By Representative John Garamendi (CA-3)
This Congress, I introduced the Fair COLA for Seniors Act (H.R. 1553), to ensure that your Social Security payment keeps pace with your cost of living. This bill would change the current ineffective price index used to calculate Social Security’s cost-of-living adjustment (COLA) to one tailored around the lives and needs of seniors. This index, the Consumer Price Index for the Elderly (CPI-E), accurately reflects how seniors spend their money, with a focus on healthcare and housing. It is a common-sense proposal that will allow for benefits to keep up with costs.
Sadly, Social Security benefits and cost-of-living adjustments specifically, have not kept up with inflation in recent years. The Senior Citizens League has estimated that the 2021 COLA will be just 1.3%., the second lowest in its history. This comes as our nation grapples with a once-in-a-century pandemic and seniors are relying on their Social Security benefits to get by more than ever before.
COLAs are calculated using the Consumer Price Index for Urban Wage Earners (CPI-W). This simply does not make sense for seniors. This method of calculation considers spending habits of younger workers who are more likely to spend their dollars on electronic devices and consumer goods. Seniors are more likely to spend money on medical services and housing expenses. The prices of these items rise significantly higher than what the CPI-W calculates.
According to the Senior Citizens League, recipients of Social Security have seen a 30 percent decrease in their buying power since 2000. Additionally, seniors who are enrolled in Medicare Part B programs or own homes have faced particularly large cost increases. This is because COLAs have not kept up with the increase in seniors’ expenses and it is simply unacceptable. This needs to change.
Americans everywhere agree: Social Security is not an entitlement; it is a benefit that seniors earn through decades of work. According to the Social Security Administration, approximately 65 million Americans received Social Security benefits in 2020 and of those 65 million, 72 percent were retired workers and dependents.
It is unfair and unjust to expect American seniors to settle for a COLA that is less than what they have spent their entire lives working for, especially when America’s seniors have to account for new expenses to keep them safe during the COVID-19 pandemic. This is why it is critical to base COLAs on an index that reflects what seniors actually spend their money on. It is time for Congress to take action and give our nation’s seniors what they deserve.
Opinions expressed in “Congressional Corner” reflect the views of the writer and are not necessarily those of TSCL.