Jon Walker already mentioned this push by President Obama for changes to Medicare and Social Security in his town hall meetings in rural areas this week. It’s actually worse than that. Walker highlighted comments from the stump speech. Look closer at the question and answer session.
Twice this week, the President was asked specifically about Social Security, in particular the COLA adjustment. The last two years, recipients were denied a COLA, because it’s based on an inflation index that didn’t show any rise in inflation. The President explained this pretty ably on Wednesday at a town hall in Illinois.
THE PRESIDENT: Well, let me talk to you about Social Security. It is very likely that she will see a COLA, a cost-of-living increase next year, because inflation actually rose this year. The reason that there were a couple of years where she did not get a cost-of-living increase was because even though she probably felt like the cost of food and gas and groceries were going up, the overall inflation index actually did not go up. There was a period there where we actually had what’s called deflation, where the costs were a little bit lower than they had been comparable to the previous year.
So all that is done automatically. It’s not something that I make a decision about each year. And I promise you when folks don’t get their COLA, they all write to me and say, Mr. President, why — you didn’t give us a cost of living, and don’t you care about senior citizens. And I have to write back and explain to them, no, that’s not something I did. These things just happen automatically based on estimates of what inflation is going to be.
Indeed, Social Security recipients are expected to get a 3% increase at the end of the year. And yes, that’s an automatic process.
What the President isn’t telling people is that he offered an alteration to that automatic COLA process, by going to chained CPI, that would result in a slower increase in benefits, and a de facto cut. So at the same time the President is explaining that the COLA is not in his control, he is hiding the fact that he wants to change the metric upon which it is based. In fact, he slipped and actually did mention chained CPI, in a roundabout way, at a second town hall in Alpha, Illinois. The President was asked about the payroll tax cap, and he answered that and went right to this “here’s why grandma didn’t get a COLA” talking point that he was obviously instructed to say, but he slipped and included a telling line:
Well, first—this is a very well-informed young man here. (Laughter.) You’re exactly right that the way the Social Security system works, there’s what’s called—there’s basically a cap on your Social Security, which there isn’t, by the way, on Medicare. But Social Security, it only goes up to the first $107,000; and you’re right, somebody who makes—who has net assets of $250 million and are making maybe $5 million a year just on interest or capital gains or something, just a fraction of it’s going to Social Security. I think there’s a way for us to make adjustments on the Social Security tax that would be fairer than the system that we use right now.
I do think, in terms of how we calculate inflation, that’s important as well. By the way, seniors — a bunch of them were upset over the last couple years because some of — because seniors didn’t get a cost-of-living adjustment. I got a lot of letters — “Mr. President, how come I didn’t get a COLA this year for my Social Security?” And I answered this question at the previous town hall; I figured I’d clear something up now. The way the system works is you automatically get a cost-of-living adjustment based on the inflation rate. The President doesn’t make that decision; it’s based on a formula.
But the President does make decisions on the formula, in consultation with Congress, and he tells you right here, he wants to change the formula for how inflation is calculated. Over time, that would become a net benefit cut of up to $1,000 a year for older Americans. With any luck it won’t go any further. But the President has a clear interest in it.
Let’s pause to acknowledge Rick Perlstein on how Democrats win:
Two years later, Nixon thought he had another one in the bag — the 1970 elections, in which he campaigned tirelessly for Republican candidates, then gave an election-eve TV speech blaming Democrats for the “thugs and hoodlums” in the streets. Only he made a terrible mistake: he sounded just as frantic and ugly as the forces he claimed the GOP would subdue.
In contrast, the Democrats ran a response to Nixon’s hysterical election-eve address from Edmund Muskie, the calm, quiet Senator from Maine, who sat in an armchair and asked Americans to vote against a “politics of fear” that insists “you are encircled by monstrous dangers” and instead choose a “politics of trust.”
You might say Muskie’s was a very Barack Obama sort of speech — but with a difference. It was overwhelmingly partisan. It excoriated Republicans for the way they “cut back on health and education for the many … while expanding subsidies and special favors for the few.” In other words, it was just the kind of speech Obama will not give.
