ABC News’ Matthew Jaffe reports: President Obama, like any other President, has his fair share of critics. Even fourth-graders have noticed.

“Why do people hate you?”, a fourth-grade boy asked Obama at a town hall event in New Orleans today. “They’re supposed to love you. And God is love.”

“That’s what I’m talking about,” replied the President.

Here’s the video of the exchange, though the transcript is below if you’d prefer:

Um, what the hell was he talking about BEFORE the little boy asked his question? Wasn’t he saying, “It’s a man’s turn. Isn’t it? It’s a guy’s turn.” That’s what it sounded like to me, anyway…So, just what came BEFORE that?? Curious.

Obama continued his response to the child:

“First of all, I did get elected president, so not everybody hates me,” Obama noted, before adding, “What is true is if you were watching TV lately, it seems like everybody’s just getting mad all the time. And I — you know, I think that you’ve got to take it with a grain of salt. Some of it is just what’s called politics where, you know, once one party wins, then the other party kind of gets — feels like it needs to poke you a little bit to keep you on your toes.”

“And so you shouldn’t take it too seriously,” Obama told the boy. “And then, sometimes, as I said before, people just — I think they’re worried about their own lives. A lot of people are losing their jobs right now. A lot of people are losing their health care or they’ve lost their homes to foreclosure, and they’re feeling frustrated. And when you’re president of the United States, you know, you’ve got to deal with all of that.”

So, um, not to quibble or anything, but just when do you think you are going to get around to dealing with job loss, home loss, and losing health care? Hey, just asking:

“You get some of the credit when things go good. And when things are going tough, then, you know, you’re going to get some of the blame, and that’s part of the job,” he continued. “But, you know, I’m a pretty tough guy.”

“You’ve just got to keep on going, even when folks are criticizing you, because — as long as you know that you’re doing it for other people, all right?” Obama concluded.

The boy’s question was the last one the President fielded at his event at the University of New Orleans, his first trip to the city since being elected to the Oval Office.

Well, there is a good reason the child asked that question. While Obama did get elected, the latest Fox Poll shows that he wouldn’t if the election was held today, as this article highlights, Fox News Poll: 43 Percent Would Vote To Re-Elect President Obama:If the election were held today, 43 percent of American voters would back Barack Obama for president, according to a new Fox News poll.

Oh dear. I guess that’s some of the “blame” Obama is getting for not fulfilling his campaign promises, for starters, not to mention his continued constant campaigning instead of working thing he’s got going on. Here are the results of this poll:

In what may be the ultimate job rating, 43 percent of voters say that they would vote to re-elect President Obama if the 2012 election were held today, down from 52 percent six months ago, from April 22-23, 2009.

Obama’s job approval rating comes in at 49 percent this week. (Emphasis mine.) That’s down just one percentage point from late September, but it marks a new low approval for the president — and the first time the Fox News poll has measured his approval below 50 percent.

Moreover, the number of Americans saying they would vote to re-elect President Obama has dropped. If the election were held today the poll finds more voters say they would back someone else in the 2012 election than would back the president.

Despite winning the Nobel Peace Prize last Friday, the latest Fox News poll finds the president’s ratings on foreign issues are lower than his overall job ratings. All in all, 49 percent of Americans say they approve of the job President Obama is doing and 45 percent disapprove. His average approval for the term so far is 58 percent.

Yep, Obama’s approval numbers are below 50% for the first time at 49%. How about on some of the issues:

On Afghanistan, 41 percent of Americans say they approve of the job Obama is doing and 43 percent disapprove. For his handling of Iran, 44 percent approve and 43 percent disapprove.

On the president’s handling of the economy, voters are almost equally split: 48 percent approve and 49 percent disapprove. On health care, some 42 percent approve of the president’s performance and half disapprove, 50 percent.

Among Democrats, 78 percent say they would vote to re-elect President Obama, down from 87 percent in April. For 2008 Obama voters, 81 percent say they would vote to re-elect him — that’s a slight up tick from the 79 percent who said so previously.

Six in 10 Americans — 60 percent — think Obama is a strong and decisive leader.
And while 38 percent think President Obama is getting good advice from his advisors, a larger number — 45 percent — think he is “listening to the wrong people.” (Opinion Dynamics Corp. conducted the national telephone poll of 900 registered voters for FOX News from October 13 to October 14. The poll has a 3-point error margin.)

Like Rahm Emmanuel, or David Axelrod, or Nancy Pelosi, or Harry Reid? Yeah, I’d say he’s listening to the wrong people.

And about that whole Nobel Peace Prize thing:

Did He Deserve It?

Upon winning the Nobel Peace Prize, Barack Obama said, “To be honest, I do not feel that I deserve to be in the company of so many transformational figures.” Most Americans agree with the president — 65 percent say he did not deserve to win, while 29 percent say he did.

Furthermore, a slim 54 percent majority of Democrats think Obama did deserve to win, while 38 percent disagree. For independents, 19 percent think he deserved it, while nearly three-quarters, 74 percent, say he did not. Among Republicans, almost all — 91 percent — say he did not deserve it.

When asked why the Nobel Committee gave the president the prize, about a third of Americans, 32 percent, say because he deserved it, while the largest number — 44 percent — think the committee hoped the prize would make Obama “think twice before using military force in the future.”

About that whole Nobel Peace Prize thing. Remember how we were all told the Committee Was unanimous in their decision to give it to Obama? Turns out that 3 out of 5 of them did NOT want to give it to him. Golly gee, I guess truth really DOES will out! Evidently, their reaction was the same as many of ours – he hasn’t DONE anything yet but speechify, for cryin’ out loud!

The poll also address how Congress was doing:

Most Americans are unhappy with Congress these days — 66 percent disapprove, including 45 percent of Democrats, 77 percent of independents and 84 percent of Republicans. Overall, less than one of four Americans, 24 percent, approve of the job Congress is doing.

Looking ahead to the 2010 Congressional election, for the first time this year the Republicans have the advantage: 42 percent of voters say they are more likely to back the Republicans to provide a check on President Obama’s power, while 38 percent say they would vote for the Democrat to help the president pass his policies.

Finally, in a rare example of bipartisan agreement, majorities of Democrats, 53 percent, Republicans, 78 percent, and Independents, 61 percent, agree the country is more divided these days. All in all, 64 percent of Americans think the country is more politically divided today — that’s more than twice the number who say it is not more divided, 31 percent.

