Source: United States House of Representatives – Congressman Peter DeFazio (4th District of OREGON)
Following Social Security Administration’s Anemic Cost of Living Increase for Seniors for 2021, Lawmakers Propose 3% Adjustment
Following the Social Security Administration’s (SSA) announcement of a meager 1.3% cost-of-living adjustment (COLA) for Social Security beneficiaries in 2021, Reps. Peter DeFazio (OR-04) and John B. Larson (CT-01) have proposed emergency legislation to increase the 2021 COLA to 3%.
“Due to the COVID-19 pandemic, seniors are facing additional financial burdens in order to stay safe,” said Rep. Peter DeFazio. “This absolutely anemic COLA won’t even come close to helping them afford even their everyday expenses, let alone those exacerbated by COVID-19. Raising the COLA to 3% for 2021 will provide seniors with an immediate, crucial lifeline during the ongoing coronavirus crisis. It’s also critically important that Congress provide a permanent fix to the COLA formula that actually reflects the real costs that seniors face. That’s why I’m urging Congress to pass my comprehensive legislation, the Social Security Expansion Act, to increase benefits and use a new COLA index (CPI-E) to factor in seniors’ actual, everyday expenses.”
“Social Security is our country’s number one financial security program, and, because of the COVID-19 pandemic, people are depending on it now more than ever. Seniors are seeing a rise in food, medical, housing costs and more, and a 1.3 percent cost of living adjustment (COLA) is just not enough during these difficult times. That’s why I’m proud to join Rep. DeFazio to introduce this emergency 3 percent COLA increase,” said Rep. John B. Larson. “Congress also needs to change the way the COLA is formulated. Our bill, the Social Security 2100 Act, enacts the CPI-E formula for adjustments to ensure the COLA reflects the rise in costs seniors are facing. I applaud Rep. DeFazio for his leadership on this issue and look forward to working with him on it.”
According to The Senior Citizens League, COLAs averaged 3 percent between 1999 and 2009. Over the past decade, however, annual COLAs have averaged just 1.4 percent. In fact, of the years in which the Social Security COLA has been increased, 1.3 percent is the second lowest increase.
Tuesday’s announcement continues the distressing trend of inadequate annual Social Security COLAs. As a result, the purchasing power of the Social Security COLA has continued to decline along with seniors’ standard of living. Social Security recipients have lost nearly a third of their buying power since 2000.
In addition to ever-rising health care and prescription drug costs, COVID-19 has disproportionately affected seniors’ cost-of-living in other areas, including increased costs for food and nutrition, deliveries, energy and heating, out-of-pocket costs for COVID-19 treatment, and more. Other added costs include personal protective equipment and cleaning supplies, as well as internet and data plans which are needed to help counter the negative effects of isolation.
“The COVID pandemic has devastated many older Americans both physically and financially. Seniors living on fixed incomes need a lifeboat; this COLA increase is more like an underinflated inner tube,” said Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare. “We strongly support Rep. Peter DeFazio’s bill to provide an emergency 3% Social Security COLA for 2021, due to the extraordinary challenges seniors face during the COVID pandemic.”
“The Senior Citizens League is proud to endorse Representative DeFazio’s legislation,” said Rick Delaney, Chairman of the Senior Citizen’s League. “A 3 percent emergency COLA would provide a much-needed benefit boost and strengthen Social Security benefits at this time when the health and finances of older Americans have been deeply impacted by COVID-19.”
“Social Security’s automatic cost of living adjustment is one of its most valuable features, even more so in the middle of a pandemic. But due to an inadequate measure, Social Security’s modest benefits are eroding”, said Nancy Altman, President of Social Security Works. “To offset that erosion, Representatives DeFazio and Larson are wisely proposing an ad hoc 3 percent increase. Social Security Works applauds their leadership and enthusiastically endorses their proposal. Congress should immediately pass their legislation, which will boost the economy and save lives.”