Quote of the day

Economist Dean Baker on the Gang of Six and their plans to cut Social Security:

The elderly cost of living index that shows they experience a higher rate of inflation is an experimental index, not a full price index like the other indexes calculated by BLS. However, it could be a full index if the Gang of Six and the rest of Congress wanted it to be. In other words, if the Gang of Six is really interested in a more accurate cost of living adjustment for Social Security, they can propose legislation that would direct BLS to construct a full elderly index. This would let them know whether it is necessary to raise, lower, or leave along the annual cost of living adjustment, to ensure that Social Security checks keep pace with the cost of living.

However the Gang of Six shows no interest in going this route. The only possible conclusion is that the Gang of Six is scared of what a full elderly index might show. In short, the gang of six is scared of the information. They obviously have made the decision to cut Social Security and they are not going to let evidence stand in the way.

3 thoughts on “Quote of the day

  1. Sen. Kent Conrad prides himself on being an economics and budget hawk wonk. He knows damn well what marginal utility* means and how it affects the poor, including those living solely on SocSec.

    Today on Market Watch, when asked if the Gang of Six’s plan unfairly hit those who have the lowest incomes, he said no, that the pain had to be shared and it’s “only” .3% (point three per cent). (Not exact words, btw)

    He freakin’ well knows that .3% is precious to somone living only on SocSec and it is not even a rounding error for someone in his income bracket.

    Our DC Dems are too damn removed from the people they represent.

    We MUST have a party of the people. We MUST drop, never again support or vote for these Corporatist Dems.

    Call this guy, burn up his phones.

    Kent Conrad: 202 224-2043

    Same for Mark Warner: 202 224-2023

    Same for Dick Durbin: 202 224-2152

    Senate Directory: Main # 202 224-3121

    Call your own senators, especially Dems, but Repubs as well.

    I’d suggest being nicely rational, but closing with something along the lines of “I will never vote for Democrats who (financially, if you wish) gang rape the neediest among us.”

    They probably don’t even know anyone who can’t afford air conditioning during these heat waves! They probably have no concept of running out of money before the end of the month.

    Tell them how thankful you are that people like them were not in charge of the Democratic Party when FDR and LBJ were trying to implement the great social safety nets we the people of the United States depend on, that if they and Obama had been in charge we would never have had the once vibrant middle class the programs of the Progressive Era, the New Deal, and the Great Society led to. We would not have SocSec or Medicare and Medicaid.

    Toss in the idea (from Susie’s post on Dean Baker) of an elderly cost of living measure — point out it’s obvious they are using the Chained CPI not because it is the best measurement, but because it results in cuts to the millions of SocSec pensioners, veterans’ pensions, leads to tax bracket creep, etc.

    Tell them we get what they’re doing and they can’t fool us on this.

    For more good talking points, go to this David Dayen post of FDL with a video of Rep. Pete DeFazio pointing out the problems of the Chained CPI. The fact someone earning $20,000 will get a 14% tax increase is insane.

    Tell them that if we want Reagan style government, we don’t vote for any Dems — we go to the source–Republicans. But we do NOT want Reagan II in the WH or Bush III; we want people who represent us, from the Democratic Wing of the Democratic Party.

    If those kinds of Dems no longer exist, we WANT A NEW PARTY. We WILL BUILD a new party.

    *Marginal Utility from Wikipedia:

    In economics, the marginal utility of a good or service is the utility gained (or lost) from an increase (or decrease) in the consumption of that good or service. Economists sometimes speak of a law of diminishing marginal utility, meaning that the first unit of consumption of a good or service yields more utility than the second and subsequent units.

    In real world terms, the first and last dollar of the poor is of great utiity to the poor — of far greater utility to the poor or low income person than to the wealthy. If someone earns $15,000 a year, that person knows where their last dollar goes, and it’s importance. It may mean buying or foregoing a prescription, using or foregoing air conditioning and heat, having food of high nutritional value or not…or not having enough food at all.

    For someone earning, oh, $150,000, a dollar has value, but nowhere near as much as it does for the person earning one tenth of that amount. For the more well off person, a dollar is…chump change. Not even a rounding error. It’s, oh, like .3%.

    NPR covered a longterm unemployed man who had been earning in the 6 figures. He finally got a temp job as a telephone rep, which he was now losing. He was taking time and using gas money to drive to his bank to contest an improper charge of just over $8 ($8.63 sticks in my mind). He said that when he had his job, he would never have bothered to contest such a small amount, but now it meant a lot to his budget.

    That in a nutshell is marginal utility. And Conrad knows that very well; he just will not consider it when it gets in the way of his Corporatist inclination.

    Now, attempt to add DeFazio YouTube:

  2. OK– Called Conrad and Warner (whose office only wants to speak to Virginians–not just run of the mill Democrats).

    I chose to right now emphasize opposition to the Chained CPI and not voting for Dems who undermine SocSec and Medicare and Medicaid.

    People answering the phones are not too interested actually….

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