2016 will mark only the third year since 1975
without a cost-of-living adjustment for seniors, veterans, and disabled people. Elizabeth Warren
is trying to fix that.
Warren's bill, dubbed the SAVE Act (short for Seniors and Veterans Emergency Benefits Act), would offer a one-time 3.9 percent increase. Why such a specific percentage? Warren points to a study showing that pay for CEOs at the 350 largest companies increased by 3.9 percent in 2015. Warren's bill would pay for this one-time benefit hike by eliminating a corporate tax exemption for performance pay packages—which would also extend the solvency of the entire Social Security program.
It would extend the solvency of the program because any excess taxes collected from CEOs would go into the Social Security Trust Fund. It would give an
average benefit increase of $581 per recipient.
"While Congress sits on its hands and pretends that there's nothing we can do, taxpayers will keep right on subsidizing billions of dollars' worth of bonuses for highly paid CEOs," Warren said in a statement.
She's joined by Sen. Bernie Sanders and 16 Senate Democrats. It should have every Democrat on board, because there couldn't be a more important thing for Congress to be doing for seniors, veterans, and the disabled, and there couldn't be a better way of paying for it. Taking care of this problem for this year would also start a necessary conversation about just how cost-of-living adjustments are calculated.
One of the reasons that there's no increase this year is that gas prices aren't higher—that's one of the things the calculation is tied to. Never mind that many seniors and disabled people don't drive, so gas prices aren't really a big spending item for them, unlike housing and food and prescription drugs. Had a more appropriate measure (the CPI-E, the consumer-price index for Americans 62 years of age and older) been used this year, beneficiaries would be getting on average a $44 per month raise.