President proposes changes to Social Security

4:43 PM, Apr 10, 2013   |    comments
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MINNEAPOLIS - If you haven't seen President Barack Obama's budget proposal, it fills three pallets, more than three dozen boxes and inside are the blueprints for trillions of dollars in spending and cuts.

One of the key areas of the budget is Social Security.

As it works now, any increase to a social security check is related to the Consumer Price Index.

If prices for items within CPI increase there's a mathematical formula used to increase the amount for an individual's security check, but instead of using CPI, there's a new formula called "Chained CPI," which would work a bit differently.

According to "Chained CPI," if prices go up on a product, it assumes you wouldn't necessarily continue to purchase that product, but purchase something that's priced similarly to what you were paying before the increase.

As a result, security checks would not increase as much, which reduces spending by economist estimates, more than $100 billion over 10 years.

"This isn't from cutting social security," explained Humphrey Institute's Jay Kiedrowski. "This is social security rising slower than it otherwise would."

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