Quote of the Day: The Folly of Short-Termism
"The president is wrong to pose the issue as more taxes for millionaires to pay for more redistribution now. That path leads to future crises because higher taxes support the low productivity growth of the welfare state, delay the transition to export-led growth, and do not reduce future budget liabilities enough.
The central issue facing the U.S. is whether we turn away from unsustainable budget and trade deficits toward an economy that grows at historic rates with low inflation. More redistribution now won't do that. More investment and productivity growth now will, and it will also provide more resources to pay for a greater share of future health-care costs at lower tax rates.
~Alan Meltzer in today's WSJ
137 Comments:
"Short-termism" is the only game this nitwit and his administration know how to play. Cash-for-Clunkers, the housing credit, the SPR release, the stimulus, etc., all steal demand from the future in order to prop up today's economy artificially. All we're left with in the end is a mountain of debt.
you had a mountain of debt BEFORE this President came into office.
He's added to it no doubt but the previous decade of spending more than we took in in revenues set the stage for a really bad economy when he came into office and limited the options to short-term responses in large part.
folks can argue as to how he should have responded to it instead of the way he did but when those same folks say he should have done what Bush and Republicans did prior to him taking office - as the antidote for the problem then we have the makings of idiocy .. which in my view that same idiocy continues.
We have this debt and instead of owning up to it and paying it off.. we're still in a blame game as to who/what caused it and we're still saying that idiotic supply-side policies will pay it off when clearly it has not.
The very folks who claim to know what the problems are - themselves - refuse to own the problem as it is and instead continue to seek to blame Obama/others when much of it - he had nothing to do with.
Not a one of the Republican candidates nor the elected leaders have put forth a plan that balances the budget despite passing a balanced budget amendment.
How can you pass a balanced budget amendment that does not also have the plan for for to balance it?
that's the kind of idiotic politics we have now days that passes for "leadership".
blaming Obama is the coward response.
"Increased domestic saving and slow consumption growth will help the transition to an export-led economy by reducing foreign borrowing. Foreigners owned $4.5 trillion of our debt at the start of this year. We can only service that debt by increasing exports and reducing imports and consumption growth."
Exports need to be a much bigger % of the economy as part of working our way out of short-termism.
"short termism"...
Gee! I thought initially it was about a 'day traders'...
Larry,
"..but when those same folks say he should have done what Bush and Republicans did prior to him taking office - as the antidote for the problem then we have the makings of idiocy .. which in my view that same idiocy continues."
Speaking of idiocy, your opening statement was Obama had a mountain of debt before he came into office. So yes, he DID do what "Bush and Republicans did prior.." only he took it to an unprecedented, ruinous level.
On the other hand, he also has been waging a merciless, relentless war on capitalism. So I guess that's something different.
"Not a one of the Republican candidates nor the elected leaders have put forth a plan that balances the budget despite passing a balanced budget amendment."
Uh, yeah they have. Paul Ryan's plan, if it had become law, would probably have kept the US bond rating from being downgraded. "Cut, Cap, and Balance" would have eventually blanced the budget(hence the "Balance" in the title of the bill.) Rand Paul's plan would balance the budget in 5 years.
You've been told all this before, yet you keep up with the same nonsense in order to protect your hero Obama.
"you had a mountain of debt BEFORE this President came into office"...
Who was the super majority in both Houses of Congress before Obama came into office?
"He's added to it no doubt but the previous decade of spending more than we took in in revenues set the stage for a really bad economy when he came into office and limited the options to short-term responses in large part"...
Which President spent like this before Obama?
Federal deficit tops $1T for 3rd straight year
"Not a one of the Republican candidates nor the elected leaders have put forth a plan that balances the budget despite passing a balanced budget amendment"...
Well as usual Larry G you parrotting a handful of Democratic politicos means that you'll be wrong...
Sen. Rand Paul's budget plan...
regardless of the totally bogus and clueless "relentless war" propaganda...
there was 10 trillion in debt when Obama came into office.
this is money we owe.
rather than pay it off.. we play the blame game about any and everything associated with right-wing idiocy .. but totally ignore the fact that we have that debt.
we evade the realities...and try to find whipping boys to divert and hide the simple unvarnished facts.
people true to their principles would not only blame Obama but they would own the debt and say how to deal with it.
instead.. we just blame... and evade.. and refuse to own that debt, eh?
re: " Uh, yeah they have. Paul Ryan's plan,"
Paul Ryans plan relied on supply-side economics to pay down the debt - over 30 years and assumed an unemployment rate of 3%.
calling THAT abortion a plan is typical of the right wing idiocy these days.
that's not a plan guy.
a plan has to have some reasonable chance to work.
a plan that looks a lot like Bush's "deficits don't matter" plan is not a plan.
Larry,
You must be aware by now that Obama is Bunny's long time boyfriend. Your showing this much interest in defending him could be seen as "cutting in", and could lead to big trouble for you. Be careful.
Larry,
"Paul Ryans plan relied on supply-side economics to pay down the debt - over 30 years and assumed an unemployment rate of 3%."
It also cut spending, something Obama has no interest in doing. He even told us a couple days ago, "there's not much more we can cut."
"instead.. we just blame... and evade.. and refuse to own that debt, eh?"
I don't even know what that's supposed to mean, really. Obama is President, he has turned a big problem into an existential crisis. He has fought the Republicans to the last ditch on spending cuts, offers no plan of his own, and says we can't cut any more. Why shouldn't we blame him?
Hey Larry, just curious, are you going to return to the "no Republican has offered a balanced budget" crap again, or has the truth finally penetrated your thick skull?
