The Liberal Civil War Over Social Security Cuts
The Social Security cuts in President Barack Obama’s new budget are creating dissension in his base.
Many liberals oppose the president’s proposal to balance the budget on the backs of the old. But a good chunk of the establishment left is sticking by the president’s side, arguing that the cuts aren’t so bad, and that any budget compromise with this Republican House will involve swallowing a bitter pill or two.
Obama’s budget would squeeze old age benefits by changing the way inflation is calculated so that increases in future monthly Social Security payments grow more slowly. Right now, benefit increases are tied to the Consumer Price Index, which tracks the prices of a bunch of consumer products. First Republicans, and now Obama, have proposed changing that to something called chained CPI, a different calculation that ends up producing a lower rate of inflation by accounting for consumers switching to cheaper substitutes when a product’s price jumps. The president’s proposal includes exemptions for the oldest and poorest beneficiaries, but it would cost all other retirees hundreds of dollars in lost benefits every year. The White House estimates the measure will save $230 billion over 10 years.
The left-leaning Center on Budget and Policy Priorities has argued that chained CPI is acceptable—but only if implemented with the exceptions Obama’s budget includes for the most vulnerable, and if it is accompanied by new tax revenues. The CBPP released a report last year titled “Chained CPI Can Be Part of a Balanced Deficit-Reduction Package, Under Certain Conditions,” and reporters have been citing it as proof of liberal support for the plan. The Center for American Progress, one of Washington’s most powerful liberal think tanks, has also backed a switch to chained CPI. (CAP did not respond to multiple requests for comment.)