April 18, 2021

Residents Of Minnesota Continue To Suffer Because of Shutdown

“As the new fiscal year started on July 1st, Minnesota was forced to shut down a huge portion of it’s government operations due to a financial crisis. Minnesota fell into a similar shutdown situation in 2005, but the effects that this most recent issue is having on residents of the state make the 2005 budget woes look like only the slightest of inconvenience

Some 22,000 employees have already been laid off without any promise of being hired again in the future, and government services and locations are closing down left and right. All state park and rest areas are shut down and funding for 26 museums and historical sites has been entirely cut off, but that’s just the tip of the iceberg. Although it might seem as if state government financial issues should not directly alter the lives of the residents of that state in such a way, an alarming number of services that many people and families relied on are entirely shut down.

At least 100 road repair/restoration projects have been put on hold throughout the state, and a reported 66 parks will remain closed for an unknown period of time. Concerned citizens calling to ask about government assistance have been receiving only a recorded message explaining that they are closed until further notice: numerous hotlines that provide much needed assistance to senior, deaf and disabled members of the community are simply no longer available. Many hotlines that help Medicare and Medicaid insurance customers in the state of Minnesota are also no longer available, leaving the people who need help the most with nowhere to turn to. The most basic of social security benefits are still available to eligible citizens, but residents of Minnesota will go yet another year without any inflation increase to their Social Security checks, and a large majority of checks have even been temporarily put on hold for the time being.

Tax refund checks will not be issued as long as Minnesota State Tax Court remains closed, and a huge number of state-funded programs that provide aid to the families and individuals that need it the most will be shut down. Parents will no longer receive many of the child care subsidies that they rely on, and a huge majority of government workers in a number of different departments will not be collecting any sort of check this month to provide for their families.

The Department of Natural Resources reported that only 220 to 230 of their approximate 2,500 previous employees will be all that remains after the budget cuts, and all facilities or services managed by the DNR will be closed down until further notice. This includes restrooms, campgrounds, state parks, water, and a number of other basic facilities that many residents regularly use. Some Minnesota DMV offices will be closed for the extent of the financial crisis, and the select locations that remain open will not be offering any driving test services until further notice. The laws surrounding hunting and fishing will still be enforced by state officials, but all registering and renewals of hunting or fishing licenses will be closed.

The entire education department for the state of Minnesota has had it’s funding cut, seriously limiting government funded schools in the amount of resources and staff available. Over $700 million dollars in funding for kindergarten through 12th grade schools in the state has been withheld, and Democratic and Republican state officials have been unable to come up with a solution that will reward the school system with the funding that it is owed. Police and fire department services continue to function as normal after being deemed “”essential to life, health and public safety.”"

The whopping 5 billion Dollar deficit that Minnesota is facing is making it very difficult for state officials to come to any sort of agreement, and business owners in all fields are suffering. At least one billion dollars worth of food that was already in warehouses in Minnesota has not been shipped to grocery stores, and liquor store owners will soon be appearing in court to appeal for alcohol shipments to resume. Democratic and Republican officials continued their political gridlock as no further meetings have been scheduled for the second week of this complete shut down.

Various proposals have been brought to speaking terms,one of which being an increased tax on Minnesota’s 7,700 millionaires, but the majority of these proposals were quickly shot down. One idea that is currently being put into consideration will expand state gambling and place a large casino in downtown Minneapolis.”

Additional resource links:

As of midnight, June 30, the Minnesota Department of Natural Resources will be shutdown due to a state budget impasse

Minnesota’s Budget And Shutdown | Minnesota Public Radio News

Minnesota state government shuts down in budget crisis

Social Security Offices In Minnesota

Social Security Checks May Stop Because of Budget Stalemate

“A storm is brewing in the nation’s capital. President Obama insists that the national debt ceiling of the United States must be raised from the $14.3-trillion limit that is currently held. A failure to raise the limit that the US is currently allowed to borrow, may result in millions of people failing to receive their Social Security checks, veteran’s checks, and disability checks this coming August.

