2012 SSA Cola Watch (April Report – Updated Monthly)

Social Security determines its succeeding year’s COLA in October each year by comparing the average CPI-W for July through September of that same year to the average CPI-W for July through September of the last year which produced a COLA. I call this the “baseline.” This year, the baseline we are working from is the period from July through September, 2008, which generated a 5.8% COLA in 2009. The average CPI-W for July 2009 through September 2009 and the average CPI-W for July 2010 through September 2010 did not exceed the baseline (the 2008 average.)

The Baseline CPI-W Amounts

July 2008 CPI-W: 216.304

August 2008 CPI-W: 215.247

September 2008 CPI-W: 214.935

2008 Average CPI-W: 215.495. This is shown as the bottom gray line on the graph.

Since then the CPI-W has been lower, until January, 2011. The months we are now concerned with are July through September, 2011. What happens before then shows a trend line and may be predictive.

The Current CPI-W

The CPI-W increased sharply in March 2011, about 1.1% over February 2011. According to the Bureau of Labor Statistics, “Gasoline and food prices continued to rise and together accounted for almost three quarters of the seasonally adjusted all items increase in March. The gasoline index posted its ninth consecutive increase and has now risen 14.4 percent over the last three months. The household energy index rose as well, with advances in the fuel oil and electricity indexes more than offsetting a decline in the index for natural gas. The food at home index continued to accelerate in March, rising 1.1 percent as all six major grocery store food groups increased.”

Current CPI-W Amounts

July 2010 CPI-W: 213.898

August 2010 CPI-W: 214.205 (+ 0.14%)

September 2010 CPI-W: 214.306 (+ 0.05%)

October 2010 CPI-W: 214.623 (+ 0.15%)

November 2010 CPI-W: 214.750 (+ 0.06%)

December 2010 CPI-W: 215.262 (+ 0.24%)

January 2011 CPI-W: 216.400 (+ 0.53%)

February 2011 CPI-W: 217.535 (+ 0.52%)

March 2011 CPI-W: 220.024 (+1.14%)

Graph showing rate of increase of CPI-W Jul 10 through Mar 11

The CPI-W July 2010 Through September 2011

There are 4 gray lines on the chart. The lowest one, at 215.435, is the baseline CPI-W, which has to be exceeded in July through September for there to be any COLA in 2012. The other gray lines, at 217.650, 219.800, and 222.000, are the levels for COLAs of 1%, 2% and 3%, respectively. As of March, we have just crossed the 2% line. If current trends continue, we may cross 3% next month.

All of this is speculative. Remember, it’s where the CPI-W is in July through September that actually determines the COLA. And, given the putative “crisis” situation in Washington, who knows whether any COLA will survive in the political battles to come. Each 1% of COLA costs about $7 billion each year forever. I do not trust President Obama and Congress not to discard COLAs altogether as a deficit reduction measure (which isn’t appropriate, since Social Security benefits do not add to the deficit.)

The May report from the Bureau of Labor Statistics, showing the April 2011 CPI-W, will be released May 13. Check back.


This information is also repeated verbatim from preceding reports, and is repeated here as a reminder.

If we get a Social Security COLA in 2012, Medicare Part B premiums will increase by a significant amount.

Part B premiums have been kept at the 2009 amount, $96.40, in 2010 and 2011, for about 75% of beneficiaries who were eligible for Part B prior to January 2010. According to law, the Social Security check amount cannot be decreased, so beneficiaries entitled before January 2010 could not have their Medicare Part B premiums increased. The Trustees project that the 2012 Part B premium amount will be $111.40, based on the assumption that there will be a COLA in 2012. This is an increase of $15.00.

The average Social Security beneficiary receives $1170.00 per month. Let’s say that we do get a 1% COLA in January, 2012. That would mean that the COLA to a beneficiary receiving the average amount would be an increase of $11.00. This is less than the projected increase in the Medicare Part B premium, so the COLA for a beneficiary receiving the average amount would be entirely absorbed by the Part B increase, with $4.00 left over to be applied to the 2013 COLA (if one is payable) along with the 2013 Part B premium increase.

If the COLA is 2%, the increase for an average beneficiary would be $23.00. After his Part B premium increase was deducted, he would see a net increase of $8.00. At 3%, the increase would be $35.00 for an average beneficiary. After deduction of the higher Part B premium, this would give the average beneficiary a net increase of $20.00.

