The Norquist Roadblock Leads To a Social Security Raid

Isaiah J. Poole

If Congress is unable to move forward on a long-term funding bill for federal surface transportation programs this month, you can lay a huge share of the blame on Grover Norquist.

Mr. Shrink-Government-and-Drown-It-In-A-Bathtub is at it again, having members of the Senate twisting itself into knots to come up with funding for highway and public transit improvements without doing something that Norquist would call a tax increase.

“The thing to avoid is to raise taxes to pay for the overspending driven by Davis-Bacon,” Norquist, president of Americans for Tax Reform, was quoted as saying in The Hill newspaper this week. (The Davis-Bacon Act that Norquist was referring to is the federal law that requires contractors on federal highway projects be paid the prevailing local wage rate.)

That means even raiding the Social Security trust fund if that’s what it takes to escape the wrath of Norquist.

That’s right: On the list of “pay-fors” for a Senate bill that would authorize federal surface transportation programs for six years, and which would cover the costs of three of those years, is a plan to use $2.3 billion in savings from not giving Social Security benefits to “fugitive felons.” Specifically, people who are subjects of a felony arrest warrant would have their Social Security payments cut off.

That may or may not be a good idea. (This article in Alternet suggests it isn’t, in part because the estimated 200,000 people who would lose benefits include people who have yet to be convicted of a crime.) In any event, the question here is why should that money, which should actually remain in the Social Security trust fund to be used for other eligible beneficiaries, be used for any other purpose?

When did it become OK, in other words, to use savings from the Social Security trust fund – which people have paid into with their payroll taxes – to pay for transportation projects, when Democrats have been falsely lambasted in the past for “raiding” the Social Security trust fund?

In a statement responding to the move, Richard Fiesta, Executive Director, Alliance for Retired Americans, wrote: “Americans contribute to Social Security throughout their lives and have the right to expect that those funds will not be used to fund other priorities. They are earned benefits, not a piggy bank for Congress to raid at will.”

He added that the gambit is “particularly galling” at a time when Congress has been pushing cuts to Social Security field offices in the name of needed budget austerity.

The Social Security provision is one of several items that Senate leaders have pieced together in an effort to close the gap between what the federal government collects through a federal gasoline tax of 18.4 cents a gallon and what it hopes to spend – which is meager when put against the actual need.

Senate Democratic Leader Harry Reid today called for a meeting of key Democrats because he had “some significant issues” with how the bill was being paid for. He was not specific, but one hopes that the way the Social Security provision is being handled is at the top of the list.

In the meantime, the House Republican leadership is stubbornly clinging to the idea of only extending highway funding for five months, in hopes that it can push through a corporate tax reform plan that would likely include a tax break for corporations that have sheltered profits overseas to avoid taxation.

Congress has until July 31 to decide whether to go with the House’s five-month extension or try to work with the Senate’s much longer, but problematic, solution. These are not the options we should be choosing from. We need a responsibly funded long-term bill, paid for not with crumbs and with raids of the Social Security trust fund, but with increased taxes and borrowing if necessary to get the transportation network we need to sustain growth and create jobs.

This post was updated at 6 p.m. EDT. Since this post was updated, Senate leaders agreed to strip the Social Security provision from the transportation bill.

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