That year, the GOP went bust at the polls. Then, in 1972, the Democrats ran a candidate whose speeches were more frantic than any in history. George McGovern, following a then fashionable theory that the middle class was prosperous enough to take care of itself and that unions were pretty much irrelevant, spoke to working-class concerns less than any Democrat had before. He lost 49 states.
McGovern didn’t give what Lyndon B. Johnson used to call “Democratic” speeches — LBJ’s shorthand for talking about which party gave the people Social Security, Medicare and the Tennessee Valley Authority and which one was willing to toss them over the side. LBJ gave such speeches all the time in 1964 — and he won 60% of the popular vote.
In contrast, you have advice like this from the President’s advisers, which is very practical and reasonable, but first of all irrelevant (Emanuel wants to say that Medicare needs changes to make it more efficient, but so many of them are already part of the Affordable Care Act, so this work is already happening) and second of all terrible, terrible politics. And the President is reflecting that as well.




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It’s pretty clear that Obama and the DC Dems have gone to the dark side and embraced Friedmanist Supply Side trickle down economics that was so loved by Ronald Reagan and every other Republican since Nixon. I believe the only reason he’s reading Perlstein’s book is so he can figure how to spin his policy failures by claiming that FDR and LBJ would have done the same.
Remember, the first rule of Marketing is that if you don’t have a product people want to buy, put it in a shiny package. To which I say you can’t polish a turd.
Give them less and make them think they are getting more. I saw that yesterday but can’t remember where….
I know President Obama has all these uber-smart political strategists, but I need to know. Do they understand he will be on the 2012 ballot as a Democrat?
When folks don’t get their COLA they write to me and say Mr. President why don’t you kiss our collective asses your lying toad?
The Great Deceiver at work.
Of fer gawd’s sake. I just heard a talking head on MSNBC state that the CBO has said that eliminating the CAP on FICA taxes would completely eliminate any future funding problem in Social Security. Why doesn’t someone in the CBO tell Obama?
Of course, this still requires the government to pay social security back the 2.5 trillion it owes.
“What the President isn’t telling people is that he offered an alteration to that automatic COLA process, by going to chained CPI, that would result in a slower increase in benefits, and a de facto cut.”
___
What most people also don’t get is the COLA sleight-of-hand inherent in “core inflation rate.” Put food and fuel back in the inflation rate, COLAs would have been much higher.
Sigh, it keeps getting worse daily . . . killin me. Being so well informed from Mr.’s Walker n Dayen and FDL is hard on the soul . . . essential, but still danged hard on the soul.
Dawg help us all.
Elected representation sure ain’t.
Thank you Mr. Dayen for all you do. N Mr. Walker too, all of FDL.
ROFLMAO……..Ya’ think they overlooked that in the strategery meeting?
This has been a BAD day for us “average citizens” who are counting on SS and Medicare. This is NOT the “change” I voted for.
Previous message @ mwarmick
I think that is Rule #1 in the “Scrooge Rules of Business Management”.
Does anyone know if quantitative easing actually did have something to do with the fuel and food price increases? Or is that just a conspiracy theory?
One could wonder if Obama means the new COLA-E which specifically weights things the elderly and disabled depend upon, resulting in a higher COLA than the current one.
But I doubt it.
Yes it would but 0 going the other way.
Very tru… Besides where is most of the seniors money going??? FOOD & Fuel.. And that was the Republicans under St Ronnie who did that.. Folks there is a
WAR going on!! A class war and we are losing as they use smoke and mirrors to obfuscate the true facts about inflation… Oh and they also change what they measure just as soon as something goes up in price such as meat they just choose a cheaper cut so now instead of using a sirloin they are using cube steaks… FUCKERS~!!!
Yep. That phrase “core inflation” always cracks me up. Like, it’s just the opposite.
Lack of leadership. Mr. O wants to blame Congress for his own selling out of Americans and shipping their jobs overseas under his trickle down trade agreements.
