Inequality is Weakening Social Security. Here’s How We Fix That.
When Congress set the cap on Social Security contributions in 1983, they didn’t anticipate forty years of rising inequality. And it’s cost us — a lot.
If Elizabeth Warren were elected President, what would she say in her inaugural address?
By Robert Hertz
January 20, 2017
I have been elected by the American people to create meaningful social change.
And do you know something? I am going to do just that.
Hang on to your collective hats, then. Here is my agenda for the “First Hundred Days.”
GOAL NO. 1 – Fix student debt
We will take the following actions:
a. All student loans, public and private, will go on to an income-based repayment plan. The basic outline is the 10/10 Plan introduced by Rep. Karen Bass in 2013.
For example, if your income after college is $20,000 a year, your payments will be no more than $1,000 a year.
Your Interest rate does not matter. Your loan principal does not matter.
Private debt collectors and loan servicing agencies will not be needed. You can just make payments through payroll or bank account deductions.
b. After ten years of payments, your loan will be forgiven, no matter what the remaining balance at that time. The lenders recover nothing. The loans go off the books, whether federal or private. If private lenders lose money, the government can bail them out at 25 cents on the dollar. If the investors in securitized loans lose money, too bad. They are vultures and parasites right now, profiting from unconscionable debt.
c. Debt forgiveness of any kind will never be a taxable event again.
d. This new law is retroactive – i.e. if you have been paying on time for ten years already, your loan is now over.
e. Pell Grants will be doubled, at a cost of $35 billion. They will also be available to families with incomes up to $75,000. This is vital because college loans will dry up rapidly – federal loan guarantees will of course disappear.
f. Vocational schools will be free for any two year course of study. Vouchers will be given for tuition, which cannot exceed $8,000 per year.
g. Free vocational tuition will require new federal expenditures of about $50 billion annually. Free courses will be available to adults as well as recent high school graduates.
We must start treating higher education as a collective social responsibility, paid for with taxes and grants, not private loans. It should not require loans to get ready to enter the work force. We should take the example of Germany, i.e. “Stop student loan sharking, and make college free.”
GOAL NO. 2 – Protect patients from unconscionable medical charges
a. Emergency room fees will be capped at 125% of Medicare rates, nationwide, with no exceptions.
If a hospital bills you for $25,000 and tries to collect – while Medicare would have paid $1,200, – you can throw the hospital bill away.
Any hospital which tries to collect bloated bills will be fined and monitored. Hospitals which persist in price – gouging will eventually be kicked out of the Medicare program. My administration will be actively hostile toward price-gouging hospitals.
b. In any emergency, out of network charges will be capped at 110% of what a network doctor would be paid. Balance bills any higher than that will be null and void.
c. In non-emergencies, we must move towards claim determination in advance of care. The provider must be forced to give a binding estimate of costs. The principle must be “No disclosure, No liability.”
d. Existing medical debts can be submitted to binding arbitration. We will establish specialized health courts in each states, with $250 million of federal funds.
These courts will be staffed by administrative law judges, doctors, and patient advocates. They will have the authority to reduce existing bills. All collection activity will stop if a medical bill to arbitration.
These protections will be available to any patient, with no income cutoffs whatsoever.
GOAL NO. 3 – Protect vulnerable workers
a. Employers will be obligated to cover payroll taxes on the first $50,000 in annual earnings for any employee. There will be no more “independent contractors” at these wage levels.
b. Federal and state spending will adhere to union wage scales. For example:
If a Teamster warehouse worker makes $20 an hour, the government will not do business with any firm whose warehouse workers are considered “temps” and make $9 an hour.
If a firm like Fed Ex is misclassifying drivers as independent contractors, the government should stop doing business with Fed Ex, immediately.
This also applies when corporations who use low paid “temps” from subcontractors. If a defense plant uses contract firms that exploit workers, then the government will end their contract – and this fact will be widely publicized.
The government will encourage boycotts of abusive companies that do not pay a living wage, and those which use exploitative scheduling practices. No government employees will stay in any hotel which does not pay union scale. No government lunches will be held in restaurants which utilize the “tipped minimum wage.” Of course any firm which uses foreign call centers will be exposed and boycotted.
Our goal is sector-wide bargaining agreements – i.e. every one who does a given job is paid approximately the same. In most other advanced nations, temporary workers get paid holidays, sick pay, etc.
In addition: The Department of Labor will add 5,000 wage-and-hour inspectors to investigate wage theft, overtime abuses, denial of sick pay, etc.
The Legal Services Corporation staff of attorneys will be increased by at least 1,000.
They will offer free legal representation to workers with complaints of unjust firing, age discrimination, and job denials due to credit reports, drug tests, or criminal background checks.
If the courts are filled with greedy employers getting sued, that is a good thing. It is not enough for the government to just encourage unions – the government will in many ways become a national union.
GOAL NO. 4 – Protect vulnerable citizens in our legal system
a. Local courts will be barred from charging fines in minor civil matters. There will be no more fees for court costs, jail costs, revoked drivers licenses, probation services, mandatory drug testing, et al. Lawbreakers can still be charged with crimes – but they are not going to owe money also.
No one will ever face jail time for failure to pay penalties. “Pay or serve” warrants will be illegal.
Instead, Federal funds for court costs and public defenders will be increased by $10 billion, immediately.
b. The war on drugs will come to an end.
There will be no more arrests for street use or possession of marijuana.
Anyone in prison for simple drug use will have their sentences commuted; drug-related convictions will be expunged, unless they involved armed robbery.
c. The debt collection industry will be severely regulated.
No debt over three years old can be sold to anyone.
Medical debt cannot be sold to collectors.
Student loan debt cannot be sold to collectors.
If a debt collector receives three complaints from the public, they can be shut down.
d. We will re-establish national usury laws.
For example, credit card interest rates will be capped at 10% – although this may have to be done in stages.
Our goal is to stop the return of creditor’s cruelty – America can be a better place than that.
As a result of these changes, a vast amount of protest will be directed at my administration – mainly by predators who have grown rich in recent years, such as:
Most public and private colleges, minimum-wage franchises, meat packers, agribusiness, and construction firms that hire illegals, pharmaceutical companies, hospitals, et al.
We have “had it” with basic social needs being converted to a pool of rents, which then are collected by private profiteers. People should not have to go into debt for health care, education, or normal living expenses.
My response to the coming protests is the same as Franklin Roosevelt’s in 1936, when he said:
“Of course we will continue to protect the consumer against unnecessary price spreads, against the costs that are added by monopoly and speculation. We will continue our successful efforts to increase his purchasing power and to keep it constant.
We had to struggle with the old enemies of peace – business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.
Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me–and I welcome their hatred.”
This piece originally appeared on the blog, New Laws for America.
Robert Hertz runs the blog, “New Laws for America” at www.newlawsforamerica.com.