Disappointment and anger were the responses of many in UE to the news that President Obama will proposed a federal budget that would cut Social Security and Medicare benefits.
The Obama budget proposes to change the cost-of-living formula for Social Security - as well as military pensions and federal worker pensions - to something called the "chained CPI." CPI means consumer price index, but this change would "adjust" the cost of living formula on the assumption that, when the price of an item goes up, retirees will stop buying it and substitute something else, and so the price increase of the original item should be ignored. As former Labor Secretary Robert Reich has pointed out, senior citizens spend 20 to 40 percent of their incomes on healthcare, "and they can't substitute lower-cost alternatives." Reich points out that even the current cost-of-living adjustment to Social Security does not adequately keep up with inflation in healthcare. The pro-labor Center for Economic and Policy Research calculates that the chained CPI would result in a .3 percent annual cut in retirees' benefits.
Obama's proposed budget also introduces "means testing" for Medicare. Under means testing, some people would lose benefits based on income. When Social Security was enacted in 1935, and when Medicare was added in 1965, their advocates wisely designed them as universal programs which cover everyone, with no means testing. Opponents of Social Security and Medicare favor means testing, as a way to make them "welfare programs". Turning them into programs perceived to benefit "only poor people" and excluding more affluent Americans would weaken their public support and make it easier to eliminate them entirely.
"These proposed cuts are outrageous, and they violate President Obama's past promises," said UE General President Bruce Klipple. "We all need to let the White House and members of Congress know that any proposals to cut Social Security, Medicare and Medicaid - whether they come from Republicans or Democrats - are unacceptable to the working people of America."
Earlier this year more than 100 members of Congress signed a letter to President Obama, pledging to vote against any budget that cuts Social Security and Medicare. You can call your members of Congress at the Capitol Hill Switchboard - (800) 839 - 5276 - and urge them to sign on as well.
Check back at this site for updates on this battle, and for actions you can take to defend Social Security and Medicare.