WASHINGTON, Sept. 2 /PRNewswire-USNewswire/ -- Millions of seniors will receive smaller Social Security checks next year, and none of the 37 million seniors who receive Social Security will get an increase, according to an August forecast from the Congressional Budget Office (CBO). The CBO is also forecasting a zero COLA for 2011.
In June, The Senior Citizens League (TSCL) became the first national group to call for an Emergency COLA for 2010. Since then, Sen. Bernie Sanders (I-VT) announced plans to introduce an Emergency COLA bill, expected later this month.
Next year would mark the first time since automatic Cost of Living Adjustments (COLA) went into effect in 1975 that seniors would fail to get an increase. Since automatic raises were established, seniors have never failed to receive an annual increase of less than 1.3 percent.
Millions of seniors will receive cuts due to the soaring costs of prescription drug plans, which many beneficiaries have automatically deducted from Social Security checks.
"Just as more seniors than ever before are slipping into poverty and filing bankruptcy, the government thinks it's acceptable to eliminate COLAs and cut benefits," said Daniel O'Connell, chairman of The Senior Citizens League. "We wholeheartedly support any effort in Congress that would provide seniors with an Emergency COLA next year."
Almost 70 percent of beneficiaries depend on Social Security for 50 percent or more of their income. Social Security is the sole source of income for 15 percent of beneficiaries.
See "Night in America," our latest video about seniors at risk, at www.YouTube.com/SeniorCitizensLeague.
Proponents of a zero COLA argue for its fairness in a deflationary period. But they do not mention that the way the COLA is calculated does not accurately track senior costs. TSCL supports a change in the Consumer Price Index (CPI) used to determine the COLA.
The government currently calculates the COLA based on the CPI for Urban Wage Earners and Clerical Workers (CPI-W), a slow-rising index that tracks the spending habits of younger workers who don't spend as much of their income on health expenditures.
However, the government does track the spending patterns of older Americans, and has done so since 1983 with the CPI for Elderly Consumers, or CPI-E. By tying the annual increase in the COLA to the CPI-E, seniors would see much needed relief in their monthly checks. For example, a senior who retired with a monthly benefit of $676 in 1984 would have received $17,596 more throughout their retirement with the CPI-E.
TSCL supports two CPI-E bills in the current Congress: H.R. 2429 and H.R. 2365, as well as any impending Emergency COLA legislation.
With 1.2 million supporters, The Senior Citizens League (www.SeniorsLeague.org) is one of the nation's largest nonpartisan seniors groups. TSCL is a proud affiliate of The Retired Enlisted Association.
|SOURCE The Senior Citizens League|
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