NO ADVERTISING, GOVERNMENT OR CORPORATE FUNDING

  • Latest News
  • Pitch a Story
  • Work with a Journalist
  • Join the Blog Squad
  • Afghanistan
  • Africa
  • Asia
  • Baltimore
  • Canada
  • Egypt
  • Europe
  • Latin America
  • Middle East
  • Russia
  • Economy
  • Environment
  • Health Care
  • Military
  • Occupy
  • Organize This
  • Reality Asserts Itself
  • US Politics
  • Obama Social Security Reform Ignores Data on Actual Living Standards of Seniors


    Teressa Ghilarducci: The "chained" CPI ignores research that shows senior's costs are going up as they get older and women are most affected -   April 13, 13
    Members don't see ads. If you are a member, and you're seeing this appeal, click here

    Share to Facebook Share to Twitter


    I support The Real News Network because it is news - David Pear
    Log in and tell us why you support TRNN

    Bio

    Teresa Ghilarducci is a labor economist and nationally-recognized expert in retirement security. She taught economics at the University of Notre Dame for 25 years and is currently the director of the Schwartz Center for Economic Policy Analysis at the New School for Social Research. Her most recent book is When I’m Sixty Four: The Plot Against Pensions and the Plan to Save Them. It investigates the loss of pensions on older Americans and proposes a comprehensive system of reform.

    Transcript

    Obama Social Security Reform Ignores Data on Actual Living Standards of 
SeniorsPAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Baltimore.

    In President Obama's new budget, there's a proposal to change the way the consumer price index is looked at in terms of Social Security. This is a reform that's supposed to, in the long run, save Social Security some money. It's called a chained CPI. Some people are calling it a cat food CPI.

    Now joining us to talk about why they're saying this is Teresa Ghilarducci. She's a labor economist and a nationally recognized expert in retirement security. She taught economics at the University of Notre Dame for 25 years. She's currently director of the Schwartz Center for Economic Policy Analysis at the New School for Social Research. Most recent book is When I'm 64: The Plot against Pensions and the Plan to Save Them.

    Thanks for joining us again, Teresa.

    TERESA GHILARDUCCI, DIRECTOR, SCHWARTZ CENTER FOR ECONOIC POLICY: Oh, sure. Hi.

    JAY: So why--people are cracking this joke about it's the cat food CPI. But why are they saying it and what do you think of this whole idea?

    GHILARDUCCI: Yeah. So there are two stories here. One is that there's a proposal on the table to cut Social Security benefits. It's done through this chained CPI, but it's a cut in Social Security benefits. And the other story is that this is the first president who is a member of the Democratic Party who is proposing to cut Social Security.

    So I'll talk about the first part of this story. Chained CPI really is just a way to measure inflation so that it looks lower than the current consumer price index, or CPI. So the chained CPI is a technical adjustment to CPI based on the theory that people move away from expensive goods and can seamlessly and costlessly switch to cheaper goods. And that's happening all the time. So the real inflation that people are really suffering is a little bit less because they've already switched out to cheaper products.

    But that is a big if. It really assumes that people are making those switches all the time and can do it without cost. To assume that older people are doing that is just plain wrong in face of what we know about the way older people spend money. And, in fact, a lot of us think that we should technically adjust the CPI used for Social Security with something called the CPIE, or the consumer price index for elderly people, because we know that elderly people face higher inflation than the rest of us. And that's because elderly people have less choice, have less mobility, and actually buy a lot of health care and a lot of services that are going up in price faster than the kinds of things that younger people buy. Just the facts show that the fixed--.

    JAY: So it's the exact opposite of what they're saying.

    GHILARDUCCI: Exactly the opposite. If President Obama wanted to technically fix the index to make it more accurate, he would have picked the CPIE, not a chained CPI. I know that sounds like a lot of geek talk, but this matters for the bottom line.

    What President Obama has proposed will cut benefits for the most vulnerable elderly, because as you grow older, this cut in [incompr.] increases to adjust for inflation adds up, so that when you're over 90, the cut has accumulated up to something like $22,000 for your lifetime or another almost 20 percent of your benefit. So you are penalized for living longer, because your Social Security buying power will be a lot less.

    It just goes--this proposal just flies in the face of what we need in this country, and it's really oriented towards the short-term budget numbers rather than any real on-the-ground ways to make sure older people, especially in their 80s and 90s, aren't really living on cat food.

