Chained CPI Means You Can’t Have Nice Things

[phantom power]

The Obama Budget Document includes 11 mentions of Chained CPI. Here are the first four:

In the interest of achieving a bipartisan deficit reduction agreement, beginning in 2015 the Budget would change the measure of inflation used by the Federal Government for most programs and for the Internal Revenue Code from the standard Consumer Price Index (CPI) to the alternative, more accurate chained CPI, which grows slightly more slowly. Unlike the standard CPI, the chained CPI fully accounts for a consumer’s ability to substitute between goods in response to changes in relative prices and also adjusts for small sample bias. Most economists agree that the chained CPI provides a more accurate measure of the average change in the cost of living than the standard CPI. P. 46

The first bold section tells us that Obama believes there is a bipartisan consensus that we have to cut Social Security and raise taxes on the middle class. I’m not seeing that in any segment of the political world except vicious jerks like the Club for Growth. I can’t wait to see the Hastert Rule operate in the House, forcing Speaker Boehner to admit that a majority of House Republicans thinks hiking taxes on the middle class and slashing Social Security is a terrible idea.

The second explains that this is good because when prices go up, or incomes drop, consumers can just buy some cheaper thing than the thing they really like. You can read a paper from the Bureau of Labor Statistics explaining this in detail here. The plain fact is that this is an outright admission of the utter failure of the consumption society.

The example you get is that if beef gets more expensive, you can substitute pork, without in any way affecting your life. In other words, the selections among beef, pork, chicken and catfood you currently make are assumed to give you a certain level of pleasure, but now you can’t have that level of pleasure. Either you eat less of something you like, or you just don’t get to eat it, and have to eat something you don’t like as much.

...

Of course, all this is irrelevant to the feral rich. Their income goes up as they suck out the money from you for your cell phone and your cable service and every other thing you buy. They don’t substitute for anything.

The real point of the Chained CPI is that you don’t get to live nicely. You can expect a declining standard of living. That is the message of your President and the oligarchy he serves.

http://my.firedoglake.com/masaccio/2013/04/12/chained-cpi-means-you-cant-have-nice-things/

[The Second Stone]

1. The Federal government doesn't use chained CPI

for any of their contracts, wage increases, etc. etc. There is a reason for that.

[AnotherMcIntosh]

2. This guy used to have a home. Here's his substitution.

And the war criminals who invaded Iraq to plunder their oil with our military resources are still walking around free, rich, and happy.

[woo me with science]

10. +1

[Life Long Dem]

3. Are you serious with that title?

You can't be. That's a joke right? Who can have nice things through SS? That's a laugh. SS wasn't meant to be your sole income on retirement in the first place. And if it is, I can tell you, you won't have any nice things.

[Dragonfli]

11. Are you serious ?

"SS wasn't meant to be your sole income on retirement in the first place. And if it is, I can tell you, you won't have any nice things."

Well, unlike you who apparently have a pension that wasn't stolen and/or wasn't pushed into relying on a 401K that turned out to be a cruel joke but were perhaps well off enough to afford a sizable investment portfolio (you've got yours so fuck everyone else)
Over a third of recipients rely on this as their sole source of income.
Sixty percent of Americans receive at least two-thirds of their retirement income from Social Security.

So good for you you got yours!

You have just admitted you don't think these people deserve to have anything nice even without the new cuts. (I emphasised that bit above)

They should also be poorer and poorer as they get older according to you or you wouldn't support a chained cpi.
you should learn what these cuts will mean, here is an explanation with pictures so you can understand it:

You may simply be uninformed and easily led astray, but your comments make you appear to be a selfish cold blooded sociopath that advocates hardship for seniors that gets worse over time. I am only saying that appears to be your opinion based on the above quote and your support for compounding cuts to recipients.

Frankly it would be less cruel to place everyone that needs SS and has nothing else on an ice flow.

Unless one advocates for slower more tortuous deaths created by an ever worsening state of poverty because one likes that sort of thing, one would consider the ice flow thing or shooting them out back as a less sadistic option.

[Warpy]

4. Yeah, like fresh fruit and veg

and don't kid yourself, Mr. Obama, this is going to start happening the day you pass this monstrosity and let seniors know they're going to be cheated out of what they've paid for.

Seniors aren't stupid and they know if their SS is going to decrease while Medicare expenses keep going up, they'd better stop spending on anything but groceries and taxes NOW.

[woo me with science]

5. "You can expect a declining standard of living.

"You can expect a declining standard of living. That is the message of your President and the oligarchy he serves."

Yes, this is the monstrous message, in a nutshell.

Thank you.

[wandy]

6. So, When beef gets more expensive, you can substitute pork.........

When pork gets more expensive, you can substitute chicken.
When chicken gets more expensive, you can substitute cat food.
When cat food gets more expensive, you can substitute ............

How the hell can anyone think this is a good idea?

[Cleita]

7. Yeah, like fresh food and heating fuel. n/t

[woo me with science]

8. Or shelter.

Three Minimum Wage Jobs Needed To Afford Two-Bedroom Apartment
http://www.democraticunderground.com/10022578738

[unblock]

9. It should be called CSI -- consumer spending index

Because it's really not a measure of price inflation at all. If everything goes up 5% but income is flat, there would be massive substitution, so chained CPI would say there's nowhere near 5% inflation. In fact the only reason it would show any inflation at all I'd because SOME people could afford to SPEND more to avoid suffering the full effects if the 5% inflation.

The reason why this crazy scheme makes sense to rich people is because they do not substitute in response to price inflation. They only substitute in respond to changing technology and so on.