Ways and Means Committee Chairman Charles B. Rangel (D-NY) joined President Barack Obama in calling for an additional $250 emergency recovery assistance payment to seniors, veterans and people with disabilities. The White House's announcement came in anticipation that the Social Security Administration (SSA), because of economic conditions, would not provide a cost of living adjustment (COLA) to beneficiaries for 2010.

“The Committee on Ways and Means is keenly aware of the economic difficulties facing our seniors," said Rep. Rangel. "I support the President’s call to assist America’s seniors during these challenging economic times and look forward to working with my colleagues in Congress to send a bill to President Obama for his signature.”

"These payments will provide aid to more than 50 million people in the coming year, relief that will not only make a difference for them, but for our economy as a whole, complementing the tax cuts we’ve provided working families and small businesses through the Recovery Act,” said President Obama in a prepared statement. "This additional assistance will be especially important in the coming months, as countless seniors and others have seen their retirement accounts and home values decline as a result of this economic crisis."

President Obama singled out Rep. Rangel as he thanked members of Congress for working on behalf of those hardest hit by this recession.

"I want to compliment all the members of Congress who have been working to address these challenges, especially Senators Reid, Baucus, Sanders, and Lincoln, Speaker Pelosi, and Representatives Rangel, McCarthy, and DeFazio.”  said President Obama.

Extending Economic Recovery Payments

The President’s proposal would provide an additional year of the $250 “Economic Recovery Payments” initially enacted under the American Reinvestment & Recovery Act (ARRA). Under this proposal:

•    57 million people would benefit. These include 49 million Social Security beneficiaries, 5 million Supplemental Security Income beneficiaries, 2 million veterans benefit recipients, 0.5 million railroad retirement and disability beneficiaries, and also about 1 million public-employee retirees not entitled to any of the previous benefits.

•    The benefit would be $250 – or equivalent to a 2 percent increase in benefits for the average Social Security retiree beneficiary. Under the rules no person could “double dip” and receive a $250 Economic Recovery Payment through more than one program. Nor could they receive both an Economic Recovery Payment and the Making Work Pay tax credit.

•    The total cost of the proposal would be $13 billion – and would not hurt the solvency of Social Security. The President is committed to ensuring that the $13 billion cost of the proposal does not reduce the solvency of Social Security or other social insurance programs.

•    Would extend an effective relief program. To date Economic Recovery Payments have been made to 55 million people including seniors, veterans and people with disabilities and totaled $13.7 billion. Most of the checks were mailed out in May 2009.

In addition to this legislative proposal, the Internal Revenue Service and the Department of Treasury will take steps this week to prevent reductions in the amounts that workers can contribute to IRAs, 401(k)s, and other aspects of tax-favored retirement systems in 2010 that some feared could result from negative inflation over the past twelve months.

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