In an interview set to air Tuesday on the CBS Evening News with Scott Pelley, President Obama explains that if an agreement is not reached by August, the checks may not be sent out by the government because there will not be enough funds to secure the 70 million checks that are normally sent out each month. If the debt ceiling is not raised, it may also have a dire effect on consumer confidence and the economy as a whole. Interest rates may climb higher for the already cash-strapped Americans who are struggling to make ends meet.

The GOP does not want the debt ceiling raised because Democrats want to raise money by increasing taxes. The two opposing parties are having a very hard time agreeing on what to do about this situation, which is being referred to as a “”Sophie’s Choice.”" “”Sophie’s Choice,”" is a novel by William Styron that concerns a young Jewish mother in a German concentration camp who has to choose which of her children should live or die.

On Tuesday, Democrats and Republicans will meet to have another round of negotiations to see if they can resolve this issue and come up with some sort of an agreement that will keep the nation moving in the right direction. Both sides will have to reach a balanced agreement that will include both spending cuts and an increase of revenue through taxes. A balance between the two seems to be the only way that both sides will come to terms with the current debt crisis to work together to tackle the issue by August. If they don’t, millions of Americans will suffer because they will have no money to make ends meet.”

CNN

Obama: Debt-limit impasse could halt Social Security Checks

Obama says he cannot guarantee Social Security checks will go out on August 3

Social Security Cuts Possible in Budget Deficit Deal

“In a move that could anger both Republicans and Democrats, President Obama is considering changing the way inflation is measured. This would involve cutting Social Security by $112 billion over 10 years, cutting pension payments and veterans’ disability payments by $24 billion, and raising taxes by $60 billion.

Social Security Cuts Possible in Budget Deficit Deal

Inflation is currently gauged using a consumer price index in order to determine annual cost of living changes for Americans. The alternative would be to use a ‘chained consumer price index’. Advocates favoring a change say that the current method of measuring inflation overstates the speed with which prices rise.

Opponents, such as Representative Xavier Becerra think that the chained CPI is a negotiating tactic on Obama’s part. “”He has tried many ways to get out Republican colleagues to come to some middle ground and hasn’t succeeded. I suspect he’s saying, ‘Look, I’ll put everything on the table, let’s see what sticks.’”"

Senator Tom Coburn, R-Oklahoma, and one of the ‘Gang of Six’ who have worked to put together a long term debt plan, said “”There hasn’t been any economist anywhere that says we shouldn’t do that. We need a CPI [Consumer Price Index] that truly reflects what’s happening in the economy, not what’s good for politicians.”"

This idea was initially discussed by the Gang of Six and Vice President Joe Biden, in a series of meetings. It was brought back up on July 6th, when Treasury Secretary Timothy Geitner met with House Democrats. When pressed on the subject by Democrats, Geithner didn’t dismiss it.

In a meeting on July 7th between President Obama and congressional leaders, they tried to come to an agreement over a deficit-reduction plan. This is needed to help pass the debt-limit increase by the deadline of August 2nd.

Although he described the meeting as “”constructive”" and “”frank”", Obama pointed out that they are still “”far apart on a wide range of issues.”"

Some Democrats view the ‘chainsaw CPI’ as a cut in Social Security benefits, reducing projected spending by 1.2 percent. Representative Jan Schakowsky, D-Illinois, pointed out that seniors already face increased cost of living due to medical care.

“”Seniors get the double whammy – higher health care costs and deeper benefit cuts,”" she said.

Senator John Thune, R-South Dakota, supports applying the chained CPI to benefit programs but not taxes. “”That would be a license to steal for the federal government if you just locked in tax increases every year based on what some index is,”" he said.

Inflation is a rise in the cost of goods and services. It is measured by surveying what people buy and where they shop. Every month, price collectors in 87 cities record prices of various products, and use this information to calculate what the typical family buys each month.

This methodology is considered flawed by economists, due to the fact that it doesn’t account for individuals and their response to increasing prices. An overestimate of inflation can lead to a cost of living increase for beneficiaries of Social Security, veterans and federal retirees. Other people affected are people who qualify for food stamps and other aid, due to the fact that eligibility for these programs is tied to federal poverty guidelines.

Marc Goldwein, the former associate director of the administration’s deficit commission summed it up this way. “”It’s a no-brainer. We’re measure inflation wrong now and it’s obvious we should measure it right – especially if it’s going to reduce the deficit.”"”