"there was 10 trillion in debt when Obama came into office"...
There was Larry G, according to what 'credible' source?
"we play the blame game about any and everything associated with right-wing idiocy"...
How does this compare to left wing parasitism?
"people true to their principles would not only blame Obama but they would own the debt and say how to deal with it"...
Why should people who didn't want what drove the debt, 'nanny state socialist programs' and fought against the implementation of these programs now be expected to pay for them?
I stand corrected on the Rand Paul Plan. It's a real plan and I'm going through it now.
The Pauls have principles.
I'm not defending Obama here. He was dealt a really bad hand and he may well not be up to dealing with it....not that Bush or any of the current crop of political players are either.
but the demonization of Obama began long ago with the birthers and dog-whistle racists and supply-side true believers.
I remind folks that there are also two deficit commission plans that are, if nothing else, reasonable starting points.... benchmarks for other plans - like the Ryan plan to contrast and compare.
We need to be moving towards real solutions rather than what the President is not doing.
Forget the President. He's probably no better or no worse than Bush which I admit is not saying a whole lot but he did not create this problem.. and he, alone, is not going to fix it.
But many here are so far out in la la land that all the past century of supposed govt wrongs are now put on this President...
FDR, SS, Lyndon Johnson, Medicare, etc, etc.. now it's this Presidents faults.
Hells Bells - the man IS a Democrat and folks.. like it or not.. about 70% of the American people support SS and Medicare so you folks need to suck it up.
Paul Rand did.. look at his plan....he doesn't sound like any of a lot of you guys.. Both Medicare and SS are included in HIS 5-year balanced budget plan because the man knows that FICA funds much of them not income taxes.
yeah, yeah... I know.. payroll taxes are fascist too.. but again.. suck it up boys.. Obama did not create them... and the public supports them....
@juandos
history of the debt:
http://en.wikipedia.org/wiki/File:Federal_debt_to_GDP_-_2000_to_2010.png
note 2008-2009
blaming Obama for all the things that happened PRIOR to his Presidency whether it be debt or social programs in the context of discussions about WHAT TO ACTUALLY DO about the CURRENT DEBT is dumb.
D U M B .... but typical of the right wing idiocy...
we have a debt. It very likely is attributable to the last 3 or 4 Presidents.
blame away but what are you going to actually do about it?
why do these discussions always devolve into red team blue team food fights?
neither party has been responsible for a long time.
even when they try, they get shot to pieces by the other team. it's always more popular to have free beer than it is to pay for the beer you already drank.
the whole process is a nightmare.
frankly, until we put in a flat tax that gives EVERYONE some skin in the game, nothing is gonna change.
how can you win on fiscal responsibility when 51% of americans pay no net federal income tax?
even then, i'm not so sure it works.
if you give the government the power to hand out goodies for votes, they will regardless of whether they are they the coke party or the pepsi party.
the only way we get real fiscal responsibility is with small government and FDR pretty much destroyed that.
it's been all downhill from there.
using GAAP, the last time we had a balanced federal budget was eisenhower.
Rand Paul's actual 5 year plan and not the Washington Examiners "take" on it is here:
http://campaignforliberty.com/materials/RandBudget.pdf
and here:
http://www.scribd.com/doc/50974600/Senator-Rand-Paul-5-Year-Balanced-Budget?secret_password=2cc367wiqv0a3y4y3441
it's worth reading IMHO.
It's straight forward, factual, HONEST and chooses NOT to engage in propaganda/blather TO HIS CREDIT and unlike many who track in ideological propaganda tripe to CD.
The man CORRECTLY ascertains that SS is not the problem and HONESTLY takes the cuts out of the non-FICA government including major slices out of the military.
He has one problem so far and that is he talks about wiping out 4 agencies and counts their budget in his savings cuts but then he transfers some agencies within those agencies to other cabinets but does not carry forward those agency budgets... as far as I can tell.
So NOW - we have THREE - CREDIBLE approaches to balancing the budget -the two deficit commissions and Rand Paul's credible proposal.
SO... how many OTHER Republicans have signed on to one of those 3 proposals instead of continuing to blame others ?
Coburn (R-OK)
DeMint (R-SC)
Hatch (R-UT)
Lee (R-UT)
McConnell (R-KY)
Paul (R-KY)
Vitter (R-LA)
and no Dems.
My hat is off to these 7.
"The very folks who claim to know what the problems are - themselves - refuse to own the problem as it is and instead continue to seek to blame Obama/others when much of it - he had nothing to do with ... there was 10 trillion in debt when Obama came into office." -- Larry
He had nothing to do with it? When the Democrats took over the Congress in 2007 the deficit was about 160 billion, down from about 400 billion. Upon taking over, the Democrats went on a spending spree and Barack Obama voted for all of that spending, either as a Senator or as President. As for the debt, what you fail to acknowledge is that Obama and the Democrats increased that number by roughly a third in only 2 1/2 years. What's more, they have enacted another expensive entitlement - ObamaCare - which will only increase the level of our future indebtedness.
"... people true to their principles would not only blame Obama but they would own the debt and say how to deal with it." -- Larry
Can you really be this clueless? The Republicans have tried many times to reform the major drivers of our spending - Medicare, Social Security and Medicaid. Every time, the left has reacted with lies and demagoguery defeating any reform. Not once have they offered a significant reform plan of their own. No, they created these programs, deliberately setting them up as Ponzi schemes. They have defeated every effort to rationalize them and they have offered no alternative. Own That!
