I heard Rudolph Penner on US National Public Radio today saying that the
social security benefits are indexed to wages. Is there any truth at all to
this assertion? Isn't it the revenues that are indexed to wages, while the
benefits are indexed to the CPI?
Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine
Rudy is pretty straight. The answer is
both, in a sense. Benefit levels depend on wage
history. For a given benefit level, there is an
adjustment with either the CPI or average wage
index, as noted in:
(From http://www.ssa.gov/OP_Home/handbook/handbook.07/hbk-0719.htm)
AFTER MAY 1975, BENEFITS MAY BE AUTOMATICALLY INCREASED to keep pace with
increases in the cost-of-living if laws providing general benefit increases
are not passed. Depending on the condition of the Federal Old-Age, Survivors
and Disability Trust Funds, the increase will be based on the smaller of
either the Consumer Price Index as published by the Department of Labor or
the average wage index, which is based on nationwide wages. . .
I don't know what "condition of the . . . Trust Funds" means,
but I will try and find out.
max
