By Helen Donovan
The Cost of Living (COLA) goes up every year, but you’ve had no increase in Social Security(SS) income since 2014 thanks to Republican President Ronald Reagan who changed the COLA formula affecting 66 million SS recipients today. But at last, you’re going to get a 2% raise.
Let’s say your SS income is $1,500 a month and your increase per month is $30. But when you get your New Benefit Amount statement from the Social Security Administration effective in 2018, your increase is $5 a month. What happened?
The premium for Part B medical insurance spiked in 2018, not a few dollars but by $25, going from $109 to $134. The $134 is automatically deducted every month from your check by Social Security Administration for Medicare, leaving you $5. Your monthly income now is $1,505. (Higher earners pay a higher Part B premium.).
About 42 percent of SS recipients will pay the $25 increase, according to the Chicago Tribune’s “Ask Kim.” The hold harmless provision that protects COLA adjustments from being consumed by insurance premium increases did not apply because $25 is lower than your $30 raise. The fear is that this situation could repeat itself indefinitely in the future.
The attack on SS recipients denies the humanity and the economic concepts upon which the Social Security system is based and ignores the economic benefit for everyone. Except for the wealthy, people on SS must spend their money to live a decent life, so when millions of people go shopping their money goes back into the economy, contributing directly to the Gross Domestic Product and helps maintain a healthy economy.
Instead, radical Republicans and Ayn Rand fans Paul Ryan and Ted Cruz are doing the opposite. If Congress passes their proposed legislation to privatize Social Security, freeze COLA raises and slash the funding for Medicare, millions more Americans will be forced into poverty, weakening our economy.
The Trump Republican Administration’s tax plan gave nearly $1.5 trillion in tax breaks over the next ten years according to Eyewitness News. More millions or billions of dollars continue to feed the profit-making greed of healthcare insurance companies, the pharmaceutical industry, the members of the American Hospital Association and American Medical Association. This greedy group contributes millions to political campaigns and pays lobbyists high salaries to effect favorable legislation which perpetuates their control of the bottom 90% of American families’ healthcare, now making less than half of the country’s income, according to CNN Money.
But Warren Buffett said it best when he described the “blooming” healthcare cost was like a hungry “tapeworm” on the economy when he, Jeff Bezos of Amazon and Jamie Dimon of JPMorgan Chase announced on January 30, 2018, that they have formed a new company. According to StreetInsider.com, the company will be “free from profit-making incentives and its initial focus [initially] on technology solutions that will provide their U.S. employees and their families high quality and transparent healthcare at a reasonable cost” and “that potentially may be rolled out to all Americans.”
Currently, healthcare consumes 17% of the Gross Domestic Product and is projected to reach 20% in 2025 by CMS.gov. Left unchecked, the obese tapeworm will eat up the purchasing power of millions, thereby threatening the life of domestic markets. Perhaps the nonprofit company headed by Mr. Bezos, Mr. Buffitt, Mr. Dimon and their excellent staffs will starve the tapeworm by significantly reducing healthcare costs that will increase individuals’ purchasing power and result in the capitalists’ domestic markets to flourish in a strong economy for everyone. We’ll see.
© 2018 Helen Donovan. All rights reserved
Helen is retired from Prevent Child Abuse, a national organization, where she served as Director of Publications. She founded Arts Unlimited, a nonprofit organization that provided live performance from music to magic on site for seniors and folks with disabilities. She is recipient of the United Way, City of Chicago Heart of Gold Volunteer Award and is author of the What Goes Around. She is a member of the Authors Guild, Chicago Writers Association, and American Contract Bridge League.