By Thom Hartmann
Explaining the Pure Cruelty of Obama's Gimmick, "Chained CPI" in Simple
If Obama goes along with a chained CPI, he will be the first President
in the history of the Dem Party to have actually cut Social Security.
December 20, 2012 |
So, the White House says they want to cut Social Security Insurance
payments over time, using a tricky little technique called the chained
CPI. Instead of actually measuring real inflation, this particular
consumer price index is chained to consumers behavior. They call it
hedonic and quality adjustments to make it sound scientific.
Heres how it works: If the price of beef goes up, and some people start
eating cheaper chicken instead, then instead of measuring actual inflation
(as reflected by the rising cost of meats), the Chained CPI measures the
behavior of moving from beef to cheaper chicken and lowers the
If more and more seniors cant afford chicken and move to cheaper
cat-food, then the chained CPI adjusts Social Security Insurance
payments and millions of disabled vets payments that are tied to Social
Security so that they can now afford cheaper brands of cat food.
Republicans love this idea.
As Ive pointed out here and here, back in the mid-1970s, Republican
strategist Jude Wanniski, in an article titled Taxes and a Two Santa
Theory, correctly pointed out that the American people loved Social
Security, brought to America by Democrats and continually defended by
Democrats. And Republicans had always played the role of Scrooge, saying,
Things like Social Security are not legitimate functions of government.
Old-age poverty should be fixed by churches, and retirement income should
be handled by Wall Street.
The Democrats, Wanniski pointed out, were essentially the Social Security
Santa Claus, giving Americans what they wanted, even though Americans were
also, themselves, gladly paying for that very same Social Security. So the
job for Republicans was twofold. First, to become Santa Claus themselves.
Because being the Social Security Santa was already taken, they should,
Wanniski proposed, become the tax-cut Santa Claus. Tax cuts for
everybody! Especially rich people! And the second really big job was to
get Democrats to shoot their own Santa Claus especially Social Security.
The problem for Republicans was that Social Security was so popular it
literally saves lives every day, and has since 1936 that even
Republicans wanted some of the glow. And, even more problematic for
Republicans, Social Security has nothing whatsoever to do with the budget
deficit, and as its now set is totally solvent for at least the next
twenty years. And it will remain solvent forever, with the very small
tweak of just lifting the payroll cap so millionaires pay the same
percentage into it as people working at Wal-Mart. Even Ronald Reagan, in
an rare moment of candor, pointed this out.
That bears repeating. You could cut Social Security all you want. You
could even end Social Security altogether. And it wouldnt reduce the
budget deficit by a single penny. Social Security is a completely
self-funded, self-contained program and its sitting on a surplus of
over $2.6 trillion.
But its the signature program that makes the American people think of the
Democrats as Santa Claus. And the number one priority of the Republican
strategists is to get a Democratic President to take a shot at Santa
Claus. Since FDR brought us Social Security not one single Democratic
president has ever, in the history of the republic, suggested shooting or
even nicking the Social Security Santa Claus. Until Obama.
And whats particularly astounding about this is how effective this White
House has been at getting supposedly progressive commentators and
journalists to jump on board. As Laura Gottesdiener points out at
AlterNet a number have responded positively to this weeks Democratic
Party conference call on messaging this, and are actually trying to say,
basically, Its not such a big cut. Not a big deal. No droids in this
Its nice to be thought of as an insider. Its cool to get invited to the
right parties. And its an adrenalin rush to be invited to the White
House for an off-the-record briefing or conference call. I can tell you
all those things from personal experience. But all those things said, its
crazy for a Democratic president to shoot the Democrats number one Santa
Claus program, and its crazy for progressives to try to pretend its
If Obama goes along with a chained CPI, he will be the first Democratic
President in the history of the Party to have actually cut Social
Security. Even though it doesnt do a thing nothing! to reduce the
budget deficit. And, as we saw with Bill Clinton reforming welfare, once
the Republicans can corner a Democratic president into shooting a
Democratic Santa Claus, the Republicans can finish the job through the
death of a thousand paper cuts over the next decade and in the states, and
everybody just remembers that it was a Democratic President who started
President Obama has brought into his negotiations with Republicans an
offer to cut more out of Social Security than he would cut out of the
bloated Pentagon budget. So hes supporting the Republicans Santa Claus
and shooting the Democrats Santa Claus. And, like with Clinton and
welfare, this will just be the beginning, once the first cut is made.
Eventually, the bloody carcass of Social Security will be swept up by
right-wing cons like Peterson, Simpson, and Bowles, and handed over with a
bow and a ribbon to the billionaires on Wall Street.
If President Obama is still pushing a chained CPI on December 21st, then
maybe the Mayans were right. It is the end of the world as we know it. Or
at least the end of the Democratic Party as we knew it.