Air Travel and Elders

Two Things You Need to Know About Social Security Right Now

For all the public posturing, threats and uninformed chatter over looming default by the U.S. government, you may have noticed an eerie silence from politician- and medialand on this topic: if the debt ceiling is not raised, will Social Security benefits be paid?

A U.S. default would be certain to cause long-lasting and cataclysmic economic consequences worldwide but since this has never happened before, no one knows how cataclysmic.

Republican Representative, presidential candidate and leader of the Congressional Tea Party Caucus, Michele Bachmann (who believes the Founding Fathers ended slavery), along with other Republicans, says in a new television commercial for herself currently airing in Iowa, “I will not vote to increase the debt ceiling.”

Additionally, this past week, she shrugged off the consequences of a U.S default:

It's that “prioritize our spending” - meaning other government obligations after paying interest on the debt - that is of concern to elders. Millions of elders live month-to-month on Social Security and two-thirds of people 65 and older rely on Social Security for more than half their income.

Will Social Security payments be prioritized out of the mix if the debt ceiling is not raised by the deadline? Official Washington and the media are not saying.

This is a stealth Social Security cut that would affect not just those age 55 and younger whom other proposals to “strengthen” the program would affect. This would impact you and me too.

The idea being “seriously discussed” in the deficit talks as part of a compromise to allow raising the debt ceiling is to change the formula by which inflation is calculated (“chained-CPI” versus the current “CPI-W”) which would dramatically affect the cost of living adjustment (COLA) to Social Security and would go into effect immediately. Here is what is at stake as explained by Social Security's chief actuary:

“...moving to chained-CPI would constitute an immediate 0.3 percent benefit cut. That may sound small, but the effects would compound, and '[a]dditional annual COLAs thereafter would accumulate to larger total reductions in expected scheduled benefit levels of about 3.7 percent, 6.5 percent, and 9.2 percent for retirees at ages 75, 85, and 95, respectively.'”

This chart shows the difference in an average Social Security benefit over time. (Click here for a larger, more readable size.)


The skewed idea behind the chained-CPI is that as goods and services become more expensive, people adjust their buying habits downward and therefore, presumably, don't need as large a COLA.

Tell that to elders who already go hungry and cut their medications in half or do without entirely. There is a level of income below which there is nowhere to go and millions of Social Security recipients fall into this category.

It is said that President Obama is open to this CPI shift. As Richard Eskow notes, the COLA change would raise taxes “on everybody but the wealthy.” He goes on to analyze where this proposal currently stands in Washington:

Contrast the White House's bobbing and weaving with Harry Reid's firm statements on the topic. In January Reid said Social Security cuts were 'off the table.' He asked the President to leave Social Security out of the deficit talks in February. In March he said he wouldn't consider restructuring Social Security for twenty years.

“But now the President has announced that he's taking direct control of negotiations, and it could be hard for Reid to block a White House/GOP deal - especially if that could lead to a government shutdown.

“That means that Social Security is now in the President's hands, and he's not telling us what he plans to do.”

No one has any business making Social Security any part of the debt ceiling ruckus or deficit reduction. It does not and never has contributed one penny to the deficit and contrary to hysterical Republicans, there is an easy fix for the minor shortfall in future years.

Dean Baker, co-director of the Center for Economic and Policy Research:

“...the longer-term gap in Social Security is relatively modest. The Social Security tax only applies to the first $107,000 of wages. If the tax applied to all wages, so that Bill Gates paid more than a senior firefighter, it would fill the gap in full.

“So this shortfall is not some huge chasm. It can be relatively easily met and there is no rush to do it.

That is, of course, the best and simplest proposal for Social Security held by many economists, and some, but too few, politicians agree. Don't hold your breath for it to happen anytime soon.

At The Elder Storytelling Place today, Mary B Summerlin: Surprise Letter


Thanks for the explanation. I'm furious about this proposal, as must be so many.

Many are furious indeed. So far, Nancy Pelosi is hanging tough for SS and Medicare. How strong a reed she is, we'll find out.

Thanks for the chart showing the benefit cut under "Chained-Consumer Price Index." That's the key information. Looks like they want to save money by locking a ball around elders' ankles and pushing us into the sea. Chained indeed!

Let's hope this is just part of a smoke and mirrors plan that will backfire on the GOP.

But, if not, expect the nursing home industry to be up in arms, because they are the likely inheritors of SS benefits to the oldest recipients. Old folks will cut back to two meals or divide up their pills, but nursing homes can't do that, and they're not going to want to make up the difference.

I continue to believe that if we stop voting for politicians, many times just a matter of choosing the best of the worst, and change platforms to use our vote to eliminate the goodies that our politicians vote in for themselves, ( so that they are subject to the same cuts,social security, benefits that we are)...that is when things will turn around for our country. I know that is a long sentence, but I needed to say it all.

Each individual who reads your comments here Ronni needs to write their Congress person or send a letter to the editor as I did and ask them "who will we not pay first in order to make a fool’s point — our military, China or our senior citizens?"

President Obama is pushing cuts in progrms that even George Bush couldn't touch. To think how hard we worked for his election only to be hoodwinked by this smooth talking flim flam man. I may even vote Republican if they nominate a grownup.

I live from S.S. check to S. S. check. Just one month without income would be devastating and I am far from alone.

Please bombard your representatives and the White House with your objections to letting Social Security be part of the mix.

This is an absolute outrage. We deserve better. We paid our payroll taxes and we did our duty all those years in order to be treated like this?
I think all Obama cares about is getting re-elected, and we aren't his base.

This is scary.

They kept saying overhauling SS wouldn't affect current seniors above age 55, but now it looks like they're going after all of us.

I wonder if AARP will stick up for us? (Yeah, right.)

So much good information (again thanks Ronni!), and so many right on comments. And as Warren Buffett said yesterday, "We raised the debt ceiling seven times during the Bush Administration." That would be seven times in eight years.

Desperation makes many do things they wouldn't do under normal circumstances.

Our politicians are trying to use FEAR to make us agree with anything they want to do; like demand they do whatever it takes to keep the government from shutting down because to do so will STOP the writing of our SS checks.

We've got to do something to keep them from moving upon our only income, placing a chain around our ankle and pushing us into the sea of disaster not only for us but the whole country.

I've been sending emails to the White House for days now, asking the President to lay off Social Security and Medicare. I'm asking the rest of you to do the same. All you have to do is go to: and click on Contact us.

I'm gonna start sending emails to my Congresswoman and Senators also, even though they are all Republithugs... can't hurt, can it?

My SS doesn't even cover my prescription costs. Luckily we do have some savings, but it won't last forever.

Have any of you thought about taking to the streets? No, not streetwalking ;-) I'm thinking we might have to demonstrate to show Congress and the White House what our true feelings are. They keep citing polls that indicate we all want everything cut, but no one has ever asked me. I would tell them to cut subsidies to the oil companies and to eliminate the cap on earnings subject to Social Security -- but no one ever asks ME! Without Medicare, my husband and I are going to be up a creek...

It's time to vote with our feet! Let's march on Washington and show them that we've had enough and we're not going to let them go any farther with their robbing the poor to give to the rich.
How about Labor Day? We labored for a long time for our SS benefits, let's show the whores in Washington that we won't tolerate any more cuts.

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