By now, FedSmith.com users have seen the news about the COLA in 2013 being 1.7%. Social Security officially made the announcement today, but we had predicted in an article last week that it would be in the range of 1.5% to 1.7%.
AFGE president J. David Cox Sr. released a statement today on the announcement of the 1.7% COLA that will be given to federal retirees and Social Security recipients. Ever the optimist, Cox said, “It could have been much worse.”
Cox’s full statement reads:
While next year’s COLA is much smaller than the increase federal retirees and Social Security recipients received at the beginning of this year, it could have been much worse. Under the deficit reduction plan proposed by Morgan Stanley Director Erskine Bowles and ex-Senator Alan Simpson, the annual COLA would be cut by three-tenths of a percentage point.
So if Bowles-Simpson were in effect today, retirees would be getting a 1.4% adjustment in January instead of the 1.7% increase. Although a 0.3% cut doesn’t sound like much, it adds up over time. Over 10 years, that 0.3% difference would mean a 3% cut in benefits. Over 20 years, the loss in benefits rises to 6%.
This cut in COLA benefits is just one of many outrageous and indefensible ways in which Bowles and Simpson proposed to cut the nation’s deficit by slashing wages and benefits of working class Americans. Any attempts to revive their fatally flawed recommendations must be vigorously rejected.
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