December 29, 2012

Regarding Ruth Marcus’s Dec. 26 op-ed column, “Chained CPI: A fairer measure of inflation”:

A “chained” consumer price index (CPI) is not “a fairer measure of inflation” but a measure of the behavioral response to inflation. Chicken is not beef. So, when beef prices went up and Ms. Marcus’s mother switched to chicken, the quality of Ms. Marcus’s life went down.

The original CPI tracks the changes in prices of a set of basic items, and those changes are a fair, true and accurate measure of inflation. Chained CPI instead tracks how people respond to that inflation, and using chained CPI to calculate Social Security benefits will lead to ever reduced quality of life over time. Yes, beef prices will go up, so we switch to chicken; then chicken prices will go up, so we end up eating bread.

F. Christian Thompson, Kingstowne

Thanks to Ruth Marcus for her clear statement on the proposed change in calculating the consumer price index.

The issue is not being mean to the aged and/or poor. The issue is that the methodology for making a critical determination that affects numerous government (at all levels) and private-sector funding decisions needs reforming. Indexing is an important tool, and we need to have it done right. That requires adjusting the methodology from time to time to reflect the realities of what constitutes the cost of living.

I am a liberal senior citizen who wants my government to do the best job it can to accurately carry out its mandates. We now have an inaccurate CPI measurement that has already cost billions in overpayments. Let’s support the president we just reelected in fixing it.

Penny Hansen, Washington

The conclusion that the chained consumer price index is a “fairer measure of inflation” for Social Security overlooks vital facts. Monthly Social Security benefits average only about $1,100 for disabled workers and $1,200 for retirees. For the overwhelming majority of beneficiaries with disabilities, benefits represent all or most of their income. Many retirees similarly rely on Social Security. In contrast, the Bureau of Labor Statistics calculates the chained CPI for all urban consumers, a group with far higher income than most Social Security beneficiaries earn.

The chained CPI shows a slower rise in inflation based on the idea that, when prices rise, urban consumers can buy a cheaper good instead of a more expensive good. But on a monthly budget of $1,100, most Social Security disability beneficiaries have already economized as much as possible. The more likely choice for them is between filling a prescription or buying groceries or paying a utility bill.

The chained CPI is less accurate for most Social Security and Supplemental Security Income beneficiaries and will disproportionately harm low- income Americans, including seniors and people with disabilities.

Marty Ford, Washington

The writer is public policy director at the Arc, which advocates for people with intellectual and developmental disabilities.