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Is There Something Worse than Despicable?

twig's picture

I'm running out of words to describe the low-lifes in Washington who continue to outdo themselves when it comes to devising ways to separate us from our money. The latest comes from the Social Security Administration, in conjunction with the Treasury Department.

My neighbor just got her social security check in the mail and asked me to help her figure out the flyer that came with it. The flyer reads, "Be prepared to stop receiving a paper check. All federal benefits will be paid electronically.... Sign up for electronic payments NOW!"

My neighbor is quite old, in her 80s probably. She has a computer and gets email, but that's it -- no online banking, shopping, etc. She has memory problems, and it's hard for her to cope with anything more complicated than logging onto AOL. Plus, she doesn't really trust the internet with her money.

So we went to the website on the flyer, to see if there was a way to opt out. There is not. Everyone receiving federal benefits (including Social Security and Supplemental Security Income (SSI) payments, Veterans Affairs (VA), Railroad Retirement Board, Office of Personnel Management and Department of Labor (Black Lung), is going to go direct deposit. [And if you don't choose direct deposit, you're automatically "nudged" into being signed up for a debit card. --lambert] This new payment method will affect millions of people, including the 18 million Baby Boomers retiring in the next five years.

As far as I can tell from the website, if you don't like or want electronic payments, too bad! But that's not the most odious aspect of this new plan. If you click on the "About the Direct Express Card" link, the second paragraph says:

There are no sign-up fees, monthly fees or overdraft charges. No bank account or credit check is required to enroll. Cardholders can make purchases, pay bills and get cash at thousands of ATMs and retail locations.

So far, so good. But here's the last sentence in that paragraph:

Some fees for optional services may apply.

Oh, some fees -- okay! Now scroll down a bit and check out the fine print (which is probably too fine for a lot of older people to read). You're allowed one (as in ONE!) free ATM cash withdrawal for every payment you receive each month. After that, you will pay 90 cents per withdrawal.

But wait ... there's more. Even the first "free" withdrawal is only free if you use "one of the more than 50,000 surcharge-free network ATMs." And that's just the tip of the iceberg. There are other fees for everything from requesting a paper statement (75 cents) to transferring your own money to your own bank account ($1.50).

Maybe direct deposit is a good thing. Less paper used, fewer stolen checks, etc. And the Treasury Department says direct deposit will save $1 billion during the next 10 years. A lot of money, but as we all know, our government is fine with pissing away billions as long as none of it makes anyone's life better. And clearly saving this billion will not be very helpful for millions of people.

My poor neighbor is very upset right now. Like most people on Social Security, she doesn't get that much money each month to begin with. And soon, she's going to have even less, thanks to all the various fees they're imposing. Plus, she has to figure out internet banking to some extent. She was beside herself when I left, so multiply her situation times tens of millions and it's not pretty -- millions of elderly and disabled people getting ripped off (again) by their own government and the banks that own it.

Maybe I'm overreacting or maybe there's some bright spot I'm not seeing that someone can point out. But I'm so disgusted with what's happening in this country right now that I'm having trouble finding words to express it. I just keep wondering what kind of scum is okay with taking nickels and dimes from people who really need them and giving the money to people who are already obscenely wealthy. That's just despicable.

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Submitted by jawbone on

like Corporatist Dems under the bus.

I can't believe this. OMG.

I read your story of how this woman will be hit with fees to use her SocSec after viewing a video of Rep. Peter DeFazio explaining what the Chained CPI will do to seniors' payments, veterans', tax brackets (someone earning $20,000 will soon get a 14% tax increase due to the effect of that damned Chained CPI. The wealthy? Maybe .3% (if I heard correctly).

The video is in a post by David Dayen giving a round of what we know for sure about the Gang of Six's "plan." The only firm things are how they're going to gang rape serniors, the middle class, low income earners, veterans.

Worth a click and the time to view.

And Obama is already lying about the impact of his deal with Boehner. I heard him on NPR evening news saying it was so important to raise taxes on the rich and spare the poor, elderly, students, etc. Lying Liar!!!!!!

twig's picture
Submitted by twig on

Between the chained CPI, Medicare increases, rising food and prescription drug prices and bank fees, there won't be much left to live on. But I guess that's what they're counting on. Plus, didn't the administration gut the program that provided assistance with heating bills? If they haven't done it yet, it must be an oversight -- I'm sure they'll get around to it soon.

Stephanie's picture
Submitted by Stephanie on

I think the program for helping w/heating bills is still running. But they have eliminated help for cooling (elec a/c) bills, in order to save $ for heating this coming winter. I'm told this by a relative who helps her grandmother w/her bills, etc.

