Biden: “There will be no changes in Social Security”

[stockholmer]

8. 2011 Flashback: Obama Pushes for Modifications to Medicare & Social Security (Including Chained CPI)

http://fdlaction.firedoglake.com/2011/08/18/obama-pushes-for-modifications-to-medicare-and-social-security/

At a town hall meeting in Illinois, President Obama reaffirmed that he will personally push for Congress to make Medicare and Social Security cuts part of any talk about deficit reduction or job creation. From the White House Transcripts:

When folks tell you that we’ve got a choice between jobs now or dealing with our debt crisis, they’re wrong. They’re wrong. We can’t afford to just do one or the other. We’ve got to do both. And the way to do it is to make some — reform the tax code, close loopholes, make some modest modifications in programs like Medicare and Social Security so they’re there for the next generation, stabilize those systems. And you could actually save so much money that you could actually pay for some of the things like additional infrastructure right now. We can close the deficit and put people to work, but what’s required is that folks work together. That’s the big challenge. That’s the big challenge. (Applause.)

So the main thing is I’m here to enlist you in this fight for America’s future. I need you to send a message to your members of Congress, to your representatives that we’re tired of the games. We’re tired of the posturing. We don’t want more press releases. We want action.

“Modest modification” is classic political newspeak code for cuts. The “modest”change Obama indicates he would support, like raising the Medicare retirement age to 67, would cause very real hardship for some older Americans and make every seniors’ Medicare premiums go up. The new Super Committee doesn’t need to cut our social safety net to reach its deficit reduction targets, but President Obama publicly says he wants to make cuts to Medicare and Social Security part of any deal. The reason Medicare and Social Security are on the table right now is because Obama has chosen to put them on the table. He has the power to take them off the table with a simple veto threat. If Medicare or Social Security get cut in the near future it will because Obama actively worked to make sure the programs are cut. The much promised “pivot to jobs” after the debt ceiling deal seems to be disappointingly focused on keeping the issue of deficit reduction on the front burner.


-------------------------------------------------------
Obama Lets Slip Plans for Chained CPI

http://news.firedoglake.com/2011/08/19/obama-lets-slip-plans-for-chained-cpi/

Jon Walker already mentioned this push by President Obama for changes to Medicare and Social Security in his town hall meetings in rural areas this week. It’s actually worse than that. Walker highlighted comments from the stump speech. Look closer at the question and answer session. Twice this week, the President was asked specifically about Social Security, in particular the COLA adjustment. The last two years, recipients were denied a COLA, because it’s based on an inflation index that didn’t show any rise in inflation. The President explained this pretty ably on Wednesday at a town hall in Illinois.

THE PRESIDENT: Well, let me talk to you about Social Security. It is very likely that she will see a COLA, a cost-of-living increase next year, because inflation actually rose this year. The reason that there were a couple of years where she did not get a cost-of-living increase was because even though she probably felt like the cost of food and gas and groceries were going up, the overall inflation index actually did not go up. There was a period there where we actually had what’s called deflation, where the costs were a little bit lower than they had been comparable to the previous year.

So all that is done automatically. It’s not something that I make a decision about each year. And I promise you when folks don’t get their COLA, they all write to me and say, Mr. President, why — you didn’t give us a cost of living, and don’t you care about senior citizens. And I have to write back and explain to them, no, that’s not something I did. These things just happen automatically based on estimates of what inflation is going to be.

Indeed, Social Security recipients are expected to get a 3% increase at the end of the year. And yes, that’s an automatic process. What the President isn’t telling people is that he offered an alteration to that automatic COLA process, by going to chained CPI, that would result in a slower increase in benefits, and a de facto cut. So at the same time the President is explaining that the COLA is not in his control, he is hiding the fact that he wants to change the metric upon which it is based. In fact, he slipped and actually did mention chained CPI, in a roundabout way, at a second town hall in Alpha, Illinois. The President was asked about the payroll tax cap, and he answered that and went right to this “here’s why grandma didn’t get a COLA” talking point that he was obviously instructed to say, but he slipped and included a telling line:

Well, first—this is a very well-informed young man here. (Laughter.) You’re exactly right that the way the Social Security system works, there’s what’s called—there’s basically a cap on your Social Security, which there isn’t, by the way, on Medicare. But Social Security, it only goes up to the first $107,000; and you’re right, somebody who makes—who has net assets of $250 million and are making maybe $5 million a year just on interest or capital gains or something, just a fraction of it’s going to Social Security. I think there’s a way for us to make adjustments on the Social Security tax that would be fairer than the system that we use right now.

I do think, in terms of how we calculate inflation, that’s important as well. By the way, seniors — a bunch of them were upset over the last couple years because some of — because seniors didn’t get a cost-of-living adjustment. I got a lot of letters — “Mr. President, how come I didn’t get a COLA this year for my Social Security?” And I answered this question at the previous town hall; I figured I’d clear something up now. The way the system works is you automatically get a cost-of-living adjustment based on the inflation rate. The President doesn’t make that decision; it’s based on a formula.