Class Warfare Extends to Senior Citizens

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Older Eskimos, according to the story, didn't retire to a golden age, but were gently placed on ice floes to freeze. Such an idea may be more humane than what the American ruling class and its political stooges have in mind for seniors.

American retirees face an imminent threat of losing their Social Security, their pensions, and their health insurance coverage. What's more, retirees make good victims in the assault against the working class – they generally vote for their own executioners!

The fastest growing age demographic has consistently voted Republican, and continued to do so even when President Obama swept the younger age groups. While union retirees, who are much better informed, voted with their unions in even higher proportions than active union members, the over-65 population in general continued to vote Republican in 2010, even when some of the right-wingers had let it be known that they intended to slice and dice retiree benefits!

Not so long ago, some American seniors had an enviable life. Their retirement packages were guaranteed for life, and there was no historical precedent for taking anything away from them. The LTV corporation pioneered the scheme, around 1986, of throwing retiree benefits into the general pool of "unsecured debt" during bankruptcy proceedings. Retirees argued, rightly, that their pensions and health care benefits were not "unsecured debt" but their own income that had been delayed until retirement. They could have, they argued, taken their job benefits in the form of larger salaries, instead of delayed benefits. But LTV shopped around until they found a bankruptcy court that would massacre retirees, and the rest of America's corporations quickly followed the precedent.

Many unionists think that company-controlled pensions and health care were an accomplishment of far-sighted union leaders. United Auto Workers President Walter Reuther is especially credited with inventing the idea in the so-called "Treaty of Detroit" around 1950. Other historians may agree that Reuther was the first to accept these benefits in a union contract, but say that the actual idea came from the CEO of General Motors, Charles Wilson.

In his shockingly candid account, Rainbow at Midnight, historian George Lipsitz explains that Wilson wanted to tie labor to General Motors and the other big corporations who would benefit from pension investment money. He wanted to delay paying workers their benefits, and the tax advantage didn't hurt at all. Wilson wanted to divide the working class into those who had good pensions and those who didn't. He wanted General Motors employees to have strong incentives for staying with the company and making fewer waves. He wanted employees to feel that they had a big stake in capitalism and the stock market, where their future pensions were invested. Lipsitz writes, "The new pension plans gave union leaders added incentive to cooperate with management. The fund functioned as an indirect kind of union shop, tying workers to the union as well as the company. The rank and file would be more amenable to schemes of labor-management cooperation and less likely to risk being fired... Within a year of the agreement between GM and the UAW, more than eight thousand new pension plans went into effect in the United States" (page 246).

In Europe, nations with strong and socially conscious unions were implementing government pensions and health care after the World War. In the U.S., corporations maintained control of both. In the 1970's, as the post-war prosperity exhausted itself in America and foreign competition re-asserted itself, those same corporations sharpened their knives and went against the time-weakened and unsuspecting working class. The slaughter, delayed but not defeated by the stronger unions, is still underway.

Social Security and Medicare were special cases. The first came from President Roosevelt's visionary assistant, Frances Perkins, in 1935. Republicans opposed it then and on every possible occasion since, but it remained America's best and most successful program. Medicare was added in the 1960s under President Lyndon Johnson. The National Committee for Senior Citizens, NCSC, largely under the control of the Auto Workers union, took credit.

Neither program met all the needs of retired workers, but both were a great deal of help and were generally improved upon. In 2003, Republicans led by President George W Bush added a fatally flawed prescription drug program to Medicare. Most of its worst features were corrected in the Democratic Party's 2009 health care reform.

Today, anti-worker politicians claim that Medicare is one of the biggest contributors to what they call America's biggest problem: the federal deficit. Instead of supporting the 2009 health care reform, which would actually reduce the long-term deficit, they are calling for its repeal and for slashing Medicare benefits.

Those same anti-worker politicians and their corporate sponsors believe that they can also convince American workers to give up Social Security. They same that it is the largest contributor to the deficit, that it is an "entitlement" like welfare, that its fund is exhausted, that its only assets are "worthless IOU's," that workers live much longer now and can easily work far beyond the retirement age, and that there aren't enough workers in America to support the retirees. Check the box for "false" on every allegation.

* Social Security has its own pay-as-you-go funding and has nothing to do with the federal deficit. It never did.

* Social Security was never an entitlement and still isn't. The payments come from a fund supplied by equal payroll taxes on employees and employers.

* The Social Security trust fund is solvent until 2037, when it could either reduce the payment schedule or take an easy fix, raising the cap on taxable income, for more revenue.

* The Social Security trust fund, while no longer in a "lock box," consists of U.S. government securities, generally thought of as the safest investment in the world.

* While Americans on average do live longer than before, the averages are skewed by the well-to-do, whose gain in life expectancy is much higher than that of workers.

* Even though there are more retirees relative to active workers than before, the difference is more than compensated for by the increase in each workers' productivity. A simple spreadsheet of annual productivity gains from the Bureau of Labor Statistics will show that today's workers produced 413 percent as much real value per hour in 2010 than they did in 1947. In other words, one worker today could support four times as many retirees as he/she supported in 1947!

In short, all the arguments against retirees and retirement benefits are nothing but ruling-class lies for their class war against us. Our side, the workers' side, is not giving in. The older NCSC has given way to the modern Alliance for Retired Americans, with much broader and more effective union support. A growing number of state and local retiree organizations, led usually but not always by unionists, is fighting back with the truth and organized political power. They merit our support.

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  • I appreciate the comments. Those who are trying it know that it is very difficult to organize retirees and move them into action. The Alliance for Retired Americans has nevertheless done a splendid job. I urge everyone to join ($10/year). They have no membership requirements, not even an age requirement.
    --jim lane in dallas

    Posted by jim lane, 03/16/2011 10:50am (7 years ago)

  • @JB I'm guessing you didn't read the article and only get your info from Glenn Beck. That's ok; it's not your fault. But there is help for you. Keep reading.

    Posted by chuck m., 02/25/2011 8:43am (7 years ago)

  • Social Security is a ponzi scheme who's finally been shown to be unsustainable.

    Posted by JB, 02/25/2011 8:37am (7 years ago)

  • Jim, as a retiree whose monthly pension check is 20% lower than it was three years ago, I thank you for your fine article. Ironically as I was reading your article Joe Glazer's song "Too Old to Work and Too Young to Die," was playing on the internet radio station I was listening too. Here are the lyrics:


    You work hard for a living until you get old,
    And sometimes they push you right out in the cold.
    When you’re working time’s through, you don’t want charity,
    You’d like to retire with some dignity.

    Chorus:
    And you’re too old to work, Too old to work,
    When you’re too old to work and you’re too young to die.
    Who will take care of you? How’ll you get by,
    When you’re too old to work and you’re too young to die?

    They put horses to pasture, they feed them on hay,
    Even machines get retired some day.
    The boss gets a pension when he is too old;
    You helped him retire, you’re out in the cold.

    Chorus

    There’s no easy answer, there’s no easy cure.
    Dreaming won’t change it, that’s one thing for sure!
    But, fighting together, we’ll get there some day,
    And when we have won, we will no longer say…

    Chorus

    Posted by Paul White, 02/24/2011 11:27am (7 years ago)

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