The switch to a more accurate measure of inflation is being attacked from both the right and left, but it is ideological rigidity, not bipartisan comity, that is fueling the resistance. The opposition underscores the ideological and special interest hurdles preventing a comprehensive, common-sense solution to our fiscal challenges.
On Monday, conservative special interest groups including the Club for Growth and Americans for Tax Reform came out against applying the chained CPI to the tax code, saying it represents a tax increase for some who would be put in a higher tax bracket. The groups did note that they could support the switch as part of fundamental tax reform that is revenue-neutral or reduces revenues, but not as a stand-alone measure.
Opponents from the left are fighting the change as it affects Social Security, led by special interest groups such as the AARP. Some Democrats in the Senate last week introduced a resolution opposing adopting chained CPI for Social Security. The Committee for a Responsible Federal Budget went through the bill line by line addressing its claims.
In a statement, Fix the Debt called for policymakers to ignore the special interests and work in the best interest of the country.
Adopting the chained CPI is a technical improvement to the way inflation is measured – it is neither a ‘tax increase’ nor a ‘benefit cut’ as some special interests prefer to describe it. Lawmakers should act now to ensure that the government is using the most accurate measure of inflation and thus raising revenue and paying benefits at levels reflecting the intent of the law – no more and no less.
While economists from across the ideological spectrum agree on the accuracy of the chained CPI, interest groups from both the left and right are invested in the status quo, because it serves their own narrow purposes. Fortunately for Americans, our elected leaders have sworn to serve a higher interest: the national interest. The Campaign to Fix the Debt urges our leaders to keep all deficit-reducing policy options on the negotiating table – especially options that represent a simple technical correction with strong bipartisan support.
The partisan hypocrisy and the opposition to a modest, technical change in how inflation is measured is a prime example of why it is so difficult to achieve a comprehensive plan that puts the country on the right financial course. Marc Goldwein and Ed Lorenzen point out this sad fact in an op-ed.
It is no surprise that groups from the left and right have mobilized to defend the status quo in order to avoid the tough choices that must accompany any responsible deficit reduction plan. Yet, the resistance to a reform as simple and obvious as using the most accurate measure of inflation for price-indexed provisions in the budget is both astounding and disappointing.
Then take action and send a letter to your representatives asking them to work in the nation’s interest, not for special interests.