"why do these discussions always devolve into red team blue team food fights?"
Asked.
"the only way we get real fiscal responsibility is with small government and FDR pretty much destroyed that ... using GAAP, the last time we had a balanced federal budget was eisenhower."
And answered.
"... in 2007 the deficit was about 160 billion, down from about 400 billion"
how about the truth:
http://www.usgovernmentspending.com/us_deficit
and how much debt did we have from the years that the Republicans had both houses of Congress and the Presidency and you say they "tried"?
If they held majorities in both houses and the Presidency and succeeded in approving 2 wars and Medicare Part D without Democratic support why were they "forced" to add another 5 trillion dollars to the debt?
see that's the problem with the revisionist history blame game here.
The Republicans are dirty as the Dems on the debt ... but when we say how we will actually deal with the debt - we revert back to the blame game - a cowardly and irresponsible tactic coming form the very folks who are using that debt to blame people and policies rather than deal with the problem.
there's more than enough blame to go around.. why flog that horse when the debt is in front of us and has to be dealt with?
"I'm not defending Obama here. He was dealt a really bad hand and he may well not be up to dealing with it...."
Oh, please Larry, you have been doing nothing BUT defending Obama, doggedly insisting he had a plan to tackle the monstrous debt he ran up. You're another liberal, just like Obama, who likes to pretend he's above all the "partisan bickering," all the while throwing jabs and inaccuracies at the other side.
You keep knocking Paul Ryan's plan, well here's what your hero Obama said about it on April 13: "A 70% cut to clean energy. A 25% cut in education. A 30% cut in transportation. Cuts in college Pell Grants that will grow to more than $1,000 per year."
Sounds great to me, nothing in that list qualifies as supply-side economics.
"I remind folks that there are also two deficit commission plans that are, if nothing else, reasonable starting points.... benchmarks for other plans - like the Ryan plan to contrast and compare."
And, once again, the reason there were 2 is because Obama completely blew off Bowles-Simpson so he created another commission in order to look like he was actually doing something.
"But many here are so far out in la la land that all the past century of supposed govt wrongs are now put on this President..."
No, he's just the giant asswipe standing in the way of actually fixing the problems.
"... doggedly insisting he had a plan to tackle the monstrous debt he ran up."
he had/has a plan but it includes more revenues and the Republicans walked about from it..without advancing a plan of their own nor did they adopt either of the two deficit commission plans nor did but 7 of them support Rand Pauls plan.
Paul Ryans plan ... go look at it.. and you'll see that the vast majority of it does not cut things like the military (unlike Rand Pauls's plan) and Ryan's plan counts on supply-side to fully fund the military .... while capping entitlements.. and the plan is premised on a 3% unemployment rate.
that's not a "plan".
the two deficit commissions and Rand Pauls plan are real plans... using real premises....
Ryan is doing what you folks accuse CBO of doing....except 10 times worse....
che-
i don't see the relevance of your proposed asked/answered post.
nobody has reduced the debt while in power.
nobody has done anything much for the GAAP deficit.
team red and blue are like bonnie and clyde accusing each other of being bank robbers.
"If they held majorities in both houses and the Presidency and succeeded in approving 2 wars and Medicare Part D without Democratic support why were they "forced" to add another 5 trillion dollars to the debt?"
Larry, you must have been out taking a whiz during the Bush presidency. Democrats were overwhelmingly in favor of the war in Afghanistan, for awhile. They even used it as the "good war" in order to buttress their (later) arguments against the war in Iraq. And many Democrats voted for the AUMF in Iraq including Hillary Clinton, John Edwards, and John Kerry. As for Medicare Part D, the Democrats wanted to spend 2x as much money.
larry-
SS is A problem, but not THE problem. it is, however, a big, big problem.
social security added $1.4tn to unfunded liabilities in 2010 alone. medicare added another $1.8tn.
stop and think about those numbers for a minute.
just with those 2 programs, we added 23% of GDP to our liabilities in one year.
add in the 11% of GDP cash deficit, and we are sinking so rapidly it's hard to see how can ever come up for air.
when entitlement deficit growth is running at 23% of GDP, sorry, but there is absolutely no way to balance a budget without cutting entitlements.
overall unfunded liabilities from SS and the medi programs is over $61tn.
that is simply not payable. ever.
are there lots of other things (like milspend) that we can cut, sure, absolutely.
but we spend $690 bn on military in 2010. cutting it by 100% would only cover 21% of the entitlement visibilities run up that same year.
sorry, but there is just no credible way to argue that entitlements are not the problem. misleading government cash accounting can be used to sweep it under the rug for a little longer, but the bill for this reckless party is coming.
"he had/has a plan but it includes more revenues and the Republicans walked about from it.."
Again?? We had this conversation a couple weeks ago. You were unable to provide this secret plan that apparently only you knew about. Even Obama's spokesman Carney knows nothing of this magic plan you keep talking about. I thought you were sufficiently embarrassed to drop this nonsense. Obama never had a plan, he had speeches. The CBO can't score a speech.
"..without advancing a plan of their own nor did they adopt either of the two deficit commission plans nor did but 7 of them support Rand Pauls plan."
The GOP passed "Cut, Cap, and Balance" that was killed in Harry Reid's Senate so Obama didn't have to veto it. I've told you this many times, so you're either a slow-learner or a liar.
"there was 10 trillion in debt when Obama came into office.
this is money we owe.
rather than pay it off.. we play the blame game about any and everything associated with right-wing idiocy .. but totally ignore the fact that we have that debt.
we evade the realities...and try to find whipping boys to divert and hide the simple unvarnished facts."