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21 Responses to 2012 SSA Cola Watch (April Report – Updated Monthly)

  1. I have given up on the United States. I am in the process of applying to immigrate to Canada and plan to teach there. There is no future for anyone in this country – young or old. I plan to work until I am physically unable. Then I will take my own life. I would rather die than continue to live in a country that has lost its soul. Nothing seems to matter anymore except corporations and greed. I have a college teaching job in Canada and also a private violin studio. If I stay in this country there will never be any more social security raises and seniors will begin to die because they will not be able to pay for food. My advice to others is to get out the country as fast as they can.

  2. There is nothing to moderate. Seniors are already starting to take their own lives. I dare you to print the truth.

  3. ssapotluck says:

    I am very sorry to hear the despair in what you write, but I can certainly understand why you feel it. There is a lot of despair throughout the country over how very much more difficult it is to live now that it has been since the Great Depression.

    I talk to a lot of people about how things are here for seniors, the disabled, the unemployed, and everyone else who is suffering from the recession and the way that the politicians, of both parties, but primarily the Republicans, are distorting the economy to suit the rich and the corporations. I agree with you that things are bad now. But there are signs that things are improving.

    The base of the Democratic party, not the politicians, not yet, but the base, is coming to life and fighting back. I am referring to the workers, the unemployed and those who are facing the loss of their homes, the young, the disabled, some of the elderly, new citizens; in other words, all the people who have to live with the results of the Republican’s thirty years’ war against the middle class. The Republican assault is so obvious now that everyone can see it.

    You are an expert in music. Think of Shostakovich’s 7th Symphony. The threat which builds from a whisper to a ravening crescendo in the first movement, is utterly banished by the song of triumph in the fourth movement.

    The Republicans in the House of Representatives have quietly abandoned their attempt to destroy Medicare. This was lost under all the Osama bin Ladin news, but they have done so. About eighty percent of the country is opposed to this proposal, according to polls from all over the political spectrum. The same percentage supports raising taxes on the rich and the corporations to deal with the budget deficit. The Republican are beginning to learn these facts when they go home to their districts, which they do every third week or so.

    Watch what happens in the special Congressional election on May 24 to fill the vacant New York 26th District. This is a heavily Republican district. The Republican candidate, Jane Corwin, is on record as supporting the House Republican budget proposal. The Democratic candidate, Kathy Hochul, has been using Corwin’s support for the Republican budget in her advertising. The Democratic party is viewing Hochul’s candidacy as a referendum on the Ryan budget, and some of the press is picking this up. The polls show that the election is a statistical dead heat. The last Representative won in 2010 by about a 75%-25% margin over his opponent.

    There will almost certainly be a Social Security COLA this year. As of March, the CPI-W had just passed the amount needed for a 2% COLA. I do not see much possibility that the CPI will turn around quickly enough to deny Social Security beneficiaries a COLA for a third straight year. The April data will be released in an hour or so, and I will put up a new 2012 COLA Watch article later today or tomorrow. Please check back.

    I know that things look bleak now, but they will reverse, and they will reverse soon. The middle class, Democrat and independent, is mad, and we have many, many votes we can cast. The threat to us is obvious now, and the media hammers us every day with more and more examples of the Republicans carrying out the wishes of their corporate masters, to the detriment of us and our country. Everyone sees. Twenty or thirty percent deny to themselves what they also see, but they are definitely the minority. 2012 will be a very interesting year, and, I think, a year in which some of the injustices of the past thirty years begin to get reversed. Please do not despair. America has not lost its soul; some selfish people have tried to shackle and subvert it. Ultimately they will fail, and be exposed for what they are.

    I wish you peace and give you my hope that the light will find you and dispel the darkness you feel now. Please feel free to write to me at any time, either here, or to my email, socialsecuritypotluck@gmail.com, to let me know how you are doing. You are in my thoughts, and I would very much like to hear from you again.

  4. Edgar Bates says:

    Democrat!!!! You gota be JOKING! After OBAMA I will NEVER vote Democrat AGAIN!

