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Chained CPI Is a Cut in Social Security Benefits and 'Stealth' Tax Hike

Illustration by Aryer via Art Strike

Beware the "chained" CPI.

As Republicans in Congress take a hard line in the sand against higher tax rates for millionaires and billionaires, they are demanding a Social Security benefit cut through a lower Cost of Living Adjustments (COLAs). The lower COLA would result from the adoption of a new formula for calculating COLAs called "Chained CPI."

The Center for Economic and Policy Research (CEPR) points out this is not only a benefit cut on already modest Social Security benefits, but also a stealth tax increase on working people, especially middle- and lower-income families.

In fact, in just 11 years, a "chained" CPI would wipe out the 2012 COLA. 

Read more from CEPR on the "chained" CPI

In other news on the "chained" CPI, RJ Eskow, senior fellow for the Campaign for America's Future, writes in When You've Lost the VFW on Budget Cuts, You've Lost America that veterans groups staunchly oppose the proposal:

A wide range of organizations representing the nation's veterans signed a joint letter to leaders in Congress, which said, "[W]e are writing to express our opposition to changing the formula used to calculate the annual cost of living adjustment (COLA) because of the harmful effects it will have on veterans and Social Security benefits."

The organizations signing on to the letter (18 in all) spanned generations, with the Vietnam Veterans of America and Iraq and Afghanistan Veterans of America. It includes former enlisted personnel, as well as the Military Officers Association of America. Gold Star Wives, an organization of widows and widowers whose spouses died while on active duty, was represented. And so was the VFW, or Veterans of Foreign Wars, an organization that had traditionally been staunchly conservative.

Here's a thought for politicians who might be considering the "chained CPI": When you've lost the VFW, you've lost America.

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Tagged under:
budget
Chained CPI
lame duck
Social Security
veterans
VFW

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