It's pretty hard not to blame the Spender in Chief when he has no plan to reduce the deficit, let alone pay off the debt.
As you pointed out, when he took office,the national debt was $10tn. He has since then borrowed $4.3tn more in only 2.5 years. He recently asked for, and received, a $2.4tn increase in his credit card limit, as it was maxed out. By the end of his one and only term in office, he will almost certainly spend to the new credit limit, so the national debt will be $16.7tn. A 67%increase in only 4 years. An amount equal to nearly half of US GDP.
As for paying off the debt, as you know, the national debt is held almost entirely in marketable US treasuries, except for the Social Security trust fund, which holds non-marketable IOUs.
Treasuries have a particular maturity date, and can not just be "paid off" by the treasury, but can be redeemed as they come due. The problem comes from continually selling more treasuries to pay off existing ones, as well as interest due. This amounts to making cash withdrawals from your credit card to make youir credit card payment. At some point, it can't continue.
Many believe we have not only reached that point at which the debt can never be paid off, but have gone beyond it. Your buddy the S. I. C. either doesn't understand this, or actually wants the US economy to collapse.
Here's a good visual representation of who holds the national debt as of the end of the last fiscal year.
Although it's not shown seperately, $1.6tn of the amount held by US individuals and institutions is currently held by the Federal Reserve. This represents an amount of money that has been created out of thin air.
...." Larry, you must have been out taking a whiz during the Bush presidency. Democrats were overwhelmingly in favor of the war in Afghanistan, for awhile."
nope. we're talking about who was in power, held the majorities and decided whether we'd have higher deficits and more debt.
The Republicans had the power and authority to NOT increase the deficit and debt and to instead PAY for the two wars and Medicare Part D and instead of paying for it they chose to go the deficit/debt route.
here's the result:
http://www.usgovernmentspending.com/downchart_gs.php?year=1996_2011&view=1&expand=&units=b&log=linear&fy=fy12&chart=H0-fed&bar=1&stack=1&size=m&title=&state=US&color=c&local=s
re: " SS is A problem, but not THE problem. it is, however, a big, big problem.
social security added $1.4tn to unfunded liabilities in 2010 alone. medicare added another $1.8tn."
not according to this:
http://www.ssa.gov/oact/TRSUM/index.html
skip down to the title:
What Were the Sources of Income to the Trust Funds in 2010?
and look at the rows:
General Revenues and General Fund reimbursements.
SS is piddling compared to Medicare Part B (SMI) which is about 200 billion.
But 200 billion out of a annual deficit north of a trillion is still only 1/5 of the "bigger" problem and SS - right now today is not a big part of it.
I admit that it will be in the future but RIGHT NOW - TODAY- ...
"THE" problem is the 1.5 trillion annual deficit and the things that are components of which SS is very minor.
People are using the deficit as an excuse to go after SS which they fundamentally disagree with as a concept but they are dishonestly using finances as the pretext.
that's what I object to.
Be honest. Be truthful. Deal with the facts.
"how about the truth" -- Larry
Did you actually follow the link you provided? The budget deficit as a share of the economy during President Bush’s tenure averaged two percent, below the fifty-year average of three percent. Here it is in simple English:
After beginning with a Clinton-era surplus in 2001, the Bush administration ran up deficits of $158 billion in 2002; $378 billion in 2003; and $413 billion in 2004. Then, with revenues pouring in, the deficits began to fall: $318 billion in 2005; $248 billion in 2006; and $161 billion in 2007. That 2007 deficit, with the tax cuts in effect, was one-tenth of today’s $1.6 trillion deficit.
Washington Examiner
"... they held majorities in both houses and the Presidency and succeeded in approving 2 wars and Medicare Part D without Democratic support why were they "forced" to add another 5 trillion dollars to the debt ... the problem with the revisionist history blame game here." -- Larry
Actually, they did not hold a majority in the Senate during Bush's first term and they never held a filibuster proof majority as the Democrats did during Obama's first two years. They succeeded in approving 2 wars with the support of a majority of Democrats. As for Medicare Part D, while I was against it it has cost LESS than was first estimated and what you're leaving out is that the Democrat alternative, which was supposed to eliminate the "doughnut hole", was far more expensive.
Bush was confronted with his own set of challenges - an epic stock market crash and the ensuing recession, 9/11 and the need to rebuild a military which had been cut in half by Clinton, hurricane Katrina, etc. Not once, that I'm aware, of did he whine about having inherited a mess. As for being forced to add 5 trillion to the debt, the vast majority of government spending, then as now, was spending on entitlements. So, yes, he was forced to spend that money. He did, however, seek to reform both Social Security and Medicare. Where are Obama's plans for entitlement reform? Can you provide a link?
" SS is A problem, but not THE problem. it is, however, a big, big problem.
social security added $1.4tn to unfunded liabilities in 2010 alone. medicare added another $1.8tn."
see Rand Pauls's budget.. where he HONESTLY portrays SS true role....
" You were unable to provide this secret plan that apparently only you knew about"
I'm pretty sure I provided you with the plan.. which you rejected...
but you got the plan which included revenues....
show me the cut, cap balance budget guy?
it don't exist.
it's a PR motto.. and nothing else.
Paul Ryan was the plan they supported until they realized that they'd all be voted out of office..
" It's pretty hard not to blame the Spender in Chief when he has no plan to reduce the deficit, let alone pay off the debt"
he has a plan - you don't agree with it.
find a plan you agree with as part of your blame game... rather than just the blame game which is bogus to the bone...
there's plenty of blame to go around.
