I do almost zero editing of comments but if I see them, I’ll typically disallow ad hominem arguments. It’s fine to say, “Congressman X’s idea is lousy because of Y.” But not “Congressman X is a jerk.”
Prof. Bernstein, I am a long time admirer of you for your thoughtful discussions (on and Off TV).
I am inclined to take issue with your statement that chained CPI is a better measure of inflation, since it is more accurate. My issue is as I understand it, it is a recipe for ‘race to the bottom’ for seniors especially those that depend to a large part on SS as their main source of income.
My rationale goes like this: so today they (seniors) switch from steak to chicken; now they will get a lower benefit, which in turn will result in their switch to not eating meat, but only beans for protein. They would be forced to do this since they were making a choice between other costs (health, communication charges – Telephone, internet, cable TV, etc.)..eventually they will be eating less and less…..you get my point.
The fact is that the seniors need a NEW index (which should not be chained)…chaining is a sneaky way to lower benefits. The new index should accurately reflect the basket of spending of seniors.
PS: you allude to this as your point 4…but my issue is with the very notion of chaining. It is sneaky and complicated for an average American to understand.
Good point re complicated, but the current weighting scheme is no simpler–we just don’t talk much about it. I’ll try to do a post on it. But there is an important point here that is also complicated and often confused. Since everyone, and I mean everyone, uses the steak/chicken eg, it always sounds like the chain wted price index is a tricky way to ignore price changes that actually make you worse off. But it’s just as likely to work the other way…the price of chicken rises relative to steak so you switch to the (more desirable, and now relatively cheaper) steak. Chain weighting is just a way of capturing substitutions induced by relative price changes and you’re just as likely to substitute up as down.
Prof. you have got to be kidding. In theory you may have a point, but do you really believe that chained CPI is anything but a sneaky way of cutting seniors’ benefits. The biggest problem with this debate over social security is that the ‘elite’ are trying to fix a problem which should not be fixed as part of the deficit debacle. SS DOES NOT contribute to the deficit.
The politicians need to be honest and do not have the GUTS to tell people the truth; which is we do not want to cut defense and the tax breaks to the corporations and the rich…so we are going to cut SS and medicare.
The democratic party WILL pay a big price for this perfidy! As for Pres. Obama, he has decided to screw the people that re-elected him…he could care less!!!
What we need to use is the CPIE. Focuses on elderly people’s real costs. However, the problem with this whole debate over so called entitlements is that it is not honest. The left wants to fix the long term funding problem; while the Ryan budget showed clearly that the right wishes to end these socialized programs. But then they act like they don’t. Which is a false hood.
It boils down to social darwinism vs the New Deal. It is like the 401K scam that everyone fell for! A funded defined benefit pension was a great invention. The 401K is social darwinism and is a foolish idea unless your a CEO. I am proud to be living in CA. where all the bad, dishonest, Republican Ideas were held at bay for the most part. And I have a defined benefit until I die. I recommend workers to fight back against capital and reclaim their rights. Or they will all be eating cat food!
As for the structural deficit: Krugman says it is only 2 percent of GDP. Has a good post up today. This fiscal crisis is much ado about nothing.
R. Nemo good post. Frankly we have a vicious circle where money buys politics and politics pays back all at the expense of the 98% who find it very difficult to break this cycle. Any ides??
Maybe we can stipulate instead of engaging in (worthless) ad hominen attacks? The odds of the attack being correct are so high, it’s a waste of time to engage in such as attack.
Less facetiously, if I’m wrong, the nation wouldn’t be in the situation it is.
But what if Congressman X IS a jerk? Then it’s a statement of fact.
Hmmm…then I guess you should call his/her office and let them know…we won’t post it here.
I agree. Stick to civil critiques.
Prof. Bernstein, I am a long time admirer of you for your thoughtful discussions (on and Off TV).
I am inclined to take issue with your statement that chained CPI is a better measure of inflation, since it is more accurate. My issue is as I understand it, it is a recipe for ‘race to the bottom’ for seniors especially those that depend to a large part on SS as their main source of income.
My rationale goes like this: so today they (seniors) switch from steak to chicken; now they will get a lower benefit, which in turn will result in their switch to not eating meat, but only beans for protein. They would be forced to do this since they were making a choice between other costs (health, communication charges – Telephone, internet, cable TV, etc.)..eventually they will be eating less and less…..you get my point.
The fact is that the seniors need a NEW index (which should not be chained)…chaining is a sneaky way to lower benefits. The new index should accurately reflect the basket of spending of seniors.
PS: you allude to this as your point 4…but my issue is with the very notion of chaining. It is sneaky and complicated for an average American to understand.
Good point re complicated, but the current weighting scheme is no simpler–we just don’t talk much about it. I’ll try to do a post on it. But there is an important point here that is also complicated and often confused. Since everyone, and I mean everyone, uses the steak/chicken eg, it always sounds like the chain wted price index is a tricky way to ignore price changes that actually make you worse off. But it’s just as likely to work the other way…the price of chicken rises relative to steak so you switch to the (more desirable, and now relatively cheaper) steak. Chain weighting is just a way of capturing substitutions induced by relative price changes and you’re just as likely to substitute up as down.
Prof. you have got to be kidding. In theory you may have a point, but do you really believe that chained CPI is anything but a sneaky way of cutting seniors’ benefits. The biggest problem with this debate over social security is that the ‘elite’ are trying to fix a problem which should not be fixed as part of the deficit debacle. SS DOES NOT contribute to the deficit.
The politicians need to be honest and do not have the GUTS to tell people the truth; which is we do not want to cut defense and the tax breaks to the corporations and the rich…so we are going to cut SS and medicare.
The democratic party WILL pay a big price for this perfidy! As for Pres. Obama, he has decided to screw the people that re-elected him…he could care less!!!
What we need to use is the CPIE. Focuses on elderly people’s real costs. However, the problem with this whole debate over so called entitlements is that it is not honest. The left wants to fix the long term funding problem; while the Ryan budget showed clearly that the right wishes to end these socialized programs. But then they act like they don’t. Which is a false hood.
It boils down to social darwinism vs the New Deal. It is like the 401K scam that everyone fell for! A funded defined benefit pension was a great invention. The 401K is social darwinism and is a foolish idea unless your a CEO. I am proud to be living in CA. where all the bad, dishonest, Republican Ideas were held at bay for the most part. And I have a defined benefit until I die. I recommend workers to fight back against capital and reclaim their rights. Or they will all be eating cat food!
As for the structural deficit: Krugman says it is only 2 percent of GDP. Has a good post up today. This fiscal crisis is much ado about nothing.
R. Nemo good post. Frankly we have a vicious circle where money buys politics and politics pays back all at the expense of the 98% who find it very difficult to break this cycle. Any ides??
Maybe we can stipulate instead of engaging in (worthless) ad hominen attacks? The odds of the attack being correct are so high, it’s a waste of time to engage in such as attack.
Less facetiously, if I’m wrong, the nation wouldn’t be in the situation it is.