Chained CPI Protections (Republicans are still going to say no)

[ProSense]

Chained CPI Protections

The President’s Fiscal Year 2014 Budget demonstrates that we can make critical investments to strengthen the middle class, create jobs, and grow the economy while continuing to cut the deficit in a balanced way.

The President believes we must invest in the true engine of America’s economic growth – a rising and thriving middle class. He is focused on addressing three fundamental questions: How do we attract more jobs to our shores? How do we equip our people with the skills needed to do the jobs of the 21st Century? How do we make sure hard work leads to a decent living? The Budget presents the President’s plan to address each of these questions.

To make America once again a magnet for jobs, the Budget invests in high-tech manufacturing and innovation, clean energy, and infrastructure, while cutting red tape to help businesses grow. To give workers the skills they need to compete in the global economy, it invests in education from pre-school to job training. To ensure hard work is rewarded, it raises the minimum wage to $9 an hour so a hard day’s work pays more.

The Budget does all of these things as part of a comprehensive plan that reduces the deficit and puts the Nation on a sound fiscal course. Every new initiative in the plan is fully paid for, so they do not add a single dime to the deficit. The Budget also incorporates the President’s compromise offer to House Speaker Boehner to achieve another $1.8 trillion in deficit reduction in a balanced way. When combined with the deficit reduction already achieved, this will allow us to exceed the goal of $4 trillion in deficit reduction, while growing the economy and strengthening the middle class. By including this compromise proposal in the Budget, the President is demonstrating his willingness to make tough choices and his seriousness about finding common ground to further reduce the deficit.

* * *

The Budget contains the President’s compromise offer to Speaker Boehner from December. As part of that offer, the President was willing to accept Republican proposals to switch to the chained CPI. But, the Budget makes clear that the openness to chained CPI depends on two conditions. The President is open to switching to the chained CPI only if:

• The change is part of a balanced deficit reduction package that includes substantial revenue raised through tax reform.
  
  
• It is coupled with measures to protect the vulnerable and avoid increasing poverty and hardship.

The Budget contains two types of protections:

Benefit Enhancement for the Very Elderly and Others Who Rely on Social Security for Long Periods of Time

• The benefit enhancement would be equal to 5% of the average retiree benefit, or about $800 per year if the proposal were in effect today.
  
  
• It would phase in over 10 years, beginning at age 76, or (for other beneficiaries, such as those receiving Disability Insurance) in the 15th year of benefit receipt.
  
  
• The benefit enhancement would begin in 2020, phasing in over 10 years for those 76 or older (or in their 15th year of eligibility or beyond) in that year.
  
  
• Beneficiaries who continued to be on the program for an additional 10 years would be eligible for a second benefit enhancement, starting at age 95 in the case of a retired beneficiary.

Because of the benefit enhancement for the very elderly, the Budget proposal would not increase the poverty rate for Social Security beneficiaries, and would slightly reduce poverty among the very elderly according to SSA estimates.

Policy is Not Applied to Means-Tested Benefit Programs

Means-tested benefit programs are not included in the switch to the chained CPI. Programs that would not be included are:

• The Supplemental Security Income (SSI) program, meaning that the lowest-income seniors and people with disabilities generally would not be affected.
  
  
• Means-tested veterans’ pensions as well as the Montgomery GI Bill-active duty or the post-9/11 GI Bill benefits.
  
  
• The Supplemental Nutrition Assistance Program (SNAP) and child nutrition programs.
  
  
• Pell Grants.
  
  
• Poverty guidelines.

http://www.whitehouse.gov/omb/budget/factsheet/chained-cpi-protections

What the hell does all this mean?

[gateley]

1. I have no idea what it all means, but I can't help but think that this will never get to a vote.

And now Republicans are coming out against chained CPI, so hopefully that means on the NEXT go 'round, it won't be in either's budget.

[myrna minx]

2. So is the President's proposed chained CPI a good thing or a bad thing?

How is SSN is any way related to the deficit?

"Very elderly"! I've read this BS several times and each time it makes me more enraged.

[Hoyt]

3. Don't totally understand it, but it ought to he read by everyone who has been bashing Obama. eom

[myrna minx]

5. So are you for the President's chained CPI proposal?

I can't tell. Why is SSN being attached to the deficit when SSN is funded and separate from the federal budget deficit? Why is the President seemingly commingling the two with this budget? What about those working class and poor folks (not office folks like lawyers, lobbyists etc, - you know, the ones who are "living longer&quot who don't have the time to wait until they're 76 for "added" benefits?
This is a cold, cynical proposal. Not one that is for those who need us most, but for those who "may one day" reach that alleyoop time when these benefits kick in - yanno, the already cared for.