    JAY: So just to be clear on what this is and why people are calling it the cat food reform is 'cause they're--the Obama administration is saying what's really happening, even though the consumer price index may go up a certain amount, is that elderly people are buying cheaper and cheaper stuff, and so that's what should be reflected. But it's kind of crazy, 'cause it's putting elderly people in a position where they have to, for example, eat cheaper food or take a bus and not drive, even though they might not be able to comfortably get on the bus. And as you say, it doesn't take into account, especially on the medical side, the amount of copays and medical costs that elderly people get into are crazy.

    GHILARDUCCI: Yeah. I mean, it's proposed as a technical fix. But the fix is based on a wrong assumption, that elderly people can substitute away from cheaper--you know, from bandages or diabetic materials to cheaper diabetic materials. Those kinds of substitutions don't exist on the ground in the real lives of elderly people.

    But what I also wanted to emphasize: this cut adds up, and every year you live into your old age, the worse the cuts are. So it's in some ways a heartless way to cut Social Security benefits, because it hurts older people the most. It adds up.

    And I'm not saying this just because I'm a woman: as the population gets older and older, women live longer than men, and so when you get to populations in their 80s and their 90s, you're finding more and more women. So this cut disproportionately hurts the oldest women among us. It's probably an unintended consequence. He probably didn't mean to go after older women. But that's the practical effect of this proposal. It's stunning that it's coming from a Democratic president. But even if it came from the moon, it's very bad policy.

    JAY: Alright. Thanks very much for joining us, Teresa.

    GHILARDUCCI: Thank you.

    JAY: And thank you for joining us on The Real News Network.

    Don't forget we're in our spring fundraising campaign. We have a $50,000 matching grant we have to match by May 2. So we're getting close to the end of this campaign. If you donate $1, we get another dollar. Of course, if you donate $10, we'll get $10. If you donate $100, we'll get $100. So the more you give, the more that will get matched.

    Thanks very much for joining us on The Real News Network.

    End

    DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


    Comments

    Our automatic spam filter blocks comments with multiple links and multiple users using the same IP address. Please make thoughtful comments with minimal links using only one user name. If you think your comment has been mistakenly removed please email us at contact@therealnews.com

