President Obama is asking Congress to send seniors each a $250 check next year.
(Bradley C. Bower/AP/File)Photos (1 of 1)
Obama: give seniors an extra $250 each
The payments would be similar to the checks that Social Security retirees and others received in May as part of the economic stimulus legislation.
By Ron Scherer | Staff writer/ October 14, 2009 edition
New York
Concerned about Social Security recipients, veterans, and people on disability payments struggling to make ends meet, President Obama is asking Congress to send them each a $250 check next year – similar to the checks they received in May as part of the economic stimulus legislation.
For the average retiree on Social Security, it would be the equivalent of getting a 2 percent increase in benefits. In total, the White House would like to give the money to some 57 million Americans, including individuals on Supplemental Security Income, railroad retirement and disability beneficiaries, and public-employee retirees.
“The president thinks in the light of economic conditions we face, it is appropriate we continue the benefit, and he calls on Congress to pass it,” said a senior administration official Wednesday, briefing reporters.
The payments would cost $13 billion, the White House estimates. But Mr. Obama does not want the money to come out of the Social Security Trust Funds, said the senior official, who spoke on condition of anonymity.
“We generally think programs should be paid for,” said the official. “We plan to work with Congress to discuss financing, but we are not insisting it be paid for.”
If the potential program is not financed by cutting another program or raising a fee or tax, it would increase the budget deficit, which is currently estimated to be $1.17 trillion for fiscal year 2010.
The White House did not specify when the payments would be made if Congress agrees to them. “We don’t have a specific timetable,” the senior official said.
The White House decision to ask for the $250 payments comes just before a scheduled announcement Thursday that for the first time, Social Security recipients will not receive an automatic cost-of-living adjustment (COLA) next year. That’s because inflation declined from the third quarter of 2008 to the third quarter of this year.
“It’s kind of saying we will offset this to some extent with this payment,” says Brian Bethune, chief US financial economist at IHS Global Insight in Lexington, Mass. “It’s one way to keep those people happy.”
Indeed, some seniors’ advocates hailed the proposal by the White House. “The White House clearly understands how devastating the rising costs of health care and the loss of retirement savings have been to seniors during this recession,” said Barbara Kennelly, president and CEO of the National Committee to Preserve Social Security and Medicare, in a statement.
In 2009, Social Security payments were raised by 5.8 percent, reflecting a much higher inflation rate that was driven by soaring energy prices. Gasoline, a component of the Consumer Price Index, peaked at more than $4 a gallon. Today, the average US price of gasoline is $2.48 a gallon, according to AAA.
The White House also intends to prevent reductions in the amounts that workers can contribute to their individual retirement accounts, 401(k) programs, and other tax-favored retirement plans.
This year, no more than $16,500 can be contributed to a 401(k) program. There was concern that the amount would be reduced to $16,000, said another senior White House official, who also asked not to be named. But, the official added, “It won’t.”
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Comments
2. Me From Columbus | 10.14.09
Wow… Obama gave all the seniors $250 of his own money…. What a guy.. No wait… Obama took OUR money and gave it to someone else. Called redistribution of wealth… He’s such a Socialist/ Marist
3. Graham Colin Nayler | 10.14.09
“That’s because inflation declined from the third quarter of 2008 to the third quarter of this year”
That’s because the government measures inflation by measuring certain consumer price levels (CPI). The trick is that price levels change based on more than just inflation. For example if the velocity of money decreases as it has over the last year this would cause a decrease in prices, absent any other effects. Retailers would naturally lower prices in order to encourage people to buy more and stay in business, some of them who took too much risk and were unable to lower prices enough would go out of business but people who had taken less risk and instead saved money would be able to come and purchase said businesses at a lower cost and would be able to offer goods and services at a lower cost, again absent any other effects. Clearly the velocity of money, or the speed with which goods and services are exchanged has declined over the past year and some price levels have come down in some sectors but not generally and not nearly as much as one would expect because there have been other effects namely inflation of the money supply and government bailouts of institutions which went bankrupt and should have been sold off at fire-sale prices. As a result the government measurement of inflation, the CPI, is increasing at a slower rate than it did before. Of course we could get into how the CPI has been changed to hide certain price level increases, housing prices for example, but the point is that number one the CPI and generally price level is still increasing (albeit more slightly than before)in the face of a massive decrease in monetary velocity because of government bailouts and deposit creation (i.e. inflation) by the federal reserve and commercial banks. Thus they are hiding the inflation behind the ludicrous notion that inflation is price level increases, when clearly price levels can increase or decrease for reasons as shown other than deposit creation and destruction (i.e. true inflation and deflation of the money supply).
