Obama proposes $250 for retirees

Obama proposes $250 for retirees

President Barack ObamaBarack Hussein ObamaDems punch back over GOP holdup of Biden SBA nominee Biden congratulates Trudeau for winning third term as Canadian prime minister Republicans have moral and financial reasons to oppose raising the debt ceiling MORE proposed giving payments of $250 to more than 50 million retired Americans who won't get an increase in their Social Security checks next year.

The announcement on Wednesday came ahead of the Social Security Administration's expected announcement that seniors will not receive a cost-of-living adjustment in 2010 because of the poor economy.

ADVERTISEMENT

"Even as we seek to bring about recovery, we must act on behalf of those hardest hit by this recession," Obama said.

The cost-of-living increase is pegged to inflation. In 2008, the increase was 5.8 percent, due in large part to gas prices that soared past $4 a gallon. But because of lower energy costs and the recession, Social Security officials are expected to announce Thursday that prices went down and that they won't be increasing Social Security checks.

Obama's proposal will cost $13 billion, the White House said. A senior administration official said that the president won't insist that the proposal is paid for, but Obama will insist that the payments don't affect Social Security's solvency. The Social Security trust fund is expected to run out in 2037, according to administration projections released last May.

The White House proposal amounts to an extension of a program started in the $787 billion stimulus.

More than 50 million people each received payments of $250 last May. The administration expects that approximately 57 million would get $250 in 2010. Of those, 49 million would be Social Security beneficiaries. The rest of the recipients would be veterans, railroad retirement beneficiaries, disability beneficiaries, those on Supplemental Security Income and public-employee retirees not eligible for those programs.

With unemployment persisting near 10 percent despite expected economic growth in coming quarters, White House officials have signaled interest in extending other parts of the stimulus, including increased unemployment benefits and COBRA health coverage for the jobless.

Despite the support for more stimulus measures, a senior administration official refused to call it a "second stimulus."

"These are continuing a few elements of the economic recovery act, which, first of all, were very successful in achieving their purpose and second of all will remain needed in 2010," he said.