No Social Security Cost-Of-Living Increase For 2010

People collecting Social Security have been getting cost-of-living increases since the program to up payments went into effect in 1975. The inflation calculation used to set the increases was negative this year.

The Administration hopes to offset the lack of an increase. The White House website released at statement saying, “The Recovery Act provides a one-time payment of $250 to retirees, disabled veterans, and SSI recipients. Over 64 million retirees and other individuals will receive this one-time payment, totaling $16 billion.” Congress may not approve the funds.

Concerns about the rising federal deficit may well mean that Congress will vote the program down. There are already deep worries about whether the Treasury will at some point reach the limit of its ability to borrow to fund America’s multi-trillion deficit which will continue to grow for nearly a decade according to most forecasts.

The lack of a Social Security payment increase is likely to hurt whatever recovery in consumer spending that might occur during the holidays. Many people are already pressed enough financially that they will spend little or nothing for Christmas and Chanukah. A poor class of retired citizens won’t help that.

Douglas A. McIntyre                                   Check the 24/7 Wall St. “Today’s Best Market Rumors”