MY parents are retired and I know how the current COLA formula for Social Security effects them. The adjustment is never enough to cover the real cost of living. Now the government is considering a ploy called the "chained CPI" to cut Social Security and other benefits for the retired, vets and the poor while raising taxes on the middle class. We can not allow this to become a concession in the ongoing negotiations to avoid the fiscal cliff. We all need to e mail President Obama http://www.whitehouse.gov/contact/submit-questions-and-comments
our Senators http://www.senate.gov/general/contact_information/senators_cfm.cfm
and our Representative http://www.house.gov/representatives/find/
and tell them the "chained CPI" plan must be rejected and in no way be a part of the fiscal cliff budget negotiations. Don't know what to say? Use talking points from the vets letter to Congress. Or you can check out the letter I emailed at the bottom of this post. REMEMBER, Congress is counting on NOT hearing from YOU! This from HuffPost....
The measure of a society’s progress is not whether it can give more
to those who have more, but whether it can provide enough to those who
have less.
- David Lim
The "chained CPI" is an attempt to camouflage deep cuts to Social
Security and other benefits, along with tax hikes on middle class wages
(but not for high incomes), in a forest of numbers and terminology.
Know who's expert at camouflage? Veterans. And a whole lot of their organizations hate the "chained CPI."
Sneaky ... But Simple
The headline for Derek Thompson's
Atlantic piece
calls the
"chained CPI" "the sneaky, complicated idea that could end the fiscal
cliff showdown." There's ongoing chatter that both parties might use it
to solve their budget impasse, in large part because they think it's too
complex and wonkish for voters to grasp.
But while it
is sneaky, it's not that complicated. In fact,
the "chained CPI" concept can be explained in one sentence: It
calculates cost-of-living increases much more slowly than before, by
subtracting the cost of the things you can't afford to buy anymore.
See? I did it in 22 words and 113 characters -- short enough to
tweet. I'll bet you understood it even if you hadn't heard of it
before. And not only understood it, but sensed its
implications: As a financially-strapped public downgrades from fresh food to canned food ... to
cat food ... their benefits will keep plunging along with their way of life.
And yet hope springs eternal among policymakers. Last year the president even said that "
most folks would hardly notice" if this cut to the government's cost-of-living adjustment was enacted. Guess what: The nation's veterans noticed.
Standing Up
A wide range of organizations representing the nation's veterans signed a
joint letter to
leaders in Congress which said "we are writing to express our
opposition to changing the formula used to calculate the annual cost of
living adjustment (COLA) because of the harmful effects it will have on
veterans and Social Security benefits."
The organizations signing on to the letter (18 in all) spanned
generations, with the Vietnam Veterans of America and Iraq and
Afghanistan Veterans of America. It includes former enlisted personnel
as well as the Military Officers Association of America. Gold Star
Wives, an organization of widows and widowers whose spouses died while
on active duty, was represented. And so was the VFW, or Veterans of
Foreign Wars, an organization that had traditionally been staunchly
conservative.
Here's a thought for politicians who might be considering the "chained CPI": When you've lost the VFW, you've lost America.
Getting It Right
Their letter's a cogent and very well-written analysis of this
proposed benefit cut, which it rightly describes as a "misguided
policy." Here's a sample:
The average retirement benefit of a veteran receiving
Social Security was about $15,500 in 2010 ... A veteran with average
earnings retiring at age 65 would get nearly a $600 benefit cut at age
75, and a $1,000 cut at age 85. By age 95, when Social Security benefits
are probably needed the most, that veteran would face a cut of $1,400
-- a reduction of 9.2 percent.
That's absolutely correct. The chained-CPI would also raises taxes for
most Americans, and in a very backhanded way: by forcing people into
higher tax brackets much more quickly. Know what
wouldn't get a tax hike under the chained CPI? Income above $250,000.
The veterans' groups also quote Congressional Budget Office estimates
of the chained CPI's deficit impact: $208 billion over 10 years through
cuts to Social Security benefits, and through higher taxes -- on
everybody
but the wealthy. (They'd pay a little more, but the
tax hikes would strike hardest at those in the $30-$40,000 income range,
and would generally affect those earning $100,000 per year of less.)
The veterans note that roughly half this amount, $112 billion, "would
come from Social Security cuts, which veterans rely on very heavily for
both retirement and disability benefits."
"Another 11 percent of the savings," the letter notes, "would come
from VA benefits, civilian pensions, and military retirement pay."
Eldernet
$208 billion also happens to be very close to my
estimate
of the amount our government will pay pharmaceutical companies for
their bloated profit margins over the next 10 years. We could probably
save $150 billion of that through negotiation and competition among drug
providers -- but Congress has forced us to pay retail instead.
Think the elderly "won't notice"? Older Americans' viral email chains
are dazzling to behold. Once you get past all the crazy fonts in
different sizes and colors -- and the GIF cartoon animations of cute
animals and oldsters playing golf -- these emails keep them well
informed about Social Security and Medicare.
And they don't need emails to tell them that their
current cost-of-living adjustments can't keep up with their expenses.
(That's why economists have proposed the "CPI-E," a higher adjustment
for the elderly and disabled who rely on items like medical care and
transportation, which go up in cost more quickly than most other items.)
Attention Must Be Paid
Let's get this straight: The "chained CPI" takes money out of the
pockets of veterans, the disabled, the elderly and everybody with a job
-- except the wealthiest of the wealthy. And we could get the money from
Big Pharma and other health profiteers instead.
It's opposed by the young and the old, the left and the right. So who's the constituency for this thing, anyway?
Silly question.
The polls are clear: Our elected officials were called to Washington
for a different mission. Any politician who thinks they can infuriate
pretty much the entire electorate because they'll have billionaire cash
on their side just isn't
paying attention.
The good news is that our nation's veterans have a lot of experience bringing recalcitrant recruits to attention.
THE LETTER I EMAILED TO PRES OBAMA, SENS WARNER & WEBB, AND REP WOLF...
The "chained CPI" proposal is wrong for the country and must not be a
concession in the negotiations to avoid the fiscal cliff. You can not
give in on this matter. It is a dirty, sneaky ploy that will hurt the
middle class, retirees, vets and the poor. The average retirement
benefit of a veteran receiving Social Security was about $15,500 in 2010
... A veteran with average earnings retiring at age 65 would get nearly
a $600 benefit cut at age 75, and a $1,000 cut at age 85. By age 95,
when Social Security benefits are probably needed the most, that veteran
would face a cut of $1,400 -- a reduction of 9.2 percent. The $208
billion realized if the "chained CPI" is enacted can be offset by $150
billion if Congress would require drug cost negotiation and competition
instead of looking for ways to protect big Pharmas profit margins. DO
NOT ENACT "CHAINED CPI" ON THE AMERICAN PEOPLE.
Follow Richard (RJ) Eskow on Twitter:
www.twitter.com/rjeskow
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