt SS recipients present or future.]

As I pointed out during my run for At Large City Council this spring (2012), our politicians have frequently forgotten to index their taxes and figures for inflation causing us as taxpayers to have some of the highest income taxes in the country.  [From February to May 2012, I posted 6 articles related to harmful effects of DC tax neglect.  Check them out, they are still active issues in our local elections and you can influence your candidates.  In 2013 I testified twice at Tax Revision Commission hearings regarding this neglect.  I am excited to report that the TRC has recommended our Council "couple" DC's Deductions and Exemptions to the Federal rate.  They estimate this should leave around $85 million in our taxpayers' pockets.       [Urge the Council to approve this, judge your Mayoral and Council election choices including this issue.]
     [In 2014, when the Council Chair decided to take 6 years to phase in this benefit, I decided to run against him.] [Now Trump's Tax Act has eliminated Exemptions and DC's Deduction was made the same as Federal rates for 2018, not 2019 tax years, a 1 year saving for all DCtaxpayers.]

Much like the well publicized Alternative Minimum Tax failure to index for inflation, I have found 2 important failure to index problems in our Social Security benefits.  Before 1983 there was NO tax on Social Security income.  Then, during the Reagan administration, it was decided that retired people with outside income should have to pay taxes on the SS benefits they had earned while working.  What is it with these Republicans and their willingness to tax lower and middle income people including retirees??  I just learned that Clinton increased the level of SS taxation.  If someone had noticed the drop from 90% tax max down to the mid 80's% perhaps he would not have felt the need to do so.

A complex Social Security Benefits Worksheet is provided in the IRS 1040 Instructions booklet to help you see if you owe taxes on the SS benefits you earned.  In 1983 the Worksheet included a $25,000 reduction for a single person, and a $32,000 subtraction for married people.  THOSE FIGURES HAVE NOT BEEN CHANGED FOR 35 YEARS!!  Adjusted for inflation, the 2016 figures should be:  single - $60,875, married - $77,664.  Talk about a "MARRIAGE PENALTY!!"  Many widowed, divorced, single elderly cannot afford to remarry because of this injustice.  Religious fundamentalists should be reminded that it is CRUEL to force people to "live in sin" or loneliness, so the rich can get/stay richer.

A second unfair result of failure to index for inflation is the "one time" SS Lump Sum Death Benefit.  When established in 1954 at $255, it was supposed to pay for a basic funeral.  Now, if inflation adjusted to $2,291 for 2016 , it would just about cover a no frills cremation.  When my mother died in 1996, I was surprised that my father received such a small "death benefit."  When my husband died in 2005 and I received the $255, I just laughed (ironically), used it to pay my electric bill, and pulled together the money to pay for his cremation and memorial service. In 1954 the death benefit was supposed to be 3 times the deceased's monthly payment or a maximum of $255, a figure close to the maximum 3 months SS payment.  As it is, this $255 is like a bad joke when we are trying to pick up the pieces of the deceased's life--funeral or cremation, medical bills, rental before cleaning out the deceased's possessions, taxes for owned property before it can be sold and instead possibly foreclosed.  One more strike against the poorest among us.

Both of these SS inequities hurt lower income workers.  They should be corrected immediately and an annual inflation adjustment applied from now on.  Moving the wage cap back to 90%, plus the 1% increase a year, suggested above, should more than cover this cost.

I will vigorously lobby to have these changes made.  Politicians, and especially Republicans should be held to account for making it easier to "live in sin" than to get married because of this "SS Marriage Penalty".   Sympathetic church groups and GLBT organizations should seize on this issue to persuade or castigate those who would choose to ignore this move to basic fairness, or claim that same sex marriage is a danger to marriage.  Thanks to the Republican supported decision to TAX Social Security benefits and NOT INDEX the Worksheet deduction, far more straight couples are being hurt by this than will ever be impacted by same sex unions.

If elected as your "Shadow" Representative, I will lobby vigorously to correct these SS inequities.  Even if not elected, I will still do some lobbying on this indexing problem.  Someday I would like to be able to afford to marry the fine man I have found since I lost my husband.  We are not alone in this wish.
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[12/1/16]  Concern for saving SS and Medicare is heating up, especially as Ryan proposes a voucher to buy private health insurance.  Here is a particularly pertinent comment (many others are good too) from the linked article regarding Medicare:
     "Once on Medicare, we also continue to pay.  Part B premiums come out of our social security check, $160 or so month for medicare supplement insurance, and average $45 month for prescription coverage, so most retired folks on Medicare are also paying $300 or more per month once on it — $3600 year.  And I want younger people to know this because we aren’t getting it for free now, even though we paid into the Medicare insurance program for 47 plus years, if one worked full time and retired at 65 to 66 years old.  The idea that it is an “entitlement” like welfare is a lie.  We all need to be more vocal about this.   And I for one, as a retired insurance company compliance officer, know that the 4 or 5 top health insurance companies do NOT want to be in the senior individual direct health insurance market.  They never have and Ryan can’t make them.  You could take his dog bone voucher and buy nothing with it!"
     Sen. Bernie Sanders goes all out against Trump and his choice, Rep. Tom Price (R-GA), for Secretary of Health and Human Services (in charge of Medicare and "Obamacare.")

Wednesday, October 17, 2012

DC Council & Mayor Expulsion for Felony on Nov. Ballot

Monday, Oct 15, 2012, I participated in the well attended Congress Heights candidate forum held at the Petey Green Center on Martin Luther King Ave.  After all the candidates had given their 3 minute statements, Philip Pannell, the moderator, brought up the issue of the Council's proposed Charter Amendments V, VI, and VII to deal with illegal behavior by our elected officials.

