Reply #5: Kucinich is on top of this issue. Good for him. [View All]

[TahitiNut]

Average Wage Indexing (AWI) is an arcane but very important element of calculating Social Security benefits, and has been a critical element in computing (initial, base) benefit elements, the Primary Insurance Amount in particular, since the late 70's. Sadly, however, it's arithmetically contrived enough to cause over 98% of the public's eyes to glaze over with any attempt to describe how it's calculated and used.

One of the effects of exploding "CEO salaries" (the HUGE salaries paid to a very small number of people on corporate payrolls) is to increase the AWI for recent years to a greater degree than actual compensation of the "bottom 99%" of workers increased. Thus, the wretched excesses of the most highly-"compensated" "workers" (it's far greater than fair compensation and they're hardly workers) has had the impact of magnifying increases in Primary Insurance Amounts, particularly for people with mid-level and lower-level earnings histories.


Always remember the "myth of the average." When Bill Gates walks into a room of 100 people, the average net worth of the people in that room increases by more than $500 million. (Too bad they can't spend it.)