Paul Krugman on Friday:
Sigh. So Obama is going with the “chained CPI” thing in his latest proposal — changing the price index used for Social Security cost adjustments. This is, purely and simply, a benefit cut.Even with the food: So the chained CPI assumption is that when prices go up, people will go for, eg, less expensive foods. They'll go from steak to chicken.
Does it make sense in policy terms? No. First of all, there is no reason to believe that the chained index is a better measure of inflation facing seniors than the standard CPI. It’s true that the standard measure arguably understates inflation for the typical household — but seniors have a different consumption basket from the young, one that includes more medical expenses, and probably face true inflation that’s higher, not lower, than the official measure.
Big deal? Yes. Because if they're already eating chicken they'll turn to beans and rice. If they're already eating beans and rice they'll go to dog food. If they've been eating dog food, roadkill is next.
In a nutshell Obama admits the CPI cut to chained CPI is a Medicare reduction to "reform" Medicare.
Which means: To reduce the deficit - Obama's own admission per the quotes.
Which means: The philosophy of economic austerity.
This word you will never hear him speak. But that's precisely what it is.
WASHINGTON -- Confronting bipartisan criticism, President Barack Obama conceded Saturday his proposed budget is not his "ideal plan" but said it offers "tough reforms" to the nation's benefit programs....that he argued will provide long-term deficit reduction....And ask anyone in Washington: Why is deficit reduction, in this depression, a good thing? They won't have a fucking clue. They've just heard the term before and that it's somehow supposed to be a bad thing.
In his address, Obama said he would achieve deficit reduction by making "tough reforms" to Medicare...
In an average economy at worst it might be a little controversial.
In a depression, it's insane.
Chained CPI for Medicare = deficit reduction = austerity.
Austerity. Come on, Mr. President. You can say it.
President Obama is an adherent of the philosophy of economic austerity. He has to know how austerity is affecting other countries. But he seems to have had no interest in and nothing to say about that.
In the US it's not just austerity. It's austerity on the backs of the elderly.
3:07 PM PT: Recommended. Thank you!