Click here for the raw data.

What a bang-up job Obama has done in uniting us, just like he said he would. Blech. Can’t believe people fell for THAT line again, can you? Great – so glad there is one area that is truly bipartisan. Ahem.

And while President Obama is still feeling the love, the numbers of those who love him seem to be decreasing the more they open their eyes to see and their ears to hear. Such a shame they couldn’t muster that BEFORE the election, isn’t it? Now, his daily tracking poll continues to go down; Secretary Clinton’s approval numbers are higher than his (no big surprise to ME there); and his overall rating is at 49%. COngress doesn’t fare much better. Oh, how the mighty have fallen. Couldn’t have happened to a more deserving guy, or more deserving Congress, could it?

See the Update about how many of our Elected Officials will/not be holding Town Hall Forums at the bottom of the page.

Friend to NQ, Kathleen Wynne from HandCountPaperallotsNow made a suggestion after seeing the negative spin the MSM is putting on reports of concerned citizens calling out their representatives on the issue of health care reform, even if all they want is for them to READ the damn thing. Here are some of her suggestions:

After watching the reporting by the usual suspects in the media, who are turning these protests into orchestrated, manufactured outrage, it’s clear that having a number of town hall meetings where those reps either chose not to participate in one or who chose to have a conference call instead, will help prove that they are merely trying to discredit these protests and undermine the citizens true feelings about the health care legislation. Or how Senator Boxer ridiculed citizens voicing their concerns as trying to “hurt our president” and too well dressed for this NOT to be orchestrated

:

Another point that should be put out there for all to see is that during the primary and general election, it was Obama, himself, who told his supporters to have debates with those who did not support him and “get in their face.” Here is a reminder of Obama saying that, along with some other actions by his supporters

:

More importantly, we want citizens to realize how important it is for them to participate in democracy and recognize how important they are in making these reps accountable and to expose their total indifference to the citizens’ concern, not to mention their total lack of knowledge of exactly what’s in the bill. This is a pivotal moment to increase citizen involvement in “taking to the streets” and keeping the pressure on. The longer citizens stay engaged in these protests, the less the MSM can dismiss them as “astro turf” (i.e., not real grassroots concerns), as Nancy Pelosi refers to them in this clip

:

Ms. Wynne is:

asking citizens in those towns where the representatives have chosen NOT to have a town hall meeting or worse, canceled them, to “BE THE MEDIA” by organizing and conducting town hall meetings themselves and having a public discussion about what they don’t like about the health-care bill and any of the other bills that have been rammed down our throats and videotape the event. In particular, they should make it clear that they are having the town hall meeting despite their representative’s choice to not have one or to cancel one. That should be made clear at the beginning, and then say that they would not be silenced.

Then request that clips of these events be sent to NQ, here, and other websites of their choosing in order to make the people’s outrage at not being listened to be seen and heard by other citizens, so that we know that this isn’t just a group of fringe groups being sent out to disrupt town hall meetings.*

It’s an end-run around the MSM’s attempt to ignore and not report what the people are really feeling about the Obama Administration’s policies.

Now word is coming that unions are being sent in to counter those who oppose this plan. And videos are already rolling in, including footage of union members (SEIU) getting into it with Tea Party protesters.

This is our country, and we have every right to speak out, to dissent, to question. And we have the right to speak out without fear of harassment, violence, or intimidation by those in power or their surrogates. We have the right to demand accountability of those whom we have elected to represent us, and that they REPRESENT US. That is their job, after all.

So, are you game? If so, feel free to send this post to whatever sites you frequent, and let’s get this thing rolling.

UPDATE: Check out how many of our elected officials are NOT meeting with their constituents:

An optimist has been defined as one who would, should a ton of crap be dumped on his doorstep, jump right in and rummage through it, convinced that there must be a pony in there somewhere. I tend towards optimism.

So, while not for one second denying that millions of citizens have been significantly harmed by the economic decline, disaster often has a way of encouraging the the best in human nature to come forward. As our society appears to increasingly embrace a narcissistic, materialistic morality, bearing witness to what this has wrought may shake us all up in a good way.

Here’s my list as to how that could happen.

1. Valuing experiences over accumulating tangible things. The research substantiates that happier people are less interested in stuff and mostly find their joy in experiences. And maybe the best things in life are not free, but some come close. To wit: a picnic in the park, walks through the closest pretty place, potluck dinners with a few friends, bird and other small critter watching (scrub jays are a hoot, especially if you have peanuts–shells and all–to offer them), and checking the paper for free events. (Many communities have slews of them every week.) It kind of takes getting used to after spending $10 for a movie and $20 for a dinner out, but it grows on you. “What is the most fun thing we can do that doesn’t cost anything (or very little)?” A great game for tough times.

2. Finding and exercising your creative self. You may have received a handmade card from a child. That beats Hallmark every time, yes? And with cards now costing as much as a gift did a few years ago, it’s time to get back to the joy of making things from scratch. Cards, wrapping paper (recycle those grocery bags and magazines with a great collage), clothing, beaded jewelry, playing with a food recipe, whatever. I have always taught my students that what is truly special about being human is our capacity to create something from nothing, to transform an idea or raw stuff into something that arose from inside our own selves. Pure joy awaits.

3. Valuing used goods. Just because it is new and no one else has touched it doesn’t mean it’s better. Increasing numbers of my friends are unabashedly buying clothing from thrift and second hand stores, not because they are absolutely forced to, but because it is fun. The bargains and “the look” can be stunning. They also like the idea of giving items another round of wear. Other friends are finding that some old things can be fixed, and sometimes they can even do it them themselves (from which they get the joy as described in #2). Money is saved in the process and for the environment, well that’s #4.

4. Helping Mother Nature. When errand times and routes are planned to conserve gasoline, and when stuff is reused or recycled, we help protect the environment. Bad economic times may help instill some good habits.

5. Learning what you don’t really need. A friend said recently, “You know, I have had to spend wisely because my job was furloughed, but I don’t miss a lot of stuff I thought I absolutely had to have. And I found some good less expensive replacements for things I needed. I’m feeling kind of proud of myself.” I think most people would be able to save money if they realized that some of what they want to replace is quite good enough as it is.

