White House, Congress social security changes are bad news for seniors

[Bluebear]

When inflation rises, retirees' social security checks keep pace with small increases. But if some lawmakers get their way, those raises may be a whole lot smaller in the future.

As part of the current deficit-reduction talks, White House officials and Congressional leaders on both sides of the aisle are advocating changes to the way inflation is calculated. The little-noticed proposal advocates measuring inflation with the "chained consumer price index," a metric that would likely make inflation look slower than the current measurement does. That would result in smaller Social Security increases for seniors, experts say. "Seniors cannot afford this," says Mary Johnson, a senior policy analyst at The Senior Citizens League, a non-profit seniors rights advocate. "This would negatively impact not just seniors, but also many families that end up helping out these seniors financially."

For the roughly 60% of seniors who rely on Social Security for at least half of their retirement income, this is a big deal. Under the new calculation, the rate of inflation would grow at an average annual rate of about 0.3% less, on average, than under the current calculations, according to the Congressional Budget Office. If Social Security uses the new measurement to determine cost-of-living adjustments, the average retiree would receive about $18,000 less in benefits over 25 years, according to The Senior Citizens League. Or, under the new calculations, after 10 years, a 73-year-old would get a check that's about 3% smaller than he would get under the old calculations, according to the Congressional Budget Office.

Of course, lower benefits are part of the point. Using the slower-rising index is being billed by many including President Barack Obama's fiscal responsibility commission and the Bipartisan Policy Center -- as a way to generate much-needed savings to help deal with the country's mounting debt crisis. In fact, the savings could amount to an estimated $112 billion over 10 years, according to the Congressional Budget Office. "This is a start in helping us fix Social Security," says David John, a senior fellow at the Heritage Foundation.

http://finance.yahoo.com/retirement/article/113133/smaller-raises-for-seniors-smartmoney?mod=retire-planning

[indurancevile]

1. knr

[newfie11]

2. this SUCKS!!!!!!!!!!!!!!!!

The way the COLA is done now is bad enough.

[Bluebear]

4. At least the Heritage Foundation likes it.

:/

[Cobalt Violet]

10. Obama's base: the have's and the have mores.

:banghead:

[dkf]

3. The state of our finances are bad news for seniors...and the rest of us.

We really screwed up. Promising more doesn't fix the underlying problems.

[Bluebear]

5. unrec

[Angry Dragon]

7. Maybe if people were paid a living wage

they could save and invest more



When ceos are paid 314 times what the lower employees are paid, it seems something is out of balance

What do you think??

Ceos got a 23% jump in wages this last year, average worker1%

Fix that and then you might get closer to fairness.........

[Lasher]

8. Pfffft

[Bluebear]

9. Well said.

[Pholus]

11. Just to qualify "and the rest of us" there is a certain 1% of top earners who can see this

as an investment "opportunity."

[girl gone mad]

24. Spending more would fix the underlying problems.

More promises, jobs programs or tax cuts for working people would help.

[Bluebear]

25. yes INDEED

[xchrom]

6. Recommend

[Ineeda]

12. Let's be clear on this....

First of all I don't want any reduction in SS benefits. At all. Ever. I want the Bush tax breaks on the rich reversed, and those richie-riches to pay their fair share. I want loopholes closed and subsidies for obscenely profitable corporations killed immediately. The COSTS of SS should be evaluated and waste eliminated. The Cap should be raised. All of these things are common sense and I, like all of us, will be outraged if any benefits are cut. In reality, it is "not the money, but the principle."

That said, the big whoop-de-do about the possibility of the chained consumer price index calculations factoring on increases to SS benefits, is, IMO, being blown way out of proportion. I receive SS, so I know of what I speak. The misconception in this discussion/conflict of the moment is all about future increases to SS benefits. We must remember that increases are not automatic and never have been, being based on inflation. A .3% difference in the inflation calculation is infinitesimal. In 2010, there was zero, none, zilch, nada increase, and IIRC, none in 2011 either. In 2009, the increase was 5.8%. On my benefit, which is nowhere near the maximum, this amounted to about $30-35 a month. Now, granted, I want to get every dime I'm entitled to (and that's not the dirty word it's being made out to be, by both sides), but $30-35 a month less (or more) won't result in any serious impact to my lifestyle. Bear in mind, SS is my only source of income but I have no mortgage, so I'm in a better situation than some. Still, I have to stretch to live within my income like most of us, and I manage to do so. A dollar or so a day one way or the other is too insignificant to get all postal about. I don't count on ANY increase. It's great to get it, but I don't depend on it because it's NEVER been a 'sure thing.'

