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Brilliant new policy idea: the CFNIA

Democrats in Congress have a brilliant new policy idea: the CFNIA, or "Compensation For No Inflation Adjustment." Pronounced "siffneeah."

You see, if you're on a fixed budget and prices don't go up, you don't lose any ground. But this apparently is a bad thing (although I hadn't realized it before). It means that, if you have inflation-adjusted benefits that would have offset the price increases, you don't get to enjoy the nominal rise in your budget. This can be very disappointing, so the least Washington can do is ease the pain with some cold hard cash.

Presumably this is why the Democrats are now proposing to pay all Social Security recipients $250 a head to "compensate" them for the fact that there has been no cost of living adjustment (because there has been no inflation and thus no need for the adjustment) for the last 2 years.

$14 billion, just because seniors are a politically powerful group. Yes, I know many seniors have tough circumstances and could use the money. But there are also younger people who could use some help - say, the millions of unemployed who were hit much harder by the down economy than retirees.

One small point in its favor: I suppose it is $14 billion of stimulus. Recipients may conceivably have a relatively high propensity to spend the money. But what a crass and pandering way this is to direct the stimulus, with bad precedential effects for future political decisions that will probably outlive the economic downturn.

If this is enacted, Congress couldn't possibly say more straightforwardly: We like you guys better than everyone else. Or rather, we fear you politically more than everyone else.

The Democrats should really get a prize for this. Beyond the budgetary irresponsibility and sleazy pandering, they show their characteristic political brilliance in proposing this after the election, and at the precise point when the benefit they reap from it will be as close to zero as it could ever be. It's not like anyone will remember this in 2012.

If I post my 2012 vote as collateral, could someone amend the legislation to add me to the list of recipients? I mean, as Al Franken would have said in a prior life, why not me.

Full post as published by Start Making Sense on November 13, 2010 (boomark / email).