I don't often get the opportunity to praise an economics article in the NY Times, but this morning's NY Times has a sterling piece by David Leonhardt. He tackles the Obama proposal to give America's senior citizens $ 250 apiece to make up for the absence of a cost of living index increase in social security payments this coming year.
Obama's idea is strange on two counts: 1) The cost of living index increases were supposed to offset inflation. If there is no inflation (and there is none), why does Obama think seniors need the $ 250? Is he just being generous (profligate?) with our unborn grandchildren's money? 2) Senior citizens are the demographic least effected by the current economic recession. Why single them out for special treatment? Leonhardt makes these points effectively in his probing article.
The answer of course is that Obama is in trouble with seniors because his health care reform promises to make major cuts in the actual provision of health care for senior citizens currently on medicare. They know that and he knows that. So, this is Obama's effort to buy them off. Once again, "change you can believe in." There is a pattern here.