6. The joy of helping others. Another solid finding from the happiness research is that accumulating wealth and material things is not a marker of a satisfying life. One of the primary sources of life satisfaction is quite the opposite—giving of oneself to others. This current economic situation means for most of us that the need is no longer just about writing a check to some charity and sticking it in the mailbox. Rather, the needs are much closer to home now. The local school is short on basic supplies, the food bank is desperate for donations, a niece lost her home and needs a refrigerator for an apartment, a neighbor’s home was stripped bare by burglars when they were away for the day and they need a lot of things that the rest of us can spare. Giving is getting up close and personal—and doing it nourishes our souls.

7. A good time to drop bad habits. For those who eat or drink way too much, smoke, are dependent on unnecessary chemicals, to work on cutting them out not only saves cash but will help out with health costs–if not now, down the line. Indeed, taking care of ourselves in every way not only will cost less but maximizes the chances of a more vibrant life (while saving the rest of us money as well).

8. Grow some food. Even those with small places, so long as you have some sun and a place to put a pot or two, you can know the real taste of a tomato. I only recently started “farming” my yard. I made some mistakes (trying veggies that really don’t like my climate) but the successes are glorious. Besides tomatoes there are herbs, zucchini, oranges, peaches, pomegranates, guavas, and carrots. They don’t taste anything like what you buy in the store. They taste like…heaven. Maybe you don’t save a ton of money, and it does take some time to watch over them as they grow, but there is something deeply satisfying to be found here. Back to the land, I guess. (Oh, and help our landfill crisis by putting veggie, fruit scraps, and coffee grounds in a big container that you turn from time to time, and after some weeks you will have the greatest soil ever. You don’t absolutely have to add worms. The right bugs will find it on their own.)

9. Remembering how to save. I was so good as a kid. I would save up those pennies until I could buy something really cool. Then adulthood hits—earn a dollar and quickly spend it on something that beckons from TV. After all, we had to have “one of those” to be perceived is as successful human beings, right? Americans are not saving, and the ramifications are destructive for us all as the bankruptcy rate skyrockets and many people cannot even buy what they really need. Maybe after things settle down (fingers crossing here) savings accounts will become popular, and having one a source of family pride.

10. Lessons passed on to the children. If we do come to value each other more, conserve better, appreciate what we do have more, and place an emphasis on meaningful experiences and maintaining good health, our kids will pick up on it. Now, that would be priceless!

What do you think? Any ideas to add or expand upon?

1) At BriefingRoom.TheHill.com, Judd Gregg says the U.S. couldn’t even join the E.U. because of the U.S.’s debt levels.

“We won’t even be able to get into the E.U. if we wanted to,” Gregg said this morning on MSNBC, “because our government is so large and so huge.”

The European Union’s Stability and Growth Pact (SGP) adopted in 1997 requires a budget deficit to be less than three percent, and requires a national debt beneath 60 percent of Gross Domestic Product (GDP).

“We’ve been lectured by France on the fact that we’re not fiscally responsible right now,” Gregg, the would-be commerce secretary, noted with incredulity.

That hurts.

2) The Weeklystandard.com notes that Obama’s been indulging in “just words.”

Some of what Obama says is just pablum and isn’t supposed to be taken as serious economic thought. At least I hope not. Rather, it might be called economic morale-boosting. Nothing wrong with that, unless he actually believes what he’s saying.
———-
Nor is Obama up to speed on tax incentives. He dismissed the fear of charities that a proposed reduction in the tax deductibility of donations by upper middle class and wealthy Americans would curb giving. “If it’s really a charitable contribution, I’m assuming that that shouldn’t be a determining factor as to whether you’re giving that $100 to the homeless shelter down the street.”

That’s easy for him to say. Every charity from museums and arts groups to hospitals is terrified by the proposed tax change. And it’s a fair assumption that they know a tax disincentive when they see one. The question is whether Obama does. Perhaps not.

Perhaps charities better front load all they can get from donors now. Obama seems to think a tax deduction doesn’t matter AT ALL. Maybe not for him. Last I heard, his tax returns showed very little charitable giving.

3) The Atlantic has a stunning piece about the financial mess. Here’s the summary:

The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time.

I’ve often wondered if oligarchy isn’t the right term for what and/or who is driving U.S. policy.

4) Realclearpolitics has an interesting piece about the current economy and the lessons learned from the 30s.

Anybody who wants to pontificate about the economy, or the budget, or the deficit right now should think about three questions:

1. What changed the Depression from an ordinary recession into a worldwide catastrophe? (And how bad was it, anyway?)

2. Is this crisis the same or different?

3. If there’s risk of another depression, how do we stop it?

Interesting stuff.

In the first post on our nation’s Social Security system I tried to give a brief history of how the program came about and the immediate needs of people suffering from the Depression that caused FDR to propose and the Congress to enact the 1935 Social Security Act.

In this the second installment of the series I want to deal with two things. One, what were the provisions of the 1935 Social Security Act, and two, how has the 1935 Social Security Act program been changed or altered over the years.

The Social Security Act of 1935 created several different, wide-ranging, and separate programs. The Act created unemployment insurance, old-age assistance (essentially welfare), old-age benefits (we now call this Social Security), aid to dependent children, and grants to the states to provide various forms of medical care.

Below is a description of all of those programs, or Titles, the 1935 Social Security Act created with a brief description of each program.

Title I – Grants to States for Old-Age Assistance was designed to provide “financial assistance” to “aged needy individuals” immediately. In other words, this program was a welfare program for the aged and was to be administered by the individual states following federal guidelines and paid for out of the General Fund.

Title II – Federal Old Age Benefits.” Title II of the 1935 Social Security Act created a social insurance program designed to pay retired workers age 65 or older a continuing income after retirement beginning in 1942. (First contributions had to be collected and a fund built up before being able to pay benefits.)

The Title II program would be paid for by contributions from both the individual and the employer and put into a Trust Fund (created in 1939) separate from the General Fund and for the express purpose of funding old age benefits. This is the program most of us mean when we say, “Social Security.”

Title III – This was also a grant program that provided financial assistance to the states for Unemployment Compensation and Administration and paid for out of the General Fund.

Title IV – Grants to States for Aid to Dependent Children paid for through the General Fund. In effect this was another welfare program.

