Corrente

If you have "no place to go," come here!

Chained CPI

letsgetitdone's picture

What that Letter Should Have Said

On Valentine's Day, Senator Bernie Sanders sent a letter to the President, authored by himself and signed by 15 other Senators, all Democrats. The letter was a response to the rumors that the President intends to include his Chained CPI proposal to cut Social Security benefits in the budget he will soon send to Congress. Read below the fold...

letsgetitdone's picture

Hell No! The Ultimate Pushback against the Grand Bargain

The underlying rationale for “a Grand Bargain” and the President’s deficit reduction budget including cuts to both Social Security (SS) and Medicare and many valuable discretionary programs, apart from the pragmatic justification, that he may be able to complete such a bargain with the Republicans and blue dog Democrats in Congress, is that the fiscal health of the United States requires that we can’t keep running annual deficits of the size we’ve been running. Why? Read below the fold...

letsgetitdone's picture

They’re Making Love to the Third Rail: What Are We Gonna Do About It?

OK, the President has officially proposed the “chained CPI” cut to Social Security in opposition to what the heavy majority of American voters want him to do and in contradiction with promises he and Joe Biden made during their re-election campaign. So, what punishment should we exact from this Administration, and what should we do to prevent cuts from happening in addition to signing petitions, and calling Representatives and Senators?

Immediate Punishment for Lying

President Obama and Vice President Biden clearly lied to our faces about what they would do when the Republicans came for Social Security if they were re-elected. I know politicians lie frequently during campaigns. But, I think that if we want to make them accountable, then we need to develop zero tolerance for that. A politician’s word has to become his/her bond; or he/she must be defeated as soon as we can make it possible. That has to become both the perception of politicians and the reality of how our system operates, if we’re going to save our democracy.

Accordingly, I propose that a Democratic Congressperson introduce a bill of impeachment in the House for this President as soon as possible. The grounds for impeachment could include failure to prosecute the torturers from the Bush Administration, failure to prosecute the control frauds in the FIRE sector, as well as the charge that the President lied to the American people about his intentions on SS policy in the last election campaign, in order to deceive us into re-electing him. I think that’s fraud. Read below the fold...

letsgetitdone's picture

Richard Eskow Asks: Which Side Are You On?

Richard Eskow of the Center for the American Future, posted a very good one a couple of days ago. He used the old union meme “which side are you on” to beat up the President and Congress about Social Security being placed on the negotiating table. I thought his writing on it was striking. Here's some of it: Read below the fold...

We knew Obama could go lower. And so he has.

No one but Our Leader, manifest in grace and compassion, could rush toward the granny-starving compromise for which he and the GOP have so fervently wished... so they can get on with the diversionary tactic of gun-control legislation. After five years of inaction, and dozens of mass murders, why the rush to craft legislation that will, as the others, die in committee? It's for the (dead) kids, see? Read below the fold...

Chained CPI: Because elders can substitute cat food for real food, Social Security benefits should be cut

Chained CPI is how Obama wants to jigger the Social Security numbers to get his Grand Bargain with Boehner and starve some old people. (So much for Biden's "flat guarantee" -- which Obama never signed on to). Trudy Rubin explains:

Why is the chained CPI (chained Consumer Price Index) so attractive to such people? As we reported a couple of weeks ago, it cuts spending and raises revenue. The Congressional Budget Office Office estimates it could produce some $217 billion in savings over ten years, with about $145 billion coming from cuts to Social Security benefits and other government pensions.

It’s a juicy target for another reason, too: the public knows next to nothing about it. Its obscurity may have led Slate to characterize it as “the sneaky plan to cut Social Security.” The headline on a blog post by The Atlantic’s Derek Thompson called it “The Sneaky, Complicated Idea That Could End the Fiscal Cliff Showdown.”

Whether that will happen is very much up in the air at the moment. Some Washington writers and columnists aren’t keen on the idea. The idea behind “chaining” is to allow for the way people substitute cheaper goods and services when prices rise. Timothy Noah, writing for The New Republic blog, gave a good description of why the Chained CPI may not measure the cost of living with as much accuracy as its advocates promote. “Would chaining really bring Social Security benefit increases in line with spending patterns? Actually no,” he argues, pointing out that the proposed index doesn’t deal with healthcare spending very well. Healthcare is the biggest expense for many of the elderly, and consumes a larger share of their budgets than does for the rest of the population. If you need a heart bypass, you can’t substitute a hernia operation, the way someone might substitute chicken for steak.

While it didn’t take a position on the proposed formula, the National Journal’s good reporting clearly explained what the new index was all about. It noted the drawbacks of making a change, even quoting Andrew Biggs, a resident scholar at the conservative American Enterprise Institute and former principal deputy commissioner of the Social Security Administration, who expressed serious doubts about switching over to the chained CPI. “One reason is, it’s not based on the purchasing habits of the elderly,” Biggs said. “The consumption patterns of a working household aren’t the same as the consumption patterns of, say, an 85-year-old Alzheimer’s patient living on a fixed income.”

The advocacy group Social Security Works estimates that a person age 75 in the future will get a yearly benefit that’s $653 lower after ten years of chained CPI than that person would get under the current formula. An 85-year-old will have $1,139 less to live on. While this doesn’t seem like a princely sum to an investment banker, it is to the very old.

Heck, $1,139 is a princely sum to me, and I'm not "very old"! Read below the fold...

Subscribe to RSS - Chained CPI