Capitol Focus |

Inflation and Its Impact on the Disability Community

This summer, The Arc Minnesota’s public policy team has been busy following a number of federal issues impacting the disability community. Caroline Sell was our Public Policy Intern this summer. She is sharing highlights of the work she has helped us with, advocating for the rights of Minnesotans with disabilities statewide.

One of the first projects I worked on during my internship with The Arc Minnesota was writing a public comment to the federal government on the topic of inflation. The federal government might be changing the way inflation is measured. We wanted to respond.

You may be asking, “What does inflation have to do with disability rights and supporting the mission of The Arc Minnesota?”

Well, the inflation index influences the calculation of the Official Poverty Measure (OPM). In turn, the federal government uses the rate of inflation and the OPM to determine individuals’ eligibility for federal programs. This means that inflation directly affects our stakeholders who use federal programs.

Chaining the inflation rate

Currently, the federal government uses a method called the “Consumer Price Index for All Urban Consumers” (CPI-U) to measure the rate of inflation. The potential proposal would change this method to the “Chained Consumer Price Index for All Urban Consumers” (C-CPI-U) or the “Personal Consumption Expenditures Price Index” (PCEPI). The current federal government administration wants to consider using these alternative methods because they both “chain” the inflation values from month to month.

Some experts say this provides a more accurate estimation of inflation for the general population. However, chaining inflation results in a slower reported rate of inflation. Other experts have said that the chaining method may actually understate the growth in the cost of living for some groups.

How this impacts the disability community

These changes would be especially relevant for low-income individuals. Over time hundreds of thousands of seniors, people with disabilities, children, and adults who rely on assistance will lose support. They will lose support because the OPM will be unable to keep up with the actual rate of inflation. In other words, the rate of inflation will continue to rise but the poverty line will increase more slowly. There will be a growing gap of people that need federal assistance but cannot access it.

It is extremely important to note that there is evidence and data to show that the poverty line is already too low. Families that meet the poverty line and those that are “near-poor” (those who have incomes just above the poverty line) both experience daily struggles. These struggles include high rates of food insecurity, difficulty paying rent and utilities, and high rates of uninsurance. Changing the method for calculating the rate of inflation might actually be a good way to help more people access the support they need. However, the proposed method would result in lowering the poverty level even more. The poverty line is already too low, so the change needed is an increase, not a decrease.

What The Arc Minnesota says

After doing extensive research on the different ways of measuring inflation and the current issues with the OPM, The Arc Minnesota decided to submit a public comment. By submitting a public comment, we are sharing our opinion with the federal government.

We made a recommendation to the Office of Management and Budget (OMB), which is responsible for this potential proposal. Our recommendation was that they should not move forward with chaining inflation. While the impact of this change may seem small at first, there would be significant long-term consequences for people who depend on access to federal programs, including people with disabilities. We told the federal agency that if they do want to change the inflation index, they should choose a method that increases the poverty line to ensure that those in need are able to access governmental services.

The OMB is required to read and respond to all concerns raised by individuals and organizations.

Questions?

If you have any questions or comments about The Arc Minnesota’s work advocating for disability rights at the federal level, please contact us. You may reach out to Alicia Munson, public policy director, at aliciamunson@arcminnesota.org.