    Comments


    Latest Stories


    University Sit-In Targets World's Largest Private Coal Company
    Investigation Finds Former Ukraine President Not Responsible For Sniper Attack on Protestors
    Can Johns Hopkins Afford to Pay A Living Wage? (1/2)
    The Modern History of Venezuela from 1973 to the Caracazo Massacre - Edgardo Lander on Reality Asserts Itself (3/9)
    Ukraine Transitional Gov't Moves Militarily To Reclaim Seized Buildings
    IPCC Report Flawed By Narrow Focus on Carbon Emissions
    The Modern History of Venezuela: The Bolivarian Revolution - Edgardo Lander on Reality Asserts Itself (5/9)
    Obama Signs Directives to Reduce the Gender Wage Gap
    Eastern Ukraine Lacks Political Representation in Kiev
    Demystifying the Role of Mitigation in the Most Recent IPCC Report
    Hypersurveillance State Won't Prevent Another Boston Marathon Bombing
    The Modern History of Venezuela from 1973 to the Caracazo Massacre - Edgardo Lander on Reality Asserts Itself (3/9)
    Univ. of Maine Faculty Reinstated After Students Protest Against Cuts
    The Modern History of Venezuela from 1908 to 1973 - Edgardo Lander on Reality Asserts Itself (2/9)
    IMF Will Address Global Inequality, Says Managing Director Christine Lagarde
    Raising Big Banks' Leverage Ratio Good, But Not Nearly Enough
    TRNN Replay: Austerity Road to 19th Century
    Has Palestinian Maneuvering Revived Peace Talks?
    Late Jackson Mayor Lumumba's Son Wins Primary to Replace His Father, Runoff Election Ahead
    Quebecers Reject PQ and Elect a Liberal Government Representing Big Business
    TRNN Debate: Decriminalization vs. Legalization
    The Beginning of the Chavez Era - Edgardo Lander on Reality Asserts Itself (4/9)
    "Off With His Head": Court Upholds Obama's Power to Kill
    Workers at Nation's Top Hospital Strike For Fair Wages
    From Exile to Radicalization in Venezuela - Edgardo Lander on Reality Asserts Itself (1/9)
    Rwanda 20 Years Later: Genocide, Western Plunder of Congo, and President Kagame
    Ukrainian Protesters in the East Demand More Autonomy From Kiev Government
    Hunger Strikers Demand President Obama Halt His Record 2 Million Deportations
    Indian Parliamentary Elections - A Primer With Vijay Prashad
    West Looks to Carve Up Ukraine & Privatize Industries Held by Kleptocrats
    Where Are Israeli-Palestinian Peace Negotiations Headed?
    The Multiple Kingdoms of Saudi Arabia (5/5)
    Do the Afghan Presidential Elections Signify Progress?
    Republican Presidential Hopefuls Pay Homage to Billionaire Casino Tycoon Sheldon Adelson
    Will Extremist Lieberman Become Israel's Next Prime Minister?
    Why do the Saudis Want the US to Attack Iran? (4/5)
    Immigrant Advocates and Families Tell President Obama 'Not One More'
    Elections, Pipelines, and Protests - The Canada Panel
    Chris Hedges on "Israel's War on American Universities"
    Baltimore Residents Decry Lack of Affordable Housing
    Yellen Talks the Talk But Will She Walk the Walk?
    Hopkins Hospital Workers Speak Out against "Poverty Wages"
    Will Venezuela's New Floating Exchange Rate Curb Inflation?
    The European Central Bank's War on Wages is Pushing Europe's Economy to the Brink
    Supreme Court Decision Opens Floodgates for More Campaign Cash
    Charles Keating, the Financier Behind the Savings and Loan Scandal, Dies at 90
    Saudi Arabia and the al-Qaeda Monster (3/5)
    Maryland Residents Voice Opposition to Natural Gas Fracking Export Facility
    Supreme Court Ruling Gives Wealthy Individuals More Influence Over Elections
    What are the Saudis Afraid Of? - Madawi Al-Rasheed (2/5)
    Baltimore's MICA Adjunct Professors Set to Vote on Unionization
    Boycott of Israel Moving to Next Level?
    Hypocrisy Dressed Up as "Realism" Justifies American Alliance with Saudi Dictatorship
    Immigration Reform in the Shadows of Cesar Chavez's Legacy
    Leaked Senate Report Shows Use of Torture As "Ineffective"
    UN Report Says Climate Change Will Threaten Food Production Worldwide
    The Hypocrisy of US Calling for Enforcement of International Law
    How the Ecuadorian Economy Grew in a Global Recession
    'Shadows of Liberty' Trailer
    Kristina Borjesson on Why CBS Shut Down Her investigation into Flight 800 (2/8)
    Glen Ford on Racism in the American Media (3/8)
    Paul Jay on What Drives Corporate Media and What Drive The Real News (4/8)
    Creating a New Media Paradigm After Citizens United (5/8)
    Should The Left Engage with the Mainstream Media? (6/8)
    What Is the Financial Backing For The Real News? (7/8)
    Standing up to Character Assassination (8/8)
    Oligarchs, Fascists and the People's Protest in Ukraine
    TRNN Debate: Is Obamacare In the Interest of Workers?
    Too-Big-To-Fail Advantage Remains Intact For Big Banks
    Obama and the Saudi Agenda
