"The Congressional Budget Office (CBO) estimates that switching to the chained-CPI could save the government $208 billion over ten years by reducing Social Security, veterans and other benefits, and by increasing revenues. More than half of this amount – $112 billion – would come from Social Security alone."
http://strengthensocialsecurity.org/sites/default/files/CPI%20fact%20sheet%20with%20graphs%207-1-11%20FINAL.pdf So, back of the envelope: If Ryan's $404 billion cut would destroy 4.1 million jobs (says EPI, MoveOn, AFL-CIO), than cutting the COLA via the chained-CPI would destroy about two million jobs. Cutting military spending by $208 billion instead of using the chained-CPI would prevent 25.8% of that job loss (PERI-UMass); that is, cutting military spending by $208 billion instead of using the chained-CPI would save about 500,000 jobs, reducing the unemployment rate by about 0.3 percentage points against the use of the chained-CPI. >From the above SS fact sheet and the underlying CBO report: http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/120xx/doc12085/03-10-reducingthedeficit.pdf I get that of the $208 billion, $112 billion is Social Security, $145 billion is all federal benefits indexed to the CPI (including veterans' benefits, federal pensions, including military), so $33 billion is other federal benefits. That would appear to leave $63 billion in "increased revenues," i.e. increased taxation. But a lot of this ain't increased taxation on millionaires. Using the chained CPI would lower the standard deduction, disproportionately hitting people on the bottom by lowering the top of the 0% tax bracket. It would also lower the boundary for the earned income tax credit. Has anyone seen data/estimates on the tax incidence of using the chained CPI? -- Robert Naiman Policy Director Just Foreign Policy www.justforeignpolicy.org [email protected] _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
