New numbers came out today and one of them shows that inflation rose 2.7% last year. That’s pretty bad when people aren’t making us much money and we still have a big unemployment problem, but the problem doesn’t stop there.
Social Security recipients didn’t get a raise this year. The calculated that in June, so the inflation is mostly since June of last year. So these fixed income seniors will be stuck paying higher prices and not having more money. This is a serious flaw in the system. Add to that the cost sharing on prescription drugs went up a dollar for Medicare, seniors are going to have a really rough 2009.
Also it will be interesting to see what the new federal poverty level looks like. Currently it is at $10,830 for a single person. Will the 2010 level reflect real inflation? If so then it should be at $11,122 this year. It will be interesting to see if the number actually reflects real inflation. If history is any indicator, it won’t. To put this into perspective, the CBO estimates the FPL will be at $11,800 in 2016. Again – we have a seriously flawed system that needs to be fixed.