    TRNN Replay: Investigating the Saudi Government's 9/11 Connection and the Path to Disilliusionment - Sen. Graham on Reality Asserts Itself pt 1
    The Iraq War's Real Legacy
    Petitions with 100,000+ Signatures Call for Snowden's Passport to be Reinstated
    We Need to Harness People Power - Andy Shallal on Reality Asserts Itself (4/4)
    BC Pipeline Fight and Quebec Elections - The Canada Panel
    Jonathan Schell - 1943-2014: Board Member of TRNN on Why We Need The Real News
    Teachers on Strike from the UK to Argentina
    Connecticut Poised to Become First State with $10.10 Minimum Wage
    Oil Spill Threatens Wildlife and Local Economy
    DC School Test Scores Up, But Poor Black Kids Are Doing Worse - Andy Shallal on RAI (3/4)
    Obama's Proposal To End NSA Bulk Data Collection Won't Protect Privacy
    How Google, Apple & The Biggest Tech Companies Colluded to Fix Workers' Wages
    An American Should be One that Questions Their Government - Andy Shallal on RAI (2/4)
    What's Driving Putin & Obama's Posturing on Ukraine?
    Hundreds of Students & Faculty Occupy College Campus to Fight Cuts to Public Higher Ed
    Due Process 'Impossible' In Harsh Death Sentencing Of Over 500 Muslim Brotherhood Members
    Has Anglo-American Capitalism Run Out of Steam?
    Being the "Other" in America - Andy Shallal on Reality Asserts Itself (1/4)
    TRNN Debate: Should Baltimore 'Ban The Box'?
    How Fallujah Became the Iraqi Government's New Battleground
    Why I Decided to Blow the Whistle on the NSA
    NASA Climate Predictions Show Serious Threat To Humanity
    Professor Who Teaches Israel-Palestine Conflict Accuses College of Violating His Academic Freedom
    CIA and NSA Wrongdoing Requires Independent Investigation, Says Former Church Committee Staff
    Are Tuition Breaks Enough To Combat High Student Debt And Low Graduation Rates?
    Industries Across the U.S. Are Stealing Wages From Their Lowest Paid Workers
    Who In Ukraine Will Benefit From An IMF Bailout?
    NSA Recording All International Calls From U.S.
    Israel "Making Lives Miserable" for Africans, Hoping They 'Self-Deport' (2/2)
    BP Gets Green Light to Drill in Gulf, But Has Safety Improved?
    Residents Still Not Drinking Tap Water Two Months After West Virginia Spill (1/2)
    Libya's Descent Into Turmoil Three Years After NATO Intervention
    From Pipelines to Peladeau - Canadian Report
    Israel "Making Lives Miserable" for Africans, Hoping They 'Self-Deport' (1/2)
    Congressional Progressive Caucus Budget Strikes Back Against Austerity
    Libya Three Years Later - Chaos and Partition
    Why Was Gaddafi Overthrown?
    Should Ukraine and West Accept De Facto Crimea Joining Russia? (2/2)
    Tony Benn Saw Socialism as the Culmination of Democratization
    Why Didn't Bush/Cheney Attack Iran and Can Obama Make and Sell a Deal? - Gareth Porter on Reality Asserts Itself (3/3)
    After Late Mayor Lumumba is Laid to Rest, What's Next for Jackson, Mississippi? (2/2)
    Crimea Referendum: Self Determination or Big Power Manipulation? (1/2)
    Sen. Graham: President Must Side with Openness About CIA and 9/11
    Manufacturing a Narrative for War - Gareth Porter on Reality Asserts Itself (2/3)
    Protesters Hit the Streets of Brooklyn to Demand $15 Minimum Wage
    Hammer: 'Moral Bankruptcy' Behind Massive GM Recall
    White House Withholds Thousands of Documents from Senate CIA Probe
    I Grew Up Believing in Time Magazine's Version of America - Gareth Porter on RAI (1/3)
    Western European Banks Vulnerable to Ukrainian Sovereign Debt Crisis
    TRNN Debate: What's Driving Inflation in Venezuela? (2/2)
    CIA vs. Senate: Who Is Obama Protecting?
    Will Tipped Workers Get Excluded Again From Minimum Wage Hike?
    TRNN Debate: What's Driving Inflation in Venezuela? (1/2)
    After Late Mayor Lumumba is Laid to Rest, What's Next for Jackson, Mississippi?(1/2)
    TRNN Replay: A Look at Who's Poised to Become No.2 at the Fed
    How Right-Wing Nationalism Rose to Influence in Ukraine (2/2)
    Netanyahu Attacks Boycott As Campaign Enters New Phase
    Moving Towards a Police State - Michael Ratner on Reality Asserts Itself (7/7)
    Fighting Reagan's Secret, Illegal Wars - Michael Ratner on Reality Asserts Itself (6/7)
    Puerto Rican Independence Movement and Cuba Further Radicalized Me - Michael Ratner on RAI (5/7)
    The Butcher of Attica - Michael Ratner on Reality Asserts Itself (4/7)
    MLK and a Radicalizing Moment in American History - Michael Ratner on Reality Asserts Itself (3/7)

    RealNewsNetwork.com, Real News Network, Real News, Real News For Real People, IWT are trademarks and service marks of IWT.TV inc. "The Real News" is the flagship show of IWT and Real News Network.

    All original content on this site is copyright of The Real News Network.  Click here for more

    Problems with this site? Please let us know

    Linux VPS Hosting by Star Dot Hosting