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Middle class could be hit hardest by chained CPI
President Obama's chained CPI benefit cut to Social Security will have some protection built in to lessen the pain for the oldest and the lowest-income people on the program, a concession that highlights the fact that the chained CPI is indeed a benefit cut, and that it isn't actually a more accurate measure of inflation for seniors if it has to be adjusted to keep people from abject poverty.

The adjustments for the really poor also point out another problem with the proposal: the middle-class, with their gutted 401(K)s and devalued homes, could suffer the most.

“We’re worried about someone who has worked their whole lives and who has a modest income—someone who is a middle-class individual, who will find himself facing an unexpected cut in retirement and waiting for a benefit enhancement that takes 10 years to amount to something,” says Cristina Martin Firvida, director of economic security for AARP.

These people will not be exempt from chained CPI, and they will see their benefit amount reduced. The average benefit for a Social Security recipient in 2012 was $1,234 per month, according to the left-leaning Center on Budget and Policy Priorities, and for 65 percent of Social Security recipients, this check provides the majority of their cash income. For one quarter, it is the sole source of income in retirement.

That goes to the heart of the problem of Social Security as an earned benefit program that we all share as we all pay into it and all draw out of it. It divides us and it risks turning the program into welfare by carving out exceptions for the very poor, pitting them against the middle class who will see their already modest benefits shrinking every year.