There is a lot of focus recently on methods for saving Social Security. This was covered in this blog just weeks ago. (louhough.blogspot.com)
Social Security is a topic of concern to almost every American whether Democrat/Republican, Conservative/Liberal and even non-voters. Very few citizens are not taxed for and expecting to receive Social Security during their retirement.
As covered in my blog article, possible solutions are to remove the cap that dictates how high a salary can be taxed for Social Security purposes; to lengthen the number of years one has to work; to raise taxes on all wage earners; as well as two ridiculous suggestions that would probably kill, rather than save the program -- opting out and privatization. And then there is the chained CPI.
Nobody likes having approximately one quarter or more of their earnings deducted for income tax, Social Security, Medicare, and Health Insurance. And yet, law abiding Americans have dutifully submitted to these withholdings for many years. No matter how one feels about large government/small government, Republicans/Democrats, or being charitable to others, all citizens who have paid their Social Security and Medicare taxes have a stake in whether or not these programs survive. Also, your parents, children, grandchildren and future generations of Americans are affected.
Some retirees, already collecting, take a laissez faire view about such issues. Perhaps they number among individuals who collect at the maximum level of benefits, so losing a portion of their customary Social Security would just cut luxuries. Perhaps they have couples benefits, so they have not experienced what it would be like to fall below the average benefit as well as have only one person's percentage. They respond with a ho hum attitude not unlike Leona Helmsley's "them", not us. Wrong. It applies to all current and future seniors.
Chained CPI, rather simply explained, means you will not receive the full amount of inflationary increases added to your annual income. The COLA based on CPI was meant to keep us at a constant standard of living. Chained CPI will keep us going lower and lower each year there was a rise in the cost of living. If inflation rises 4 per cent during 2014, you will not receive a full 4 per cent increase for 2015. You will get only what Congress deems to be the cost of cheaper fruits, vegetables, etc. You can't buy Porterhouse, or possibly even round steak. You can't buy 93 % heart healthy lean ground beef, you have to buy the cheapest hamburger, complete with fat, gristle and pink slime. Your bread won't be crusty Italian. It will be day-old or stale store brands. Do you get it?
But the worst part is, cutting Social Security to seniors will actually raise taxes on working Americans. How? Because every significant cut adds senior citizens to some level of Welfare. Maybe they will be forced to use HUD housing. Maybe they will have to have assistance with heating fuel. Perhaps they will have to receive help paying their Medicare and supplemental health insurance premiums or go on Medicaid. Maybe they will, OMG, have to be placed on Food Stamps.
Yes, more aid to retirees means more taxes on working Americans. Whereas Social Security was meant to be self supporting, Welfare is paid by income taxes. Welfare is a budget issue. Social Security is not.
It is totally unacceptable that America's entrepreneurs and our legislators have forced hard-working Americans to suffer the humiliation of needing to be on Welfare rolls in retirement even though they supported themselves proudly during their working years.
We need all our citizens to participate in this issue, before it is too late. If we just sit here and do nothing, we will probably get chained CPI as a permanent part of our American experience. We need you to speak out for yourselves, your daughters and sons, your grandchildren, ASAP. If you don't call, e-mail, speak with, write to or otherwise consult your area Congressmen -- or OMG you could even forward this article -- we are probably going to get the chained CPI option. Life will just get harder.
You understand, the Tea Partiers, Conservatives, Liberals, Republicans, Democrats, all are considering this as the way to "save" Social Security. It is not the worst way, but neither is it a good way.