Title V – Grants to the States for Maternal and Child Welfare, again paid for through the General Fund.

Title VI – Public Health Work, again paid for through the General Fund.

Title X – Grants to States for Aid to the Blind again paid for through the general Fund.

Titles VII, VIII, IX, and XI are administrative in nature and set up the Social Security Board and detailed how contributions/taxes would be collected especially for Title II.

As you can see, The 1935 Social Security Act was a very broad and all-encompassing program extending a social safety net far and wide for those suffering during the Depression and beyond. And except for Title II, all of these programs would be paid for through the General Fund.

[I can’t help but make a snarky remark here. Look at the specifics of this program and how it is targeted to help people in need and compare it to the Christmas tree approach of the current stimulus package.]

Over the years each of these programs has been referred to as “Social Security” since they were all created by the 1935 Social Security Act. But as you see, they are really separate and distinct programs funded in different ways. I tell you this now because I want you to know this and keep this in mind because the unscrupulous among us have sometimes deliberately misled people regarding some of these programs to try and achieve their own selfish agendas, especially as regards wanting to change the old age insurance benefits, or Title II of the Social Security program.

The Title II program is funded by FICA taxes. In short, the individual contributes into the system and the employer is taxed an equal amount. The self-employed must make both contributions. All of this money goes into a separate account, or Trust Fund, to be used expressly for and exclusively for those who contribute into Title II. None of this money ever goes into the General Fund. NOT EVER. Furthermore, no one can receive benefits under Title II unless they paid into the system for at least 40 quarters. If you did not pay into the system you are not eligible to receive any benefits. Therefore, no illegal alien can, and more importantly does not receive any monies from Title II, the Social Security old age insurance program – not one dime! (This is true even if they paid into the system under a phony or even stolen Social Security number, as some do.)

It is a different matter with the other programs that the 1935 Social Security Act created, as you will read a bit later.

Changes Made to 1935 Social Security Act
Now let’s look at how The 1935 Social Security Act has changed over the years. As I researched this I was amazed at how stable the program has been since its inception. It has occasionally been slightly tinkered with here and there, but by and large it is remarkable how few changes there have been. The main changes have tended to be in one of two categories. The first category increases benefits going to recipients, and the second is continually making the program more financially sound.

I am not going to list each and every minute change to this act. If you are interested in minutia you can go to Social Security History and the Social Security Administration has listed them all. I will only hit the highlights.

1935-1939

The original Social Security Act was mostly a white male program. According to Wikipedia most women and minorities were excluded from receiving benefits from all of the various programs through how employment was defined and through specific listing of the job categories that were or were not covered. Certain jobs were just plain and explicitly excluded from the program. For example, most agricultural workers were excluded, as well as nurses, teachers, hospital workers, librarians, and domestic workers to name just a few.

Since many of the programs were also administered by the states, even more discrimination crept into the programs at that level. Fortunately, the practice of discrimination began to change in the late 1930’s as shifting gender roles and positions of minorities in society began to change. By the 1950’s the debate changed from which occupations should be covered by Social Security to achieving universal coverage.

1939

Before Title II even paid out any benefits retirees there were changes made to the program in 1939. Originally benefits were to be paid only to the worker. The 1939 Amendments added two new categories of benefits. Payments could now be made to the spouse and minor children of a retired worker, and second, in the event of a premature death a survivor’s benefit was added.

The 1939 Amendments also increased Title II benefit amounts and moved up the start of the program from 1942 to 1940.

The taxing provisions of Title VIII [see above] were also removed in 1939 (would not have been constitutional) and authority to tax was placed with the IRS (constitutional) and renamed Federal Insurance Contributions Act, or as we affectionately know it today, FICA.

However, the most significant change in 1939 was the creation of a Trust Fund managed by the Secretary of the Treasury for any surplus monies collected. These excess funds could be invested in both marketable and non-marketable securities. I could do an entire post on the Trust Fund and how it operates; it is that all-encompassing. There is not enough room in this post to detail its inner workings.

1940-1950

For ten years between 1940 and 1950 only one significant change was made to any of the programs. The Social Security Board was abolished in 1946 and replaced by the Social Security Administration (SSA) headed by a single Commissioner. The SSA still exists today.

Benefit levels however, remained very low. According to the official Social Security History web pages, “……. until 1951, the average value of the welfare benefits received under the old-age assistance provisions of the Act [Title I] were higher than the retirement benefits received under Social Security [Title II] provision. And there were more elderly Americans receiving old-age assistance than were receiving Social Security.”

So several amendments to the Act were made in 1950. Again, from the official history page of the Social Security website, “These amendments increased benefits for existing beneficiaries for the first time …….and they dramatically increased the value of the program to future beneficiaries. By February 1951 there were more Social Security retirees than welfare pensioners, and by August of that year, the average Social Security retirement benefit exceeded the average old-age welfare assistance grant for the first time.”

Today most people know that the Title II program has an annual cost-of-living (COLA) clause. This was not always the case. The first retirees received the same monthly benefit for the remainder of their life. But that also changed in 1950 when a COLA was enacted by Congress. At that time these increases were not automatic and were enacted by Congress periodically as necessary. It was not until 1972 that Congress enacted legislation providing for an annual automatic COLA based on the average increase in consumer prices.

Also in the 1950’sthe disability provisions were strengthened.

1960’s and 1970’s

The decade of the 60’s brought several significant and major changes to the Social Security Act. Retirees were given a choice of early retirement with a reduced annual benefit.

But by far the biggest change in the decade of the 1960’s was signed into law by President Lyndon Johnson on July 30, 1965. The Medicare program extended health coverage to retirees by helping them pay for hospital and medical expenses.

Like Title II of the 1935 Act, Medicare is a social insurance plan for people aged 65 or older. It operates as a single-payer heath care plan. This program consists of two parts. Part A is for hospital insurance, and Part B is for medical insurance. The 1965 amendment did not provide for prescriptions in most instances. It would be 30 more years before prescription drugs would be added to the program. Medicare is paid for by additional FICA taxes and is administered by The Centers for Medicare and Medicaid Services (CMS), which is part of the Department of Health and Human Services (HHS). [Snarky comment #2, for those keeping count- which thankfully Tom Daschle will not be heading.]