[Hoyt]

6. I'm for creating jobs, getting the economy in shape to avoid draconian cuts later, etc.

I'm not going to focus on one little aspect of a much bigger picture. If some badly needed legislation does not get enacted, the day will come where you will lament the CCPI as the good old days.

[neverforget]

7. That "little aspect" affects tens of millions of seniors.

Hardly little.

[Hoyt]

9. I'm one of those, but I'm willing to sacrifice for good of those who need jobs, loan help, etc.

The protections built in by Obama make the dire predictions by the shortsighted over the past few months way off base. Look at the big picture, and be happy.

[neverforget]

10. I am and SSI has nothing to do with the deficit.

[Hoyt]

12. It does, because it's all interrelated. And if you read the stuff above, you won't be impacted.

[myrna minx]

14. How is SS, which is independently funded and not related to the deficit, now interrelated?

[Hoyt]

17. Because the government has to borrow to pay into SS fund when current FICA collections are down.

That's just one example you are missing. There are also the politics of situation.

Again, you are looking at things from an accounting viewpoint, not a macroeconomic viewpoint.

[myrna minx]

23. Who introduced the FICA reduction? Why should my mom who paid into

the system for her whole life suffer the consequences of horrible war and economic policy? That wasn't "part of the deal".

Do you find the FDIC irrelevant? This is a compact that insures that your savings (unlike the pre-New Deal that savings of the poor was just as risky as the stock market) is safe. Should we return to that because our economy is unstable? Should we stuff cash and coins in our mattresses?

If we don't honor our generational "deals" then then there's no point to our country. Then we're the Ron Paul libertarians and that's not ok with me.

[myrna minx]

13. "One little aspect" is the national compact the New Deal made with our citizens.

Wow! I'm stunned our lives are so trivial.

[Hoyt]

15. Please. There are no guarantees in life, or national compact.

Do you really expect am economy in decline will adhere to that compact if other people are looking for jobs, needing health care, etc. I agree there are other ways to get there, but if CCPI - with most folks protected - is a way to get there, I don't mind the sacrifice because we will all be better off.

[myrna minx]

18. That's ridiculous. We have a social compact as well as a constitutional compact.

If We the People cannot trust in the structure of our government and the said compacts, how are held together? Is paying into SSN optional? Are you for privatizing? The republicans nearly drove the AAA credit rating of the United Stated of America by defaulting on out debts and compacts. Should this be rewarded?

Do we cease to honor treaties because they no longer work for us? Does "our word" no longer matter?

Oh - and please explain in detail who should be sacrificing at this time. My Mom, who has paid in into the SSN her whole life and her church secretary contributions have added nothing to the federal deficits, or the wealthy and the military industrial complex, which is ALWAYS untouched during these times of "sacrifice"?

Wow.

[Hoyt]

21. Go to Cyprus, Greece, etc., and ask how that social compact worked for them.

I'm not saying it's right or fair, but it's reality, and could be worse. Cancer is not right or fair, but griping about it and bashing Obama doesn't change facts.

I'm foe getting needed economic legislation passed with money for jobs, education, health care, increased taxes for wealthy, etc. The small sacrifice is worth it to me if it can keep those three youngsters who will pay my SS benefits employed.

[myrna minx]

24. The Constitution of the United States of America and the New Deal

are not the same as the economic conditions of Greece nor are they the same as how cancer is unfair.

It's as easy as this:

If you break your word, no one believes you again. No one will loan you money or give you money and no one will trust you. Especially your own people.

Political and social compacts matter. Our word matters.

[Hoyt]

25. We are not going to get anywhere, so good luck.

[myrna minx]

30. So no thoughts on FDIC ?

Last edited Wed Apr 10, 2013, 09:52 PM - Edit history (1)

Or how if a country's own people (and their creditors) lose trust that said country will not honor its promises could prove economically disastrous?

The United States of America is fueled by our reputation and our commitments and compacts. If we toss off our commitments to our elderly and disabled, we aren't the pinnacle we and the world once thought.

[neverforget]

22. No guarantees! See how easy it is to rationalize this?

[MotherPetrie]

29. Especially -- *only*, actually -- when there is a Democrat in the WH who needs defending

for proposing Chained CPI.

If Bush had proposed this, you can bet no one here would be trying to rationalize it.

[myrna minx]

39. Yep , the goal posts are moved yet again.

It's appalling. If the United States of America *chooses* no longer honor the commitment to her elderly, disabled, veterans, children and unfortunates, then what the hell are we waving around miniature flags at rallies and pledging allegiance? It's absurd.

