Paul Krugman says its unfair and wrong to raise the Social Security and Medicare eligibility age; Sen. Harry Reid says any adjustment to the Social Security COLA calculation is off the table. It appears what’s left is higher and higher taxes to preserve a 20th century benefit in the 21st century.
While I can understand the age position, the COLA position is just stupid and short-sighted leaving the Country with ever-increasing liabilities requiring higher and higher taxes on everyone. We already spend a disproportionate amount of national resources on us old folks and yet even long-term, gradual and practical changes offend the sensibilities of the left.
Here is an excerpt from a Huffington Post article. Note the section I put in bold below, look at the logic used. What they are saying is that if you only get a raise on your job of 3%, but you were expecting 4%, you suffered a pay cut. Nonsense; you may have received less than anticipated but no pay was cut. But even more absurd is the dollars involved; $1,000 less a year after twenty years in the future, that’s $50.00 a year each year (that you don’t even have now) and that’s something to risk the fiscal solvency of the Country over? No wonder we are in the shape we are.
Most of the people now collecting Social Security will not be here in twenty years and younger people will have ample time to plan ahead for this very modest adjustment. What is the government paying for via lost revenue through a myriad of tax favored retirement vehicles if not to help people plan for retirement beyond Social Security?
The whole idea of an automatic COLA disconnected from affordability or economic conditions as well as under funded is abominable. What business can stay solvent providing raises to workers each year regardless of revenue or profit? Minor adjustments to the Social Security COLA over decades are virtually painless. There are other alternatives as well as I have previously mentioned. No COLA for anyone during the first five years of collecting a benefit, no COLA applied before the full retirement age, a COLA only every other year for anyone entitled to the maximum Social Security benefit and no COLA at all for beneficiaries subject to the supplemental Medicare Part B premium.
Our politicians are nothing but enablers to Americans who fail to plan and provide for their own economic well-being. This is not to say we ignore those truly in need, but setting policy to the lowest common denominator is going to sink us just as it is sinking Europe and who suffers most; the average citizen.
“I’ve made it very clear. I’ve told anyone that will listen, including everyone in the White House, including the president, that I am not going to be part of having Social Security as part of these talks relating to this deficit,” Reid, D-Nev., told reporters.
Reid’s edict would appear to take a key proposal off the table as an ingredient for a deal on avoiding the “fiscal cliff,” the year-end combination of expiring President George W. Bush-era tax cuts and harsh across-the-board spending cuts.
At issue is the inflation adjustment used by the government to calculate cost-of-living adjustments for Social Security and other federal programs. A less generous inflation measure that takes into account consumers finding alternatives when prices go up could reduce deficits by more than $200 billion over the next decade.
It’s a no-brainer for many budget wonks because it means gradual, less noticeable curbs to the growth of benefits. It also means about $70 billion more tax revenues over 10 years because automatic rises in tax brackets to account for inflation would be smaller.
That new inflation index, known as chained Consumer Price Index, is a magic elixir for budget writers. But it’s anathema to many liberals, who say that moving to the new cost-of-living measure could cut average retiree benefits by about $600 a year a decade after taking effect and mean a cut of about $1,000 a year after 20 years.
Note the poll to the right, vote and then see the results to date >>>>>>>>
Related articles
- Senators Caucus Vows To Protect Social Security, Medicare (crooksandliars.com)
- Dems Stiffen Spine Against Potential Big Cuts (huffingtonpost.com)
- Reid Says “We’re Not Going to Mess With Social Security” (news.firedoglake.com)
QUINNSCOMMENTARY 
Since the D’s are into all things Clinton, why not revive the blue ribbon commission work from the mid-1990’s. That was our last, best opportunity to resolve social security funding and benefit issues. A compromise which was derailed by Monica….
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One other consideration is the nearly 50% increase in Social Security (FICA) taxes (from 4.2% to 6.2% also scheduled for 1/1/13). I suspect if D’s resist changes in benefits, they’ll run into a wall over any suggestion to extend that “middle class tax break” which is foisted upon future generations. Time for the D’s to choose – retirees or workers, the greatest generation or Gen X, Y and generations to come.
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