Former Treasury Department economist David Bernstein has a new blog, Policy Memos, and his first post is on the use of the chained CPI for Social Security COLAs. He concludes:
“The decision by the Obama Administration to include a permanent change to the Social Security COLA as part of an annual budget exercise is a really large concession. The change in the COLA is sensible fiscal policy but it will increase poverty among elderly Americans and will not protect the Social Security system from demands for future cuts.”
But read the whole blog post to see why.