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As Rumors of 'Grand Bargain' Cuts to Medicare Swirl, Progressives in Congress Say No Way

Progressive caucus leader: Medicare, Medicaid and Social Security shouldn't be cut.

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There are lots of slightly different variations of the CPI, and liberals fear the final deal will shift from the current measure — called the CPI-W — to a different measure called the chained CPI. Many economists agree the CPI-W  overstates inflation, so some people want to change that formula, which would save Social Security money. The chained CPI has emerged as the most likely replacement. It assumes that beneficiaries will change the goods they purchase as prices change (e.g. if chicken prices go up, they’ll buy more beef), but liberals and some economists say that this change  isn’t fair to Social Security beneficiaries. They warn that it represents a devastating cut to monthly checks and that it’s not practical to assume that seniors will adjust to cuts by constantly altering their spending habits to response to subtle price variations.

Alex Lawson, executive director of Social Security Works, an advocacy group that works to protect social safety programs, told Salon the chained CPA is “unacceptable.”

“The chained CPI would cut significantly the benefits of all current and future Social Security beneficiaries, including retired and disabled veterans, even after politicians promised repeatedly that any changes to Social Security would not affect current beneficiaries,” the group warns in  a fact sheet. Veteran benefits are calculated used the Social Security Administration’s COLA measure.

That said, it’s entirely possible that a grand bargain remains out of reach, but that Democrats were happy to have Politico run a story showing their willingness to make serious entitlement cuts. When the deal falls apart, they can boast that they made a good faith effort to work with Republicans, despite the protestations of their base.

Indeed, House Speaker John Boehner just told reporters that “ no substantive progress” had been made in fiscal cliff talks, despite the story.

In this, perhaps conspiratorial scenario, the $400 billion trial balloon would be designed precisely to elicit angry liberal responses such as those above, so as to make Democrats seem at once more reasonable and less able to make a GOP-favored deal. It should be state that there is zero evidence supporting this notion and there’s plenty of evidence to suggest that Obama really does want to cut entitlements, but planting the story would be classic “triangulation” — and Obama seems to understand how to play this game a lot better than he did during last year’s budget talks.

 

 
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