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View Diary: Poll: Will Chained CPI for Social Security Benefit Calculation Get Passed Before December 31, 2013? (19 comments)

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  •  It's probably not worth the political (0+ / 0-)

    ...capital it costs to pass it. More likely, COLA will be suspended every once in awhile. Obama already did that a couple of times with nary a peep from the peeps.



    Denial is a drug.

    by Pluto on Wed Jan 23, 2013 at 05:06:53 PM PST

    •  Obama did not "suspend COLA" (5+ / 0-)

      Pure myth.

      COLA was set at zero for two years running simply because of the way the formula works in relation to projected CPI.

      Two things are true:

      One. The current Scheduled Benefit formula is inadequate. We can and should beef up benefits for retirees and especially lower income ones, and even more especially for widows from law income one worker households.

      Two. Social Security recipients got a much larger COLA for 2008 than the existing formula justified in light of updated CPI. As a result COLA was set at zero for two years to allow the two trend lines of CPI and benefits to realign.

      Now because of the inadequacy of the first truth recipients never FELT like the 5.8% COLA was arithmetically too much and instead just factored it in to their consumption. With the result that the lack of COLA the next two years was pereceived and in a real sense was a deprivation. But was perfectly "fair" given the formula and current law.

      Neither of which Obama had fuck all to do with, there were no changes in current law that "suspended" anything. On the other hand retirees who saw much to all of their home equity disappear at the exact time their SS check was frozen experienced some very real income shocks. Which is why it was worth your life to "explain" that in a real sense they actually got two years of COLA early. I know, because I tried to explain it a couple of times before giving it up as a lost cause. People saw a frozen check and food prices going up and naturally concluded they were being screwed.

      And were. Just by current law arithmetic and not any particular act of malice by any person certain. Including Obama.

      socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

      by Bruce Webb on Wed Jan 23, 2013 at 06:08:56 PM PST

      [ Parent ]

      •  It's odd. (0+ / 0-)

        I actually wrote a Diary about it at the time. I did not fault the president, but I thought I learned about it from the president.

        So, you are saying that COLA is suspended by an invisible hand? Or a department with the authority to do so whenever inflation touches a specific number?

        No branch of the Federal Government is involved in such a decision?



        Denial is a drug.

        by Pluto on Wed Jan 23, 2013 at 06:15:53 PM PST

        [ Parent ]

      •  I may have conflated this with (1+ / 0-)
        Recommended by:
        musiccitymollie

        ...the Federal Employees salary freeze, which was announced at the same time.

        Thanks for the insight.



        Denial is a drug.

        by Pluto on Wed Jan 23, 2013 at 06:24:55 PM PST

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        •  Automatic COLA (0+ / 0-)

          http://www.ssa.gov/...

          The 5.8% COLA for 2008 was distorted by a spike in 3rd quarter gas prices that was not sustained. Take that 5.8% and split it over three years and nobody would have blinked. It was the front loading that was indeed set automatically that created the huge perception problem.

          socialsecuritydefender.blogspot.com - SocSec.Defender at gmail.com - founder DK Social Security Defenders group - (hmm is there a theme emerging here?)

          by Bruce Webb on Thu Jan 24, 2013 at 10:23:50 AM PST

          [ Parent ]

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