socially insecure — ‘the cat food index’

April 14, 2013

social-security-cutsOne recent political, ricochet-rabbit-bombshell has been President Obama’s budget proposal — bits of it leaked two weeks ago, the whole shebang officially released last Wednesday — parts of which include cuts to Social Security through lowering life’s expectations.

Obama wants people who are getting close to being old to just change how they live — he’s come up with a new formula to calculate the cost of living and finds it invigorating — Not!

(Illustration found here).

In budgetary matters, I’m as lost as Michele Bachmann, and must read and re-read all the information on the subject before even half of it sinks anywhere near past skin deep. The words, “chained-CPI,” is the new normal-lead for bullshit jargon.
Supposedly, CPI (consumer price index) is used to measure cost-of-living adjustments, and again, supposedly this CPI is handcuffed to people’s wallets as viewed through the national-goods ‘market basket‘ scheme: Chained CPI holds that consumers make choices not reflected in the basket — when the price of one item rises, they substitute something less expensive, mitigating the overall price increase.
In other words, buy down, or die, or something less dramatic, I hope.

The current system for SS (Social Security) adjustments uses price changes faced by urban wage earners and clerical workers, and the new chained model covers the entire urban consumer, everybody. This “daisy chain” approach makes for a slower rise in benefits then the old one. Which, therefore, references the ultimate bottom line: While the lowest-income people may in the end receive higher benefits than under current law, they will experience years of losses before their benefits catch up. (And some won’t live to see those gains.) 
Now well into my 65th year, SS is near-high on my event horizon. Most likely in the next year (or less), I’ll quit a near-50 year regular work life and enter so-called ‘retirement,’ mainly depending upon the old SS check, which right now is less than $1,000 a month. (If I follow SS regulations, right now if I retire, my benefit check would be 13.3 percent less than if I wait one more year — age 66 is my birth age for full retirement).
Of course, I’ll never fully ‘retire,’ and optimistically would find some part-time employment to compensate for a pitiful SS check. And of course, when I’m removed in a body bag then will come ‘full retirement.’

One of the better explanations for all this SS lingo came in an interview last Thursday at The RealNews Network with Michael Hudson, distinguished research professor of economics at the University of Missouri-Kansas City, and author of ‘The Bubble and Beyond,’ and ‘Finance Capitalism and Its Discontents.’ (h/t TruthDig).
After a discussion about the plight of the dumb-ass financial cesspool, Hudson had this to say about Obama’s proposed 30 percent tax hike on those poor slobs making $1 million a year, and was it a sound offer?

No, for the following reason.
Yes. It is a fraud.
It is doubletalk.
Rich people don’t make income.
Income is for the little people, as Leona Helmsley said.
Rich people make capital gains.
So Obama’s going to say, folks, when you fill out your tax returns, don’t say you’re earning income.
Say you’re earning capital gains. We’ll cut the taxes for you on that.
So what he’s doing is simply flimflam.
Don’t believe it when he talks about income and rich people.
And the Congressional Budget Office has shown that the wealthy people get their money in capital gains, not income.
He’s not making a peep about that.
So that is absolute straight dishonesty.

And the talk veered into the SS CPI apparatus — supposedly that chained cost of living. Hudson’s response:

Well, because it’s not a cost of living index.
It’s the cost of lower living standards index.
It’s the — some people call it the cat food index.
Here’s what it does.
Suppose that you have to switch away from eating steak or eating meat or eating fish to eating canned tuna fish or canned beans.
That’s considered a price reduction.
If the chained index is done properly, you can cut Social Security by 50 percent.
And here’s how.
If people stop taking cabs and begin to take buses, that’s considered a lower cost of living.
Well, what if they buy a bicycle?
All Obama has to say is, look, folks, if you really want to save money, get a bike.
That’s what Margaret Thatcher said.
That was one of her campaign slogans, get a bike.
So all of a sudden, the transportation in the cost of living goes down to zero.
People pay between 25 percent and 40 percent of their income on rent.
Let them live out on the street. Let them live in a homeless shelter…

This is way-extraordinary — a Democrat president cutting a pretty-much Demo icon. This came came from FDR, for cripes sake! Sen. Bernie Sanders of Vermont is going to fight tooth-n-nail the SS action, stating last Friday: “I am terribly disappointed and will do everything in my power to block President Obama’s proposal to cut benefits for Social Security recipient.”
Adding this major afterthought: “This is not a minor tweak, as its proponents contend.”
And for next year’s mid-terms it could be disastrous for Democrats:

Rep. Bill Pascrell (D-N.J.) said Obama’s Social Security proposal was a gift to Republicans that could single-handedly kill any chance the party had at regaining the Speaker’s gavel in 2014.
“Seniors vote in even heavier numbers, proportionately, in off-year elections,” he said.
“So just looking at a political standpoint … I would think that this would be a damning blow to our chances of taking back the House next year.”

Dean Baker, the co-director of the Center for Economic and Policy Research, says Obama doesn’t understand the fictitious intent of being earnest about being serious: “You piss on the people who care about Social Security, then you’re serious,” Baker said.
As a heart attack.

The best on the hill or on the lakeside — Elizabeth Warren — had this to say about the SS bullshit, and for all those millions upon millions of old folks (like me) who don’t got no rich relative. She dispatched an email last week to supporters her views on Obama’s politics.
Via HuffPost:

The email, which was sent on Wednesday, was a response to President Barack Obama’s plan to cut Social Security benefits.
Warren said she was “shocked to hear” of Obama’s plan before describing how her brother David lives on the $13,200 per year he receives in Social Security benefits.
A reporter from Boston’s FOX 25 questioned Warren on the email, asking the senator why she didn’t help her brother.
“I do help him. This is a question about how much,” Warren said.
“He was worked for 40 years and paid into this system and that’s all the money he has to live on.
And there are literally millions of people around the country for whom that is the case.”
Warren also emphasized that the email was not just about her brother, but about all Americans who rely on Social Security benefits to get by.
“Let’s be clear about this. Not everyone has a sister who can help,” Warren said.
“This is about people who work all their lives and all they’ve got at the end is their social security.”

Why the shit can’t we have a whole stadium-full of people in DC like Warren?
Then a lot more people would be insecure.

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