The Social Security Administration estimates that a proposal floated by the Obama administration would put 245,000 people into poverty, according to an analysis released by liberal senator Bernie Sanders (I-Vt.) on Saturday.
That level of impact would be felt by 2050 if a proposal to change the way inflation is measured is adopted, Sanders announced. The change to the way SSA would calculate the Consumer Price Index has been floated in debt ceiling talks between Congress and the White House. The White House has suggested revising CPI for both the tax code, in order to generate more revenue, and for benefits.
Social Security Administration’s Office of Retirement Policy estimated that by 2030, according to the report prepared for Sanders, there would be 173,400 more people living in poverty in the United States.
Benefits for those who are 80-89 would drop by $960 a year. Benefits for women would fall by 3.5 percent overall while men’s benefits would drop by 2.9 percent.
By 2050, seniors in the 80-89 age bracket would see benefits fall by $1,200 a year.
"I am especially disturbed that the president is considering cuts in Social Security after he campaigned against cuts in 2008," Sanders said. "The American people expect the president to keep his word."
This week Sanders demanded that Senate Majority Leader Harry Reid (D-Nev.) join House Minority Leader Nancy Pelosi (D-Calif.) in flatly ruling out any benefit cuts to Social Security as part of the debt deal.
Reid in the past has said Social Security does not need to be reformed for decades. While Social Security is expected to be unable to pay full benefits by 2036, it is not a major driver of the budget deficit. Republicans want the program reformed now because they fear otherwise that as 2036 approaches massive tax hikes that could stall the economy would be demanded by senior citizens.