As expected, the $250 one-time benefit sought by Democrats for Social Security recipients has become a talking point in the campaign. Both Nancy Pelosi and Harry Reid have committed their chambers to a vote on the bill in the lame-duck session, with strong support from the President. But the lack of support caucus-wide in the Senate may throw a wrench into this plan:
“Instead of helping seniors,” Pelosi’s office said, “Republicans, backed by their allies on Wall Street, are threatening to privatize and cut Social Security, just as they tried to do under President Bush.”
Added Reid, “The only thing standing in the way of America’s seniors receiving this critical support are Senate Republicans.”
Actually, 12 Democrats and one independent who aligns himself with Democrats joined 37 Republicans in blocking the $250 bonus when Senate voted on the issue last March. Two of the Senate Democrats who voted against it then, Michael Bennet of Colorado and Russ Feingold of Wisconsin, are engaged in tough campaign battles to keep their seats.
Those votes would probably change if the legislation were paid for. The benefit for the roughly 58 million recipients of Social Security would cost about $14 billion. When the Senate brought up the bill last time, they didn’t offset the spending, and thus it failed. Bennet, Feingold and many others would probably come back to the fold, in that case. In fact, Bennet has vowed to support the measure as long as it’s paid for.
You may see the carried interest loophole come back into play here. The compromise hashed out as part of the tax extenders bill, which eventually never passed, would have saved the government around $18 billion, by ensuring that investment fund managers pay taxes on their income as income and not capital gains.
Whatever the case, Republicans in key races could be put on the spot about their support for seniors, sure to be the largest voting bloc in the midterm elections.
UPDATE: Reid, and 19 Senate Democrats, just wrote a letter to Mitch McConnell, asking him to “end Republican obstruction” to the $250 one-time benefit. Interestingly, the letter does phrase the benefit as “emergency relief,” suggesting that they might not try to offset it. Here are a couple excerpts of the letter:
“Therefore, we are writing to ask that you join us in supporting legislation as soon as the Senate comes back into session to provide $250 in emergency relief to our nation’s most vulnerable senior citizens and disabled veterans to help them pay for their increased cost of living.”
“We should note that the estimated $13 billion cost of emergency relief this year to our seniors is only a fraction of the $70 billion in average annual tax breaks over the next decade that would go to the wealthiest two percent of Americans if all of these tax breaks are extended.”
“We hope that you will agree with us that it is far more important to provide $250 in emergency relief to senior citizens and disabled veterans than it is to provide an average tax break of over $100,000 a year to taxpayers earning more than $1 million a year.”