Above is video of President Johnson signing the Medicare Bill and Former President Harry Truman signing up for Medicare.

As mentioned earlier, another major change in the 1970’s was the introduction of the permanent COLA.

There were a series of Amendments made in 1977 to deal with projected shortfalls due to the bad economy of the 70’s. And for the first time the issue of a projected shortfall due to the baby boom is mentioned and a slight FICA increase was made.

Supplemental Security Income
If you remember, The 1935 Social Security Act created several different programs. Except for title II, the other programs were administered by the states with partial funding from the federal government.

Over the years the programs varied tremendously from state to state with payments to recipients varying by as much as 300% between the states. There were also over 1000 agencies administering these programs. It was a bureaucratic nightmare rife with confusion and inequalities.

In 1969 President Richard Nixon changed that. He initiated reforms that would “bring reason, order, and purpose into a tangle of overlapping programs.” At Nixon’s instance Congress federalized Title I, Title X, and the disabled category (created in the fifties) by creating the Supplemental Security Income program (SSI) in the Social Security Amendments of 1972.

The Social Security Administration, created in 1946 to administer Title II, was chosen to administer this new SSI program because of its reputation for successful administration of the Title II program and because of its nationwide field offices and data-processing and record keeping skills.

However, Supplemental Security Income (SSI) is a Federal income supplement program funded by general tax revenues, not with Social Security or FICA taxes.

In keeping with the original Titles and the disability amendment SSI is designed to help the aged, blind, and disabled people, who have little or no income, and provides cash to meet basic needs for food, clothing, and shelter.

I am going to include this next part here, even though it is out of chronological order because it deals with SSI benefits to illegal aliens. This is often the source of the misunderstanding, urban legends, myths, or downright lies about illegals getting Social Security Title II benefits.

During President Clinton’s administration a balanced budget bill was passed and a Welfare Reform bill was passed. The Balanced Budget Act of 1997 among other provisions restored SSI eligibility to some non-citizens whose eligibility would have been terminated under the Welfare Reform Act.

Now here is where it can sometimes get dicey. Some politicians and some activist who do not like Social Security (Title II) and want to totally get rid of it, and/or who would like to make some money off of the pool of money in the Title II Trust Fund sometimes play fast and loose with the truth.

When people sometimes will say that immigrants and/or illegals are receiving Social Security what is most likely happening is that eligible aliens are receiving SSI monies. Some folks do not distinguish between Title II monies and SSI monies. And because many people do not know the difference between the two programs, and because both programs are run by the same Social Security Administration, many people believe that illegals are dipping into their retirement pot and that they will bankrupt the Title II system. They are not. They are getting SSI monies.

Beware and ask questions when someone tells you illegals are raiding the Social Security system. Ask those who are telling you these things if the immigrants or illegals are getting Title II monies or SSI monies. Now you know the difference between the two and hopefully you won’t be fooled by the games some folks like to play with your emotions.

The 1980’s

Major changes were made to Title II by President Ronald Reagan upon the recommendations of the Greenspan Commission in the 1983 Amendments. These changes were in response to both short term and long term projected shortfalls in the system.

Contributions amounts went up for both individuals and employers, retirement age went up, some benefits were lowered, more federal employees were added into the system, taxed Social Security benefits, among many other provisions.

The original Title II program was a pay-as-you-go program. In other words, current workers paid for benefits for current retirees. This was great for the WW II retirees as 78.2 million baby boom workers could afford to pay to fund increased benefits for many years. The 1983 Amendments changed this formula. For the first time in Social Security’s Title II history the baby boom generation was funding a part of their own retirement simply because there were not enough citizens behind them to afford to continue the same benefit level for them unless they helped to pay for it up front.

1990’s and 2000’s

In addition to the changes already mentioned under SSI President Bill Clinton also made some changes to the disability portions of the act.

However it was left to President George W. Bush to make the biggest and most controversial change to the Medicare portion of Title II in 38 years. The Medicare Prescription Drug, Improvement, and Modernization Act was enacted in 2003. During hearings on the bill the projected cost of the Prescription Bill was estimated to be $400 billion.

I will let Wikipedia take up the story from here: “The MMA was signed by President George W. Bush on December 8, 2003, after passing in Congress by a close margin.

“One month later, the ten-year cost estimate was boosted to $534 billion, up more than $100 billion over the figure presented by the Bush administration during
Congressional debate. The inaccurate figure helped secure support from fiscally conservative Republicans who had promised to vote against the bill if it cost more than $400 billion. It was reported that an administration official, Thomas A. Scully, had concealed the higher estimate and threatened to fire Medicare Chief Actuary Richard Foster if he revealed it. By early 2005, the White House Budget had increased the 10-year estimate to $1.2 trillion.

“Former US Comptroller General David M. Walker has called this “…probably the most fiscally irresponsible piece of legislation since the 1960s… because we promise way more than we can afford to keep.”

One of the strongest organizations lobbying for the bill was AARP. It was during the Prescription drug debacle that I first learned, realized, or finally understood that AARP is not an advocate organization. It is an insurance company first and foremost. It will look out for its corporate interests first. And making money was clearly more important than helping poor people afford life-saving prescription drugs. To this day I refuse to join AARP for that reason alone.

President George W. Bush also attempted to privatize Social Security, but that did not fly. I think W learned an important lesson. Don’t rile up the senior set. One, they are vocal. And two, they vote!!! However, that issue is not dead and there are still many individuals and organizations who would like to privatize Title II.

We will deal with the issue of privatization in the next installment in this series entitled, “Is Social Security Really Broke?”

CAPTION: On January 31, 1940, the first monthly retirement check was issued to Ida May Fuller of Ludlow, Vermont, in the amount of $22.54.

Miss Fuller, a Legal Secretary, retired in November 1939. She started collecting benefits in January 1940 at age 65 and lived to be 100 years old, dying in 1975.

::::::::::::::::::::::::::::::::::::::::::::::::

Until my next installment, please keep these figures in mind:

In 1940 when the first benefits were paid 222,488 people received benefits totaling $35,000,000.

By 2006 there were 7,235,565 people receiving benefits totaling $41,312,000,000.

Since 1935 – for 74 years -The Social Security Act has literally kept millions of retired and disabled Americans from the poor house during the ups and downs, good and bad times, and the recessions and depressions our country has faced. Not bad for a government program!!!!

