It's Official: No Social Security Increase
by ALICE GOMSTYN
ABC NEWS Business Unit
Older Americans had dreaded hearing the news for months -- and today the government made it official: For the first time since 1975, there will be no cost-of-living adjustment, or COLA, for Americans receiving Social Security checks next year.

There will be no cost of living increase for more than 50 million Social Security recipients next year, the first year without a raise since automatic adjustments were adopted in 1975.

Under the law, Social Security payments are supposed to increase annually if U.S. consumer prices increase. But over the past 12 months, prices have declined. Specifically, the CPI-W -- the price index upon which Social Security adjustments are based -- has dropped 1.7 percent since September 2008.

Many, including President Obama, the AARP and the Social Security Administration itself, are calling for Congress to approve a $250 stimulus payment to older Americans and other groups, including veterans and those receiving disability benefits, to compensate for the lack of a COLA.

"This additional assistance will be especially important in the coming months, as countless seniors and others have seen their retirement accounts and home values decline as a result of this economic crisis," Obama said.

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