Constant COLA could contribute to turning our economy around and maybe save our Democratic Brand.
See the Democratic Party brand is now at risk, or had you not heard?
Well here's Rachel !!!!
She reports on last week delivery of the 2.3 million signatures in support of no cuts to Social Security and Medicare benefits at an event in front of the White House.
Video includes statements by several elected officials about not cutting Social Security and Bernie Sanders who ends with saying that any one votes for cuts to Social Security they will likely not be returning to Congress.
Social Security and My Mom
I am still a little in shock and denial that I am drawing Social Security. Never thought the day would come, but with unplanned big family doctor bills last year seriously did need it and welcome it. Its been a great help.
My 82 year old mother clings fiercely to her independence in expensive Austin, Texas and squeaks by on her SS survivors benefits (dad died at 52). Though rent, food, and medical expenses have steadily risen she missed getting her COLA raise .
So what's Constant COLA ?
Susan Rhea explains:
Constant Dollar COLA
The president is asking Congress to change the way cost of living adjustments (COLAs) are determined for retirees and eventually federal civilian and military employees. This is needed because reducing the federal debt requires seniors to take a hit for the country so corporations, Wall Street financiers, and others in the top 10 percent don't see an income tax increase, closure of tax loopholes, or reduced income deductions.
She goes on to make the case that using chained cpi proposed in the President's budget is a 'fraud' because it requires retirees, including my mom, reduce their living standards instead of raising the amount needed to live due to inflations. That sucks. For what, so the 1% can continue their 30 year ride to drive us back into a majority in poverty?
Most retirees spend 100% of their social security and this goes into the economy and creates jobs. We need to keep that engine going.
Constant Dollar COLA is Fair.
The annual increase in federal salaries and pensions should be determined in a fair way.
Find the median wage retiree, whether it be urban, suburban, or rural. Determine how much that person's real costs have gone up. Say it is 2 percent. Use that to calculate the COLA, and apply that dollar value to everyone.
For example, if the median salaried retiree is getting $36,000 a year, then 2 percent is $720. Everyone, from the disabled vet to the judge will get a $720 COLA. Apply a similar adjustment to current federal employees, both civilian and military. All boats rise with a rising tide the same amount, as they should. And the money will circulate in the economy, increasing the general welfare. All good.
This proposal is fair. It raises incomes for all equally, it improves the economic condition of those at the lower end, it is realistic in terms of offsetting increases in expenses of necessities, and it might just save the Treasury.
Hope you will go read the entire article, much more math from her there.
Going Forward
This is a much more valid way to move forward than chained cpi, and will put more money into the economy. Its something Dems can run on.
We should keep working to prevent Chained CPI and Medicare retiree costs from possibly losing elections.
Defense cuts vs Social Security Cuts
It goes without saying that cuts to defense would solve much.
(See Progressive Caucus Budget.)
Targeted spending cuts and health efficiency savings
The Back to Work budgetalso proposes realigning defense priorities and finding other targeted and efficient savings in the budget.18 The CBO 2013 current law baseline includes a $310 billion reduction in DOD outlays from the first BCA phase of discretionary spending caps and a $553 billion reduction in DOD outlays from the second phase of sequestration cuts, both over FY2013–2023. The sequestration cuts in particular were intentionally poorly designed; annual cuts are frozen in nominal dollars so they actually decline as a share of GDP, creating front-loaded fiscal drags and complicating programmatic implementation. The Back to Work budget repeals these cuts and replaces them with a reasonable trajectory for defense spending. The budget provides $102 billion in budget authority for overseas contingency operations (OCO) budget authority for FY2014—enough to fund full and safe withdrawal from Afghanistan—after which all OCO funding is ended. Responsibly reducing OCO spending would save $939 billion over FY2014–2023 relative to current law. The Back to Work budget also gradually phases in reductions in non-emergency DOD funding, cumulatively reducing outlays by $897 billion over FY2014–2023 relative to repeal of the BCA.19 These savings are well within the bounds of those identified as reasonable by the Sustainable Defense Task Force (SDTF 2010).
Constant COLA, Defense Cuts, and then how about more revenue from the sector that has caused our economic woes?
Rep Keith Ellison, via PCCC
How to pay for my Constant COLA ?
Six years ago, Wall Street’s misdeeds led to a global recession that plunged over 60 million people into poverty worldwide. Since then, the Big Banks and their profits have only grown.
Rep. Keith Ellison (D-MN), the co-chair of the Congressional Progressive Caucus,today introduced legislation to make Wall Street pay America back. The “Inclusive Prosperity Act” would tax the following financial transactions in the following ways:
A 0.5 percent tax rate on stocks
A 0.1 percent tax rate on bonds
A 0.005 percent tax rate on derivatives or other investments
Additionally, the bill would provide an offset for households with incomes below $75,000 a year and individuals whose incomes are $50,000 or less.
“A lot of people in Washington like to talk about reducing the debt and deficits. Well if you really care about reducing the deficit, how about asking Wall Street speculators to pay their fair share?” Ellison said in a released statement. “This bill will add a tax of a fraction of a percent on transactions made by the same Wall Street firms and stock traders who crashed our economy in 2008. This tax alone will generate up to $300 billion a year in revenue, stabilizing the deficit and allowing us to invest in the things that matter—education, roads and bridges, and health care for our seniors and veterans.”
image credit
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