Watch Out For The Poor When Considering the Chained CPI

A blog about business and economics.
Dec. 11 2012 3:55 PM

Watch Out For The Poor When Considering the Chained CPI

Kevin Drum's two-step plan for putting Social Security into long-term actuarial solvency is to first raise the payroll tax cap so it once again covers 90 percent of taxable payroll and second to slightly reduce benefits across the board by switching to the Chained Consumer Price Index for doing cost of living adjustments.

I did a Chained CPI explainer piece last week, and I'll just say the bottom line is that it's a mistake to regard this as some kind of technical fix. It's an across the board benefit cut, with the cuts falling especially hard on people who live a very long time. These things happen sometimes in life and it's all got to be part of the political mix. But I'll say this. If I proposed cutting Social Security benefits for the poorest retirees and cutting them especially severely for very old poor retirees, I don't think liberals would be enthusiastic. But C-CPI-U does just that. The fact that it also cuts benefits for not-so-poor seniors doesn't really make that any better. It's perfectly possible to design a Social Security plan that does CPI chaining and also boosts benefits for classes of seniors who are most vulnerable—check out Christian Weller's plan if you're interested—but at the cost of creating a situation where you can't describe the plan in two bullet points.


Long story short, I don't think Social Security ought to exist in some separate mental category from the whole rest of public policy. If spending must fall then spending must fall. But protect the poorest who need the money most.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.



Scalia’s Liberal Streak

The conservative justice’s most brilliant—and surprisingly progressive—moments on the bench.

Colorado Is Ground Zero for the Fight Over Female Voters

There’s a Way to Keep Ex-Cons Out of Prison That Pays for Itself. Why Don’t More States Use It?

The NFL Explains How It Sees “the Role of the Female”

The Music Industry Is Ignoring Some of the Best Black Women Singing R&B


Theo’s Joint and Vanessa’s Whiskey

No sitcom did the “Very Special Episode” as well as The Cosby Show.


The Other Huxtable Effect

Thirty years ago, The Cosby Show gave us one of TV’s great feminists.

Cliff Huxtable Explains the World: Five Lessons From TV’s Greatest Dad

Why Television Needs a New Cosby Show Right Now

  News & Politics
Sept. 18 2014 8:20 PM A Clever Attempt at Explaining Away a Vote Against the Farm Bill
Sept. 18 2014 6:02 PM A Chinese Company Just Announced the Biggest IPO in U.S. History
The Slate Quiz
Sept. 18 2014 11:44 PM Play the Slate News Quiz With Jeopardy! superchampion Ken Jennings.
  Double X
Sept. 18 2014 8:07 PM Crying Rape False rape accusations exist, and they are a serious problem.
  Slate Plus
Behind the Scenes
Sept. 18 2014 1:23 PM “It’s Not Every Day That You Can Beat the World Champion” An exclusive interview with chess grandmaster Fabiano Caruana.
Brow Beat
Sept. 18 2014 4:33 PM The Top 5 Dadsplaining Moments From The Cosby Show
Future Tense
Sept. 18 2014 6:48 PM By 2100 the World's Population Could Be 11 Billion
  Health & Science
Sept. 18 2014 3:35 PM Do People Still Die of Rabies? And how do you know if an animal is rabid?
Sports Nut
Sept. 18 2014 11:42 AM Grandmaster Clash One of the most amazing feats in chess history just happened, and no one noticed.