After hanging tough on his budget proposals for avoiding the supposed ‘fiscal cliff’, it looks like the President is willing to reduce Social Security benefits. Wait, what?
Social Security isn’t even part of the deficit problem. It is self funded and self sustaining and is liquid for quite a few more years without any tweaking whatsoever. It should come under some scrutiny in the near future. And lifting the cap on taxable earnings for Social Security taxes would solve the liquidity problem beyond the lifetimes of anyone who is reading this and their children. But that discussion should occur later…after this self imposed crisis is over…it’s got nothing at all to do with the current issue.
(well it does briefly…the 2 point moratorium on payroll taxes that we have enjoyed the past year is being made up out of the general fund…so it currently is contributing to the deficit just a wee bit…but that’s an exception…not the rule)
But the President has shown a willingness to reduce future cost of living adjustments by allowing changes to how inflation is determined. That will in fact reduce Social Security benefits for current and future retirees. This isn’t necessary and goes completely against the general consensus in the country. Shame on the President for even considering this just to sweeten the pot for the Republicans.
Social Security should be off the table for this round of economic discussions.