I wonder what kind of effect that's having with week-long temps over 90 degrees.

Submitted by lambert on

Just "check the website"! From the website, as you point out:

Some fees for optional services may apply [that's how it will start out]. For more information on card fees and features, see the Direct Express® card brochure.

* * *

Of course, it's especially nice now that it will be easier to track your spending. But also, once "you're in the computer" it will be easy to start changing the formula. And much easier, I would bet, for them to "mistakenly" give you less than for you to correct it. Not I'm paranoid...

UPDATE Here's the beauty part:

If you do not choose an electronic payment option by March 1, 2013, or at the time you apply for federal benefits, you will receive your payments via the Direct Express® card so you will not experience any interruption in payment.

So, they're "nudging" (thanks, Cass!) you into the fee-based system.

Just appalling. I'd say they treat us like animals, except that animals don't tend to use debit cards.

Just keep sending me a paper check in the fucking mail, please.

Valley Girl's picture
Submitted by Valley Girl on

So, this is a tactic to force people who don't sign up for direct deposit to be placed in the rentiers hands.

Very despicable.

On the other hand, I really don't see a problem with choosing "direct deposit", except that the people who are affected may fear that, not know how to evaluate the situation, and thus end up with extra costs. They may not even be able to read the fine print.

edit- thus the "deal", (if you don't sign up for direct deposit, this is how you will get your money) is very predatory.

Valley Girl's picture
Submitted by Valley Girl on

I tried to check out the link, but it stalled.

My brief reading is that direct deposit per se, and direct deposit "express card" are two separate things. Again, my reading is sign up for direct deposit (part 1), and then there's this extra offer from the rentiers.

Direct deposit, per se is not bad, at least not in my experience at U. This is the only option and has been for 10 years. Money goes directly to my credit union, instead of me having to deposit it in person at the credit union.

It's the second part that baffles me- as I said this seems like a scam from the rentiers. A scare tactic bundling that with "direct deposit".

So, comments please. I'm still trying to figure this out vis a vis this new "offer".

edit: uh, also see my new response to Lambert.

DCblogger's picture
Submitted by DCblogger on

just means it goes directly into your bank account. Unless your neighbor does not have a bank account.

I had a direct deposit account at a job I once had. Very handy. I does NOT mean internet banking, Only that the US Treasury sends the money directly into your account. You can still use paper checks and bank the old fashioned way.

On the other hand, this is too despicable for words.

Valley Girl's picture
Submitted by Valley Girl on

I agree with you about "direct deposit" not changing things (I prefer it, actually, because it cuts out the trip to the bank/ credit union. Other things will not change, as you say.

But, interesting point about people who may not have a bank account, for whatever reason. A really valid point.

Submitted by jawbone on

of a city where there are very few banks, if any. Or in rural areas distant from banks.

But, of course, "everyone" has broadband, eh?

There was a news report about a NYC program to make checking accounts available for free or very low cost in parts of the city where there were few banks. It was all small banks involved in the program. There's an education aspect to the program where people are taught some of the ins and outs of banking. One young woman said by having her check deposited to her new bank account, she'd ended up spending less than when she got the wad of cash.

twig's picture
Submitted by twig on

and you don't need to use internet banking.

But one of the things that's upsetting her is that she won't have any way of knowing when the check is deposited, since she won't be doing it herself. So she'll have to call the bank or go there or something. That's a small thing to a lot of us, but it's a big deal to her, just knowing that the money is there because she put it there.

I realize that's not necessarily rational, but dementia does seem to eat away at logic, and that's likely to be an issue for a big chunk of the population this is targeting.

Valley Girl's picture
Submitted by Valley Girl on

But, she'd have to go to the bank anyway, to deposit the check. So that does involve a trip to the bank. Unless she mails in the check. But, it she is visiting the bank to deposit a check, visiting to make sure the direct deposit money is there, is not so different. However, I do understand the difficulties of changing the way one does things, especially for the elderly, so don't imagine that I am dismissing your point.

twig's picture
Submitted by twig on

right now, it's just hard for her to get hold of the "no paper check" idea since it's a big change. Plus, I think she may be confusing this with the threat of no SS checks -- not sure. What an appalling thing for him to say.

But you're absolutely right -- she can still go to the bank and make sure the money is there and get a paper statement showing her balance, etc. Overall, not such a big deal, just one that she needs to get used to.

