Eternal Poverty: The Real-life Consequences of Living on a Fixed Income
Poverty, some people argue, is relative. It very well might be. I can introduce you to several of my poor relatives, not to mention friends and colleagues. Based on that sample you could also argue that poverty is contagious. The once small circle of poor people in my life has now grown in number well beyond my ability to count them.
Whether relative or contagious, when poverty is imposed on us by events beyond our control, we suffer some pretty humiliating side effects--and lots that we can't foresee.
Poverty is self-perpetuating
If you are drawing Social Security disability, then you’ve noticed the sporadic Cost-Of-Living Adjustments (COLAs) are so scant that they do nothing to offset the simultaneous increases in your Medicare Part D premiums. The latest example of this is what happened in January 2017. Social Security gave us an increase of 0.3 percent. Such increases are based on the Consumer Price Index (CPI). According to the US Department of Labor, the CPI it is the most widely-used measure of inflation, and theoretically reflects the effectiveness of government economic policy. So let’s put that abstraction into some concrete numbers and see the real-life impact.
My 2015 SSA benefits: COLA of 1.7 percent.
- My total monthly benefit before deductions was $1,164.90.
- Medicare Part B premium was $104.90.
- Medicare Part D premium was $44.20.
- After deductions, my net SSA income was $1,015.80.
My 2016 SSA benefits: No COLA this year because no increase in inflation.
- My total benefit before deductions was $1,164.90.
- Medicare Part B premium was $104.90.
- Medicate Part D premium was $51.70. That’s an increase of $7.50, up from $44.20 in 2015.
- After deductions, my net SSA income was $1,008.30, down $7.50 from 2015.
**Without a COLA, my annual net income was reduced by $90 because of the Part D premium increase.
My 2017 SSA benefits: COLA of 0.3 percent.
- My total monthly benefit before deductions is $1,168.00, up $3.10 from 2016.
- Medicare Part B premium increased from $104.90 to $108.00, up $3.10 from 2016.
- Medicate Part D premium increased from $51.70 to $60.10, up $7.50from 2016.
- After deductions, my net SSA income decreased from $1008.30 to$999.90, down $7.50 from 2016.
**Despite a COLA of 0.3 percent, my annual net income was reduced by $90. The COLA and Part B premium increase was a wash, but the additional Part D premium increase set me back.
Render the poor even poorer
Numbers are not in my grain, but even I can see that my net monthly income fell from $1015.80 in 2015 to $999.90 in 2017. That’s $15.90 per month, or $190.80 per year. What was left out of my stats was the rise in food prices that resulted in an across-the-board increase of $1.00 per item in 2016, among various other “small” price hikes such as a rise in my drug co-pays each year, and a $12 dollar-per-month increase in my rent. If the goal of government economic policy is to render the poor even poorer from one year to the next, I’d say they went above and beyond what was necessary to succeed. If there’s anything I can’t stand, it’s an over-achiever.
Did you spot the elephant in the room? Among other things, the rise in healthcare costs seems not to be factored into the CPI.
Another elephant wandered in this morning, too. Senate Republican John Cornyn, talking about the Republican’s stalled health care bill blurted out the words “health care” and “reform” in the same sentence. Suddenly I gave the television my full attention. But my ear was misled. He was using the word “reform” as a jab at Senate Democrats who, he claimed, wanted to funnel money to insurance companies to offset the losses that are making them pull out of the ACA exchanges. For a minute, I thought that finally, somebody was going to break out of the partisan talking points and acknowledge the need for more regulation.
But no. Reform was just a code word for splitting the market and floating lower premiums to healthy people. I was just waxing nostalgic, time-traveling back to the good old days of the 1960s and 1970s when reform meant a progressive social action that exposed corruption or gave some relief to the sick, the old, and the poor. Ralph Nader-like exposé and reform back when he was the mother of all whistle-blowers and the darling of the progressive element in the Democratic Party. But those days are gone. The DNC courted big money in the 1990s and, now beholden to it, pushed out that progressive element. You can’t very well protest the exploitative urges of big money when it’s paying for your ad campaigns. And the consequences for the disabled and the working poor on some kind of government assistance? Pure contempt.
“Are there no prisons? Are there no workhouses?” –Ebenezer Scrooge, to charity workers who solicit him for a donation for poor children in Charles Dickens’ A CHRISTMAS CAROL (1843)
We are living in a modern Ice Age. Frosty, brittle messages of hatred-of-the-poor abound. The poor are thieves, stealing your tax dollars to live high on the hog. If we don’t like being poor then we should bootstrap it, suck it up, and get a job. Including that toddler with the congenital heart defect whose normal color is a lovely blue. She should get off her cute, Huggie-diapered little tush and mop floors like every other poor child whose parents are lazy losers. After all, God helps those who help themselves.
The holiday season is among us and can be so stressful! Do you experience more flares during this season?