Municipal Government

100 Protest Proposed “Chained CPI” Cuts to Social Security

July 8, 2013
By Steven Wishnia

About 100 people picketed July 2 outside the Midtown offices of Senators Charles Schumer and Kirsten Gillibrand to protest proposed cuts in Social Security payments. “It’s inadequate as it already is. We don’t want them to cut it any more,” said Joan Boyle, 73, of Manhattan, who works part-time to supplement her Social Security income.

The event was part of a national day of protest against the “chained CPI,” the Obama administration’s proposed formula to reduce Social Security cost-of-living increases as part of a “grand bargain” with Republicans on the federal budget for fiscal 2014. It was one of more than 100 such demonstrations nationwide, including seven in New York State, organized by the Alliance for Retired Americans and various labor unions.

“It’s disturbing that it’s even on the table,” said Nancy True, director of the retirees division of Teamsters Local 237 and a regional director for the Alliance for Retired Americans.

“Chained CPI” is based on a twisted bit of logic. Cost-of-living increases are given so people’s incomes can keep up with higher prices: If the New York City subway fare were raised from $2.50 to $2.75, they would get a 10 percent increase so they could still ride. The idea behind “chained CPI” is that people shouldn’t get such a big increase because they buy less when prices go up: If a 10-percent fare hike made them stay home or walk more often, then they shouldn’t get a 10 percent increase.

The result would be significant cuts to people’s Social Security, especially as they live longer. The Alliance for Retired Americans estimates that chained CPI would reduce the amount of benefits collected by an average person retiring at 65 by more than $6,000 by the time they turned 80.

Chained CPI, True adds, also doesn’t take into account that older people spend much more money on health care, where costs have been going much faster than the overall rate of inflation.

The demonstration was a “friendly event,” she emphasized, as both senators have opposed the proposed cuts, and “Gillibrand in particular has been very good.” Gillibrand was one of 21 senators who cosponsored an April resolution opposing chained CPI; Schumer was not.

“We’re just here on them to keep doing the right thing,” said Mark Hannay, head of the Metro New York Health Care for All Campaign. But they could be more outspoken on the issue, he added, as “they’re not championing it yet.”

Several protesters noted that neither senator sent a representative to meet them.

July 7, 2013

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