Krugman: Rumors of a Deal

[Fire Walk With Me]

Via @RepublicanDalek

http://krugman.blogs.nytimes.com/2012/12/17/rumors-of-a-deal/

It sounds as if Ezra Klein is hearing more or less the same things I’m hearing: Republicans willing to give up a lot more on tax rates, although not fully undoing the Bush tax cuts in the 250-400 range; additional tax hikes via deduction limits in a form that hits the wealthy, not the upper middle class (28 percent and all that); unemployment extension and infrastructure spending; but “chained CPI” for Social Security, which is a benefit cut.

Unlike what we’d heard from Republicans before, this contains stuff that Obama can’t get just by letting us go over the cliff: more revenue than he could get just from tax-cut expiration, unemployment and infrastructure too. But it has a cost, those benefit cuts.

Those cuts are a very bad thing, although there will supposedly be some protection for low-income seniors. But the cuts are not nearly as bad as raising the Medicare age, for two reasons: the structure of the program remains intact, and unlike the Medicare age thing, they wouldn’t be totally devastating for hundreds of thousands of people, just somewhat painful for a much larger group. Oh, and raising the Medicare age would kill people; this benefit cut, not so much.

(More at the link.)

[1StrongBlackMan]

1. I know the "chained CPI" is supposed to be a bad thing ...

But what real effect will it have on benefiaries.

I get the basic concept; but have no idea how it will effect the low-end beneficiary and the median-ranged benefiary?

Finally, would a "chained CPI" be a deal breaker for DUers, given the gains? (I think I know the answer to that one.)

[Panasonic]

4. Chained CPI would force me to lose a significant amount of SSDI I collect per month

and it's BARELY enough to live by.

I oppose Chained CPI. Period.

Unless they give us a higher COLA raise to adjust for chained CPI. I'm not talking abotu the usual mini COLA raise we get each year. This year is 1.7%

If we get chained CPI, then the COLA has to go over 25% just to cover the bases.

[Luminous Animal]

5. It is a reduction in benefits and will also lead to a tax increase

For the poor through the middle class..


The Chained CPI: A Painful Cut in Social Security Benefits and a Stealth Tax Hike

The Chained CPI would also effectively raise taxes on virtually all working Americans, especially middle and lower income families. By applying it to all government programs, including the annual adjustment in income tax brackets, the Chained CPI would cause those thresholds to rise more slowly than they do now. That would lead to incomes jumping up to higher tax brackets faster, or in other words, income tax increases.
According to Congress’ Joint Committee on Taxation, if individual income taxes were indexed to the Chained CPI starting in January 2013, by 2021, 69 percent of the gains in revenue would come from taxpayers with incomes below $100,000, while those in the highest income brackets would barely be affected. For example, workers with incomes between $10,000 and $20,000 would experience an increased tax burden of 14.5 percent, while those with incomes over $1,000,000 would just see an increase of 0.1 percent. 9 This contradicts the idea that the negative effects from benefit cuts due to a switch to the Chained CPI would be offset by increased revenue from the wealthy.

The above is an excerpt from a report from the Center For Economic And Policy Research. You can download the report from this page:
http://www.cepr.net/index.php/publications/reports/the-chained-cpi-a-painful-cut-in-social-security-benefits-and-a-stealth-tax-hike

[1StrongBlackMan]

6. Thanks ...

I'll read your link.

[Luminous Animal]

7. You're welcome.

[Luminous Animal]

2. I am so pissed off at the prospect of this happening, I can barely think.

Clinton fucked over poor people and Obama seems poised to do similar.

[1StrongBlackMan]

11. Do you think ...

that, in balance, this is a deal breaker?

[Luminous Animal]

13. Clinton's welfare reform not only drove me to change my voter registration...

but to help run Nader's Northern California office and to vote for him. I still tear up when I witness the affects of that life crushing mean spirited legislation. Millions of U.S. citizens living on fucking $2 a day. An increase in poverty in supposedly the wealthiest nation on earth.

We are an extra-ordinarily cruel country... allowing children to starve and side-stepping grandmas and grandpas sleeping on the streets.

[ProSense]

3. This makes no fucking sense.

The President and Democrats have repeatedly said that Social Security has nothing to do with the deficit.

Raising the age for Medicare, which is a driver of the deficit because it's linked to health care costs, is taken off the table because it's a stupid idea that doesn't save money and will "kill people."

Now there are rumors of a deal involving cuts to Social Security benefits?

What the fuck for? Why is a program that has nothing to do with the deficit being dragged into the negotiations?

Are these people seriously determined to cause seniors pain for the hell of it?

There is stupid, raising the Medicare age, and then there is fucking stupid, this current rumor.

I'm surprised at Krugman's piece after he wrote this:

Krugman: No Deal, Continued
http://www.democraticunderground.com/10022013316

We just had a fucking election:



What the millionaires want versus what the voters want
http://www.dailykos.com/story/2012/12/07/1162018/-What-the-millionaires-want-versus-what-the-voters-want

[No Compromise]

10. "Are these people seriously determined to cause seniors pain for the hell of it? "

They do seem to act that way.

I think there is something seriously wrong with these sadistic bastards.

How the hell did so many of them get in power?

[Hoyt]

8. If the rest of the deal really helps economy, chained CPI is OK with me.

And I'm really close to living off SS.

Preserving Medicare is big, helping job situation for younger folks is big, cutting defense and increased taxes on wealthy are too.

I'll take the chained CPI and adjust if the deal puts most people and our country in a better position. Not happy about it, and I assume those at lowest end of SS will get a boost.

[Luminous Animal]

12. There is absolutely no reason to cut a program that has nothing to do with the deficit

(And, in my opinion, cuts during a recession are stupid stupid stupid.)

It will also result in a tax increase on the poor through the middle class. Are you fine with that, too?


The Chained CPI: A Painful Cut in Social Security Benefits and a Stealth Tax Hike

The Chained CPI would also effectively raise taxes on virtually all working Americans, especially middle and lower income families. By applying it to all government programs, including the annual adjustment in income tax brackets, the Chained CPI would cause those thresholds to rise more slowly than they do now. That would lead to incomes jumping up to higher tax brackets faster, or in other words, income tax increases.
According to Congress’ Joint Committee on Taxation, if individual income taxes were indexed to the Chained CPI starting in January 2013, by 2021, 69 percent of the gains in revenue would come from taxpayers with incomes below $100,000, while those in the highest income brackets would barely be affected. For example, workers with incomes between $10,000 and $20,000 would experience an increased tax burden of 14.5 percent, while those with incomes over $1,000,000 would just see an increase of 0.1 percent. 9 This contradicts the idea that the negative effects from benefit cuts due to a switch to the Chained CPI would be offset by increased revenue from the wealthy.

The above is an excerpt from a report from the Center For Economic And Policy Research. You can download the report from this page:
http://www.cepr.net/index.php/publications/reports/the-chained-cpi-a-painful-cut-in-social-security-benefits-and-a-stealth-tax-hike

[gkhouston]

9. If the Republicans are willing to give up anything on taxes, it's a hint that they believe

they'll lose more than they could gain from going over the fiscal cliff. This is a crappy deal and the Dems shouldn't take it.