    • ssapotluck says:

      A lot of people felt the same way you do last election. They were mad at Obama, and at incumbents in general, and voted in a Republican House of Representatives and many Republican legislative bodies and governors, with disastrous results. It’s your choice not to vote for Obama, but would you prefer any of the current pathetic crop of Republican hopefuls? The time not to vote for Obama is in the primary election, if a viable challenger runs against him. In the general election, I will vote for the Democrat, no matter who he or she is, before I will vote for any Republican. The Republican Party doesn’t give a damn about the America I care about, or about average Americans. For the record, I do not consider Obama a true Democrat. From his own lips I heard him say (after he was elected) that the former President he admired most was Ronald Reagan. He has continued many policies of the Bush Administration, such as perpetual war, torture, denial of habeas corpus, and extralegal assassination. Still, he is better than any Teabagger, which is the choice we will face in November 2012.

  5. revenuer says:

    To Richard Stevens: Mr. Stevens, you have directed a personal attack at another poster on this blog. You were rude, abusive and attacked as a bully would attack. We have zero tolerance for personal attacks on other posters. This is one of many reasons why we moderate the posts before they go up for public view.

    In our Moderation section we spell out what is and what is not acceptable behavior. You have gone far beyond what we consider acceptable and appropriate. We are trying to maintain a community where our readers are free to post their thoughts about our content, how government affects it and how the attempted manipulation of Social Security, Medicare and other social programs affect them. We want our posters to feel safe in saying what they feel and think. We invite their comments, advice and opinions. We ask only that posters treat each other with respect, and avoid hatespeak.

    Apparently you do not understand what the words “respect” and “hatespeak” mean,. You do not understand what common courtesy means. You made not one comment on the material published on the blog. Instead you launched straight into a personal attack on another poster who was expressing personal feelings and beliefs which are simply not your business. If you disagree with someone’s feelings of course you can say so, but leave it at simple disagreement and say why you disagree without hostility or over the top hyperbole.

    We have no intention of asking our readers to post and then exposing them to being flamed, hassled or bullied. You are a guest. You do not speak for us. You don’t even speak all that well for yourself. Please remember that we operate on a “one strike” policy. Your post comes into the moderation queue but is not visible to others until we release it. We will not release posts that are cruel or violate our standards. Your post has done that and will not be released. Strike one, Mr. Stevens. If we get another comment or email from you which violates our policies on comments it will go straight to the spam folder as will all subsequent posts from you. Posts which come in after a second violation will not be read. We do not approve of bullies or people who cannot allow others to have their own ideas or express these ideas even though they do it politely and do not concern anyone’s lives or feelings besides their own. I believe a word you should keep in mind but do not seem to be familiar with is tolerance. It will get you further than acting as if the only correct answers to life and living are yours.

  6. Gary Gingrich says:

    All the government has to do to cut social security and medicare is to not increase benefits as costs go up. Increase monthly deductions for medicare from ss without cola for ss. Think about it. Costs go up 4% for ten years =40%. No cola (due to no increase in gov’t spending for ten years) and seniors are left with 40% gap in only ten years. People will not go for even preventive care cause they just can’t afford it. So forget about cuts they will just inflate us out of it.. Just remember Wall Street was to big to fail. Or was it more like the elite insiders did not want to take a hit of say, 50 million dollars out of their portfolio worth maybe 150 million.. Seems fair to me!! How about You??

    • ssapotluck says:

      That is one way to fix Social Security’s long term funding problems. The Congressional Budget Office put out about 30 options for making up the Social Security funding shortfall over the next 75 years. Two dealt with COLAs. One option was to reduce all COLAs by 0.5%. This would cut the shortfall by half. The other option is to switch from the CPI-W to the Chained CPI-U for COLA computations. This would cut the shortfall by about a third. I think the President and the Congressional negotiators are considering the second option now. I have two problems with it. First, it does nothing to fix the budget deficit, since no part of Social Security is funded from general revenues. Second, either cut would compound over time, just like interest but in the opposite direction, disadvantaging seniors more and more as the years went by.

      The rich and the corporations control the government. It is not only unfair, it is fascist, as Mussolini himself defined the word (only he felt that it should be called “corporatism” rather than “fascism.”

  7. Rob says:

    I don’t want much in these hard times, what ever the seniors and congressmen get would be good enough for me

    • ssapotluck says:

      Thank you for your comment. I certainly know how you are feeling. We are all learning to live with diminished hopes and dreams, and without expectations at all. For what it’s worth, we’re all in this together now.