Bloomberg

In Debt Talks, Obama Offers Social Security Cuts

Obama Urges Dems To Accept Changes To Medicare, Social Security

Will Inflation Reduce Your Social Security Check

“Ahead of the Aug. 2 deadline to raise the federal debt ceiling, President Obama and GOP House Speaker John Boehner have been meeting privately at the White House to come up with plans to cut the federal deficit by $2 to $4 trillion over the next 10 years, the Associated Press reported July 7. White House officials said that changes in the way that Social Security payments are adjusted could make up $200 billion of those cost savings.

Will Inflation Reduce Your Social Security Check

Despite earlier pledges to leave Social Security untouched, Obama appears willing to compromise by considering a new inflation measure called the chained Consumer Price Index, which shows a lower inflation rate than the traditional CPI.

A chained CPI is a measure of inflation that tries to take into account the adjustments made by consumers as a response to inflation. If, for instance, the price of beef rises, consumers may switch to lower priced poultry. Currently, the CPI used by the federal government measures a fixed basket of goods.

If the reported measure is adopted it would affect not only Social Security but a broad range of government payments. Veteran’s benefits, government pensions and the earned income tax credit are affected by how the government measures inflation.

Opponents of the change claim it just a back door tax increase on the middle class and poor. While the change would not immediately affect Social Security recipients or taxpayers, over time the cuts are significant. Some economists say the chained CPI is annually as much as 0.3% lower than the traditional CPI.

House Democratic leader Nancy Pelosi, and Democratic members in Congress, may be a tough sell for this proposal. Pelosi acted swiftly in denouncing the reported deal.

“”Do not consider Social Security a piggy bank for giving tax cuts to the wealthiest people in our country,”" she said July 7. “”We are not going to balance the budget on the backs of America’s seniors.”"

Obama has said that there will be “”pain involved politically on all sides”" and plans to meet with Pelosi at the White House on July 8.”

More information:

AP News

CPI – Wikipedia

Obama to Meet with Pelosi at White House

United States Federal Budget – Wikipedia

Make the Debt Limit Disappear! – Slate Magazine

No Social Security Increase for Senior Citizens

“For the third year in a row, senior citizens will not be getting their social security increase.

Social Security Increase

Each year, Social Security recipients are supposed to get a cost of living increase in the benefit amount that they receive. This cost of living increase is tied to inflation, which has been rising in recent years.

The rising cost of health care and a government that is having to do some financial belt-tightening have created a very difficult situation for the aging segment of American society.

A Social Security increase was expected this year but the government has decided to put off the incremental increase in Social Security benefits for another year, which may create serious political repercussions for the Obama administration – but more importantly, it will definitely have a major impact on the lives of millions of seniors.

This has created a serious problem for retirees and disabled people because they comprise a huge percentage of American population and with prices of almost everything going up (inflation) – they get caught between a rock and hard place because their benefit amount stays the same.

The ongoing economic turmoil of 2008 has still left many people bearing the burden of high mortgages, loan defaults, and rising prices on essentials like food, utilities and gas – if government does not intervene in the right time, the Social Security increase issues will definitely create serious political problems in the country.”

For more information, visit http://www.charlotteobserver.com/2011/03/28/2178034/no-raise-in-benefit-for-most-seniors.html

All About Social Security

Social Security encompasses a number of valuable financial welfare programs aimed at ensuring income for certain populations of qualified Americans.

The Social Security program was first established by President Roosevelt in 1935 and, in its infancy, was considered a retirement program designed to support older Americans.

Since then the Social Security program, under the Social Security Administration, has undergone a number of major revisions and become much more than just retirement benefits. Today it offers resources and financial support for the following:

  • Income for retired Americans
  • Income for unemployed Americans
  • Supplemental income for qualified disabled adults and children
  • Supplemental income for Americans with severe financial hardship
  • Supplemental income for widows and widowers
  • Medical benefits for retired Americans.

Workers’ Benefits: Earning Social Security

For most Americans, Social Security is known best as the cut of your income that’s deducted from your paycheck to pay into the Social Security program. Throughout most of our working lives, our Social Security payments are a promise that we will have income for our retirement years.