[Nite Owl]

34. the way it sounds to me

they are using the funds 'saved' twice. It is being used (incorrectly) as a deficit reducer and it is being used to 'strengthen' SS in which case it should go into the trust fund. But it isn't going into the trust fund so SS isn't getting strengthened it is getting robbed.

If the above mentioned groups are not being affected it is really means testing. I thought I prepared as best as I could for retirement now I have to spend down all I have to not get chained. How is that fair?

[dawg]

4. Republicans are going to block this. You're right about that.

And it will endear them to voters all across the country.

[Larrylarry]

8. Thanks for the laugh

The Republicans already voted for the Paul Ryan budget, a budget that is far far worse than the presidents
in fact the Paul Ryan budget could be the worst budget ever written in the history of United States

But the American citizens will "endear" the Republicans because they blocked the presidents budget

That's a pretty deep thought you had right there

[dawg]

11. Just wait and see.

They will hang this around our necks like an albatross.

It won't be fair, of course. Despite my strong opposition to this proposal, it's nowhere near as draconian as what the Republicans would do. But the public doesn't follow things as closely as we do. And the Republicans will demagogue this issue.

Remember all the Republican ads about Democrats cutting Medicare? It will be like this, only on steroids.

The best thing Democrats can do is turn their backs on this proposal and publicly disavow any support for it at all. Obama isn't running again. We need to make this about him and not about the Party.

[Nite Owl]

35. I think it will be

we could very likely lose the Senate now.

[tokenlib]

16. Looks like a lot of holes in that protection net....

..they really want us to believe people on Social Security are better off than they really are.
And with the new entries into the system having decimated 401K's, no defined benefit plans, and no savings due to student loans and job losses having gobbled up reserves..the cuts will suck from age 67-76 for those on the edge.

I'm criticizing Obama..and I find NO COMFORT in these protections for too many people who are going to be hurt....

Once again, Social Security is not a part of the deficit... and scraping the cap gets rid of most concerns...

[Liberalynn]

20. I see that it protects SSI Disabled but what about SSD Disabled?

I worked for fifteen years before getting sick! So I get thrown under the bus for that?

I agree with you these "so called protections" aren't enough.

I also agree with scraping the cap.

[bhikkhu]

19. All this means that Obama proposed exactly what he said he would propose -

which is, to make no changes that would hurt the most vulnerable, or those who relied on SS for their primary income. The devil is always in the details, and we can see here that he has proposed changes that would actually increase the money-in-pocket for those most in need...

Of course, its neither here nor there as far as legislation goes, as both sides rejected it before they read it, apparently.

[RKP5637]

26. It means we are all F'ed for no good reason if this passes. n/t

[Bluenorthwest]

27. The key to the nature of this language is that it speaks of 'phasing in over 10 years' a benefit

that starts at age 76 then look at life expectancy rates:
Life expectancy for black and white men and women was as follows:

Black male: 69.8 years
White male: 75.7 years
Black female: 76.5 years
White female: 80.8 years

Must I go on? I'll add that to claim that 'people with disabilities in general' are on means tested SSI is deceptive at best, as huge numbers of disabled people are beneficiaries of the Social Security Disability program, not SSI. Anyone who worked a few years and became disabled will have contributed to SS enough to get SSDI, and would thus be subjected to chained CPI.

What this is is a bunch of language that lets us know how damaging it is by the level of bullshit they are spinning to distract from the cuts. 'We will now give one million dollars to all who are 125 or older, phased in over the next 75 years.'

[suffragette]

37. + 1,000

They are spinning this like a big old flashy disco ball. The last thing they want people to see are the facts you just laid out. And thank you for doing that.

[Vinnie From Indy]

28. This will not be the first pruning done to SS now that Obama

has put it on the table. SS will now face a slow, incremental attack.

[winter is coming]

31. It's a fig leaf to make us think that the cuts aren't going to screw people.

And it's bullshit.

Our huge honking deficit came from Bush tax cuts and two off-the-books wars... so why are we talking about "reforming" Social Security instead of upping taxes and slashing the Pentagon's budget?

[woo me with science]

32. Fuck "protections" from the President's policies.

How about a Democratic President not assault us in the first place?!

[ProSense]

33. I really don't

"Fuck "protections" from the President's policies. How about a Democratic President not assault us in the first place?!"

...understand why this thread (http://www.democraticunderground.com/10022650258) isn't attracting anyone.

[jazzimov]

38. which explains a lot

about you.

[jazzimov]

36. Actually, it's pretty simple and straight-forward

if you apply your old Algebra Word Problem expertise to "Legal Speak", as well as applying all we already have been "warned about" with regards to Chained-CPI.