      Do you receive Social Security? If you do, you will get whatever seniors get. Congress and the Senate generally vote to refuse their COLAs, but that’s only right — they’re mostly rich anyway.

      Feel free to come by any time.

  8. revenuer says:


    We have printed multiple warnings that we will not tolerate verbal abuse, including name calling of other posters or of ourselves. If you had read comment moderation or looked at the warnings in the comments you would know what is going to happen next.

    We have zero tolerance for this behavior. You are now routed to the spam folder. We do not like Obama either, but it is not up to you or anyone else to characterize our opinions in an abusive way. A simple, polite disagreement would have been sufficient and would have been moderated. This will not be.

    All future comments and emails from you will be sent directly to the spam folder. If you want to comment at a place where rudeness and abuse are part of the culture, try Democratic Underground or the Free Republic depending on your political leanings. Who knows you could probably learn a lot more about abuse if that is the way you choose to express yourself. You will not be doing it on this blog however. No abuse from anyone will be moderated.

  9. Joe Nonemaker says:

    In my very humble and very getting poorer and poorer every month (Senior Citizen & at 72 still working part-time) there isn’t a politician in office who got there without some sort of corporate help, so… The greedy “Corporate Captains” with their ‘vested interest’ now have a “right” to direct goverment’s directions respective to their particular interests. Folks, WE KEEP ELECTING LAWYERS…!!!! I’ve always worked hard, since I was 13 (for my Dad) until getting my first full-time job at 18 with an insurance company. I’ve always had lousy pay working for greedy companies that did not contribute a thing to anyone’s retirement and each year the money one could put away for later years was ‘eaten up’ by the increase cost of living! Bet there’s a lot of you out there “in the same boat” so to speak! PERHAPS the government should start giving Social Security ONLY to those who put into it and then stop using the fund as a ‘cash cow’ for other projects. I feel that EVERYONE in public office should be FIRED but that won’t happen because AMERICAN PEOPLE ARE LAZY!!! Not even a revolution would ever work but that is what we need. (“They” control the military!) HOW ABOUT MEDICARE? Doctor prescribed a knee immobilizer for me prior to a knee operation. I received a $50. immobilizer and Medicare was charged $1344. I am presently fighting this via a member of congress right now. (MEDICARE ITSELF IS MORE GUILTY THAN THE THEIVING SUPPLIER BECAUSE THEY HAVE LAZY PEOPLE WORKING FOR THEM THAT DON’T MONITOR COSTS AS THEY SHOULD! If anyone is interested I would be happy to tell the entire story.

    • revenuer says:

      Potluck is having an arthritis flare-up in his fingers and wrists, so he cannot answer you directly right now. But he does want to and will do so in a few days, either directly or through me. I can tell you that you are not alone in both your feeling of despair at how things are going and your anger at the politicians. The vast majority of Americans recognize that most politicians and the corporations are only interested in helping each other. It’s so obvious now, so out in the open, that we both think that the 2012 elections will cost a lot of corrupt politicians their jobs.

      Taking your Medicare situation to your Congressman is the best thing you can do. As far as telling your story, we are both very interested, and would be happy to hear it from you.

  10. Joe Nonemaker says:

    Thank you!
    Joe N.

  11. John Manousso says:

    I have never understood how the Government is projecting cost of living. They must be insane. Here we have senators and congressmen that they give among themselves an increase of $800.00 per month but for seniors they do give a dam.
    My guess is that we seniors have been put on the back burner and they could not care how we survive.
    I am truly feud up we this dysfunctional govrnment

  12. Joe Nonemaker says:

    The Social Security System is no more than a “PONZI SCHEME.” Money is collected NOW from “investors” who are working TO PAY THOSE WHO HAVE ALREADY INVESTED…(We retirees.) Only thing is, “our” government (notice the quotes around “our”) uses some of that money for other purposes for which the fund is not intended; it’s a ‘cash cow.’ Finally one day after many years there simply is not enough money coming in to pay those to whom benefits have been earned via their “investment.” IT’S THE SAME DEAL THAT BERNIE MADER PULLED OFF for quite a number of years only it’s done under a ‘mask’ of legality. I am a retiree, 72 years old and have paid into this scheme since I was 16 i 1955 and “our” LOUSY government has pissed it away!

