The latest proposal to cut Social Security coming from our out-of-touch DC elites literally says that because old people cut back to cat food when people food is expensive, then we shouldn’t let Social Security rise enough to keep covering people food. It literally says that.
There is a Social Security proposal circulating among the out-of-touch DC elites that says because old people cut back when prices rise, then Social Security inflation adjustments should be cut back, too. They are actually saying that because people have to cut back to cat food, then they should only be getting enough to pay for cat food. The proposal is called by a funny name, “Chained CPI.” The elites love it because it helps keep the government from raising taxes on the rich to pay back what was borrowed from Social Security and used to give tax cuts to the rich.
APM’s Marketplace explained how Chained CPI works in Alternate inflation index could save billions:
(Note – if the audio stream player doesn’t show up, please go to this link to listen.)
Fiscal cliff talks have brought into the mainstream a phrase previously little-known outside economic policy circles: Chained Consumer Price Index. The concept is as complicated — evidenced by a jargon-splattered FAQ on the Labor Department’s website — as its impact could be massive.
… The CPI measures the price of various goods over time. But it doesn’t really account for how humans behave when prices go up. Sometimes they buy less of items that become more expensive. For example, rising beef prices will affect the CPI. But consumers may just buy more pork instead.
… Chained CPI accounts for this shift in consumer behavior, what economists call the substitution effect. The simple act of switching the way we measure inflation could save hundreds of billions of dollars. That’s because chained CPI is lower than the benchmark CPI. If life really isn’t as expensive as we thought, the government doesn’t have to pay as much in benefits.
Benefits will still continue to increase over time, just more slowly. One place where a switch to Chained CPI will have major impact is Social Security, which is why powerful seniors interest group AARP has a flotilla of lobbyists fighting this idea.
Got that? Old people switch from eating beef when the price goes up, therefore we don’t need to increase Social Security when prices go up. Except they are switching to cat food, not pork.
This males sense if you are in the 1% who doesn’t have to worry about it, and who gets that cash that isn’t put into increasing Social Security along with inflation.
Call your Senators and Representative and tell them you do not want them to cut Social Security or Medicare in any way, and not with this “Chained CPI” scam. Tell them we won the election, we voted for tax increases on the rich and no cuts in Social Security or Medicare.