LaborTalk for October 18, 2011

Obama Cut Cost-of-Living Benefit for Retirees;
Who Else Will Pay for Trillions in Spending Cuts?

By Harry Kelber

Since 1975, retired people on Social Security have received an extra increase beyond their annual benefit, based on the increase in the cost-of-living. The process compensates retirees, who live mostly on fixed incomes, for the higher prices they have to pay for the goods and services they need for ordinary living.

But for 2011, President Obama has decided to cancel the cost-of -living benefit (known as COLA), acting on his own authority), without informing retired people or the general public.

Surely, the President knows that retired people have to pay for the rising cost of food, housing, transportation, fuel, child care and many other necessities with the same fixed monthly Social Security check, without which many of the 53 million retirees would find it difficult to survive.

The retirees are hardly the only ones who will be victimized as Obama proceeds with the trillion dollars of spending cuts that he worked out in a deal with the Republican Speaker of the House, John Boehner. We know the deal includes major cuts in Medicare and Medicaid and possibly Social Security. But what else? We don't know. And our officers, because they may not know, won't tell us.

To reduce the federal debt by a trillion dollars will require an enormous amount of spending cuts that will eliminate or cripple dozens of programs that help working people.

Why Isn't the AFL-CIO Fighting Back?

As far as we know, AFL-CIO President Richard Trumka has not publicly questioned the deal that Obama made with Republicans to cut spending by a trillion dollars in order to lower the federal deficit. Besides speaking up on Social Security, Medicare and Medicaid, Trumka has remained silent on spending cuts that are manifestly unfair or unnecessary.

AFL-CIO leaders who are supporting Obama for a second term as president are reluctant to criticize him for fear that in a close race with a strong Republican contender he might risk defeat. Thus, there was no heavy attack on Obama for signing a Free Trade Agreement with Colombia, where 15 trade unionists had been murdered since April.

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Labor will have to deal with another problem when the bipartisan Super Congress of 12 lawmakers makes its report by Nov. 23, 2011. It is charged with making at least $1.5 trillion in additional deficit reduction steps over a10-year period. That will lead to more spending cuts and accompanying layoffs. It will deal with reforming the tax code and eliminating tax breaks and loopholes in the law.

With the committee report just a month away, what will be the reaction of our leaders? Are they going to give Obama a blank check to decide on why he favors spending as much as $2.5 trillion to cut the federal deficit, while there are at least 14 million Americans who can't find a job?

We're assuming our leaders are thinking about the problem, but there is very little on the AFL-CIO Web site to confirm this.

Won't they at least ask Obama to explain his $3.5 trillion deficit reduction plan, so that an ordinary unionist can understand it?

LaborTalk will be posted here on October 21, 2011 and on our two web sites www.laboreducator.org and on www.laborsvoiceforchange.org.

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