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U.S.
Senator Sherrod Brown...
Supporting
Social Security Cost of
Living Adjustment Increases for Seniors
November 29, 2011
Belle
is a 90-year old resident of
Cuyahoga County who, like so many other seniors, has lived a longer and
healthier life because of Medicare and Social Security. But Belle’s
income and
Social Security benefits barely cover the costs of hearing aids, eye
glasses,
prescription medications, and rising energy and housing expenses.
Simply put,
Belle’s Social Security check, like that of other seniors, has lost its
value
over the years. That’s because while seniors’ energy, food, and
prescription
drug costs have increased over the past three years, they’ve only
received a
Cost of Living Adjustment (COLA) for Social Security this past year.
That’s
because of an outdated and flawed formula for calculating COLAs that
does not
accurately reflect the real costs facing our nation’s seniors.
Last
month, the Social Security
Administration announced that seniors would get their first COLA
increase in more
than two years. But while seniors will finally receive a COLA in 2012,
the
increase is less than it should be to meet current expenses. Right now,
COLAs
are based on the Consumer Price Index for Urban Wage Earners and
Clerical
Workers (CPI-W). But the groups included in the CPI-W only represent
about 32
percent of the U.S. population. It measures the costs of younger,
employed
individuals – and does not reflect seniors’ expenses, forcing them to
pay
rising bills with inadequate COLAs.
That’s
why I recently introduced the
Consumer Price Index for Elderly Consumers Act. The Act would formalize
an
already existing Consumer Price Index for the Elderly (CPI-E) to
calculate
COLAs for people who are more than 62 years of age, which would more
accurately
reflect the needs of today’s seniors. The CPI-E would take into account
seniors’ specific consumption habits and costs of living – adjusting
for health
care, energy, and food costs for seniors – and then be used to
determine COLAs
for Social Security benefits.
The
average person who retired in 1985
received a monthly benefit of approximately $887.27 under the CPI-W in
2009.
Under the CPI-E, that senior would have received $954.52 – a difference
of
$66.25 a month or $795 over the course of a year.
Too
many seniors who have worked hard
and played by the rules depend on Social Security to help pay for
necessities.
For others, Social Security has become their sole, or majority, source
of
retirement income – the result of a financial crisis that wiped out
retirees’ pensions,
IRAs, and 401Ks.
I
believe we need to reduce the
deficit for our children and grandchildren. But I don’t think we should
balance
the budget at the expense of their parents and grandchildren. Instead
of
cutting Social Security, I’m fighting to reduce spending by ending tax
loopholes for companies that send American jobs overseas, cancelling
taxpayer-funded subsidies for big oil companies and extra breaks for
wealthy
investors.
We
can solve America’s deficit problem
without creating an even greater deficit of resources for America’s
seniors.
We
know that the COLA for seniors is
already too low because it is based on the cost of living for a working
person
– if you’re seventy years old you are more likely to have higher health
care
costs than a 30-year old. Yet, despite the fact that Social Security
does not
contribute to the budget deficit, some Washington politicians want to
make
COLAs even smaller.
Belle
witnessed the creation of Social
Security in 1935 and paid into the program throughout her working life.
Now,
when she and so many others need Social Security the most, some
politicians are
threatening to make further cuts to the benefits seniors have earned
and so
rightly deserve. In the 1960s, President Kennedy said, “changes in our
population, in our working habits, and in our standard of living
require
constant revisions.” He anticipated necessary improvements for senior
citizens
like Belle.
It’s
time we ensure seniors receive the
benefits they deserve – and so desperately need.
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