Monday, July 25, 2011
"Official CPI Is Running 3.6%, But If It Were Still Calculated The Way It Was Before The Greenspan Commission Went To Work, It Would Be 11.1%"
Addison Wiggin notes:
Whatever agreement emerges from the backroom dealing [on the debt], it is now almost sure to include what we’ve labeled a “stealth default” on Social Security.See this and this, and this for background.The White House quietly put out the word two weeks ago that it’s on board. Congressional Republicans think it’s a super idea, too. “There hasn’t been any economist anywhere that says we shouldn’t do that,” says Sen. Tom Coburn (R-Okla.).
Of course, they don’t call it a stealth default. They call it “chained CPI.”
This stealth default has occurred before. When Social Security was in trouble in 1983, one of the Greenspan Commission’s fixes included an adjustment to the consumer price index known as “substitution.”http://www.blogger.com/img/blank.gif
It works like this: If steak gets too expensive and you start buying hamburger instead… well, your price of beef hasn’t really gone up and your cost of living is unchanged. This is one of the reasons official CPI is running 3.6%, but if it were still calculated the way it was before the Greenspan Commission went to work, it would be 11.1%.Because Social Security benefits are keyed to CPI, this has resulted in a substantial savings for Uncle Sam. But fast-forward 28 years and Uncle Sam has burned through all the trust fund money just to pay his bills, and “substitution” alone isn’t good enough. Hence, “chained CPI.”
Under “chained CPI,” if your hamburger gets too expensive and you start buying beans instead… well, your price of protein hasn’t really gone up and your cost of living is unchanged.
3 comments:
→ Thank you for contributing to the conversation by commenting. We try to read all of the comments (but don't always have the time).
→ If you write a long comment, please use paragraph breaks. Otherwise, no one will read it. Many people still won't read it, so shorter is usually better (but it's your choice).
→ The following types of comments will be deleted if we happen to see them:
-- Comments that criticize any class of people as a whole, especially when based on an attribute they don't have control over
-- Comments that explicitly call for violence
→ Because we do not read all of the comments, I am not responsible for any unlawful or distasteful comments.
Posts
Nothing new.
ReplyDeleteThe ruling elites and corporate USA LIE to and at We, the People to maintain a status quo that ensures the ever-upwards transfer of USA wealth from the many to the deserving few.
Obey, you disgusting commoners.
Love it or leave it.
OBEY your masters.
"There's class warfare, all right, Mr. (Warren) Buffett said, but it's my class, the rich class, that's making war, and we're winning."
The plunder of the people you described is being done because of the size of a certain part of "government".
ReplyDeletePriming the nation for revolution or war?
ReplyDeleteThese lies are easily demonstrated. And they know it. Who will be the fall guy???