Clinton brought 5 trillion. Bush added 5 trillion. Obama has added 5 trillion.
Okay?
now.. like a dog on a bone..you focus on Obama and forget how we pay it.?
"nobody has reduced the debt while in power ... nobody has done anything much for the GAAP deficit."
The drivers of our deficits and by extension our debts are programs enacted by Democrats. The initial surpluses related to these new entitlements provided the money used to increase the size and influence of government, funding things like the "War on Poverty". Once these programs were in place their funding was mandated by law, and while the Republicans have tried to reform them, the Democrats have fought to make any reforms impossible.
The Republican record on spending is not perfect by any means, but compared to the Democrats they've behaved much more responsibly. Given the choice I would eliminate or privatize all entitlements and rollback the "New Deal" and the "Great Society" leaving in place only a social safety net, not a hammock. Unfortunately, many Americans have been conditioned to expect government handouts and until there is some sort of fiscal reckoning they will not be convinced that such massive government spending is inherently unsustainable.
"Clinton brought 5 trillion. Bush added 5 trillion. Obama has added 5 trillion. Okay?" -- Larry
In 8 years. In 8 years. In 2 1/2 years.
Larry,
"nope. we're talking about who was in power, held the majorities and decided whether we'd have higher deficits and more debt."
Nope. YOU said they did all this WITHOUT Democrat support. Not true in case of the wars. Democrats wanted to spend even more regarding Medicare Part D.
"I'm pretty sure I provided you with the plan.. which you rejected..."
You finally linked to his monstrous fy 2012 budget that ran the debt into the stratosphere and was defeated in the Senate unanimously. I not only rejected it, I marvelled at your ignorance. Again, I assumed you were embarrassed enough to drop it when I pointed this out. So, let me get this straight...this is still the plan you are talking about???
"now.. like a dog on a bone..you focus on Obama and forget how we pay it.?"
Obama is standing in the way of paying it. He said Monday night "theres not much more we can cut."
@morg -
I have absolutely no problem reforming Medicare Part B and MedicAid to be capped at a fixed % of GDP or equivalent measure.
but first we have to be willing to recognize the different contributions to the budget between FICA (payroll tax)-funded Medicare Part B and income-tax/general revenue-funded Medicare Part B.
if you look at the trustees report:
http://www.ssa.gov/oact/TRSUM/index.html
you'll see the truth - and the difference.
Part A current is using less than a billion dollars of general revenue money whereas Part B is using more than 200 billion.
Part B is the problem.
Part B is NOT an entitlement in the sense that Part A is.
You do not have to sign up for Part B - it is purely voluntary.
But no senior in their right mind passes on Part B enrollment because it's basically $100 a month comprehensive health care for as long as you live with no adjustments to your age or income.
Part B needs to cost more, have larger deductions, higher co-pays and be means-tested.
Any or all of the above would reduce Part B to a small part of the budget.
MedicAid is going to be harder but a major part of MedicAid is people who own their houses outright and have significant assets who are going into nursing homes and want to pass those assets on to their kids and have taxpayers pay for their nursing home care.
that has to be fixed also.
at the least - people who own homes who need nursing homes need to have reverse mortgages put on their homes to pay for their nursing home care and whatever is left goes to their heirs.
but fixing Medicare Part B and MedicAid (as well as SS) are relatively straight forward and will be supported, even if reluctantly by most folks when the truth is told to them.
The military, homeland security and two wars off budget are not as easy and that's my problem with the folks who want to blame... Obama... SS.. entitlements as the primary villains with the deficit and debt.
It's simply not the truth.
and until and unless we are willing to put aside the ideological aspects and deal with the realities.. we just continue to basically hold the deficit and debt resolution - hostage to ideological demands that cannot even be supported as economic imperatives.
the simple facts are that entitlements are part of the problem but not THE problem and that the entitlements are solvable problems as presented in both deficit commission reports and even Rand Pauls proposals.
re: " In 8 years. In 8 years. In 2 1/2 years"
agreed...
but you're all wet on the budget.
210 billion is Medicare Part B
400 billion id MedicAid
SS and Medicare Part A are very minor parts of it.
we take in about 1.1 trillion in income taxes.
600 billion of that is spent on Medicare Part B and MedicAid.
we spend 2.2 trillion.
where is the rest spent?
" Nope. YOU said they did all this WITHOUT Democrat support. Not true in case of the wars. Democrats wanted to spend even more regarding Medicare Part D. "
Paul - if you read up on how Part D passed the Congress.. it had nothing to do with Democrats....and it had a lot to do with Tom Delay threatening members of his own party at 3am.
the point here is that the Republicans owned majorities in both houses and the Presidency and could have cut/reduced the deficit and debt without a single Democratic vote ...
so if we had the problem with the deficit and debt and Republicans swear up and down they are the true fiscal conservatives who REALLY want to fix the problem - what did they actually do when they had the power and authority to do it?
Instead of wiping out Clinton's 5 trillion debt by increasing the surplus they inherited from Clinton, they did what?
What they did was DOUBLE the debt.
and they had the opportunity to do the opposite - without having to convince a single Democrat to accomplish it.
this is the truth.
blaming the Dems is totally bogus when the Dems have NEVER claimed to be fiscal conservatives to begin with and during Bush's term had no way to keep the Republicans from balancing the budget if they were really serious about doing it.
fess up Paul.. it's the truth.
you cannot spin your way out of this.