Valley Girl's picture
Submitted by Valley Girl on

Well, she isn't all that demented if she knows about Obama's threats.

Totally agree about Obama's comments re: SS etc. checks not going out. Appalling, and more. Heartless, thoughtless, etc. That comment of his put me over the edge, uh, well, no, I was already over the edge, and I'm not yet quite at SS age. Totally ugly, irresponsible, etc. etc. threat. Sorry, my vocabulary fails as to what I think about Obama.

I never supported Obama. Never. But, I didn't expect exactly how awful he would be. I have my own dark fantasies as to what should be his fate, but I'll keep them to my self. I don't want "government" visits.

hobson's picture
Submitted by hobson on

I believe you are assigned a day of the month when your money will be deposited, ie, the third Wednesday of the month. You never know, when you deposit a paper check exactly when it will clear so I don't see much of a difference. Where I work, most of the employees have opted for direct deposit for the convenience. The ones who haven't are the ones who live week to week and need to cash their checks. But that is on a weekly, not a monthly basis.

I am shocked if not surprised at the fees for the extra services. But one shouldn't be. If you get Social Security and continue to work or have other income, your SS is subject to Federal taxes at a relatively low total of earnings. Plus, you continue to have SS and Medicare deducted from your wages.

Submitted by lambert on

See here. Of course, the banks will never cheat on the fees. Not.

But here's the important point:

Soooo…., not only is the ruling junta raping the treasury on their way out the door, bailing out these institutions to the tune of hundreds of billions of dollars, but are forcing us as well to do business with these predatory bastards, these failing entities, to participate in this failed social economic model, for pennies on every dollar I bring home.

Exactly the same modus operandi as health exchanges in HCR. It's the last gasp, I surely hope, of the neo-liberal paradigm: The role of the State is to select which rentier is to deliver a "service," and to take a cut.

* * *

Also, I forgot to mention upselling. First, the government forces you to do business with a bank "in the network" (or pay extra fees). Next, bankster marketing weasels accost you when you walk in the door, and try to sell you more fraudulent products. Always Be Closing...

* * *

Also, forgot to mention the CA city with an ID that doubles as a debit card. I suppose the reverse could be true? Why not?

