Republicans Say they are Willing to Shut Down the Government in March
White House officials are eyeing a return to elements of a “grand bargain” they tried to reach late last year with House Speaker John Boehner (R-Ohio) in order to defuse a fresh threat to the U.S. economy in just two months, according to The Washington Post and sources familiar with the discussions. The Post article is at http://tinyurl.com/ahtfrb6.

President Obama and Boehner came close last month to a major deal aimed at stabilizing the federal debt. But the speaker abandoned the talks, saying that the White House offer was too heavy on taxes and too light on spending cuts. Instead, Democrats and Republicans reached a far more modest agreement to avoid the fiscal cliff. Republicans say they have a stronger hand in the new negotiations because of the federal government’s pressing need to increase its $16.4 trillion borrowing limit. The government hit the debt ceiling this week, and the Treasury Department warns it will be unable to pay its bills in about two months unless it can borrow more. Congressional Republicans say they will not vote to raise the debt ceiling unless there is a deal to make steep spending cuts. Republicans also say they are willing to shut down the federal government in March, when a resolution funding it expires. If Republicans do resist an increase in the debt ceiling, Obama Administration officials plan to attack them for risking an economic calamity in an effort to slice Medicare. One possible way to curb the debt is to adopt a less-generous measure of inflation in calculating Social Security payments, the “Chained CPI.”

According to the Social Security Actuary, moving to a chained CPI would mean an immediate benefit cut. “An average earner retiring in 2011 at age 65 would lose over $6,000 over 15 years if the chained CPI were adopted,” said Edward F. Coyle, Executive Director of the Alliance. “The losses would be greater for those living longer.” The Alliance is planning a broad lobbying effort between now and the end of February. More on the chained CPI is at http://tinyurl.com/b49dhhc.

Long Term Care Program Ended by “Fiscal Cliff” Deal
The resolution to the “Fiscal Cliff” reached earlier this month in Washington repealed the CLASS Act, or the “Community Living Assistance Services and Supports” Act. A component of the 2010 health reform law that was championed by the late Senator Edward M. Kennedy (D-MA), the program aimed to help middle class families afford long-term care. However, the federal effort has faced great challenges since becoming law. The insurance industry strongly targeted it for repeal, and the Obama administration was forced to suspend implementation because of long-term funding problems. Despite the repeal, Senator Jay Rockefeller (D-WV) was able to insert into the fiscal agreement a provision to create a commission to recommend improvements in long-term services. “Long-term care causes great anxiety for millions of Americans families. We must help people afford the care they need,” said Ruben Burks, Secretary-Treasurer of the Alliance.

Social Security Checks: You are asked to Switch to Direct Deposit by March 1
Millions of Americans still receiving paper checks for Social Security and other federal benefits have less than two months to switch to electronic payments. In an effort to cut spending, federal officials began retiring paper checks in favor of direct deposits and prepaid “Direct Express” debit cards in May 2011. Since then, the Treasury Department has required all new recipients of payments from federal benefits programs -- including Social Security, Supplemental Security Income disability, Veterans Affairs and government pension plans -- to sign up for electronic payments. It set a March 1, 2013, deadline for all other recipients to do the same.

According to CNN, approximately 93% of payments are now being made electronically. However, about 5 million checks are still mailed each month -- representing an additional $4.6 million in monthly costs, since each mailed check costs 92 cents more than a direct deposit transfer, Treasury officials said on Tuesday. The agency said if it didn't push for the switch to electronic transfers, it would cost taxpayers another $1 billion over the next 10 years. Anyone who fails to make the change will still receive paper checks, but will be the target of more aggressive communication efforts, such as additional mailings, said Walt Henderson, a Treasury official. He warned that after March 1, Social Security beneficiaries receiving paper checks are not in compliance.

Labor Secretary Hilda Solis to Leave the Administration
Secretary of Labor Hilda Solis is resigning, opening up one more slot in President Obama’s second-term administration. A former member of Congress, Secretary Solis was the first Hispanic woman to head a Cabinet-level agency. “I would like to offer my gratitude to Secretary Solis. Because of her, we have workplace safety and government support of its workers in place, allowing us to achieve healthier, more economically stable retirements down the line,” said Barbara J. Easterling, President of the Alliance.

Texas and New Mexico Alliance News: A Convention and Medicaid Expansion!
The Texas Alliance held its annual convention in Austin on Saturday. Attendees voted on bylaws changes and discussed activist actions for early 2013. Tommy Christakis of UFCW and Leah Witherspoon of Working America were elected as new Vice-Presidents/Executive Board members.

Next door in New Mexico, on Tuesday, Governor Susana Martinez (R) gave a speech announcing the acceptance of Affordable Care Act funds for Medicaid expansion, after months of pressure from retirees and other health care justice advocates. For more on this, go to http://tinyurl.com/aufyjy7.

Florida Alliance Holds Fiscal Cliff Events in Palm Beach Gardens, Wellington
On Tuesday this week, Florida Alliance members participated in a round-table discussion on “The Fiscal Cliff: Myths, Truths and Options” in Wellington. Dr. Richard Hattwick, an economist, and Wendi Lipsich, District Director of Rep. Ted Deutch’s (D) office, spoke at the event.

Members of the Florida Alliance Executive Board met with Sen. Marco Rubio’s staff on Friday. The meeting was followed by a press event outside the Senator’s Palm Beach Gardens office. Sen. Rubio was one of only eight U.S. Senators to vote against the fiscal cliff deal earlier this month.

For a printable version of this document, go to http://tinyurl.com/bc5p3p2