"but fixing Medicare Part B and MedicAid (as well as SS) are relatively straight forward and will be supported, even if reluctantly by most folks when the truth is told to them."
this sounds awfully optimistic to me.
the AARP is not going to go quietly, and they vote in droves.
and part B is an entitlement. you are entitled to all you can eat healthcare for virtually nothing. sure, you could opt out, but you've been paying for it your whole life, so why would you?
i agree that there are simple ways to solve the issues in fiscal terms, but the politics of getting it done are anything but simple.
therein lies the problem.
@morg - we could have a legitimate different view on the politics but most seniors who own their own homes, often including additional vacation homes and RVs and some 3 or more cars with half a million in assets and income... would agree to pay THEIR SHARE of an overall plan to balance the budget - I believe.
Charging seniors $100 a month for health care is ridiculous and characterizing it as an 'entitlement' leaves the impression that people are entitled to it.
they're only entitled to purchase it and the govt is "entitled" to charge for it and increase the premiums to keep it solvent.
If seniors no longer like the cost, they certainly are free to pursue other options including whatever AARP might want to offer.
Right now.. AARP offers Medicare "Gap" policies which for those seniors who are well off - means that Medicare Part B would then cover everything 100% while those folks kept their homes, cars, RVs and continued to have 50K+ annual retirement incomes and still be able to leave half a million in assets to their sons/daughters.
It's middle class retirees who are ALSO in bed with the MedicAid "leeches".
but as I said..
we bring in about 1.1 trillion in income taxes and we spend about 2.1 trillion and of that amount - about 600 billion is Medicare Part B and MedicAid.
we still have another 600 billion non-entitlement spending that has to be cut to balance the budget.
Larry,
"blaming the Dems is totally bogus when the Dems have NEVER claimed to be fiscal conservatives to begin with and during Bush's term had no way to keep the Republicans from balancing the budget if they were really serious about doing it."
Not all Republicans are good, I have never claimed otherwise. That said, there are no good Democrats. There were never enough true fiscal conservatives in the GOP during Bush's terms, including Bush himself. Meanwhile,the Democrats agitated for more and more spending throughout. The direction should be to elect more conservatives and throw out the Democrats, especially Obama. You know, the guy who says we can't cut any more from the budget. You actually seem to recognize this when you say.. "the Dems have NEVER claimed to be fiscal conservatives to begin with."
"you cannot spin your way out of this."
Who is the one spinning? I'm not the one deflecting the blame from Obama's staggering race towards the fiscal cliff.
"history of the debt:
http://en.wikipedia.org/wiki/File:Federal_debt_to_GDP_-_2000_to_2010.png"...
I said a, "credible" source Larry G and there's nothing whatsoever credible in wikipedia since there's damn little peer review...
"but the demonization of Obama began long ago with the birthers and dog-whistle racists and supply-side true believers"...
So Obama's hanging with the mad bomber Ayers had nothing to do with the demonization, eh?
So the demonization didn't begin with Obama spilling his commie guts by tell 'Joe the Plumber' about sharing the wealth?
Or about Obama making inane noises about coal fired electric plants?
"I'm not defending Obama here. He was dealt a really bad hand and he may well not be up to dealing with it"...
What's funny is that the bad hand Obama had dealt to him was done by himself and his fellow party members while they were in control of both Houses of Congress...
"about 70% of the American people support SS and Medicare so you folks need to suck it up"...
Well good! Then that 70% won't mind paying for those programs will they?
"The man CORRECTLY ascertains that SS is not the problem..."...
Not exactly, I think you need to look at more of Rand Paul's writings and comments...
"blame away but what are you going to actually do about it?"...
Trying to convince fools not to along with the charade and Ponzi scheme....
morgaovich pretty much nails the coffin closed with his comment: "team red and blue are like bonnie and clyde accusing each other of being bank robbers"...
"Clinton brought 5 trillion. Bush added 5 trillion. Obama has added 5 trillion.
Okay?"
The history is irrelevant. The national debt is a serious problem, and the Spender in Chief, who is currently in the driver seat, has only managed to find the gas pedal, is pressing it even harder than his predecessors, and has no plan to even begin searching for the brake pedal. It's now his job to show some leadership, no matter what's happenned in the past. He's had 2 1/2 yrs, and has only made matters worse.
Nice sounding but meaningless speeches, nothing more. Where is his plan, Larry? I haven't rejected it, as I haven't seen it. Show it to us.
As to the suggestion that more revenue is needed through taxes, you should reread some of the comments on this thread, and try to understand the problems with that idea.
Allow me to quote morganovich:
"stop and think about those numbers for a minute.
just with those 2 programs, we added 23% of GDP to our liabilities in one year.
add in the 11% of GDP cash deficit, and we are sinking so rapidly it's hard to see how can ever come up for air."
I know it may not help, but DO think about those numbers for a moment.
Current tax revenue is roughly 16% of GDP. To eliminate the current deficit of 11% of GDP and the annual increase in entitlement liabilities of 23% of GDP, requires a tax revenue increase to 50% of GDP just to keep things from getting worse. None of the current debt is even addressed.
Can you afford to pay 50% of your income in taxes?
The fact is, no matter how much tax rates are increased, and "loopholes" plugged, actual revenue won't increase by anywhere near the required level. Incentives matter.
People will change their behavior to avoid higher taxes, except those who can't, because their only income is W2 wages.
Are these the people you want to collect more revenue from?
Spending needs to be drastically cut, Larry. Your boyfriend in the Whitehouse doesn't have a clue what to do. He's incompetent, and is out of things to try.
Larry is in denial. Instead of a V-shaped recovery, we got a train wreck.