Let's "parse" the statement, pulling out the most important sentence in each paragraph (this is something I learned in Public School):

He is focused on addressing three fundamental questions: How do we attract more jobs to our shores? How do we equip our people with the skills needed to do the jobs of the 21st Century? How do we make sure hard work leads to a decent living? The Budget presents the President’s plan to address each of these questions.

Granted, some of that is just empty rhetoric but rhetoric that the GOP demands, such as: How do we make sure hard work leads to a decent living?

So there you have it. These are the main questions that the President's budget is trying to address, although it is evident later that there are many other considerations that must be made.

Nothing is ever easy. No matter what tea-baggers claim.

To make America once again a magnet for jobs, the Budget invests in high-tech manufacturing and innovation, clean energy, and infrastructure, while cutting red tape to help businesses grow.

Ok, so it is spending money for these specific programs. It is also "cutting red tape" which means that it requests previous laws to be repealed. some of those laws are simply stupid and outdated, but they are still on the books. I definitely think we need to review them and keep the laws that are relevant and get rid of the ones that are just plain stupid. And there are many that may have served a purpose at one time, but are just plain stupid at this point. That is what should be interpreted as "red tape". Unfortunately, at least some of those laws are still relevant and useful but described Lobbyists as "red tape". We do need to "cut the red tape" to allow everyone to "be all that you can be", but still instill the controls that they were meant to control originally. Unfortunately, I don't really see this happening in any meaningful way. My suggestion is to repeal any law that is not self-evident, and then address the consequences as they occur. Not a perfect plan, but at least it is a plan. remember, right now we are in the middle of a difficult recovery which is very fragile and could revert to another recession - or even a depression - if we make a wrong move.

The Budget contains the President’s compromise offer to Speaker Boehner from December. As part of that offer, the President was willing to accept Republican proposals to switch to the chained CPI. But, the Budget makes clear that the openness to chained CPI depends on two conditions. The President is open to switching to the chained CPI only if:

The change is part of a balanced deficit reduction package that includes substantial revenue raised through tax reform.

It is coupled with measures to protect the vulnerable and avoid increasing poverty and hardship.

So, the President is willing to negotiate only if Republicans are willing to negotiate. The Republicans clearly are not willing to negotiate, but I am not trying to argue strategy here.


In his budget proposal, Obama did propose a Chained-CPI calculation "fix", WITH PROTECTIONS FOR THE VERY PEOPLE THAT MANY CLAIM ARE HURT BY THE PROPOSAL.

It's right there in the quote you supplied:

The Budget contains two types of protections:

Benefit Enhancement for the Very Elderly and Others Who Rely on Social Security for Long Periods of Time

The benefit enhancement would be equal to 5% of the average retiree benefit, or about $800 per year if the proposal were in effect today.

It would phase in over 10 years, beginning at age 76, or (for other beneficiaries, such as those receiving Disability Insurance) in the 15th year of benefit receipt.

The benefit enhancement would begin in 2020, phasing in over 10 years for those 76 or older (or in their 15th year of eligibility or beyond) in that year.

Beneficiaries who continued to be on the program for an additional 10 years would be eligible for a second benefit enhancement, starting at age 95 in the case of a retired beneficiary.

Because of the benefit enhancement for the very elderly, the Budget proposal would not increase the poverty rate for Social Security beneficiaries, and would slightly reduce poverty among the very elderly according to SSA estimates.

Policy is Not Applied to Means-Tested Benefit Programs

Means-tested benefit programs are not included in the switch to the chained CPI. Programs that would not be included are:

The Supplemental Security Income (SSI) program, meaning that the lowest-income seniors and people with disabilities generally would not be affected.

Means-tested veterans’ pensions as well as the Montgomery GI Bill-active duty or the post-9/11 GI Bill benefits.

The Supplemental Nutrition Assistance Program (SNAP) and child nutrition programs.

Pell Grants.

Poverty guidelines.

So, there you go. For anyone who believes in the "Catfood Commission", once again we prove that Obama is pushing for PROTECTIONS for the poor.

Bottom line, "what does this mean?"

It means that the anti-Obama people have once again jumped to conclusions without truly understanding the situation.

Yet they like to call us names. And to all those who cannot refute my analysis:

I am NOT DLC. I am NOT Centrist. I am NOT whatever "name" you choose to label me with because I refuse to vote for the Green Candidate:

I AM informed.

[myrna minx]

40. So, is the President's proposal for a chained CPI a good thing or a bad thing?

[ProSense]

41. Anything that makes increases more stingy is a bad thing. n/t