He's No FDR

(Editorial cartoon by Mike Luckovich and published in the Atlanta Journal Constitution 4/12/13.  Click on image to enlarge and then get back here.)

Michael Hiltzig reminds us that it is a Democratic president who is willing to lower Social Security benefits by using the chained CPI method in order to cut the deficit, even after the discovery that the whole "austerity" idea is based on a deliberately false study.

Washington's tug of war over the federal budget has many wonders, but the biggest one of all must be the lengths to which politicians and pundits will go to deprive Granny and Grandpa of $30 a month.

That's the amount by which benefits for the average Social Security retiree would be reduced by 2023 under a provision in President Obama's new budget. It might not sound like much to the president or fans of the proposal in both parties and the Washington commentariat. For the retiree trying to stretch an average monthly check of about $1,200 to cover housing, healthcare and every other necessity under the sun, it looms rather larger.

The idea that Social Security benefits should be on the table in budget talks arises from the fear that America's national debt, driven by its budget deficit, is growing to the point that it will push us over the economic brink.

Here's the tragedy of it: That fear is based on junk economics. ...

Front and center among his proposed deficit-reduction tools were changes to Medicare and Social Security. The former involved increasing premiums paid by higher-income seniors. The centerpiece of his Social Security rollback was a change in the index for cost-of-living increases from the traditional consumer price index to the "chained" CPI.

If you've been following the Washington debate, you know that the uncanny popularity of the chained CPI as a deficit nostrum lies in its supposed "accuracy." The idea is that it incorporates certain changes people make in their purchasing behavior when prices rise — when apples go up in price, they buy bananas instead. Therefore it typically yields a lower inflation number.

What you may not know is that these behavioral changes are very hard to track and the conclusions applied by the index-makers often conjectural. (What if you like apples but not bananas?) Experts also debate whether consumers respond to absolute price changes or relative price changes — if hamburger is cheaper than steak but its price rises faster, people may actually buy more steak. And under many circumstances people may not have a choice: If gasoline goes up, you may not have the option to take the bus to work instead. ...

It's rare for bad research, bad economics and bad politics to come together to produce something so just plain bad. And it's sad that Obama proposed a budget that undermined his credibility with the progressives who should be providing him with his firmest support, and even gave some Republicans the latitude to attack him from the left, as someone willing to balance his budget on the backs of the elderly. Who would have thought that Barack Obama, of all people, would be going for the title of Democratic president least likely to be mistaken for Franklin Roosevelt?   [Emphasis added]

FDR?  Hell!  Obama wouldn't even be mistaken for Dwight Eisenhower.  What is so galling about the president's position is that he continues to offer to cut the programs for the elders and the poor even after the disclosure that the study allegedly forming the basis for cutting the budget has been shown to be based on errors, presumably intentional errors.

I can only assume that he wants to grind the poor and the elders, that he's on the same side as the GOP in that regard, and that he serves someone other than the 99% of us.  He's aiming for a Grand Bargain, but it's not for our benefit.