But the chained CPI really isn't being proposed as a Social Security reform, as a way to make the program more solvent or better-functioning. True Social Security reforms think about ways to better protect the poor, or to encourage longer work lives, or increase retirement saving. The chained CPI, by contrast, is about producing savings within the 10-year budget scoring window. 

But by eliminating the cap, a person earning $225,000 would pay roughly four times more in taxes than he'll receive in benefits. A growing resemblance to a welfare plan would be inescapable. 

A New America Foundation proposal would cost 3.7 percent of GDP and crowd out the private saving that drives our economy. 

The narrative is already forming that President Obama only proposed using the chained CPI to appease congressional Republicans. But why should Republicans take the rap for a measure that weakens Social Security for the least well-off and institutes a large and regressive tax increase? Higher taxes and a less effective Social Security program - what's not to dislike?

AEI economist Sita Slavov spoke at an AARP event on the Hill on Social Security and cost-of-living adjustments.

In his State of the Union speech, President Obama urged Congress to "act soon to protect future generations." He was talking about addressing environmental issues. But there's an easier, more obvious step we can take to improve the lives of our children and grandchildren. We can act now to fix Social Security.

David Certner, legislative counsel and director of legislative policy for government affairs at AARP, and AEI’s Andrew G. Biggs will discuss how the Chained CPI should fit into our thinking regarding Social Security and the federal budget.

As the debt-ceiling debate begins, congressional Republicans will demand spending cuts which are likely to include entitlement reforms, with Social Security as a prime target. Although these increases are not the best way to solve America’s entitlement problem, they may be necessary to consider if an agreement is to be reached. If so, payroll tax increases should be levied across the board.

The Social Security program currently encourages early retirement, which reduces the ratio of workers to retirees and increases the strain that entitlement programs place on the federal budget. By improving the structure of Social Security, we can make the program fairer, increase economic growth, and boost tax revenue.

Social Security hasn't added a dime to the federal budget deficit, so why should Social Security reform even be on the table for the budget deal that, sooner or later, must be reached? We've heard that question again and again, from the seniors' lobby to liberal activists to Congressional Democrats, and if true it would be compelling. But unfortunately it's not true.