Editor’s Note: Yes! This essay is written by “bert,” who you all know from her regular comments here. She submitted this superb article for publication, and we are so pleased to share this fine writing and excellent research with you. Below, you’ll see that “bert” also found a shocking historic photograph and a video of Franklin Roosevelt signing the bill into law. Thank you, bert!

This post is a follow-up to Susan’s excellent post last Friday regarding Social Security remaining this country’s core safety net, for that is truly what it is.  

During the Bush administration there was a move afoot to privatize Social Security. There are rumors and signals from the Obama administration that politicians will again try to “save” Social Security by privatizing it. 

It is amazing that while most, if not all of us, pay into the system and will some day be eligible to receive benefits, most of us know very little about how the program came about and how it operates. There is a lot of misinformation out there and many people labor under some pretty big myths about the program. 

When I was a child I loved Friday nights. Since it was not a school night I could stay up late and watch one of my favorite TV shows, Dragnet, a classic police drama. The lead character, Sergeant Joe Friday, was played by actor Jack Webb as a serious, no-nonsense, slightly droll officer. When interviewing victims or witnesses all he wanted was “the facts,” no emotional fluff for this detective. 

In fact, the phrase, “Just the facts, ma’am,” became his trademark line. (Piece of trivia – Sergeant Friday never uttered those exact words. That phrase was uttered by Stan Freberg in a parody of Dragnet. But that is a different story all together.) 

However, a “just the facts, ma’am” mentality is exactly what we will need if we are to save this vital core social safety net from politicians who for some reason want to do away with this program. That is the purpose of this post and future ones if necessary. I want to give you, I want to arm you with facts about our – your – Social Security program. 

I had initially hoped to write one comprehensive post. But when I began to do the research I found out there was just so much great information out there I could not get it all into one post. So I have decided to break it down into more manageable pieces. In this post I will deal with how and why Social Security came into existence. In subsequent posts I will deal with the changes that have been made to the program over the years, and last of all try to answer the question: is the Social Security program bankrupt? 

So let’s start at the beginning. How and why did Social Security begin? 

Everyone knows that Social Security was created by Franklin Delano Roosevelt during the Great Depression. But why? What were the conditions that made helping senior citizens and children so imperative? 

We all tend to think Social Security was only in response to the Great Depression. But the Great depression had roots in many places, not the least of which was the Industrial Revolution. 

If you remember your American history classes you know that there was a shift from an agricultural society to an industrialized society in the mid to late 1800’s. The Industrial Revolution and the resulting urbanization of America led to the disappearance of the "extended" family and the safety net it provided young and old alike. 

This also meant that more people were dependent on wages to buy food. Prior to the Industrial Revolution most families could at least grow enough food to feed their immediate family.  

All of that changed in the decades before the Great Depression. When economic income is primarily from wages then your economic security can be threatened by factors outside of your control. Recessions, bank failures, layoffs, failed business can all adversely affect you. And none of those things are your fault. You can still work hard but that will not protect you from the vagaries of the market. 

The upshot of all this is that the old ways of providing for economic security for children and the elderly were crumbling prior to and during the depression. Keep that in the back of your minds as you read about the Great Depression and what happened to ordinary folks like yourselves.   

Most historians agree that the Great Depression began on Black Friday, the day the Stock market crashed, October 27, 1929.  Herbert Hoover was President. Most people believed the economy would correct itself as the nation had survived worse recessions. But this belief soon proved untrue. 

According to the Eleanor Roosevelt Papers, by the time FDR took the oath of office in January, 1933 unemployment had grown from 8 million at the start of the recession to 15 million people. This was roughly one-third of the non-farmer work force. The GNP had fallen from $103.8 billion to 55.7 billion.  

When the depression began about 18 million elderly, disabled, and single mothers with children lived at bare subsistence levels. [Emphasis mine] By 1933 another 13 million Americans had lost their jobs. States, which had been caring for the elderly, disabled, and mothers with children, were over-whelmed and could no longer provide even minimum help. Poorhouses and orphanages were created to help, but often conditions in these institutions were extremely harsh and only the most destitute would apply. 

Food riots broke out, men deserting their families began to rise, and the homeless were living in public parks and in shanty towns. The effect of the Depression on poor children was devastating. 

Most of the elderly did not have personal savings or retirement pensions to even provide for bare minimum support during good economic times, let alone during an economic crisis. For those that did those savings and investments were wiped out by the crash.  

Americans had always taken pride in their rugged individualism and self-reliance. But these kinds of harsh realities and conditions made many Americans begin to question that assumption.  

From the Eleanor Roosevelt Papers: 

“…… Although the depression was world wide, no other country except Germany reached so high a percentage of unemployed. The poor were hit the hardest. By 1932, Harlem had an unemployment rate of 50 percent and property owned or managed by blacks fell from 30 percent to 5 percent in 1935. Farmers in the Midwest were doubly hit by economic downturns and the Dust Bowl. Schools, with budgets shrinking, shortened both the school day and the school year. 

The breadth and depth of the crisis made it the Great Depression. 

No one knew how best to respond to the crisis. President Hoover believed the dole would do more harm than good and that local governments and private charities should provide relief to the unemployed and homeless. By 1931, some states began to offer aid to local communities. FDR, then governor of New York, worked with Harry Hopkins and Frances Perkins to begin a direct work relief program. This helped only a very few. By 1932, only 1/4 of unemployed families received any relief. In 1932, only 1.5 percent of all government funds were spent on relief and averaged about $1.67 per citizen. [Emphasis mine]  

Cities, which had to bear the brunt of the relief efforts, teetered on the edge of bankruptcy. By 1932, Cook County (Chicago) was firing firemen, police, and teachers (who had not been paid in 8 months). Breadlines and Hoovervilles (homeless encampments) appeared across the nation.”   [See photo below] 

Citation: The Eleanor Roosevelt Papers."The Great Depression." Teaching Eleanor Roosevelt, ed. by Allida Black, June Hopkins, et. al. (Hyde Park, New York: Eleanor Roosevelt National Historic Site, 2003). http://www.nps.gov/archive/elro/glossary/great-depression.htm 

This picture haunts my heart and my soul. This is America circa 1932. It looks like a third world country.  