Your annual Social Security statement sent out from the Administration summarizes your earnings to date and shows what you might earn monthly if you were to start receiving benefits at your current income level.

Unemployment Compensation

Despite the fact that Unemployment Compensation benefits are state-mandated, the programs were inspired with the original 1935 Social Security Act, so it’s largely regarded as an adjunct program. As a wage earning American you are entitled to receive income from your state government if you are suddenly unemployed through no fault of your own.

Disability

The Social Security Disability program provides additional monthly income for qualified adults and children suffering from severe disabilities and/or medical conditions. For adults especially, qualifying is not easy. The application review process may take up to six months to complete. Applicants are required to earn less than $1,000 per month, have a disability or medical condition that impacts their ability to perform their jobs, possess limited additional education or training, plus much more.

Supplemental Income

Supplemental Security Income (SSI) provides financial support to qualified adults and children suffering from disabilities or severe medical conditions with the additional burden of financial hardship.

Medicare

Medicare is basically medical insurance for folks in their retirement years or nearing retirement age—working or not. This program ensures that older Americans have adequate medical care during a particularly vulnerable time in their lives. Medicare is comprised of three parts: Medicare Part A (hospital care), Medicare Part B (medical care), Medicare Part C (the Advantage programs), and Medicare Part D, the infamous prescription drug coverage.

Learn more about these and all the Social Security programs, including forms, educational resources, and more, at the official U.S. Social Security Administration website. (http://www.ssa.gov/ )

The History of Social Security

The depression of 1929 brought a great deal of hardship to the American people. Because of the many problems, that were brought about by this depression, in 1934 President Franklin Roosevelt introduced the idea of a program for social security. He appointed a committee to study the country’s economic problems and make recommendations to Congress.

In the fall of 1934 there was a national town-hall meeting regarding the proposed program with a report to the Congress being drafted and presented,aid to dependent children and regarding their proposal. This bill was passed in July and sent to the president for his signature. On August the 4th 1935, President Roosevelt signed the Social Security Act into law.

There were a number of provisions for general welfare as well as a program to pay retired workers, 65 years or older, a continuing income after retirement. Upon signing the law, President Roosevelt made a statement specifying that it would be impossible to ensure all of the population against the problems of life, but an attempt was made to produce a law that would help the average citizen, as well as his family, against the loss of a job or poverty in his or her old age.

This original program included old-age assistance, unemployment insurance,grants to states for various kinds of Medical Care, and aid to dependent children. Disability coverage and medical benefits were not included in the original act. Two major provisions being grants to states for old-age assistance (welfare programs for the aged) and Federal Old-Age benefits.

Federal Old-Age Benefits Program was the original name of what is now called Social Security. Originally these benefits were paid only to a worker when they reached the age of 65. Benefits were based on payroll tax contributions, made by the worker, during their period of employment.

Taxes for this program were collected in 1937 and payments began in 1940. The premise of this program was to provide economic security through a contributory system with the workers paying into a retirement plan. It was believed, at that time that the ‘relief’ portion of the program would eventually be dropped, as more people were employed, with only retirement provisions remaining.

A trust fund was established to hold the contributed funds. These funds are currently under the auspices of the Social Security Administration. It is interesting to note that the first applicant for benefits was a person who retired one day after the program began. Five cents was withheld from his pay for Social security and, when retired he received seventeen cents as a lump sum payment. In 1937 there were 52,238 people collecting benefits with a total paid out of $1,278,000. In 2008, 50,898,224 were collecting benefits with a total paid out of $615,344,000,000. As wages increased, with higher contributions made through payroll deductions, the amount of retirement checks also increased, which accounts for the huge difference between a 1937 and 2008.

There have been a number of changes to the program since its inception. Social security income, for example, is now subject to taxation by the government. In addition, in 1996 a bill was passed that applicants for Social Security or SSI disability would not be eligible if they had drug addiction are alcoholism. The eligible age for a person to collect benefits has been increased to 67, depending on the year of birth, and prisoners may not draw SS checks.

For more information, visit http://www.cato.org/social-security