Ron H,
"As to the suggestion that more revenue is needed through taxes, you should reread some of the comments on this thread, and try to understand the problems with that idea."
To that, read Mickey Kaus's post about the outrageous federal hiring that is STILL going on even while Obama insists we just can't cut any more spending. His final sentence is right on the mark: "Don’t voters want a President who spends a year or two at least trying to wring the fat out of government before he jumps to the conclusion that he needs to extract more in taxes?"
Paul,
Thanks for the link - I think - now I need to take another blood pressure pill. Kaus is right on the mark with this article.
By the way, you must assume that Larry, like almost everyone else in the world, can be embarrassed by SOMETHING. I haven't found what that might be yet. Showing him why he is clueless certainly doesn't do it.
" That said, there are no good Democrats"
I believe it was Clinton who handed Bush and the Republican majority a slight surplus AND the OPPORTUNITY to roll back even more the Democrat excesses.
Instead this Republican .. MAJORITY.. did WHAT?
they DOUBLED the deficit by doing the very thing they claim the Dems do.
this was not a "few" Republicans Paul.. this was a BUNCH!
and it's the SAME BUNCH that is around right now crying wolf about the budget.
they are the great pretenders.
fess us Paul.. The Dems did what they usually do.. we expect that..
but what did the Republicans do?
they acted like Democrats - right?
and they are STILL acting like Democrats because even though they say "cut" - the ONLY ONE that actually has delivered a proposal is Rand Paul.
the rest of them are your basic hypocrites - save the 7 who supported Rand.
where are the Republicans fiscal conservative principles beside wagging on their tongues?
nowhere.
@juandos
" .. I said a, "credible" source..."
then you must know that Wiki does not source data - they provide footnotes to it..
how about you go back and check that footnote guy? Report back....
" What's funny is that the bad hand Obama had dealt to him was done by himself and his fellow party members while they were in control of both Houses of Congress..."
ahem.. that would be AFTER they were handed a 10 trillion debt, a 1.5 trillion annual deficit and a cratered economy....
back to the blame game here, eh?
" Well good! Then that 70% won't mind paying for those programs will they?"
and they do.. FICA pretty much pays for SS and Part A right now.
How about you show me the numbers that say they don't?
here:
http://www.ssa.gov/oact/TRSUM/index.html
skip down and check out how much general revenue money is provided to SS.
" Not exactly, I think you need to look at more of Rand Paul's writings and comments"
well .. I DID.. DID YOU?
here's what Rand says:
" Based on the trustees’ report on long-term projections, Social Security payments are expected to run a cash deficit beginning 2015,"
http://campaignforliberty.com/materials/RandBudget.pdf pg 42
he goes on to talk about the problems SS WILL HAVE - which I AGREE WITH but the issue right now is what role is SS playing in the CURRENT deficit and debt and the answer is VERY LITTLE ..ESPECIALLY compared to the other things that contribute to the 1.5 trillion annual deficit and 14+ trillion debt.
this is what I object to here which is the dishonest portrayal of what role that SS plays in the CURRENT DEFICIT and DEBT and why SS is prioritized for change rather than dealing with the real root causes of the CURRENT DEFICTS.
" Trying to convince fools not to along with the charade and Ponzi scheme....
morgaovich pretty much nails the coffin closed with his comment: "team red and blue are like bonnie and clyde accusing each other of being bank robbers"... "
more blather to divert attention from the true issue.. this is your bailout song... "blame" and "ridicule" but for God's Sake don't say something relevant and honest with regard to the CURRENT Deficit and Debt.
If you can't deal honestly with this issue why should anyone listen to anything else you say?
"I believe it was Clinton who handed Bush and the Republican majority a slight surplus AND the OPPORTUNITY to roll back even more the Democrat excesses."
What you believe and what the fleshed out facts are, have been shown many times to be entirely different. Clinton was no Obama, I'll give you that. But his so-called surplus was a result of the Gingrich GOP keeping his spending in check, and a dot-com/Y2k bubble that popped just as Clinton was getting ready to leave office. Those surpluses Bush "inherited" were never going to materialize. Bill Clinton is the same guy who tried to nationalize our health care system in his first yr in office. He moderated his radical impulses in 1994, when the GOP took over Congress, but not enough to shut the government down over the "extremist" GOP budget cuts.
"..and they are STILL acting like Democrats because even though they say "cut" - the ONLY ONE that actually has delivered a proposal is Rand Paul."
You're actually making progress, Larry, congratulations. Perhaps in a year or so of constant tutoring, you might recognize there have been other GOP plans to cut the size of government. You might finally discover Obama has not submitted an actual plan to cut the deficit and debt.
" The history is irrelevant"
we AGREE
" The national debt is a serious problem"
again - agreement!
".. and the Spender in Chief, who is currently in the driver seat, has only managed to find the gas pedal, is pressing it even harder than his predecessors, and has no plan to even begin searching for the brake pedal. It's now his job to show some leadership, no matter what's happenned in the past. He's had 2 1/2 yrs, and has only made matters worse"
BZZZZTTTT
even if I buy the premise as Obama being the SOLE person responsible for the 14 trillion - the man was NOT responsible for the 10 trillion created by his predecessors but even more than this - is what you are saying anything other than playing the blame game while not coming up with a competitive plan that would show up Obama for what you say he is?
You have a wide open field here.
There are two Deficit commission reports and Rand Pauls and none of the 3 talk about who is to blame and all 3 focus on what to do to move forward.
I call that LEADERSHIP.