Loser!
gosh, doesn’t anyone here have markos’ MOJO!
Guess you have to be a mindless obamabot to post over there and be in the big orange good graces.
And at tpm, the blog that lead in defining w’s SS bamboozle tour, they have this screaming headline:
Is He Even Trying?
But once you click through, you see its not about obama selling out his base and carrying water for repugs, it
Huntsman Seems Determined To Alienate GOP Base
No mention of o’s selling out the new deal, however.
just a reminder that Chained CPI had it’s genesis (or at least it’s coming out party) in the Diamond-Oszag White Paper – Jane Hamsher has been posting about it and the President’s reliance on it since early 2/09
Jane Hamsher 2/12/09
yet more Hamsher on Orszag goodness
Food fuel and the ever inflationary Healthcare also not included in the core. Huge losses there.
the o bots have been fenced off over at Big Orange – still some concern trolling a la, ‘I’ll plug my nose and vote for him, but wont work or donate towards his re election’- and I wont be surprised to see that segment shrink the closer they get to cutting the net – but the dew is definitely off the Kos
that it took a real threat to a Dem Party centerpiece and not torture, extra constitutional power grabs, 3 wars, child soldiers, etc. is a whole ‘nother diary and waay beyond this ol waitress’s pay grade
The f*%ker lies about everything. It must be arrogance that makes him believe he can get away with it.
Thought I was the only one. :) Watching this nightmare unfold is like coming upon a horrific traffic accident. You can’t help but look. Obama is a dangerous man. my 2 cents
Great point. Actually, he will run on the Pete Peterson “screw you” platform of the Third Way (Kissinger) party.
This is what they are really up to…http://www.nakedcapitalism.com/2011/08/michael-hudson-the-case-against-the-credit-ratings-agencies.html
they want ALL assests that are public. All taxes must be given to the uber rich by way of their corporations. The biggest tax is for their wars.
Kennis Kuccinich protested Cleveland form their greedy claws when rating companies downgraded their debt in an attempt to privatise the energy company. He was successful and the rates for electricity remained affordable.
When he laments that those “folks” write to him…such an inconvenience…I do wonder if he refers to his Martha Vineyard pals as “those folks”….I beginning to think that is his very perjorative term for “folks” who annoy him….
Well, us folks can do two good things in 2012. I’ve been hearing that there are efforts in many states to bar small parties from the ballot.
So help protect small party access, pick a small party and vote for it in 2012. This will also serve to send a huge message to the folks who take our votes for granted and plan to screw us out of Social Security and Medicare.
Yes, a real transformation there–for the most part.
Took them awhile though, but it looks like a major collapse of Obama support.
GOTV in 2012 will suffer as well. And that’s about the only use the dems ever had for lefty sites.
I won’t hold my breath, but it would be nice if Obama’s defeat could be credited to the stay-at-home progressives.
I’d be curious to know what sort of questions he’s getting at these “town halls” [I'm sure participants are screened as thoroughly as Bush's were], what sort of crowd reactions, what sort of write-ups in local newspapers.
I’m sure the Obama team is all over this like white on rice, but maybe something seeps through.
Thye figured out years ago how to jigger the numbers to make the unemployment rate look low and the inflation rate look low. There is no reality behind these numbers any more, and yet they just tell us that what we are actually seeing and feeling is ‘anecdotal’, an illusion. Even in the Bush years when there was no COLA, he produced a small check for SS beneficiaries to compensate. This jerk hasn’t even said he was sorry, and he just makes excuses that it isn’t his fault. Damn! This guy is just nowhere, helpless, no character, without a plan for anything! He is worse than George W Bush in this respect, and that is a sad thing to have to say.
Telling people that the truth is false makes them crazy and angry. (I guess my exclamation points indicate that I am a little crazy and angry too.)And it tells them that their government cannot be trusted to tell them the truth. That is a really bad situation.
Somebody tell me who calculates the “gross national product” that provides the standard definition of “recession” and “depression”. I am thinking that there is a serious amount of cooking those numbers also to make the government look good.
