— In his State of the Union address, President Obama said we must “restore the basic bargain that built this country…,” which I interpret to mean preserving and strengthening our retirement and health security programs.
Recent polls show that most Americans agree with sensible reforms including allowing Medicare to negotiate lower drug prices, allowing safe drug re-importation in Part D and lifting the payroll tax cap in Social Security. These strategies would save money without cutting benefits.
But proposals to expand means-testing for Medicare and proposals to cut annual cost of living adjustments with the “Chained CPI” as the president proposed earlier, certainly break his promise not to damage a secure retirement.
The COLA change amounts to a loss of $130 per year in benefits, a loss that will grow to a $1,400 later on, especially important for those many low-income elders who depend on Social Security.
That is money that would likely be spent in Main Street businesses. It’s time for the President and Congress to realize that cutting already modest Social Security and Medicare benefits is not a path to a strong economy.