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Does anybody know the proposed income threshold before Chained CPI kicks in? (Original Post) rucky Apr 2013 OP
across the board. Warren Stupidity Apr 2013 #1
I don't think there is an income threshhold; it's just a boost in the payout, from age 76 muriel_volestrangler Apr 2013 #2
Chained CPI is a way to calculate inflation adjustments to payments and taxes, etc. bemildred Apr 2013 #3
Here's a graph Life Long Dem Apr 2013 #4
kicks in ?? there is no chained cpi, only been proposed spanone Apr 2013 #5
That's why I said proposed. rucky Apr 2013 #6
 

Warren Stupidity

(48,181 posts)
1. across the board.
Mon Apr 15, 2013, 07:48 AM
Apr 2013

Social security benefits (not SSI or other programs, at least not yet) would use CPI-C instead of CPI-W for COLA. That affects everyone who receives the standard SS retirement benefit.

Income threshold has nothing to do with COLA adjustments to SS benefits. I don't understand what you mean by "does that go off of full income or just the SS payout". CPI-C cuts the COLA increase for SS by using a different (and lower) measure of CPI than the current CPI-W. It is a significant cut in benefits, and a cut that gets worse over time as each annual COLA adjustment is starting from a lower base. The simple switch to CPI-C is so bad that the proposal comes with a 'bump', an adjustment to compensate for how bad it is. I posted a graph to illustrate this disaster yesterday:



(from thenation.com)

muriel_volestrangler

(101,159 posts)
2. I don't think there is an income threshhold; it's just a boost in the payout, from age 76
Mon Apr 15, 2013, 07:57 AM
Apr 2013

until 85. So a typical retiree would get gradually falling payments, in comparison to the currently-used inflation measure, until 76, and then the payments would gradually increase until, at, 85, they're almost up to the old measure. Then they'd start falling again.

bemildred

(90,061 posts)
3. Chained CPI is a way to calculate inflation adjustments to payments and taxes, etc.
Mon Apr 15, 2013, 07:58 AM
Apr 2013

Congress mandated in happier days that SSI recipients are to get annual COLA adjustments to payments, mine typically run 15-25$ a month more, but a couple times it was nothing at all. It also affects the tax cap on FICA tax, so it means that Grandma can afford less dog food, and the well-off pay less to support Grandma too. It's a win-win if you are rich, and a lose-lose if you are poor.

I was once paid enough to go way over the cap, and it is like free money once you hit the cap.

CPI is a measure of price inflation, Chained CPI makes it easier to fudge the numbers so Grandma can buy less dog food.

 

Life Long Dem

(8,582 posts)
4. Here's a graph
Mon Apr 15, 2013, 08:47 AM
Apr 2013


"The results by using chained CPI for taxes are also striking. The Tax Policy Center calculated the income tax increases that would be caused by a switch to chained CPI. They’re not big — a little more than $100 a year for most families — but they’re oddly regressive:"

http://www.washingtonpost.com/blogs/wonkblog/wp/2012/12/11/everything-you-need-to-know-about-chained-cpi-in-one-post/

You could see in the graph why later on you would could use a bump.

"Is it possible for the C-CPI-U to increase faster than the CPI-U?

At lower levels, and for short periods of time, it is possible for the C-CPI-U to increase faster than the CPI-U. That said, the evidence suggests that the C-CPI-U over time will trend slightly lower than the CPI-U."

http://www.bls.gov/cpi/cpisupqa.htm

Check the source. "AARP’s incredibly one-sided explanation combines ballpark accuracy with misleading omissions."

http://www.zebrafactcheck.com/fact-checking-aarps-explanation-of-chained-cpi/

Not that this will pass, just that there is hyperbole out there.
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