Re: How is the premise flawed?
Indexing caps and limits to inflation I have no problem with.
Indexing gains to inflation is murkier.
First, just try to get the average schmo to figure out cumulative inflation (watch accountants push for this...).
Second, most investments are a gamble against inflation. You are betting that over time the value of your investment will go up and will beat inflation. If it didn't well poor you, you lost your gamble. Now cough up.
Third, I imagine the cost would be extraordinarily prohibitive at a period in time where we are about to see the biggest withdrawal of investment moneys ever. Not a Dem or Rep congress could ever go for it (but I'd still like to see the figures).
Cheers,
Tony