Rush slipped in a very disturbing item in his list today of “bad things the Democrats have done”…. He bemoaned that for two years there has been no cost of living increase, and that’s the work of the Democrats.
First, the reason that there has been no increase is the cost of living has gone down, not up. The law even protects social security that payments won’t go down if the cost of living went down during deflation.
I can hear the screaming from here “WHAT???? Have you been to the supermarket lately?”. Yes, I have – thanks for asking. The reason the cost of living has gone down is two main reasons – cost of housing and gasoline.
Buy you scream at me “BUT I OWN MY OWN HOUSE AND DON”T HAVE A MORTGAGE!!!!, so my housing cost can’t go down”… Well, when housing costs were going up in the last decade, your cost of living increase was going up because of the increase in the cost of housing, even though it didn’t affect you.
If you think back to 2008 before the crash, oil had reached $140 a barrel and gasoline was well over $4 a gallon – that fuel increase was reflectecd in the 5.8% 2008 COLA increase, even if you don’t use any gasoline.
But to get back to Rush, the automatic Social Security COLA went was passed in 1972 and went into effect in 1975 (that means Richard Nixon was the President who signed it). What was done is the Social Security administration followed the law. Cost of living went down last year, so no increase. Social Security is not a welfare handout program.
Ronald Reagan tried to break the back of the COLA loop in the 1980s – his people realized that giving automatic COLA to everyone just turned around and increased inflation – creating a positive feedback loop that just created more and more inflation.
This type of rhetoric is why I don’t believe the Tea Party movement is genuine. (Rush is not techically part of the movement, although he talks at times like he is). The same people who demand the government cut spending massively and balance the budget will burn up the phone lines for days if their pension payment goes down $2 a month – while their children delay getting married and starting a family because of the tax burden on them. This is only going to get worse over the next 20 years.
Art, I disagree.
The cost of living index has been so perverted since the Carter administration attempted to fudge the terrible inflation that looted everyone’s pension plans and CAUSED the big push for COLAs that it is hard to figure out how these crooks are trying to starve retirees! This obviously applies differently to retirees than it does those who are working.
The hidden taxation of inflation looks better to those who have some power to raise their earnings by raises, promotions, or changing their jobs, and paying fixed loans off with cheaper, more abundant money is all great for younger folks. Those on more fixed incomes are being robbed! COLAs are a right and should be increased to make up for their losses when these thieves bloat the money supply without ANY accountability.
Seniors worked and paid taxes, and did what they were supposed to and now these crooks are saying “To bad, so sad”. If you want any idea at all what their savings have become worth, look at gold. It’s a place to start.
Let me tell you, my friend, demographics are a bitch.
The baby boomers comprise half the population and are reaching retirement, and they vote. “You can fool all of the people some of the time…”
Jack
“We can’t worry about businessmen at a time like this. What we’ve got to think about is jobs”. Fred Kinnan – Amalgamated Labor of America
BTW, Is that quote from “Atlas Shrugged”? Where is John Galt?
Yes, it is.
I think Rush’s comments about the COLA were in jest. I believe he was making the point that the media would be laying into the Republicans if they were in charge when no COLA was given for 2 years during a recession even though this result is a direct result of how the COLA law was written.
I also disagree with two points. First, Social Security IS a welfare handout program, thanks to Lyndon Johnson. Prior to his administration, payments into the SS system were reserved solely for that system. Johnson began robbing the “lockbox” and stuffing it with IOUs in order to fund the Great Society programs he initiated. At this point, what is extracted from paychecks TODAY is transferred to seasoned citizens TODAY. Second, the prices of raw commodities (e.g. soybeans, wheat, corn) are now at all-time highs, meaning that the price of any product that depends on these inputs (ethanol, processed foods, meat) has been going up accordingly. The cost of living data the government uses to index COLA excludes energy and food prices in its formula. So, if you don’t eat, heat your home or drive, your cost of living HAS gone down. Admittedly, the idea that a cost of living raise is a “right” is nonsense – my employer doesn’t give me a raise because my expenses go up – but the point is, the government’s formula doesn’t compute with reality.