4. mary ann lahan | 10.14.09
Don’t make me laugh. That’s the worst example of pandering to seniors I’ve ever heard of. You are talking about $250. Disabled people have increased expenses to cover and $250. is a pittance! Don’t mean to be ungrateful but if that’s the best this government can do for all the people who worked their fingers off to support their family and now are disabled and unable to work, I think that is tragic and a sorry declaration for this President. Michelle’s sneakers she wore when she “worked” at the food bank cost $600. Michelle also commented that she would be hard pressed to find a use for $500 saying, she couldn’t even buy earrings with that. And you offer us $250! Shame on you.
5. Momlee | 10.14.09
Gee seniors should kiss Obama’s feet. Why not increase social security…what’s $250.00 going to buy? A tank of gas? This is an attempt to buy the senior vote but they’re not stupid. First reduce medicare by $500 bill and then offer up $250.00. Good try Obama.
6. Clinton | 10.14.09
Just saw in the Washington Post the majority of the money for this proposed ’stimulous’…aka ObamaCare vote grab for seniors, is going to come from a special increase in Social Security payroll taxes for people making between $250-359K. http://www.washingtonpost.com/wp-dyn/content/article/2009/10/14/AR2009101403954.html
Here comes Robin Hood to save the day! In case we didn’t all learn the first time, the Bush era stimulous checks DID NOT WORK! But who cares, its not Washington’s money anyways. Its fun spending money when its not yours!
7. David E. Connolly, Jr. | 10.15.09
Trying to buy back the votes he’s lost, I see. Too bad he’s always spending our money, and not his.
8. George Samuels | 10.15.09
Some may say that the cost-of-living has not increased whereas others know that the cost of medications has. The disabled know that for a fact. The disabled need the C-O-L-A to survive. One of my medications doubled in price over the past few months. Why, I do not know and yet I do. And I do need the C-O-L-A adjustment to pay for it or at least try to pay fot it.
9. Hananova | 10.15.09
57 million times $250 = $14.25 billion, not $13 billion. Does the White House think the US educational system collapse means that we can not even do basic arithmetic any more?
Plus the “White House estimate” of $13 billion does not include the salaries of the bureaucrats running the program. Historically, in social services, only 1/3 of the money allocated to welfare actually would up in the hands of the poor. So now we are closer to $50 billion.
Since Bush’s earlier program, giving taxpayers an extra $300-$1200 had a negligible effect on the economy (while worsening the debt by another $100 billion) why does the media now praise Obama’s similar plan?
If this is such a great program, why not make it $2500? or $25,000? Hell, just give everyone a million dollars!
It’s insanity for this administration to think you can just keep printing money for anything and everything before the system will collapse.
Also, how is it that this administration can determine how much money you can contribute to your IRA? I thought this was a formula that bureaucrats couldn’t interfere with.
Is this IRA contribution a law, a regulation or what? If it’s just something not, if this is just another one of Obama’s czars creating regulations, what’s to prevent Obama from saying next year, no one can make an IRA contribution?
10. Hananova | 10.15.09
Oh, sorry. I just noticed this is the Christian Science Monitor
For some reason, you censor my comments.
I think it’s vile when a president can lie to the people and when slander and defamation, libel, run rampant, such as with Rush Limbaugh the media does not only not protest, yet itself engages and propels such malignancy.
Last time I ever read anything in this newspaper. You are dead to me.
11. Ronald | 10.15.09
There will be no cost of living increase for more than 50 million Social Security recipients next year, the first year without a raise since automatic adjustments were adopted in 1975, the government announced Thursday.
Bush and this administration has given hundreds of billions of taxpayer dollars to save the rich. So why are the people on Social Security unable to get a cost of living raise? Would someone here at the Christian science monitor please ask the administration that question.
