President Barack Obama’s new budget proposal, due out March 4, will not include measures to limit annual growth in Social Security benefits, according to Fox News. The cuts, which were part of last year’s proposal from the White House, would have required a shift to what is often called “chained CPI.”
Chained CPI is an alternative way to measure cost-of-living increases based on the widely used consumer price index.
CNN reports that many economists believe chained CPI is a more accurate way to measure inflation because it makes better allowances for consumer behavior. For instance, if the price of chicken were to go up, chained CPI rules assume that consumers would not continue to buy chicken; instead, they would likely find a lower-cost alternative.
The news was good news for Democrats who had been overwhelmingly opposed to the idea. Many feared a switch to chained CPI would hurt vulnerable members of their constituency.
“Middle-class Americans need retirement security they can depend on, and that starts with keeping Social Security’s promises,” Sen. Jeff Merkley, D-Ore., was quoted as saying in a New York Times story.
Republicans cited the move as proof that the president was backtracking on previous promises to address looming fiscal concerns for the nation.
House Speaker John Boehner’s spokesman Brendan Buck was on the offensive.
“This reaffirms what has become all too apparent: the president has no interest in doing anything, even modest, to address our looming debt crisis,” he said. “With three years left in office, it seems the president is already throwing in the towel.”
Officials at the White House fired back that Republicans had also not made good on some of their promises.
“There was a point in time when there was a little bit more optimism about the willingness of Republicans to budge on closing some tax loopholes,” said Josh Earnest, a deputy press secretary in the administration. “But over the course of the last year, they’ve refused to do that.”
That rhetoric aside, officials at the White House signaled there could still be an opportunity to reach a bargain. According to CNN, one official said chained CPI could still be "on the table” if Republicans, once again, became willing to look at closing tax loopholes for wealthy Americans.
With mid-term elections looming this year, most believe no progress will be made on this, or any other, major issue.