With the mid-term elections over, Max Richtman (CEO of the National Committee) sent a letter to President Obama concerning his FY 2016 Budget.
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The CPI-E – A Better Option for Calculating Social Security COLAs
President Obama’s 2014 budget proposal includes a plan to change the way Social Security cost-of-living adjustments, or COLAs, are calculated by adopting the “chained” consumer price index (CPI). The National Committee has been vocal in its opposition to the chained CPI because it does not accurately measure the purchasing patterns of our elderly population. We urge the adoption of a CPI for the elderly, or CPI-E, as a more accurate means of calculating Social Security COLAs. An in-depth examination of the CPI-E follows.
But they also call for switching COLAs to the Consumer Price Index for the Elderly or CPI-E, designed by the U.S. Bureau of Labor Statistics. The CPI-E would boost Social Security payments without worsening the system’s deficit.
via The Social Security Fix That Could Help the Poorest Retirees.
Related Reading:
Why Seniors Need a CPI-E.
But if the CPI-E determined the Social Security COLA, the expected average COLA would increase about 0.2 percentage points per year.
Baker proposes that if after a few years of studying this more robust CPI-E, economists find that it typically grows 0.2 or 0.3 percent more than the current price index, then it would be worth adopting the CPI-E or at least adding that increase onto the CPI-W.
The National Committee believes a fully developed CPI-E represents the best hope for correcting problems with the CPI-W for America’s seniors. Congress and the Administration should provide the BLS with the resources needed to perfect the CPI-E and make it the standard for calculating COLA adjustments for Social Security, Veterans, and Federal Civilian and Military retirement benefits. America’s seniors worked hard for their earned benefits and they deserve to have their standard of living and purchasing power preserved through an accurate COLA calculation.
via NCPSSM.
The Social Security Trustees say you probably won’t get a COLA increase next year because inflation is low. But we know the COLA formula doesn’t work for seniors and that’s why we want a new formula for seniors, the CPI-E.
Read more from our release by clicking the graphic above or here.
The CPI-E – A Better Option for Calculating Social Security COLAs
President Obama’s 2014 budget proposal includes a plan to change the way Social Security cost-of-living adjustments, or COLAs, are calculated by adopting the “chained” consumer price index (CPI). The National Committee has been vocal in its opposition to the chained CPI because it does not accurately measure the purchasing patterns of our elderly population. We urge the adoption of a CPI for the elderly, or CPI-E, as a more accurate means of calculating Social Security COLAs. An in-depth examination of the CPI-E follows.
On Friday at our Retirement Security in a Changing America symposium, former Senator Harkin spoke about expanding Social Security and using the CPI-E as a new measure for the COLA.
A sentence more than halfway through the 214 page document reads that the budget proposes to eliminate strategies for claiming Social Security benefits that allow beneficiaries to maximize delayed retirement credits.
The chained CPI would reduce Social Security benefits for the oldest and most vulnerable Americans who would be least able to afford it.
Max Richtman via Letter to President Obama on Fiscal Year 2016 Budget.
Seniors went to Capitol Hill earlier this month to tell Congress why their current #SocialSecurity benefits are inadequate. Boost Social Security Now! https://www.ncpssm.org/campaigns/boost-social-security-now/ @RepJohnLarson