For more depression era photos click link below: 

http://www.english.illinois.edu/maps/depression/photoessay.htm 

In America prior to Social Security there were Civil War veteran’s pensions and some company pensions. I will not delve into that history except to note there is some precedent to Social Security in America 

Some states provided aid for the elderly and retirees. But these state programs were basically just welfare programs and eligibility was based on financial need. Then, as now, most Americans opposed welfare type programs. Furthermore, these plans were woefully inadequate, most providing less than $1 a day. And when the depression came there were just too many in need for them to be effective. 

Throughout 1934 Roosevelt talked about ‘national economic insecurity’ and a ‘social insurance’ plan during many of his fireside chats. On June 8, 1934, Roosevelt announced his intention to provide for a Social Security program. By executive order he initiated a commission composed of five of his top cabinet-level officials to find a way to achieve this goal. The committee was instructed to study the entire problem and to make recommendations that would serve as the basis for legislation. 

What Roosevelt did that was so innovative was to introduce an alternative to welfare and called it “social insurance.” He changed the debate. He created a work-related, contributory system in which workers would provide for their own future economic security through personal and company paid contributions, or taxes, paid while they are still employed. 

“Security,” Roosevelt said, “was attained in the earlier days through the interdependence of members of families upon each other and of the families within a small community upon each other. The complexities of great communities and of organized industry make less real these simple means of security. Therefore, we are compelled to employ the active interest of the Nation as a whole through government in order to encourage a greater security for each individual who composes it . . . This seeking for a greater measure of welfare and happiness does not indicate a change in values. It is rather a return to values lost in the course of our economic development and expansion . . .”  [All emphasis mine] 

In January 1935 the commission made its report to the President and on January 17, 1935 Roosevelt sent the report to both houses of Congress for simultaneous consideration.  

The final bill was passed into law by voice vote on August 8, 1935 in the House (372 Yes, 33 no, 25 not voting) and on August 9th in the Senate (77 yes, 6 no, 12 not voting). 
 
On August 14, 1935 President Roosevelt signed the bill into law at a ceremony in the White House Cabinet Room. 

President Roosevelt’s remarks on this video, posted by politicalhack28, say it all:  

"We can never insure one hundred percent of the population against one hundred percent of the hazards and vicissitudes of life, but we have tried to frame a law which will give some measure of protection to the average citizen and to his family against the loss of a job and against poverty-ridden old age." 

From the Social Security – History website: “The two major provisions relating to the elderly were Title I- Grants to States for Old-Age Assistance, which supported state welfare programs for the aged, and Title II-Federal Old-Age Benefits. It was Title II that was the new social insurance program we now think of as Social Security. The new Act created a social insurance program designed to pay retired workers age 65 or older a continuing income after retirement.” 

The original bill provided benefits only to the worker. In 1939 an amendment added two new categories of benefits – payment to a spouse and minor children of a retired worker (dependents benefit) and survivors benefits in case of a premature death of a covered worker. This changed Social Security from a workers only retirement program to a family based economic security program. 

From the Report of the Social Security Board which recommended those changes: 

"It is impossible under any social insurance system to provide ideal security for every individual. The practical objective is to pay benefits that provide a minimum degree of social security—as a basis upon which the worker, through his own efforts, will have a better chance to provide adequately for his individual security."  

Now how does all of this affect me here and now?  

According to the National Center for Policy Analysis that is really quite simple. 

“SOCIAL SECURITY IMPORTANT FOR RETIREMENT OF POOR AND RICH” 

“Even the wealthy depend upon Social Security for much of their consumption after they quit working, according to a new report from the National Center for Policy Analysis (NCPA). 

Consider:

Social Security accounts for virtually all of the discretionary consumption of households with pre-retirement incomes of less than $50,000 a year or $25,000 for singles.  

Social Security accounts for about one-third of all discretionary consumption for the highest-income households — couples earning $500,000 or singles earning $250,000 prior to retirement.   

A primary goal of financial planning is to maintain a consistent standard of living during a person's lifetime.  If Social Security were abolished tomorrow, all retirees would experience an immediate reduction in their consumption.   

If younger workers were notified in advance, they could adjust their saving and spending habits today to avoid abrupt changes in their standard of living upon retirement.   

Yet only the highest income workers have the ability to adjust so as to completely smooth their consumption across their lifetime.  Because low- and middle-income workers are constrained by current obligations they cannot completely adjust.  

For example, if Social Security benefits were eliminated for workers age 35 or younger:

A couple with an annual income of $500,000 could level their consumption across their lifetime by reducing their current consumption by almost 18 percent in each succeeding year.  

Yet a couple with an annual income of $200,000 that reduced their current consumption by almost 24 percent, would experience approximately another 15 percentage point reduction in consumption upon retirement.  

A couple with an annual income of $50,000 that reduced their current consumption by more than 21 percent would experience another 26 percentage point reduction upon retirement.” 

Source: Laurence J. Kotlikoff, Ben Marx and Pietro Rizza, "How Much Do Americans Depend on Social Security?" National Center for Policy Analysis, Policy Report No. 301, August 2007. 

So on Friday last, Susan was one-hundred percent correct: Social Security is this nation’s CORE safety net in good and bad times; but especially in the bad times.  

Don’t let anyone, especially politicians take your safety net away and give it to Wall Street types.  

The American populace knows that the primary architects in the formulation of the Stimulus Plan working its way through Congress are Rahm Emanuel, Nancy Pelosi, and Harry Reid. This contingent, along with President Obama, have not been bashful in stating they view the November election results as effectively a mandate to change policies emanating from Washington.

Against that backdrop, the initially proposed Stimulus Plan was so loaded with pork that the Republicans and the American population at large slammed it as more a promotion of the

Martin Feldstein

I will give President Obama credit for formulating a Panel to Advise Obama on Economy.

This panel will be known as the White House Economic Recovery Advisory Board. The Board will be headed by former Fed chair Paul Volcker. He will be joined by Jeff Immelt of GE, James Owens of Caterpillar, William Donaldson, former SEC chair, Roger Ferguson Jr. of TIAA-CREF, Richard Trumka of AFL-CIO, Anna Burger of SEIU, and Martin Feldstein, renowned Harvard economist. The group will be guided by Austan Goolsbee, an economic adviser to the White House.

