The push for Congress to enact another $250 cash payment to seniors has generated substantial opposition. The prevailing view, voiced widely on the Internet in blogs and comments on news stories, is that seniors already have protection from price inflation and don't merit further special help, particularly when most Americans are financially strapped and the nation is running horrendous budget deficits.
Social Security Makes the Call: No 2010 COLA.]
The impetus for the payment comes from the lack of consumer price inflation, which last week prompted the Social Security Administration to forgo a cost of living adjustment next year for Social Security recipients—the first time no COLA has been levied since the adjustments first were enacted in 1975. Last year, by contrast, the spike in oil prices contributed to a 5.8 percent COLA for 2009, which was the largest since 1982. As many people noted, that adjustment created a permanently higher floor for payments that will continue to provide protection to Social Security recipients.
Despite the absence of general inflation, medical prices have continued to rise and seniors spend large percentages of their incomes on healthcare. Further, bonds and certificates of deposits—conservative investments appropriate for most older Americans—are earning little or no money. This is because interest rates are near zero, courtesy of Federal Reserve Board policies to counteract the recession and provide what amounts to free funds to a still-shaky banking industry.
But while many seniors clearly could use some extra money, it's also clear that many don't need the funds. Further, while some opposition runs predictably along partisan party lines, much of it does not. Reader comment boards on many news sites are filled with concerns from seniors themselves. While they would enjoy more money, many people say, they just can't justify the payment.
To be sure, a lot of people are frustrated and angry at the huge payments that Washington has been making to bail out big financial institutions. With AIG , the big failed insurance and financial-services company, having received $180 billion in public funds, some posts noted, it's tough to fault paying $13 billion (the total cost of the $250 payment) directly to the people.
Is Retirement Really a Fading Goal?]
Over the weekend, message boards at many news sites were full of comments about the payments issue. These comments, pulled from
The Washington Post's website, are typical:
There should be an income eligibility limit for seniors to receive the $250. Many seniors collect Social Security and a comfortable pension. So, they cavalierly dismiss the $250 simply because it makes them sound righteous, but actually they are very comfortable on their incomes that allow them to drive big cars and trucks and winter at their condo in the South every year or cruise the country in their big motor home. How about the poor seniors who have to live on $1,000 or $1,200 per month. Could you do it? The $250 one-time payment is a big help to those who struggle.I am a senior who receives Social Security benefits and I oppose the $250 increase. Last year we received a 5.8 percent increase mostly because of higher gasoline prices, which most of us are not affected by. We had an increase in real purchasing power. This year gasoline prices fell so our purchasing power stays pretty much the same. Let's not be greedy. There are more deserving citizens than us. It is time to stop worrying about what we 'deserve' and start worrying about what we're doing to future generations who must bear the burden of this debt and endure the inevitable consequences of our irresponsible profligacy with other peoples' money. It is time to stop pretending we're being some sort of philanthropists when we steal money from our own children and grandchildren to pay for social programs designed to benefit us and our generationEither the cost of living increase formula works or it doesn't. If it does, then why do seniors deserve extra money, and if it doesn't, then shouldn't we be fixing the problem?I am a senior and I have no problem with Social Security payments being the same for next year. We have a good system that ensures that Social Security keeps up with the COLA. The formula worked in our favor last year and no one complained. This year it does not work in our favor but it is fair. I doubt that $250 is going to make much of a difference in people's lives. Stick with the rules.What seniors need is not money. It is health care, medicine, food, lodging, and transportation. Make those things affordable please.A means test of $30,000 in yearly income should [determine] who gets a COLA. . . .I'm a senior citizen and I'll take Obama's $250 if he throws it at me, but it is totally unwarranted. The Social Security regulations are clear: No inflation, no increase in Social Security payouts.Seniors are much better off than those who have lost their jobs and, with them, insurance for themselves and their families. Giving them money (taken in many cases from those who already have a hard time making it) to offset the present minimal level of inflation, when others have nothing, is absurd and morally offensive.The cost of living changes will be different for the elderly than, say, teenagers and young adults in their 20s. Set up an 'old folks inflation index,' being sure to include medical costs. . . .
[See 6 Money Lessons of the Great Recession.]