The Social Security Administration announced on Wednesday a 5.9 percent increase in 2022, a day before President Joe Biden signed a bill that provides a short-term increase in the U.S. debt limit while inflation reaches a 13-year high.
According to a press release from the SSA, “the 5.9 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022. Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021.”
But so far inflation, one can infer from the SSA press release’s timing, appears to have had a cascading impact across all economic sectors. As NPR’s Chief Economics Correspondent Scott Horsley reports, high oil prices are contributing to an increase in consumer prices.
“Oil prices have been on a tear lately,” Horsley stated. “The U.S. benchmark topped $80 a barrel this week for the first time in nearly seven years. That price has more than doubled over the last year. And gas prices, which typically fall in the autumn as summer driving season winds down, are instead going up. Gas was one of the big drivers of inflation in September. Prices were up 1.2% from the month before and a whopping 42% from a year ago. And what’s driving all this, A, is a strong rebound in demand for oil and production that’s growing only modestly. You know, OPEC and the Russians are sticking with their plan to increase output only gradually. And domestic producers have also been pretty disciplined about not flooding the market.”
While oil continues to drive inflation, in Washington, Senate Minority Leader Mitch McConnell, in a letter to the president, writes that Republicans “will not be a party to” the economic repercussions incurred by not raising the debt ceiling.
“I will not be a party to any future effort to mitigate the consequences of Democratic mismanagement,” McConnell writes, according to Bloomberg. “Your lieutenants on Capitol Hill now have the time they claimed they lacked to address the debt ceiling through standalone reconciliation, and all the tools to do it. They cannot invent another crisis and ask for my help.”
Even though Biden’s signature may have prevented a historical default and would now allow the Treasury Department to meet its financial obligations; “experts,” according to Forbes, predict the $480 billion increase to the debt ceiling won’t be enough to last through Dec., prompting another set of political battles.