No you are not alone.
“Watching this nightmare unfold is like coming upon a horrific traffic accident. You can’t help but look. Obama is a dangerous man.”
Every time I hear one of them start out with “…the American people want…..” I start to fell like I am going to throw up. I wonder what planet their “American people” live on, you know, the one where rich people don’t pay any taxes at all, there is a $2/hour job for anyone who wants to work, and everyone is happy happy joy joy.
I am one of the American people living in this USA that no one is listening to and none of them have any idea of what I want, or how disappointed and disillusioned I am. And the constant grieving for the UAW and all of the unions and these young folks out there don’t even know what has been lost. They believe what the Repugs have told them, that unions are bad. So they don’t even know it when they are being screwed.
I call the White House today to leave my rant on my oppositions to the cutting of Social Security, medicare and medicaid. The lady started to interrupt. I ask her was this her opinion and remarks or mine. I also ask her was she drinking from that same stupid jar that Dub ya left for Gilligan Obama. I told her I had been a pharmacist for 24 years. I ask her was Gilligan Obama on drugs. I then hung up on her. That probably sent her to get 1 mg Xanax out of her own purse. I can just picture her talking about the inhumanity of it all around the water cooler.
Which ones are those? With what countries?
I don’t mean to rag about that orange place so much – I signed up just before recalls cuz it seemed a good source of info and I was very involved on the ground.
I have been reading this site and that one since almost the beginning of each – so I knew what I was up against.
I never posted anything that was a strong statement, just carefully worded questions. I never said I wouldn’t vote for him or anything – even though many are coming around now, that’s not the site for that dialog. I was respectful.
Still got baited and flamed and even challenged if I was a badger or not (though my posts and 1 diary clearly showed on I was on the ground in WI).
When I understood markos (don’t kid yourself – he’s a repug that couldn’t get a voice in that party) “mojo” system and the way they manipulate folks to “tow the party line”, I had enough.
I didn’t do one of the GBCW final posts, just marked mine as no longer used and left.
Sure, I check back to see if there is any breaking news, especially about WI, but now there is none – amazing, so many there talk a good game about SOLIDARITY and supporting the badger state, but not a PEEP out of obama fully-standing down and even avoiding the state when he was in MN and IA in his magic gazillion dollar canadian bus.
He’s a bastard and so is kos, I will let it go soon, but he is doing more damage to the progressive movement than most realize – he is a REPUG that wants to direct the messaging on the left.
No wonder he likes obama that has proven to be a repug and dur chimpfurher’s third term.
The narrative has been successfully changed. I hope that people stand up because if they don’t you can say goodbye to the safety net. I found it astounding that when Obama told a crowd that he was going to cut benefits for SS people applauded. WTF?
These people at the Town Hall Meetings are pre set ups. They are hard core active Dems and strong supporters. Its done all the time. We used to do it when I was active. When a politician appears on a talk show you will notice all the cheering from the audience. They bring their own people in on those things too.
“I have a selling job, Chuck……. I have a selling job, Chuck I have a selling job, Chuck I have a selling job, Chuck I have a selling job, Chuck…….”"I have a selling job, Chuck……. I have a selling job, Chuck I have a selling job, Chuck I have a selling job, Chuck I have a selling job, Chuck…….”"I have a selling job, Chuck…….folks….FoLkSsSsSsSsssssssss……fOlKsSs….folks…
hang in there buddy, what comes around goes around, remember the French Revolution was only a couple hundred years ago….you can make history.
http://www.youtube.com/watch?v=TROP-z0O9Yk
Don’t forget that Big O, in his effort to deceive us with a “bipartisan compromise” (that Republicans will pretend they oppose), will likely propose a one-day tax holiday that will enable all companies and wealthy individuals — those who have stashed their taxable profits offshore to avoid paying taxes here — to bring it back to the U.S., tax-free, on the specified date, and pay no taxes on it. The idea is that all this money will be used to create jobs. But in reality, none of it will. The result will be all the lucky tax-avoiders and debt fear-mongerers will be rewarded. Billions will end in the pockets of those who already have so much money they won’t know what to do with it. This is what happened 7 years ago, the last time it was done. Is that fair to all the rest of us who dutifully pays our taxes — with all this talk of deficits and our need to share in the pain?
