We’re all aware that Social Security recipients won’t receive a Cost of Living Allowance (COLA) in 2011.
"Why IS that, Chuck?"
Well, there has to be a Cost of Living Increase (COLI?) to trigger a COLA, and there hasn’t been one in 2010 (nor was there in 2009). From the Social Security COLA FAQ page: “By law, Social Security and Supplemental Security Income benefits increase automatically each year if there is an increase in the Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), from the third quarter of the last year to the corresponding period of the current year. This year there was no increase in the CPI-W from the third quarter of 2008 to the third quarter of 2009.†AND there was none between 2008 and the third quarter of 2010, either.
“WHUT?!? Who told you that lie? Food costs more, fuel costs more, medicine costs a LOT more. How was there no increase?!?â€
Yeah, yeah, ok… calm down. The Consumer Price Index includes stuff that DIDN’T increase, and in many cases decreased. For instance, the cost of housing is included… and the cost of housing, ON AVERAGE, has declined since 2008… by a bunch. The problem is, of course, that for most seniors, housing is not a changing cost of living. We’re mostly affected by the commodities sort of stuff, which, except for the cost of oil, HAS increased… especially the cost of medical care. BUT…
…we’re now about even with 2008, ON AVERAGE. If you’ll follow this link, and look at the last three rows, you’ll see that by October 2008, we had already begun our decline from the July 2008 high of 216.3 to our modern recessionary low of 204.8, achieved in December 2008. Since that date, the CPI has been steadily increasing, but, since the third quarter (July – September) is the defining quarter, we get stuck with comparing one quarter too early. If we were comparing 4th quarters, we’d never have lost COLA at all, because by the 4th quarter of 2009, the CPI-W was well above the 2008 4th quarter CPI-W. And so is 2010’s. A graph is found here.
BUT… (yes, again a “butâ€) we have NOT, in fact, quite caught up to where we were in the 3rd quarter of 2008. Absent the feared “double-dip†recession, we will have done so (and then some, I imagine) by 3rd quarter 2011. The good news is that the “deflation†was only a six-month event, and the economy has been “reinflating†ever since. The bad news is that it’s an uneven reinflation. Commodities and medical costs are inflating again. Housing costs... not so much.
“Well, Chuck… is it fair or not?â€
“I dunno… probably not entirely, but we benefited from the housing inflation that affected us less than the folks who had to move occasionally, or who had their rent raised regularly (although those things applied to many of us, as well). In any case, I’d like to see the CPI-W run without housing costs included, for Social Security COLA purposes. I believe we might see a different expression. But fair or not, COLAs are designed to catch people up for what they've lost to inflation, in a VERY broadly-based calculation, in a given previous year.
I can tell you what it's NOT. It's NOT happening because "Democrats don't care, because they still see this as welfare." It's NOT because the Republicans are blocking funding to try to make the Democrats look bad (might backfire, dontcha think?) It's not some agency whim, a decision taken because our budget can't stand the strain. Nope, THIS is the way the Social Security COLA was DESIGNED to work.
BTW – more good news. You’re not going to see a Part B Medicare increase. There's a "hold harmless" clause (see the Social Security FAQ link, above).
I'm a senior, and I'm smart enough to figure this out. I'll bet most of us are.
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Comments: 54
Great summary!
Joke or not, The CPI-W is what it is... and what it is, is the formula the SS uses BY LAW to calculate the COLA. We might want to lobby about that... probably thru AARP.
Lobby through the AARP? The same people who agreed with the health reform? Why? Doesn't Satan lobby now? Wouldn't he make a better lobbyist?
AARP listens to us as much as the feds do. I gave up my membership on that one. (Not that it mattered. I got better deals for necessities away from them then I ever did showing my card.) I trust them as far as I can spit, and when I spit, it rarely even leaves my chin.
I did the only intelligent thing when they announced no COLA...I moved to Canada. My SSI is direct deposited in my American bank but I withdraw it (through my debit card) in Canada. Because the Canadian dollar lags the American dollar (on purpose), I got a 15% "raise" when I moved here.
Walker... since you're on SSI, I think you'll STILL feel the pinch. That's not a lot of money. Three years is still three years, and no COLA just can't be a good thing,
Tell you what - eradicate those black flies and figure out a way for me to move, and I'm there. A nice lake to fish on for the rest of my life? There was a time when that was a conceivable retirement goal. Of course, that was so long ago, a US dollar was worth $1.33.
Pretty cool how that worked out, eh?
So while we're not actually reducing spending by lowering their payments, at least we're not increasing spending by raising them (as per the formula that is used as required by law), so this is good news for Republicans/fiscal conservatives/teabaggers.
For all the money Senator Byrd appropriated for his state in the time he was in office, he could have just given every man, woman and child $2 million a piece, and we all would saved billions"helping" his constituents. (If we had just given them $5 million, we'd still have saved money.) Granted, Spector would have had to give less for every Pennsylvanian, but it sure shows how much is wasted.
Then again, let's keep the chant going, "Republican's fault." "Democrat's fault." "Republican's fault." "Democrat's fault." "Republican's fault." "Democrat's fault."
Easier yet, how about teaching those of us, who can't afford minor stuff like underwear, glasses, and a dentists how to scrimp even more? Obviously, it's all our fault, because, hey, the important thing is it is always someone else's fault.