Do you think President Obama and his economic team would listen to Mr. Feldstein or is that a “mere courtesy” having him on the board? Let’s review what Mr. Feldstein said about the Stimulus Plan just last week.

Regarding the proposed Stimulus Plan, Martin Feldstein offered that it is far better to go back to work and do it right versus merely doing it fast:

An $800 Billion Mistake

By Martin Feldstein
The Washington Post
Thursday, January 29, 2009

As a conservative economist, I might be expected to oppose a stimulus plan. In fact, on
this page in October, I declared my support for a stimulus. But the fiscal package now
before Congress needs to be thoroughly revised. In its current form, it does too little to
raise national spending and employment. It would be better for the Senate to delay
legislation for a month, or even two, if that’s what it takes to produce a much better bill.
We cannot afford an $800 billion mistake.

Start with the tax side. The plan is to give a tax cut of $500 a year for two years to each
employed person. That’s not a good way to increase consumer spending. Experience
shows that the money from such temporary, lump-sum tax cuts is largely saved or used
to pay down debt. Only about 15 percent of last year’s tax rebates led to additional
spending.

The proposed business tax cuts are also likely to do little to increase business investment
and employment. The extended loss “carrybacks” are primarily lump-sum payments to
selected companies. The bonus depreciation plan would do little to raise capital spending
in the current environment of weak demand because the tax benefits in the early years
would be recaptured later.

Instead, the tax changes should focus on providing incentives to households and
businesses to increase current spending. Why not a temporary refundable tax credit to
households that purchase cars or other major consumer durables, analogous to the
investment tax credit for businesses? Or a temporary tax credit for home improvements?
In that way, the same total tax reduction could produce much more spending and
employment.

Postponing the scheduled increase in the tax on dividends and capital gains would raise
share prices, leading to increased consumer spending and, by lowering the cost of capital,
more business investment.

On the spending side, the stimulus package is full of well-intended items that,
unfortunately, are not likely to do much for employment. Computerizing the medical
records of every American over the next five years is desirable, but it is not a cost-
effective way to create jobs. Has anyone gone through the (long) list of proposed
appropriations and asked how many jobs each would create per dollar of increased
national debt?

The largest proposed outlays amount to just writing unrestricted checks to state
governments. Nearly $100 billion would result from increasing the “Medicaid matching
rate,” a technique for reducing states’ Medicaid costs to free up state money for spending
on anything governors and state legislators want. An additional $80 billion would be given
out for “state fiscal relief.” Will these vast sums actually lead to additional spending, or will
they merely finance state transfer payments or relieve state governments of the need for
temporary tax hikes or bond issues?

The plan to finance health insurance premiums for the unemployed would actually
increase unemployment by giving employers an incentive to lay off workers rather than
pay health premiums during a time of weak demand. And this supposedly two-year
program would create a precedent that could be hard to reverse.

A large fraction of the stimulus proposal is devoted to infrastructure projects that will
spend out very slowly, not with the speed needed to help the economy in 2009 and 2010.
The Congressional Budget Office estimates that less than one-fifth of the $50 billion of
proposed spending on energy and water would occur by the end of 2010.

If rapid spending on things that need to be done is a criterion of choice, the plan should
include higher defense outlays, including replacing and repairing supplies and equipment,
needed after five years of fighting. The military can increase its level of procurement very
rapidly. Yet the proposed spending plan includes less than $5 billion for defense, only
about one-half of 1 percent of the total package.

Infrastructure spending on domestic military bases can also proceed more rapidly than
infrastructure spending in the civilian economy. And military procurement overwhelmingly
involves American-made products. Since much of this military spending will have to be
done eventually, it makes sense to do it now, when there is substantial excess capacity in
the manufacturing sector. In addition, a temporary increase in military recruiting and
training would reduce unemployment directly, create a more skilled civilian workforce and
expand the military reserves.

All new spending and tax changes should have explicit time limits that prevent ever-
increasing additions to the national debt. Similarly, spending programs should not create
political dynamics that will make them hard to end.

The problem with the current stimulus plan is not that it is too big but that it delivers too
little extra employment and income for such a large fiscal deficit. It is worth taking the
time to get it right.

The writer, an economics professor at Harvard University, is president emeritus of the
National Bureau of Economic Research.

Barack, how about you and Martin go for a little walk. Take your time!!

LD

Did you see what Nancy Pelosi had to say about the dire job situation in America? In case you didn’t catch it, she said that 500 million Americans lose their jobs every month that the economic downturn lasts.

That means the country has lost at least 2 billion jobs since the recession began. Even allowing for those who work two, three or even four jobs, it means that not only are there no jobs left in America, but that we now have minus a billion jobs that were not there in the first place.

This is scary stuff.

It is not only scary to have such a huge shortfall in the job market – amounting in effect to more than six no-jobs for every man, woman and child in America – it is even scarier that someone with Nancy’s loose grasp of economic reality (or at least a loose grasp on her tongue) should be one of the most influential people in Congress.

Of course this is not the first time that Pelosi has exaggerated slightly. She helped to scupper the first economic rescue package (though some, including me, may say that is not a bad thing) by making absurdly partisan claims that it was the economic policies of George Bush that were solely to blame for the crisis, whereas it was Congress (led by Pelosi and helped by Barney Frank) that blocked reforms of Freddy Mac, Fanny Mae and the legislature that allowed the whole sub prime mortgage fiasco to happen in the first place.

I am pretty sure it will not be her last exaggeration. I wonder what her next one will be. Of course there was her recent promise that no rescue package would be passed that contained any pork. Did I hear someone say something about pigs flying?

The Christmas to New Year period can be the loneliest time of the year for those not celebrating with family or friends, or who are stuck in the rut of depression. There are many more lonely people out there than most of us can imagine, and in the current economic climate there is no doubt a lot more personal depression to go along with the financial depression.

While I do not want to spread despondency or gloom, I wanted to try to give expression to the kind of isolation and emptiness that many experience during the Christmas period and through the winter months. This video is the result.

It is the second video in a series called “Painting With Music”, where I tried to match music to video footage that has been processed to look like moving paintings. The first one in the series is called “Sunrise” and is a much more cheerful video.

Once again I would like to wish all NQ readers a great new year and to express thanks for the kind comments about my previous videos and the pieces I have written specially for NQ.