If you haven’t read it yet, please read Matt Taibbi’s blog on Rolling Stone about this, posted one to two weeks ago.
Well you see the COLA is automatic I don’t control it … that’s just the way the law works ….
Yet the law also says that we shall collect 12.4% from paychecks and ALL that money will go to the Social Security Trust Fund … somehow 2% of that payroll tax leaked out back to the workers? How did that happen? Did he have anything to do about CHANGING THE LAW?
Obama is such a weasel.
I still think anyone who would cheer their safety net being shredded need their head examined. Supporters or not.
Obama knows.
The quantitative easing by the FED was/is a program of pumping trillions of dollars into the global economy. The result and purpose is to devalue the dollar. This is a reason for the gas to increase in price. Some people argue that food prices should not be effected – that is, food grown in this country. I believe devaluation does effect the price and there is the added factor of “investors” gambling on the commodity market.
I certainly believe Obama should get the full credit for this. The word needs to get out. Maybe Republicans will even help us. If Obama is responsible for cutting Social Security benefits then President Obamacuts can see just how much people believe Obamacares.
Food and fuel are IN the CPI and that is what’s used for Social Security [“Core inflation is not used for things like calculating cost-of-living adjustments for Social Security; those use the regular CPI.” Krugman – http://nyti.ms/pBmDWQ. Changing that is what DDay notes Obama may do to screw us.
I also suggest that you tell your Dem Congressional delegates that you will work against them if they don’t oppose Obama on wars, economy, Constitution shredding, etc.
“In answering the first question posed to him, about the estate tax, Obama pivoted again to compromise, arguing for a middle-road approach between reinstating the estate tax and doing away from it, permitting a $7 million exemption that he said would protect most family farms.
[snip]
“As at the Atkinson event, there were no notably hostile questions.”
http://bit.ly/oWl2NZ
“There is no reality behind these numbers any more”
I suggest searching on GDP, inflation and other such questions along with “Paul Krugman” if you want some legitimate answers. I don’t agree with your complaint. Though we are being screwed with, the answers are available.
Thanks for that reference. Unfortunately it still appears that the COLA will more or less lag the cost of living by a year.
The “chained” CPI was one of several changes recommended by the 1996 Boskin Commission. The Commission said that the CPI overstates inflation by about 1.1% and thus overpays seniors. In 1997 Chairman Greenspan testified on the CPI before the Senate Finance Committee and agreed with the Commission’s findings, saying “there is almost a 100% probability that we are overcompensating the average Social Security recipient for increases in the cost of living.”
Peter A. Diamond and Peter R. Orszag proposed in their 2005 book Saving Social Security-A Balanced Approach that Social Security be stabilized by various tax and spend adjustments and gradually ending the process by which the general fund has been borrowing from payroll taxes. This requires increased revenues devoted to Social Security. Their plan, as with several other Social Security stabilization plans, relies on gradually increasing the retirement age, raising the ceiling on which people must pay FICA taxes, and slowly increasing the FICA tax rate to a peak of 15% total from the current 12.4%
The villain in housing. in financial meltdown, and in the attack on Social Security is Greenspan and the GOP – albeit Moynihan and Rubin, and a few other Dems, had to be beaten back by Clinton.
What is sad is the fact that today we had a book Salon where the author tried to make Greenspan/GOP betrayal and incompetence into Clinton started it – nicely forgetting a few hundred facts like analytical needs for statistical proof that anything done by Clinton, or anything done by Dems for the working poor/middle-class to get loans into areas where banks turned down minorities, actually caused loan losses (the stats show they did not). There really seems a need on the part of some to dump on Bill Clinton so as to justify the dump on Hillary in 2008
Well, since Obama is running on the Republican platform, Huntsman probably decided to run on the Democratic platform. I’m still hoping for 4 candidates.