Garnishing Social Security to Impoverish Elderly

Citizen Wealth Financial Justice

social_securitySilver Spring I couldn’t believe this when I read it, but somehow Congress and the Bush Administration managed to figure out a way to garnishee social security and disability payments for seniors by eliminating the 10 year statute of limitations on collecting certain debts owed to the federal government.  Did you know this?  Amazing that while we should be committed to building citizen wealth, instead we are trying to play gotcha with the elderly to attach their small social security checks for federal government debt claims in many cases for an indefinite period.  Thanks to Ellen Shultz in an article in the Wall Street Journal called “Seniors Lose Shield on Debts.”

Here’s the horror:

◦     Before you count on social security payments for your senior years, realize that the government can demand payback on veterans payments for health care, defaulted farm and small business loans, student loans (!), income taxes, and almost any other debt, though I’m not sure about housing loans.  I would bet it could include hurricane recovery loans.

◦     3.1 million Social Security recipients are already having their checks dunned.

◦     The student loan people got the 10 year statute of limitations lifted in the 90’s, so this is now when every federales finally caught up.

◦     They snuck this through in the 2008 Farm Bill.  Hello?  Who was looking there?!?

◦     They can include the debt, interest, and penalties.

The “good” news:

◦     The feds can only take 15% of your check and can’t move you less than $750 per month or about $10000 per year (though good luck living on that!).

◦     There is still a 10 year limit on income tax.  You figure?

◦     They have not allowed credit card companies and banks to attach your Social Security payments.  Yet!  I bet their lobbyists were drooling when they read this.

We talked recently about the problem with student loans, particularly their ability to assign huge, predatory, and unconscionable collection and similar fees onto the total debts for citizen scholars.  To think that these folks had already snookered Congress into making these kinds of obligations eternal into the 65 and older set that might have incurred the debts 40 years before is simply wild!

This all seems to be the modern equivalent of a permanent “work release” debts prison.  We need some kind of a debt holiday or jubilee for citizens on some of these obligations once they have this much age on them.

At the least we need to call it square when the principal is paid off, rather than strapping these burdens on people until they escape to the grave.

What kind of country are we becoming?