Valley Girl's picture
Submitted by Valley Girl on

~~~First, the government forces you to do business with a bank "in the network" (or pay extra fees).~~~

Not sure what you mean here. "in the network"? with a bank? Are you talking about direct deposit of SS checks? Seems, from at least one comment here, that SS checks can be directly deposited to credit unions.

Or, are you talking about something else?

Submitted by lambert on

If you go the debit card route, and not direct deposit, you are charged fees if the ATM is not "in the network" of banks that accept the debit card. Another hidden subsidy to the banksters, since that "nudges" people to some banks and not others (and how many small banks or credit unions will be in the network? Not all, for sure).

gizzardboy's picture
Submitted by gizzardboy on

I recently moved to a new area and of course, I wasn't going to use a bank. I joined a local credit union and they filled out the paperwork to switch my Social Security payment (Yeh, I'm that fucking old!) to a direct deposit in my credit union checking account. Yesterday was 3rd Wednesday of the month, so I called and checked to make sure the transfer had happened.

No check fees for low balances or other fees involved except they want $5.00 kept in a savings account and a few bucks to print some checks. They give you a debit card for ATM transactions (no fees at theirs or other credit union ATM's) and for store transactions (I don't do those). I signed up for their credit card and put a quite low maximum on it. That way, I don't mind using it on the internet and other places that might not be all that secure. If you pay it off every month, there are no fees or interest.

Valley Girl's picture
Submitted by Valley Girl on

As I said, I am in a credit union, and the terms seem very similar to the ones you have related.

They have an "online" option, but I have NOT signed up for this, because it costs money, and I know of one credit union that suffered online hacking. There's a number at my CU where I can call to learn the status of my account- automated, so I don't have to phone (and wait to talk to a human) to learn if something or other has been deposited.

Submitted by lambert on

That's the outrageous part. Why should this 80-year-old woman have to jump through hoops because President Fuck You wants to throw some business to his bankster golfing buddies?

Submitted by Fran on

Definitely choose Direct Deposit, NOT the Direct Express Card. It looks like she has until March 1, 2013 to choose.

Direct Deposit really is OK. The money just shows up in your bank account. It is easy to set up. Some banks even give you some kind of benefit for having direct deposit.

As was said above, all bills etc. can still be paid by check from your checking account. The only difference is that you do not have to take a check to the bank to deposit it. This can be good because you may actually get the money faster with direct deposit.

I handle the SS account for 2 disabled neighbors of mine. I just check to make sure the money is there, although it always is (so far! ha.) You can do this by phone (or online). I pay all their bills by check from their accounts and give them cash to buy food, etc. When I withdraw cash, I ask for a receipt with the balance to see if it agrees with what I have as a balance.

As DC said, this is NOT internet banking.

Submitted by lambert on

The claim is that the savings will be what, $10 billion? That's trivial, so there are other reasons in play.

Further, I don't mind being allowed to choose direct deposit. But being forced to with no opt out? That just sucks. It's another mandate.

Submitted by Fran on

because they make so much money on the fees. It is the default choice if people do not specify.

I agree that it is not right to be forced, and it just occurred to me that this could be transitional - that eventually you won't even have the choice of direct deposit, possibly. That would be pretty nasty.

Also, there are probably a lot more people, especially poor people, who do not have a bank account, than one would imagine.

twig's picture
Submitted by twig on

She has a grown daughter who comes by occasionally, so I'll make her a list of all these suggestions and then let them sort it out.

It's great that you're helping your neighbors -- I imagine a LOT of people could use help with this sort of thing.

Submitted by Fran on

I was trying to be practical with the situation.

I understand that she feels more secure seeing her check come in the mail. I was thinking, that, since she is used to going to the bank anyway, to deposit it, she could go on the day after it normally gets deposited and get a statement printed out to show the deposit.

Dario's picture
Submitted by Dario on

It seems to me that a few seniors who want to continue receiving their check through the mail could file a class action lawsuit to force the government to send the checks by snail mail when requested.

Submitted by lambert on

I don't know if it's "few." I don't want it, exactly because I'm computer literate and live on the net.

Why do I want to give the Feds my bank account number? And suppose the banks stop offering me an account because it's too small or they can't sell me other products or whatever? Why should I have to pay the rents on the card?

NOTE Of course, if the banks were regulated public utilities, I wouldn't object so much. But they aren't.

Submitted by jawbone on

demos, protesting against the war in Viet Nam, watching Daley's cops beat up protesters at the 1968 Democratic Convention. Back then I never felt there was no hope for the Democratic Party, even though the leadership was backward and brutal if they felt it necessary.

Now, however, I feel a gaping chasm between myself and the Democratic Party. It seems to have no realization of what people need, even though the members surely check polls. It seems hell bent on a reverse Robin Hood approach -- taking from the poor to give to the rich.

I've lost hope the party can be revived, retrieved from its corporate paymasters.

twig's picture
Submitted by twig on

Even when Bush was in office, I felt much more hopeful. I figured he'd be gone eventually and we'd get a nice shiny new president who would make all the bad things go away. Boy, was I naive/stupid/delusional.

Submitted by lambert on


The bracketed addition amplifes what is clear after reading everything, but I thought I'd make it more prominent.

* * *

I also think it's great that people are offering creative ways to help Twig's friend manage the situation. A couple of comments:

1. Not every 80-year-old is as richly networked as Twig's friend. Not every 80-year-old has friends, or even family. Age, in this society, can be very isolating. (This applies doubly to elders in the hands of nursing homes with nobody to handle their affairs properly). Thus, the "nudge" targets exactly the most vulnerable for predation, because if and when they do not affirmatively choose direct deposit, they are moved into the fee-based system. (And why should they have to pay to access their own money?)

