Norquist: Chained CPI is Obama trap

The anti-tax crusader Grover Norquist on Friday suggested that President Obama was trying to trick Republicans into backing a tax increase with his proposed change to Social Security benefits.

Norquist, the president of Americans for Tax Reform (ATR), charged that the proposal — known as the chained consumer price index (CPI) — would only be a modest entitlement reform while falling far short of the sorts of changes that House Republicans have sought in their budgets.

At the same time, chained CPI would also raise an estimated $124 billion in new revenues over a decade.

{mosads}Because of that, Norquist said the president was “hoping the Republicans would say something nice about a hidden tax increase.”

“My concern is that chained CPI is what this administration has chosen to throw out like marbles at everybody’s feet to ignore the fact for four years now that they’ve had no recommendations — written down, serious recommendations — to reform entitlements,” Norquist also said.

Norquist’s comments underscore the delicate political situation that chained CPI has put Republicans in. House Speaker John Boehner (R-Ohio) has said the plan was a positive, if modest, step on reining in entitlement spending, and has commended the president for putting the proposal in his latest budget.

But Rep. Greg Walden (R-Ore.), the chairman of the National Republican Congressional Committee, has called the budget a “shocking” attack on seniors.

Chained CPI is a slower rate of inflation than the measure currently used by the government for a variety of programs, and switching to it would lead to Social Security beneficiaries receiving smaller checks than they otherwise would have.

Many liberals have their issues with chained CPI for that reason. But the slower inflation measure would also cause income tax parameters to grow more slowly, thus pushing some taxpayers into higher brackets.

Norquist on Friday compared that idea to the “bracket creep” that occurred when inflation rose under President Carter. Implementing chained CPI, Norquist added, would be a tax increase under the pledge administered by ATR unless it was offset with a tax cut elsewhere.

The vast majority of Republicans in Congress have signed the ATR pledge vowing not to vote for a tax increase.