Danny Vinik at Business Insider argues that Social Security recipients are getting hosed by the Cost Of Living Adjustment (COLA) even without chained CPI. He thinks Congress should require the use of the CPI-E (with E standing for Elderly) for the COLA instead of the measure being used now, CPI-W. The CPI-E would result in significantly higher benefits for those staying on Social Security benefits for an extended period of time.
Still better than the COLA SSA employees are getting.
ReplyDeleteI think this is another good idea that isn't likely to happen, but it's good to bring it up to counter the claim that we should adopt the chained CPI because it is more accurate.
ReplyDeleteI think the linked article is wrong where it says if CPI-E were used instead of CPI-W from 1992-2007 "benefits would have been almost 16% higher..." I think it would be the same 7% as in the preceding sentence.
Also, it's interesting that he stops at 2007. From 2006 to 2011, CPI-E actually rose slightly less that CPI-W. This is because medical costs and housing have been rising slower than before. These might be temporary, but if not, there might not be much difference between CPI-E and CPI-W in the future.
(See http://www.bls.gov/opub/ted/2012/ted_20120302.htm)
when the federal govt. agrees to pay employees (people who are actually working) a COLA, then I'll support one for beneficiaries.
ReplyDeleteAs I've said on this blog before, the people living on a fixed income are actually employees. Beneficiaries have seen their buying power increase (in relation to employees) since 2010.
p.s. I am NOT a paid schill. I am a govt. employee.
Chained cpi = slavery...
ReplyDeletePure and simple, people who get benefits are largely White and chained solves nothing, it just puts off the problem for a few years and reduces benefits, in a few years there will be calls by the rich to do chained again and again.
Raise the limit on payroll taxes to 90% on the amount of income taxed or remove the limit entirely, either will work, but then so will a revolution...
Social Security used to be a cash cow. Now it has cash shortfalls, supposed to be taken care of by the trust fund, but that's not available since it was spent on what it shouldn't have been.
ReplyDeleteThis is going to be a long fight. TPTB will keep causing fake crises and hold the economy back until they can cut S.S. It's time to send half a million to occupy the DC mall until this president recinds Chained CPI.