2. Elders are constantly targeted by scams. The appalling wording that Twig quotes: "Be prepared to stop receiving a paper check....." reads exactly like a scam (and as a rentier-enabling nudge policy, it is, in fact, a scam, though not of the kind Twig's friend may be used to). So I don't blame Twig's friend for being worried, since the letter gives her no concrete ways to "be prepared"!

3. Those who are saying "she can do this" or "she can do that" .... Well, people on this thread are only trying to help, but I've also seen the view expressed (cf) that Twig's friend (and we) should just stop whining and get with the program; she doesn't really have to understand the Internet, and so forth. First, having some smidgeon of empathy, we understand that while we may know that direct deposit isn't the same as online banking, Twig's friend may not. Second, the effort involved to find all this out, contact friends or family, work out a new routine, et cetera: These are all costs imposed on Twig's friend, and for no good reason at all ($10 billion over ten years). Our days are always finite, no matter our age, but when you're 80, finitude is a real concern. Why in the name of sweet suffering Jeebus should this lady be forced to spend even one minute doing this? And she is being forced, since there's no opt-out. And third, those who don't want to waste their time on shit they shouldn't be forced to do, or don't have the friends or family to help them, are once again opted into the fee-based system, and so once again the most vulnerable are targeted for predation.

As soon as you start looking at the social dynamics of this, "despicable" is far too mild a world.

twig's picture
Submitted by twig on

I appreciate the clarification. And many thanks to everyone for all the great suggestions. I wrote this immediately after spending time with her and didn't step back to review.

So now that I have, I should say that I think she will be okay. She's in a much better situation than a lot of elderly people -- lives in her own house, still drives, etc. But so many others are just squeaking by. And now these monsters are demanding -- actually stealing -- the little bit they have. And you know those special "low, low" fees are going to start creeping up any minute now.

The thing that made my head explode was exactly what you point out -- the mandatory participation -- and the fact that if you peek under the veneer of how this is all about helping seniors, it's quite clear they're just preying on vulnerable people -- elderly, unemployed, the poor -- extracting every last nickel they can get.

Plus, as you point out, what about people in nursing homes? Various friends' parents have been in homes for years, medicated to the gills and completely out of touch. And their kids are supposed to come in and do forensic accounting to determine whether or not they're being overcharged, underpaid, etc.? The banks are incredibly efficient at stalling, obfuscating and lying. I just tried to get an answer to a simple question from my bank -- three different people, three different answers. Between the banks and the federal bureaucracy, good effing luck.

BTW, the savings are only $1B over ten years or about $100 million annually. Same as the cost of one drone.

Valley Girl's picture
Submitted by Valley Girl on

You said:

~~Well, people on this thread are only trying to help, but I've also seen the view expressed (cf) that Twig's friend (and we) should just stop whining and get with the program; she doesn't really have to understand the Internet, and so forth.~~

I checked out the (cf) and (perhaps poor reading skills) I didn't understand who your target was. As in "the view expressed".... people at corrente? Or?

I don't think anyone who actually tried to offer practical advice on this thread was saying "stop whining and get with the program". I don't think you can assume that people (including myself) who were offering practical advice were saying "get with the program", at least in the way I read your statement.

I can see the importance of stepping back and taking a meta view, but when confronted with the rentiers steamroller, immediate practical advice is often helpful.

editor_u's picture
Submitted by editor_u on

The heat (103 in NYC) has made me dizzy, so this may be a bit fuzzy and not up to my usually middling level of clarity.

Certainly the mandatory nature of participation is wrong. Big deal that one can choose between two unwanted modes of payment. But if one does not have (and does not wish to open) a checking account, one has no choice and is forced to take the debit card, with all its potential fees.

It's the recipient's money, and he or she should be able to get all of it. But with the debit card, one can't get all of it at once. I don't know of any ATM that would dispense as much money as any but the smallest SS payment would be. Not all at once, anyway, and probably not all in one day even with multiple withdrawals (with those per transaction fees, after the first one).

So far, having a checking account isn't mandatory. But what about a working person? How can he or she get paid? More and more employers are requiring that employees be paid via direct deposit, but since one cannot be required to maintain a bank account, that direct deposit requirement really shouldn't stand up to legal scrutiny (of course, who, outside of someone with a union protected job, would challenge the boss on this?).

And how would such a worker deal with a physical paycheck without a bank account? It should be widely known, but it's not, that (unless they've changed the laws VERY recently) federal statute* requires employees to be paid in cash OR with a negotiable instrument, most commonly a check. That check must be easily convertible to cash on payday, at no expense to the employee, and on company time (not after work, on lunch break, or during any other unpaid time).

Consider, further, the case of someone in such dire financial straits that creditors are trying to get at that person's assets. Social Security payments, like unemployment compensation, may not be garnisheed. In some cases, apparently, states and the IRS can levy on the SS payment (quick armchair research says the levy can be as much as 15% in the case of the IRS). The IRS, at least, cannot levy on unemployment benefits (it might be a different situation with the state issuing the benefits). But once that otherwise largely untouchable money is deposited into a bank account, it's easily taken. All of it. In some cases, at least if the IRS executes such a levy, one could get the money back by proving it came from a Social Security (or unemployment) payment. Presumably this would be true in the case of a creditor as well. But it would take much time and effort to do so, especially if one had funds from other, non-exempt, sources on deposit in that same account.

*The Fair Labor Standards Act

twig's picture
Submitted by twig on

Even if people can't always act on it, it's good to know.

The complaint I've heard over and over again about checking accounts is that the bank always manages to sneak in fees and charges somehow, even with the "free" checking accounts. So there goes more of your money, never to be seen again.