They’re going to CUT my WHAT?!

I’m writing this for the benefit of my contemporaries: OLD retired people. And while the term is subjectively relative, meaning that the point at which geezerhood begins depends on whoever beholds it, but chronologically, it’s ABSOLUTE.

Relatively speaking, to a 90-year-old, people turning 70 are still youngsters, but to average 15-year-olds, 30-year olds are ALMOST DEAD!

But in absolute terms, if we’re lucky enough to stay healthy, we’ll either grow too old to work or we’ll simply tire ourselves out and look to retire. And this is the point of this week’s post.

Most people in this country work hard for thirty or more years of their lives. And if you’ve been a wage earner or self-employed, you’ve paid into Social Security all of your lives.

Some of us will use Social Security as a supplement to retirement because we’ve saved for it in addition. Others, through no fault of their own, will NOT have been unable to save for it; they’ll have to depend on those benefits for 100% of their retirement financial sustenance.

Whenever there are rumblings of NECESSARY cost cutting, it inevitably comes down to social spending that bears the brunt of those cuts. And, I’m usually first in line to admit that while some of it is necessary, it must be done in a balanced way.

Over the past few months, the American Association of Retired Persons (AARP)—I’ve been a member for over 23-years—has sent me no less than six URGENT notices telling me that our beloved U. S. Congress is going to cut my Social Security benefits… by a LOT.

As important as Social Security has become, it takes only a modicum of common sense for even the densest of us to realize that some programmatic changes to both Social Security and Medicare are necessary and coming whether we oldies like it or not.

I’ll deal with Medicare in a later post; this one’s about proposed cuts in Social Security benefits. Some are imperative, but others are NOT. So we need to pay closer attention to STUFF coming from Congress.

For the record, I collect Social Security benefits, but they’re NOT my sole means of retirement income. I also receive monthly benefits from a vested pension (as opposed to a 401K), as well as income from some private investments.

On the other hand, there is no shortage of seniors who depend 100% on their monthly Social Security benefits for their financial sustenance. And with the average benefit at $1,230 a month, these folks are fully justified in their concerns.

AARP has sounded the alarm that benefits are going to take drastic hits. Click here to see how much yours will be “reduced.” But keep in mind that AARP does NOT explain their calculating methodology. I’m suspicious!

As well, the media is playing it up for all it’s worth, and the politicians, both LEFT and RIGHT, have raised political ambiguity to a whole new level.

Congress wants to switch FROM the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) TO the Chained Consumer Price Index for All Urban Consumers (C-CPI-U).

This does NOT mean that Congress is threatening to reduce our monthly benefits directly. Nor does it mean that we’ll no longer receive COLA increases; we will. It’s just that they’ll be smaller percentage increases.

The questions are by how much our COLA’s will decrease and will it actually save the federal government any real money. The answer is that NOBODY actually has a clue!

Congress, at best, when it comes to “estimates,” can’t do any better than a WAG (a WILD ASS GUESS) and AARP goes catatonic involving any hint of revising the way we deal with Social Security. All the while, the press milks the controversy for all it’s worth simply to increase reader/listenership.

According to one of MY U. S. Senators, Delaware’s Tom Carper (D), this change would “reduce the average annual COLA increase by about 0.25% (25-one hundreds of 1%) and will save the federal government about $300-BILLION over 10-years.”

But according to other government sources, including the Congressional Budget Office (CBO), the reduction in COLA percentage increases will be less than 1%, but they’re far less specific than Carper is.

And as far as a 10-year savings to the federal government, it would not come close to Carper’s $300-BILLION. A number of “estimates” dominate the preponderance, but they seem to settle around the $130-BILLION mark over 10-years.

Whenever the United States Congress “estimates” expenses and revenues, ordinary shirtsleeve Americans should immediately move to protect their anal openings because there isn’t enough lubricant on the planet to ease the pain.

The “estimates’ are all over the place; which leads me to believe that, at best, they’ve been RECTUM-GENERATED!

Here’s a list of the average CPI-W COLA increases since 1975. I began to collect benefits in 2003. So going from 2003 through 2012, my annual COLA increases have averaged 2.56%.

So, according to Senator Carper, had CHAINED CPI been in effect during those years, my average COLA increase would have been 2.31% instead of 2.56%. Seems hardly worth the effort!

But Carper’s savings estimate—if the savings are due entirely to a reduction in reduced COLA increases—is a BLARING wild ass guess! The math is so easy that grade-schoolers can do it.

If, by decreasing the COLA increases by 0.25%, the federal government saves $300-BILLION ($300,000,000,000) over 10-years, it means that instead of them having paid out $120.3-TRILLION ($120,300,000,000,000) over ten years, they will have paid out ONLY $120-TRILLION!

On a straight average basis, this means that the United States of America would be paying out over $12-TRILLION… per YEAR in Social Security benefits!

REALLY? Our current 2013 projected expenditures are $3.8-TRILLION and this INCLUDES Social Security payouts! And the other wild ass guesses that estimate a 10—year savings of “about” $130-BILLION are just as laugh-inducing.

I have no idea where this is going in Washing DC. The federal budget has historically been written with such blatant obfuscation that even the most astute CPAs in the country wouldn’t be able to trace ACTUAL expenditures. And they’ve done it INTENTIONALLY.

The U. S. Congress has become a millionaire’s CLUB completely overrun by multimillionaires with a few billionaires thrown in for good measure. They protect their own interests at all costs.

And a lot of hard-working Americans are going to get the shaft right up their poop-chutes without so much as a dab of lubricant… not even an occasional reach-around or a cursory smooch on the backs of their necks.

But as Dick Cavett put it ever so succinctly; “As long as people accept crap, it will remain profitably feasible to generate it.”

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