Why Chained CPI is BAD in Under Two Minutes

From Robert Reich. He “gets” it. The REAL issue here is, why is a Democratic president offering to gut Social Security (which has NOTHING TO DO WITH THE DEFICIT) and means-test Medicare? Obama apologists say it is a mere negotiating ploy. THAT’S EVEN WORSE! Because Obama has done this reckless thing, future conservative maniacs will try to gut these programs and point to Obama to say, “well, HE did it first!” This man who many of us said was NOT ready for prime-time, has wrought more damage than he will acknowledge just by making this offer whether he means it or not. He has opened Pandora’s box. He is the FIRST Democrat president to do this. We will all suffer because of this. As Reich concludes, “Democrats invented Social Security and have been protecting it for almost 80 years. They shouldn’t be leading the charge against it.”


Reich’s full text follows below the video.

“The White House and prominent Democrats are talking about reducing future Social Security payments by using a formula for adjusting for inflation that’s stingier than the current one. It’scalled the “Chained CPI.” I did this video so you can understand it — and understand why it’s so wrongheaded.

“Even Social Security’s current inflation adjustment understates the true impact of inflation on the elderly. That’s because they spend 20 to 40 percent of their incomes on health care, and health-care costs have been rising faster than inflation. So why adopt a new inflation adjustment that’s even stingier than the current one?

“Social Security benefits are already meager for most recipients. The median income of Americans over 65 is less than $20,000 a year. Nearly 70 percent of them depend on Social Security for more than half of this. The average Social Security benefit is less than $15,000 a year.

“Besides, Social Security isn’t in serious trouble. The Social Security trust fund is flush for at least two decades. If we want to ensure it’s there beyond that, there’s an easy fix — just lift the ceiling on income subject to Social Security taxes, which is now $113,700.

“Why are Democrats even suggesting the inflation adjustment be reduced? Republicans aren’t asking for it. Not even Paul Ryan’s draconian budget includes it.

“Democrats invented Social Security and have been protecting it for almost 80 years. They shouldn’t be leading the charge against it.”


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