Brian Beutler, of Talking Points Memo, presents the CHART OF THE DAY: The Stealth Social Security Cut In Debt Talks and warns us that "a stealth change to the Social Security benefit structure that has quietly been placed on the negotiating table."
The proposal wouldn't just impact Social Security benefits. It would also shave off yearly increases in federal pension payouts, and result in somewhat higher tax revenues. But the ratio would be skewed toward benefit cuts by a factor of about 2-to-1 and would represent a financial hit to even the poorest retirees unless they were exempted.
The idea is to change the way Cost of Living Adjustments (COLAs) are calculated across the federal government. Currently, the COLAs for tax brackets, pensions, and Social Security are tied to different measures of the Consumer Price Index (CPI). Because spending habits change when living costs increase, some experts think these measures are too generous, and want to change all of the COLAs to a different, smaller measure of inflation: the so-called "chained-CPI."
... the program's chief actuary explained that moving to "chained-CPI" would constitute an immediate 0.3 percent benefit cut. (and)... the effects would compound, and "[a]dditional annual COLAs thereafter would accumulate to larger total reductions in expected scheduled benefit levels of about 3.7 percent, 6.5 percent, and 9.2 percent for retirees at ages 75, 85, and 95, respectively." ... And that's why advocates and interest groups all the way up to AARP are sounding their alarms.
"Let me be clear - AARP will not accept any cuts of any kind to Social Security as part of a deal to pay the nation's bills," said AARP CEO A. Barry Rand in a statement late last month, "and specific proposals such as the chained CPI should not be considered as part of the debt ceiling or deficit reduction negotiations."
This would be an incrdibly stupid thing for Democrats to agree to. Those of us who recieve Social Security, and Social Security Disability, and Government Pensions are smart enough to see that these constitute real cuts over time, as benefits do not keep up with inflation, while defense spending remains untouched. We will hold all politicians who betray the trust of the Social Security Trust Fund, and federal pensions, accountable.
We Democrats have a a winning issue on our side right now, that the GOP has made their intentions clear. But we could blow this advantage big time is we join the GOP, in a "Thelma and Louise"-like suicide pact to drive our party over the cliff by making a deal to include Social Security cuts in this debt-ceiling hostage deal.