I'm not sure if that's easier, since there always seems to be a lot of disagreement over what constitutes "pork barrel spending". But if we can agree that everything listed in the Citizens Against Government Waste 2010 Congressional Pig Book qualifies as wasteful pork barrel spending, that amounts to $16.5 billion. Not exactly a drop in the bucket, but pretty miniscule compared to the $677.95 billion in Social Security spending.
And if we cut out the $16.5 billion, then presumably there will be people losing jobs who will then be unable to afford minor stuff like underwear, glasses, dentist visits, etc. so what are we going to do about them? Let 'em rot, because it's their own fault for taking a "pork barrel" job?
Don't get me wrong; I'd like to see less waste in the budget, too. I'm just saying it's not necessarily as easy as passing laws to make spending you don't like illegal. In many cases, one person's pork is another person's paycheck.
I seriously doubt it. According to Citizens Against Government Waste, Byrd got $3.3 billion in pork for West Virginia between 1991 (when CAGW started tracking) and 2008. If we accept that he managed to get money at those levels the entire time he was in Congress (highly unlikely), that would amount to around $9.7 billion over 50 years. I think a reasonable ballpark figure for the total population of the state over that time would be 5 million. If those numbers are right, then the amount per person would be $1,940.
old man, and we could shack up, (kidding here of course ), love, Elsie
As for finding an "old man?" For his sake, I'd love to introduce you to my Dad. (Warning: he's a younger man. Only 80. lol) For your sake, I couldn't do that to you. I love him dearly, but at one point we were running out of options, too. We were quickly coming down to the choice between living in our car or moving in with my Dad, and, I swear, we both chose living in our car. Good thing the feds came through (that second mortgage I mentioned in the other comment.)
Speaking of which, have you tried things you've never considered before? Without your son's help anymore, you might qualify for food stamps and other government help. I know, "food stamps don't pay the rent." BUT, with the money you save on groceries, it just might.
Two years ago, we got that COLA and sure enough, I'm frugal enough to have been able to save a little each month. That came in handy when our roof leaked and our hot water heater went in the same week. Last year, I kept adding to savings, and then had to take out half of what I saved for one reason or another. (15 year old cars only run but so well. Good thing gas costs so much. We've cut down on driving so much, we have less than 90,000 miles on that car, and we bought it when it was a year old and already had 60,000 miles on it.) This year? I've cut, scrimped and went without for so much of what I used to be able to buy without thinking. Even so, I haven't been able to save a dime since February.
Maybe it is time to sell this house. A few problems with that idea - no ones buying, we can't afford the down payment and security deposit for an apartment, we can't afford to move, and efficiencies cost more than our mortgage.
Congress told us last year that we weren't getting a COLA increase this year. That was illegal to do, but I knew they speak the truth when it comes to cutting back on those who no longer matter. Did they get their increase?
The scariest thing is the agenda is working - take, take, and take some more from everyone, and then make sure the argument always goes back to "Who's to blame? They are." (And, it doesn't matter who anyone thinks "they" are.) It's working. Disabled people and older Americans are suffering while everyone makes this an abstract argument about politics. Nice to find out what really matters.
Besides, what do you old people need that you can't get at the dollar store? When all the dollar stores become the $1.25 stores, then you cry babies can have your raise. Until then, just deal with it.
We are not so worried about a raise as being able to continue to have a roof over our heads and being able to buy the necessities to continue to live. Your screwed logic about buying what we need at the Dollar Store is about as crazy as your first statement about children in Africa. You can not buy food, etc. from the Dollar Store to live on.
As Elsie said one day you too, if you live that long, will be an "old geezer" and have to live either on S.S. or what ever you may have saved or invested unless another depression hits what you saved or invested. Then you will have to worry about how to continue to exist as we do now.
Either you do not care about your fellow citizens which it appears or you think it is a joke that we worry what we will be getting in our S.S. checks for the next year. Fellow everyone gets old. Yep it is a fact of life you might start thinking about if you really use your brain for other than to watch cartoons.
:O\
Just a thought!
O-o-o-h, Kartman just got pulled over by the grammar police.
But he obviously isn't a very good grammar cop, because he wrote the following:
"As Elsie said one day you too, if you live that long, will be an "old geezer" and have to live either on S.S. or what ever you may..."
"What ever" should be "whatever".
Here's a few clues for you that you won't understand for quite some time (if ever, judging by your intelligence level) -
- Some of us aren't old.
- The ones that are old could teach you a few things about life, if you listen.
- When you become an old geezer, you'll reap what you sow. SS will be bankrupt, and you won't have a pot to put your face in. (And, since, judging from your intelligence level, you won't understand that last reference, you will chose to make yourself look even sillier by adding some unprofound semi-correction to that one, too. ;) )
Kartman can't wait until the Obamacare 'Do Not Treat or Resuscitate' mandate for seniors kicks in in 2011.
And for all you cry babies, the mandate should free up a few extra Social Security dollars in the next few years.
Who are you calling "little"?
But tell us. How do you really feel? ;)
NOT, I see your butt/head. You're right, nothing little about you except your thoughts. And, bummer, you didn't annoy me. You amused me, like watching a dust bunny rolling across the floor.
I would appreciate a return comment!
Thanks in advance!
Obviously we can't afford cost of living increases for SS, though. The seniors are not being served well by this program and it's time we allow people to opt out of it. Eventually, we can let it settle in the dustbin where it belongs.