It is being said that the new SS cost of living calculation, being called "chained CPI", actually reflects the inflation rate more accurately. If that is true then it would seem that people on social security who do not like the proposed change are not complaining about being forced to use a more fair CPI calculation but that their standard of living will not continue to rise as it has in the past yet the status quo is unsustainable.
This is what I mean that everyone in this country is out for number one and to heck with the guy who has to pay the bill.
And with the change in age demographics and the fact that we have imported massive amounts impoverished people who will contribute less to SS but will eventually draw a disproportionate amount from it, relative to their contributions, as they obtain the political clout to force this to happen, we will see a major change in the sustainability of SS. As a result the amount of SS that everyone will get will go down significantly as the ratio of contributions to expenditures declines. The only way to balance the payments will be to give everyone less or become another Greece.
So it seem ridiculous to me that they would be focused on a 0.25% change that is only correcting a CPI calculation error when this train wreck is coming down the road in the not too distant future. Sometimes I think that the general population is completely out of touch with reality. It reminds me of the cartoon picture of two smug guys having a conversation at one end of a row boat while another two guys on the other end of the row boat are bailing out water from a leak at a hectic pace. One guy says to the other “I’m glad the leak is not on our side of the boat.”
We are all in the same boat!!!
rayban, here's how chained cpi works. old, retired people who've worked all their lives and had SS deducted from their paychecks are now on fixed incomes. SS is often the greatest portion of their senior income and they have to scrimp and save in their retirement. this scrimping and saving requires old, retired, poor people to buy cheaper things, and less often, trying to save money. The chained CPI calculation takes this into account and says, "old retired people don't need as much money because they don't spend as much". That's how chained CPI works. Its like realizing that people they only need a couple of slices of bread and a glass of water each day to survive so that's what they'll get.
"chained CPI", actually reflects the inflation rate more accurately
This really depends on whether CPI calculation is viewed from an academic economic perspective or a real income/total purchasing power perspective. The chained CPI has been championed by academia based on the economic principle of substitution. Such as, General Mills raises the price of their bran cereal. A consumer chooses to switch to a lesser cost store brand (substitution).
I have read academic papers suggesting consumers can readily switch between gas or electric appliances as cost vary. I guess to realistically be able to do this_there would have to be exchange centers; enabling switching as energy costs switch back and forth. I mention this to point the foolishness of some ‘Georgetown’ and ‘Berkeley’ academic philosophies.
The senior population segment (most likely to be effectively skewed) has many cost drivers that are not easily substitutable. A few examples__in most locales real estate taxation is a county/city/township determination. Even a renter’s rent will have to absorb the owner’s taxation. That is not substitutable. Many medications are not generically substitutable (cost). Most in the US are not allowed to import substitutions (Canada, etc.). Medical after care is mostly not substitutable. In many cases overall insurance costs have not been substitutable. Additionally, these cost drivers I mentioned have been trending at a higher growth rate than the CPI or the Federal Reserve’s favorite inflation gauge the personal consumption expenditure core index.
Now I will leave you and other myopic posters to your favorite pastime. Demagoguery!
Hey Raybans, from your rant about SS, it seems you know nothing about how its funded, how its run, how much is in the SS trust, how much congress has "borrowed" from the trust - or anything else about SS. So be quiet.
I am aware of all those things and how you came to the conclusion that I wasn’t from my post is beyond me because I didn't even discuss any of this. You assume to know much about what I know but you actually know very little but talk like you do yet that would be impossible since I have not told you. I think they call the state of mind where you image that you know things that you can't possibly know as being either delusional or simply being too dumb to have a clue and at the same time too immature to feel reticent about being expressive on something you know nothing about, so which is it?
The current structure of the social security won’t survive as is. If you go to the SS web site they even state that the benefits will have to be cut in the future if nothing is changed to increase funding. And even today in congress they are talking about changing SS payments in the future so that those who get the most will bear the brunt of any social security cuts. So I think it is pointless to talk about how SS is calculated today when in all likelihood these criteria will change in the future. The US government cannot afford to pay IOUs that they owe SS on which those projected underfunded dates are based and continue to fund current programs at the same time.
This is part of the reason Obama’s problems won’t simply go away if the economy gets back on track because the whole dynamics of government funding has changed. Obama wants a new great society but now the SS situation has taken away from him all the money he would have needed to achieve this.
They won’t be able to look at the SS situation in isolation because those IOUs have to be paid and that money will come from the general fund and when programs from the general fund are getting cut to pay for those IOUs then an SS compromised will be made. Keep in mind that most of Obama’s Acorn constituents are young so he will be more inclined to focus on them not the seniors.
Generally it's things that have huge volatility or are controlled by forces outside supply and demand.
For instance, energy is controlled by international cartels to suit their whims of profit. They would gladly draw smiley-faces with the price graph if they could use it to manipulate government payments to tens of millions of people, if they could see how that would benefit them. For instance, if the public has more money, the oil companies can charge more for energy, and if the price of energy drives up the CPI and thus the amount of money the SSA gives the public, then it's in the oil companies' best interest to increase prices, drive up CPI, and get the SSA to pay for the old folks' new, higher energy costs.
So no, it's not a good idea to allow the energy companies to have YET ANOTHER way to use the government to pick the public's pockets.
raybans look at it this way. Young and illegals are supporting this overspending. We will be the recipients in our lifetime. They will be slaves to the system they voted in throughout there lives. We cant do anything about it. We are along for the ride,drink up and be merry,its party time.
The problem is that these new immigrants are net tax takers, not net tax givers so it is a losing proposition. For everyone that comes across the border the remaining pie gets smaller leaving less for the rest of us. How so? Most of the money is spent on their US citizen children to educate them and the social programs that fund their medical expenses and they have much larger families than the people who were born here in the US. The fact is that when these new immigrants come to the US, those of us that were here lose benefits as a result. Every year we will get fewer and fewer benefits as they cross the border because more money will get diverted to them.
It's not hard to understand. It is really rather simple. It only requires that people think about it and ponder it with some degree of interest. But there is a problem with this. Many people are intimidated by those who would brand them as racist if they discuss such issues because most of these new immigrants are not white. The fact is that it would not matter if they are not white or if they were all white the problem would be the same and the motivation to restrict their entry into the country would not change. It's just a ruse to get people to look the other way against their own interest.
That is why my Hispanic friends think that white people here in the US are simpletons because they cower over the racist issue. Two of my Hispanic coworkers and myself meet regularly at lunch time to have what we affectionately call our trilateral commission during which we discuss conservative issues of the day and our hobby of gun ownership. Lately we have been meeting at a local firing range on the weekend and sharing target practice sessions together. What I like about these guys is they have a very good knowledge of the illegal immigration issue because they come from the community. They know the issues from the inside. It’s a perspective that many don’t have access to.
you are really asking why people are upset about being asked to give up a source of free money.
think long and hard about it, and when you come up with an answer, consider a run for Congress, so you can do something about it.