WASHINGTON, DC, Jan 25 — For the second year in a row the Social Security Administration promised seniors big boosts in their Social Security checks to help them cope with the Biden administration’s inflationary spiral – a 5.9% Cost of Living [COLA] bump in 2022 and a whopping 8.7% increase in 2023. But an analysis by the independent Senior Citizens League [SCL] shows that last year’s increase missed the mark by 46% a month and this year it’s “too early to say how well the 8.7% COLA will keep pace with inflation in 2023.”
Indeed, inflation hit the country hard last year, particularly among seniors, when it hovered in the 9%-plus high in 2022. It has come down to an uncomfortable 6.3% in the new year, still too high for too many of America’s elderly citizens. And it looks like things are getting worse. Despite the fact that the Consumer Price Index [CPI] came down in December, it was by just one-tenth of one percent.
But essential food prices have continued to increase. Will Luther, the American Institute for Economic Research’s Sound Money Project, recently told Newsmax that the CPI report is deceiving; food prices are still on the rise. Luther said, “The increase in food prices is unfortunately even higher than it seems by looking at year-on-year growth in the CPI release…I don’t think there’s any reason to think food prices will come back down to a level consistent with average price growth we have seen over the past couple of years. Prices will, unfortunately, remain elevated over the next couple of years.”
The Newsmax report cites American Institute for Economic Research economist Peter C. Earle, who agrees food prices “broadly are still rising.” However, they are rising more slowly than they were a few months ago and that a decline will be particularly gradual “because agriculture and other food-related businesses are still reeling from the pandemic policies.”
In her analysis, Mary Johnson, SCL’s Social Security and Medicare policy specialist, says “inflation appears to be moderating but will Social Security recipients ‘catch up’? Inflation as measured by the same index that’s used to calculate the cost-of-living adjustment was 6.3% through December. That’s lower than the new 8.7% COLA starting this month. Will 2023 be the year that seniors catch up? Before anyone can answer that question, we first need to have a measure of just how far Social Security benefits fell short due to cost-of-living adjustments that didn’t match up to actual inflation.”
In fact, a Motley Fool survey found that 55% of respondents said that the 8.7% cost-of-living adjustment wasn’t enough. In its report on the survey, the Motley Fool noted that “there’s a great deal of disagreement over how important Social Security benefits are to retired Americans.” So they included the question in their survey and 70% of them said they rely on their Social Security payments.
Kaiser Health News [KHN], meanwhile, reports that 54% of older women living alone and 45% of single men are “either poor according to federal poverty standards or with incomes too low to pay for essential expenses.” KHN quotes the Gerontology Institute, which revealed “that nearly 5 million older women living alone, 2 million older men living alone, and more than 2 million older couples had incomes that made them economically insecure…Nationally and in every state, the minimum cost of living for older adults calculated by the Elder Index far exceeds federal poverty thresholds, which are used to calculate official poverty statistics.” And that was before inflation soared to more than 9%.
John Grimaldi served on the first non-partisan communications department in the New York State Assembly and is a founding member of the Board of Directors of Priva Technologies, Inc. He has served for more than thirty years as a Trustee of Daytop Village Foundation, which oversees a worldwide drug rehabilitation network.