Healthcare, Cutting Directly Into the Old and Poor

Social Security, as we all know, is a program which borrows from current workers, to provide relief to the elderly. In turn, those who contribute to this system receive Social Security benefits as well, when they reach the set legal qualifications. However, the problem pertaining to the current elderly generation is that the budget on Social Security is tightening, inevitably leading to cuts in the program. Currently, in order to reach a bipartisan agreement over the federal budget deficit, President Obama proposed "slowing the rate at which benefits increase over time."


However, with this proposition, comes many consequences, hitting the poor and old the hardest. Perhaps one of the largest problems of Social Security, the "inflation adjustment" is in correcting itself to the current index. Currently, recorded inflation deviates from the current index about "0.3 percentage point less each year," which is much more significant than it might seem. Over time, the culmination of this continuous compounding of lagging inflation adjustment add ups, creating quite the heavy burden on Social Security Beneficiaries. 

In order to combat this problem, some speculate that replacing the current C.P.I-W with C.P.I-U, the first is just your normal consumer price index while the second means chained consumer price index, would be the right move. The difference that C.P.I-U makes is that it would account for a fifth of the current system's shortcomings, and that it would therefore provide relief to more SS beneficiaries.

C.P.I-U not only would measure direct lines of products, and their resulting price and quantity sold fluctuations, but also encompass different product categories as well. For example, C.P.I-U would monitor pork as well as its alternative of beef, chicken, etc. Critics to this new method of measuring inflation argue that the goods and services that those on Social Security utilize are rather inelastic, that there is much less opportunity for substitution, and therefore the impact of C.P.I-U is negligible. After all, one is not going to substitute spinal surgery for a heart operation correct?

Through in through, perhaps C.P.I-U might just provide an edge for SS dependents, especially since the budget on SS itself is so tight. What do you think of this whole debacle? Do you support the implementation of C.P.I-U or not in regards to Social Security beneficiaries?