Monday, 25 February 2013
The President Puts Chained CPI in Writing
Last week, the incessant blame game between Republicans and Democrats was in full force over whose fault sequestration is and whether the president offered any deficit reduction items to Congress. That's all just noise - blah, blah, blah - but something important to you and me came out of it.
If you had been willing to give President Barack Obama the benefit of the doubt on whether he really would cut Social Security for current beneficiaries or if you believed it could not possibly be true that he would reduce the deficit on the backs of America's elders, you will have to give up your dreams.
At the White House website is a document named “The President’s Plan: $4 Trillion of Deficit Reduction Including the Last Offer to Speaker Boehner.” Click image for larger view [pdf].)
The relevant line circled in red above reads: “Spending Savings from Superlative CPI with protections for vulnerable - $130 billion."
Keep in mind, that would be an immediate reduction in current benefits that would continue every year there is a cost-of-living increase and the reduction would be cumulative year over year over year.
AARP has posted a calculator that will give you a rough estimate of how much SSA benefit income you will lose over time if chained CPI is implemented.
Please recall that Social Security contributes not one penny to the deficit. Social Security is not bankrupt nor is it broke. It is solvent for about another 20 years and then, with no changes, it could continue to pay about 75 percent of benefits.
Small changes that would hurt no one can make Social Security whole for many decades beyond 2033, changes like removing the salary cap so everyone pays FICA on their entire salary just like the poor people do.
As it is, the U.S. Social Security benefit is the smallest in the developed world and if anything, should be increased. Even the consumer price index that is used now to calculate Social Security COLAs doesn't begin to reflect the real price increases elders bear year after year.
It is hard to believe that President Obama does not know all this. So what could be his reason, do you think, for making the chained CPI giveaway to Republicans, a move that would harm millions of elders who paid into Social Security all their working lives?
At The Elder Storytelling Place today, Susan Gulliford: Where's the Paper Boy?