By Al Norman
Some members of Congress have been playing fast and loose with your money.
I’m not talking about lawmakers going on a spending spree. I’m referring to the debate over the federal debt ceiling — something that every retiree and near-retiree should be upset about.
In late September, U.S. Treasury Secretary Jack Lew started warning the media that, “If we have insufficient cash on hand, it would be impossible for the United States of America to meet all of its obligations for the first time in our history.”
Republicans in the U.S. House of Representatives were equally adamant that they would not vote to raise the debt ceiling unless Congress defunded Obamacare — the only federal health law that protects Americans from being denied health insurance due to a pre-existing condition.
The U.S. Treasury processes about 80 million payments a month. Secretary Lew said that by mid-October, if Congress hadn’t raised the borrowing limit, Treasury would not be able to pay the bills just with the cash it has on hand. Bills like IRS refunds, Social Security checks, Medicare payments, etc.
The Congressional Budget Office projected that the U.S. Treasury would run out of cash to pay its bills sometime between Oct. 22 and Oct. 31. How’s that for a Halloween scare?
President Obama wanted the debt ceiling raised — not so that Congress could spend more — but so the nation could pay the bills it’s already incurred, based on budgets already passed.
Republican Congressmen saw the debt ceiling debate as a political opportunity to bring down the ceiling on Obamacare. But here’s why every middle class American should have hit the ceiling when they saw this Republican gambit:
In August 2011, when Congress was in another debt ceiling face-off with the White House, Standard & Poor’s downgraded America’s credit rating. U.S. stocks slid by 6 percent that month alone. That’s a financial hit for everyone investing in an IRA or for everyone relying on a mutual fund or annuity for his or her retirement. With employer pensions almost non-existent, millions of workers have had to turn to their own meager savings as their only add-on to Social Security. Anything that knowingly hurts such investments is an attack on retirees.
“The market is vulnerable to negative news,” one stock analyst fretted. “You have the market watching dysfunction in Washington in real-time…” Investors start to pull back, nervous that Congress won’t be able to cross the debt-ceiling divide, and will toss the U.S. government over the cliff.
People in retirement, or near retirement, watch helplessly while their IRA monthly statement head south, costing them thousands of dollars in losses. All because some Congressmen want to cripple President Obama’s legislative cornerstone.
Seniors have good reason to be seething over the House Republican strategy. Your retirement savings are being put on the line for members in Congress to score political points.
Clip this column and mail it to your Massachusetts Congressman and Sens. Markey and Warren. Let them know you’re fed up with House Republicans savaging your personal savings with all this talk of defaulting on the federal debt — because you know this is going to keep coming up year after year. Let your representatives know that it is middle class retirees who will pay the price financially for this political game of hostage.
Al Norman is the executive director of Mass Home Care. He can be reached at firstname.lastname@example.org, or at 978-502-3794.