    • revenuer says:


      I am writing for Potluck. We sympathize with your strong feelings and share many of them. I would just like to clarify for you that Social Security is a tax, not an investment. It is the FICA withheld by your employer based on what you are earning and which ceases to be collected when your income is $106,000. The IRS collects your FICA because it is the taxing authority and a law enforcement agency. If you are self employed and file on a Schedule C as a sole proprietor you pay in Self Employment tax which is charged at a higher rate than FICA. You are then allowed to deduct a portion of what you pay in since you are paying at a higher rate. Self Employment tax is also collected by the IRS because it is a tax.

      These are not investments which are sums of money you voluntarily place into stocks, bonds or individual accounts. Investments are a completely different matter. The Social Security taxes (FICA and Self Employment) are placed into the Social Security Trust Funds. They cannot be casually borrowed by other branches of the government. If they are borrowed the, government must do it by purchasing interest bearing Treasury Bonds which are held by Social Security to be redeemed if necessary with interest.

      In your prior post you mentioned that people who do not pay into Social Security are paid benefits. This is a misunderstanding on your part. In order to collect Social Security Retirement benefits or Social Security Disability payments you must have paid into the Social Security trust fund until you are fully covered. That requires forty quarters of coverage based on FICA or Self Employment tax based on taxes withheld throughout your working life. When you retire or become disabled you apply for payments based on your earnings and after the Social Security Administration makes adjustment for cost of living increases which have occurred throughout your working life your benefits are computed. Generally you will receive much more than you have paid in over your remaining lifetime. Only US citizens or legal residents who have worked and paid into the Social Security Trust Funds can collect benefits.

      When you say that people who have not paid in are collecting Social Security, you may be thinking of SSI. This is a needs based program for the aged, blind and disabled who were unable to work and pay enough taxes to become fully insured. SSI is not funded out of the Social Security Trust Funds, it is paid out of general revenue. It came into existence in 1973 and was designed to act as a safety net for people who are poor, unable to work and have no other way to survive. The fact that it somehow takes away from those who pay Social Security taxes is a conservative meme designed to take a small livelihood away from people who need it the most. Since we are a community of people who need to reach out to others in kindness and need rather than support the greed and lies of the very wealthy individuals and corporations who should be paying their fair share of taxes but who do not, I come down on the side of helping people who need it the most. Is that not what we are all on earth for? To care for each other and understand that life is more important than greed?

      You also stated in your previous posts that the people who administer Medicare are lazy and do not care. I cannot speak for them since Medicare is not administered by the government. It is yet another program which has been privatized and put into the hands of the same greedy and opportunistic private health care companies that have been robbing us blind for years. They process and pay the claims, they choose the vendors who provide supplies and durable medical equipment and overcharge whenever they can. That is yet another government program that stated well and fell victim to privatization which benefits no one. Since the government has veered to the right since Reagan we will all have to be alert to the tendency to privatize functions best administered by government resources and try to keep them as a public trust instead of a private cash cow for those who care about nothing but making money and using those in this country who are weaker than they are.

  13. Joe Nonemaker says:

    Thanks for your astute reply. I was mostly being facitious and so because the government ‘borrows’ from this fund to fund other funding needs which includes help for the illegals. I should have put quote marks around the word “investment…ing..ment..etc” I realize that we would receive much more than we “invest” in the SS program as time goes on but then again, we should and therefore, when that juncture is reached, we have become ‘investors’….notice half quotes. Further, as you surely must know, the funding with which to pay out to recipients is lacking money to do so. Adequate plamnning would have allowed for normal drops in the economy so that SS recipients, many of whom depend on SS would not have to suffer as we all are now.

  14. Meee says:

    Big freaking deal. Just cost of food alone went up a hellin. We will be worse off

    • revenuer says:


      I think we all realize that nothing is getting better. This has been a long time coming and it will take a long time to remedy it if it is even possible to do so. I feel obliged to try, though. It is our country too and our lives still belong to us. Fight back. I don’t see how it will make anything any worse. Could you please explain what your post on illuminati is about? I’m sure you have made many of us curious.

  15. Meee says:

    To figure out what our governments true agenda is just research illuminati

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