Bowing to pressure from liberal groups and angry seniors, the Obama administration on Thursday dropped from its forthcoming proposed budget a plan to trim back cost-of-living adjustments for Social Security recipients.
President Barack Obama angered Democrats and seniors last year by including a proposal favored by Republicans called the Chained Consumer Price Index, which involves a less generous way of making cost of living adjustments and thus reduces the budget hit for these payments to retirees.
"This is a huge progressive victory -- and greatly increases Democratic chances of taking back the House and keeping the Senate,” said Stephanie Taylor, co-founder of the Progressive Change Campaign Committee, a liberal policy group. “Now, the White House should join (Massachusetts Democratic Sen.) Elizabeth Warren and others in pushing to expand Social Security benefits to keep up with the rising cost of living."
Obama proposed the change as an olive branch to Republicans in an effort to forge a bipartisan budget. The recent two-year budget deal did not include chained CPI, and that signaled it was unlikely that the president would propose it again.
“In the course of those negotiations (last year), he put chained CPI on the table as a gesture of good faith; yet Republican leaders were unwilling to budge,” Minority Leader Rep. Nancy Pelosi, D-Calif., said in a statement. “Democrats applaud the President for eliminating chained CPI from his budget, and we look forward to working across the aisle to adopt a responsible fiscal framework.”