12. Charlotte Ogden | 10.15.09
I’m a Senior on Social Security, with a husband that is ill. We are in the infamous “Donut hole” NO COLA this year. I just recieved my current property tax bill and noticed it has gone up from last year. I would say, that raises the “Cost Of Living” wouldn’t you?
13. Henry Taylor | 10.15.09
Is this supposed to compensate for the lack of cola for 2010?
I was ready, as a retiree, to adjust to that out of a necessity for our national debt. Now, it makes no sense. Where is the money coming from? Who will pay off the overwhelming debt being accrued these past few years and, especially, the past few months? I fear we are heading to a revolution, either at the ballot box in 2010 or in some extralegal actions of radical politicians. The political and financial situation is getting way out of hand! Let us pray that such events that bring change are God directed. His hand in all things is the radical stand for a right solution.
14. Felix Tijerina | 10.19.09
I am great full for this up and coming Stimulus Check but I know that I my self would be better served with a cost of living raise. The inflation decline report that is shown really dose not really help me because i am still struggling to make ends meet. I see no difference in my financial situation. I know that I really am one person and wont really make a difference to you guys up there. I know that up there it is easier to look forward, but if you would look at us more than on occasion down here It would help you realize that we are not all in the same position financially. And you can put that in your back pockets with all due respect. Trying to survive and be positive all the time. (My own personal life)
15. Leonard Mark jr. | 10.22.09
I think that we should receive a little more than 250.00 because our electricity rates are constantly increaseing.I am very,very up-set that after all of these years,we have been getting a raise,now we are not? All of the bail-out money that congress gave a-way,and the way the industry mis-used it,took a toll on the people of this country.
16. Carl Hamilton | 10.28.09
I think we seniors should get more than the $250. What is wrong with all you people? We just spent $79mil.to shot a missle into the moon. We don’t own the moon, God does. Now we just sent off a test rocket for what ever ungodly reason that cost $449mil.. I think the space program is quite out of hand. Couldn’t or shouldn’t we use the millions,no billions of dollars that’s going up in space here on earth. Are people really foolish enough to think that God would let them live up there somewhere. Oh, I’m sorry, I forgot these scientist don’t believe in God. Get your heads out of outerspace and put your effort where it should be. On this filthy, polluted, contaminated, evil earth. This money spent for space projects would be better spent here on earth. Gas is steadily going up for the past two weeks, and when it increases, so do all other things increase. Why are so many people worried about where the money is coming from. We spend millions on projects most of us know nothing about. Eventually it most likely comes from us “legal” US citizens.
17. Tony(the)Tiger | 11.04.09
iI can’t believe we as Americans can’t see through the picture this president is painting in front of our faces. That we forget all the monies he has given to the insurance companies and to automakers and only god knows how many other companies he has helped, but for one moment you think he thought about us? Yes, you and I; the hard working people of this country and ma and pa businesses that virtually pay 85% of all taxes in this country, not GM, Chrysler, Ford, AIG,etc., and yet they need help? This is the way this president should have taking charge. As the economy is going down the toilet, we have all this money; why not boost the economy by helping every homeowner and small business to reestablish their finances? Because that would just put a spark into the economy? Yes. But, oh no. Doing that sounds too legitimate. Instead, he is going to insult all of us by sending $250.00. I say to all Americans when you get that money–send it back to insult this crooked government we have.
18. Bob | 11.06.09
Hey all you disgruntled folks if the republicans were in charge you wouldn’t even get .50 cents from them remember bush even vetoed the bill to give the unemployed compensation before he left office, $250.00 might not be much but believe me it all helps I wish to it would be more and I think it should be so stop being so critical and be thankful for what you dohave. Thank You.
19. Bob | 11.06.09
Tony (the tiger) You have conveniently forgot to mention that bush signed the first give-a-way to the banks was that just a slip-up?
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1. Tyler | 10.14.09
$13 Billion to give people $250? Could we not have found better use for that kind of money. This one time $250 payment is the equivalent of one trip to the grocery store. I sincerely doubt that eleviates the individual’s long term financial issues. I am certain that a $13 billion lump sum directed at one issue would have been MUCH better spent. Just my opinion.