I had covered this issue in an earlier blog post: "Harry Thomas Inspired Council Act Received by BOEE", and a detailed Comment at that post providing the Council approved revised language.  I had attended the BOEE's regular meeting to deal with a specific DC Statehood Green Party matter, but found the BOEE's treatment of this material forwarded to them by the Council most interesting.

After they reviewed the material submitted, I had the impression that the Board was ready to approve it.  However, I asked whether "ineligible" meant for the duration of the term, or forever.  Also, whether this would prevent a dismissed Councilmember from running for Mayor, or a dismissed Mayor from running for Council.  These thoughts were discussed for a minute among the Board members.  Then the Chairwoman, Deborah Nichols, said, "this matter is much too serious to rush through", and it was tabled.

Then she asked if I would like to submit suggested language to her regarding and including the issues I had raised with my questions.  I had planned to do that a few days later, but unfortunately they untabled the matter 2 days afterwards, May 10, and sent their recommendation back to the Council. My email letter was not sent until May 14, 2012.  BOEE further indicated that they liked having the public attend and wished more would do so.  Only about 8 of us were there altogether.

The final language approved by the Council and to appear on the November ballot establishes that:
   Charter Amendment V "would permit the Council to adopt a resolution to expel a Councilmember upon a 5/6 vote...upon demonstrating that Councilmember's gross failure to meet the highest standards of conduct and upon establishing procedures for the expulsion...."
   Charter Amendment VI "would make anyone who is convicted of a felony while holding the Office of Councilmember ineligible to remain in office and ineligible to ever hold the office again."
   Charter Amendment VII "would make anyone who is convicted of a felony while holding the office of Mayor ineligible to remain in office and ineligible to ever hold the office again."

Mr. Pannell explained the seriousness of these 3 ballot measures and then invited people to speak for or against each of the 3 Amendments.  I spoke to explain what had originally happened at the BOEE.  I pointed out that I had raised the issue of whether the expulsion was only for the remainder of the term, or forever, or some in between period like 10 years.  The issue of whether an expelled Councilmember or Mayor could run for the opposite office has not been addressed at all.  There will probably be an election in a few months for the Chairman's replacement, and perhaps a Charter Amendment VIII could be approved by the council and put on the ballot at that time to cover this issue.

Someone spoke in favor of each of the 3 Amendments, but there were strong statement against as well.  There is deep distrust of the use the establishment or other powerful interests might make of these measures to get rid of politicians they do not like.  There is lack of specificity regarding what "gross failures" or "felony convictions" might merit expulsion.  In recent decades we have seen gross theft of  $1/3 million from young people's activities, personal dishonesty or failures regarding loan documents or income taxes, or so-called victimless crimes involving drug use.  I imagine there are those who fear that entrapment could be used to depose the unpopular.  Also, what if there is a felony conviction and then some years later this kind of "crime" is decriminalized?  Sodomy and marijuana use come to mind.

[12/15/14 -- Now that the elections are over and we have memorialized the life of former Mayor and Council member, Marion Barry, voters are once again facing political action to replace the late Ward 8 Council member, and the soon to be vacant Ward 4 seat of Mayor elect, Muriel Bowser.  In a recent City Paper, Loose Lips column, NBC4's Tom Sherwood was mentioned as suggesting the man mentioned in the preceding paragraph might try moving to Ward 8 to replace the former Mayor.  Since Charter Amendment VI was approved in November 2012, I immediately wondered if this were even possible.  He resigned from the Council January 5, 2012, and was sentenced May 3, 2012.  Thus he was not a Council member when CA VI was voted in.  Loose Lips thinks that his required residency in a court ordered halfway house not in Ward 8 until March makes any run impossible.  One can wonder whether the fact that his attorney was Attorney General elect, Karl Racine, would help or hurt his ambitions.  And of course the big question.  While Ward 8 voters were forgiving of Marion Barry's personal failings and legal problems, would they be equally forgiving of stealing, for personal profit, from children much like their own?]

When I was working for a member of the DC Board of Education in the late 1970s my boss would joke that the most popular local newspaper was holding a "secret expose" over the head of the incumbent Mayor to make him toe the line.  I never knew if this was more than a joke, but given the situation with our current Mayor, it is a thought that deserves pondering.

[1/14/14, Mayor Gray has filed and is running for Mayor in  the Nov. 2014 General Election.  This despite the fact that legal actions regarding the $650,000 "shadow" campaign issue has not been resolved, and more arrests are rumored.  Today's telephone poll of a little more than 1,000 people by the Washington Post indicated that more than 50% felt the Mayor was untrustworthy.  Mayor Gray received 24% in favor, Muriel Bowser and No one/none 12%, Jack Evans/Tommy Wells/No opinion 11%, Vincent Orange 9%, Andy Shallal 5%, Reta Lewis and Christian Carter 1%.  This poll was half land line and half cell phone.  Land line  would tend to express the views of older settled voters.  Younger voters might favor someone like Andy Shallal.  Polling a population the size used can have around a 4% error rate.]

[the 1/14/14 poll has statistics on 32 questions with interactive information on some including race, age, income, education, etc.  It also includes some of this information on the more important candidates.]

All in all, BOEE Chairwoman Nichols' statement that this is "much too serious to rush through" may still be valid.  People with opinions on this topic will need to contact their Councilmember's office.  Muriel Bowser, I believe, was spearheading the Ethics improvements in government at the Council.  My April 3rd blog post lists a number of Council Member's email addresses (of course there have been some changes since then).

If you have thoughts on this issue, I hope you will provide a comment so I will have some ideas, opinions and statements to work with in the coming months as I campaign and lobby.