Rosegrower, you are correct when you say that your employer doesn’t owe you an increase. He doesn’t tax you for a retirement plan, spend the money, then pay you with script that buys less each year, then tell you it’s welfare and you should be gratefull for the dole. If he did, you’d have quit, sued, or called a cop, maybe all of the above.
Ok now Im confused , When my father retired in 1972 he received $1200 a mo from the teamster union and $1200 a mo from Social Security, @ $ 2400 a mo. he had 20 yrs acumulated in the union.
I retired in 2009 with 25 yrs in the union, and 22 yrs in a non union job and receive only $950 a mo. from the union and $ 1658. from SS @$ 2608 a mo. so I get only $ 208 more a month 38 yrs later ? Something tells me this does not add up.
Now as of last March I was informed by the distributor of my teamsters retirement fund that I would be relieved of $ 10 a month more increase for Federal Tax bringing me down to $ 940 a mo. I was caught in a no COLA this yr from Social Security and it looks like a no COLA next yr + a $ 10 decrease in my income. My question is this, Can I file for welfare or Obamacare ? Since I pay my own insurance and I Own my home and my “little shack on the Coast” Free and Clear ???
Or am I exmept from all the Government goodies ? No, I do not rent out my shack I only survive on my meager income from the union retirment and SS.
Rush made a mistake with that comment. He should have stayed out of the COLA discussion. He was apparently trying to link the lack of a COLA adjustment to a bad economy but the logic doesn’t wash. There’s no relation between the two. In the 1950s we had a strong economy with no COLA adjustments.
I believe the whole point of the government COLA analyses since the early 1980s has been to ensure that the “official” inflation rate remained below 2% per year so that the tax tables wouldn’t have to be adjusted fairly and equitably. So they took energy, housing, and all but the most basic foodstuffs out of the COLA equation so that they could achieve the numbers they wanted, the ones that would preserve bracket creep and ever more progressive government.
I’m 54 years old and have been self-employed as an engineer for the last 15 years. Not a dime of my income is affected by COLA adjustments. I filed an expense report today and I couldn’t bring myself to bill my client using the government mileage reimbursement tables because they’re so ridiculously inflated compared to my actual costs. For the past 15 years I’ve had to supplement my parents’ income on both sides of the family because Social Security is such a total farce. If the government offered me an escape from Social Security I’d take it in a heartbeat, and they can keep all the money they’ve already stolen from me – and owe me nothing in my old age.
Today I find myself closer to the Tea Party populists than any other political movement. I lean Libertarian, but their “let anyone walk across the border anytime they want” policy on immigration is just nuts. Perhaps the Tea Party crowd in New England is different. Here in the South we’d just as soon see the Federal government go away. We can no longer tell much difference between the US Congress and the Politburo of the old Soviet Union. If that means we have to stop requiring government to steal from our fellow citizens in exchange for our votes, wouldn’t that be a good thing in the long run?
So Art, how do my views compare with the Tea Party folks you’re talking to?
I’m not involved with the tea party movement. My only contact with them is what I hear on internet radio and the news – I don’t listen to local radio and don’t own a TV. I hear/read very little about them locally.
My biggest concern about the Tea Party is not knowing what their core principles are or who is pulling their strings. I saw a headline today that 65% of Americans would like to dissolve Congress and start over. I understand the emotion, but could you imagine what that would look like? The President would be free to run the country by decree while the New Congress is still trying to find the bathrooms. Congress would be even less capable of pushing back against the interests of career government employees and lobbying groups. That’s even without worrying about military threats or economic panics.
Not saying we won’t or shouldn’t wind up there – but don’t kid yourself life would turn into rainbows, free ice cream and unicorns if we just kicked all the bums out.