[doc03]

13. The current COLA for SS doesn't address the real

cost of living either. They giveth a COLA raise based on average COL for everything and then they taketh away most of it for an increased Medicare premium based on medical costs alone. The COLA is figured on a formula based on the (average) cost of various things, food, medical, fuel, housing etc for everyone. Say for instance the average COLA is 3% for a year you get a 3% raise in your SS. Then they come at you with an increase based on health care alone that could be maybe 25%, that does not in any way address your true COL. In other words if you received $1000 a month in one year and the COLA increased 3% you get $30 more per month. If say you paid $100 a month for your Medicare and medical costs increase 25% your Medicare premium would increase $25, which gives you a net gain of just $5 or just 1/2 of one percent increase. My mother has been on SS for over thirty years and I have seen this every time she ever recieved a COLA she got a raise in her check and then a good part of it would be taken back for her Medicare Premium.

[Ineeda]

17. That's the true dilemma, and one we should focus on.

[Bluenorthwest]

14. Let me be clear on this. And tell your friends too!

The tactic of saying "I don't want this, but...." and then pitching the thing you claim not to want is the overworked OFA end run of the decade, and it no longer flies. "I support single payer, but...I'm a pragmatist and I know we can never, ever have it, so..."
Far too many of the 'moderate centrists: excuse division' use this "I really want X, but I can not support X because (insert reason here), so I HAVE to support the opposite of X. Because of the Congress. Or because of the 'MSM'. Or because there are Republicans on earth."
Well I am a Pragmatist. We see the only evidence of that which is believed to be that which is acted upon. That is a person's 'inner desires' are proven not by their proclamations but only by their actions. What is wanted is evidenced only by that which is acted upon. Here, you rationalize chained CPI, which means you do in fact want anything the President offers. To say 'I don't want' that which you then pitch is a contradiction.
Only that which is taken into action exists in a person. Want? Not real. Belief? Not real. Actions taken, such as pitching the opposite of what you say you want? That is real. What you want is clear. You own your home, so you feel this is safe for you. So you support the Chained CPI. With your actions, which is all that matters.
"I am basically a socialist" some of y'all say, "but I am a realist, and I know that I have to be really conservative and right wing, although I am a socialist, I can not really be one, so I have to be the opposite, because I am so damn Pragmatic Realistic."
Tis a bullshit technique of the first division.

[Pholus]

16. +1

[Ineeda]

18. Glad you have a crystal ball

to know what I think about any subject other than the facts I posted. I also did not say I supported anything you claim I did or that I want "anything the President offers." I also did not say I owned a home. I said I had no mortgage -- big difference. AND you have no idea what "actions" I have or have not taken. I hope you can get your money back on that crystal ball -- because it's broken.

[Bluebear]

23. 'It's great to get it, but I don't depend on it ' - Bully for you. many people DO depend on it.

[Ineeda]

26. Did you misunderstand? I depend totally on SS but NOT on annual increases

because annual increases are not dependable!!!11!

[somone]

15. Recommended

[jtown1123]

19. Current COLA doesn't even accurately reflect Seniors' spending. This cut would compound, making cuts

HUGE for future generations. This isn't the America we want is it? http://youtu.be/MPeEejtoT_o

[madfloridian]

20. "a 73-year-old would get a check that's about 3% smaller"

That means they are cutting benefits though many are in denial. We voted Democrats in in 2008 so they would stand up for us. They did not, and they lost. The loss will be greater next year I fear.

[Bluebear]

22. It's OK. At least the Heritage Foundation is pleased.

[mimitabby]

21. tax the rich tax the rich tax the rich

[mmonk]

27. There is no savings.

It's just switching public insurance money from seniors' account over to the people who run the American dictatorship, the billionaires.

[Zorra]

28. Ending the Bush tax cuts for the wealthy would save over $700 billion

over 10 years.

It's a question of priorities.

Should we spend an extra $100 billion and make it easier for older folks to get a higher quality cat food for dinner, or spend the $700 bil to give spending money to the Murdoch and Koch crowd so they can buy new Maseratis for their grandkids.