What you are saying in essence is that because Obama is not a leader that the other side does not have to lead either - even though they are the ones who claim the high ground of fiscal conservatism.
I call that Grade A Hypocrisy.
We owe 14+ trillion in money we have already spent.
Regardless of who is to blame - how do we deal with it?
"..blame" and "ridicule" but for God's Sake don't say something relevant and honest with regard to the CURRENT Deficit and Debt."
Obama the President is the one saying we can't cut any more spending. The GOP is saying cut more spending. Where else should the current blame go? Is this really that hard for you to comprehend, Larry?
Regarding entitlements, let me guess...you're another greedy geezer who doesn't want to give up a penny of his benefits, regardless what that does to future generations, right?
" "stop and think about those numbers for a minute.
just with those 2 programs, we added 23% of GDP to our liabilities in one year."
more blather.
those numbers have nothing what-so-ever to do with the CURRENT BUDGET which ought to be the CURRENT PRIORITY.
look at http://www.ssa.gov/oact/TRSUM/index.html and show me how those numbers relate.... they don't.
" Current tax revenue is roughly 16% of GDP."
divide that out into FICA and non-FICA please.
FICA is dedicated to SS and essentially off budget.
we take in 1.1 trillion in income taxes.
tell me what % THAT number is of GDP...
" and the annual increase in entitlement liabilities of 23% of GDP, requires a tax revenue increase to 50% of GDP just to keep things from getting worse. None of the current debt is even addressed. "
be specific. tell me WHAT entitlements you are talking about here... because SS is not them...
so you tell me what they are....
so I know that you know what the heck you are talking about...
" Are these the people you want to collect more revenue from?"
Nope. I want the folks who say we can balance the budget without more revenue to show how and if we cannot do it then to provide a plan that works even if it has to include taxes.
in other words - complete your homework.
if you say we have a bad problem - and I agree with you - then tell me what plan to fix it is and if you can do it without more revenues.. then great....
if not.. give me plan b.
" "As to the suggestion that more revenue is needed through taxes"
is that essentially what supply-side economics is?
more tax revenue?
so isn't advocating supply-side policies advocating more taxes and tax revenue as a solution to deficits?
"Regardless of who is to blame - how do we deal with it?"
Step 1: GOP takes a commanding control over the Senate, and Barack "cant cut any more spending" Obama gets the steel toe.
" What you believe and what the fleshed out facts are, have been shown many times to be entirely different."
I go by what the data says.
you can attribute the data to different things - on both sides if you want to - but it does not change the actual facts.
no matter how you cut it.. Bush and the Republicans and their policies did not keep the deficit low or keep the slight surplus...
are you saying they INHERITED bad stuff from Clinton but that Obama did not inherit bad stuff from Bush?
ha ha ha
lord lord... Paul....
you can't get away from the blame game but you can't even play it consistently from one president to another.. :-)
" Obama the President is the one saying we can't cut any more spending. The GOP is saying cut more spending"
yeah.. but Paul.. they won't name the cuts...
how can you say you want cuts and a balanced budget but then not show how?
that's hypocrisy.
" Regarding entitlements, let me guess...you're another greedy geezer who doesn't want to give up a penny of his benefits, regardless what that does to future generations, right? "
be specific about what entitlements.
show the list and show the numbers for each entitlement both how they are funded and what their current spending number is.
show me that you really understand the entitlement data.
"..so isn't advocating supply-side policies advocating more taxes and tax revenue as a solution to deficits?"
You're once again approaching Benji level of idiocy.
" Step 1: GOP takes a commanding control over the Senate"
ha ha ha
WHY should we vote them into a majority when the last time they were a majority they added 5 trillion in debt and now that we are 14 trillion in debt - the only one of them who is man enough to actually present a real cut budget is Rand Paul ... and a whole 7 of his colleagues supported his plan.
these are the guys who will "fix" the problem?
these guys don't know their butt from a hole in the ground Paul.
they're pretenders....
Even Morg says that......
" "..so isn't advocating supply-side policies advocating more taxes and tax revenue as a solution to deficits?""
if you advocate supply-side policies are you not saying that cutting taxes will result in MORE tax revenues?
I think you are.
And if that is what you are advocating.. are you not advocating MORE REVENUES for govt spending rather than cutting?
I think so.
explain how I got this wrong.
"..are you saying they INHERITED bad stuff from Clinton but that Obama did not inherit bad stuff from Bush?"
Is there any evidence I said anything of the kind?
"yeah.. but Paul.. they won't name the cuts..."
Yeah, they have you moron, in multiple places. Your hero Obama even spelled out some of the cuts in his speech about the Paul Ryan plan. It Obama who, once again, has offered no plan.
Looks like I'm right about the entitlements. Don't touch a penny of Larry's bankrupt Medicare and Social Security, screw the future generations.
"..if you advocate supply-side policies are you not saying that cutting taxes will result in MORE tax revenues?"
The Laffer Curve certainly doesn't say that. Cut taxes to zero and you get zero revenue. Paul Craig Roberts only offered he thought the Reagan tax cuts might generate enough econonmic activity to pay the interest on the extra debt. George Gilder was much more expansive. It's complicated, and it depends on which supply-sider you talk to.
It depends on the type of tax and who is being taxed at what rate.
"Yeah, they have you moron, in multiple places. Your hero Obama even spelled out some of the cuts in his speech about the Paul Ryan plan. It Obama who, once again, has offered no plan."
well FOOL it's NOT what Obama did not offer.. it's what the folks who say they are the fiscal conservatives refused to offer - a real plan instead of just whacking entitlements and relying on supply side to pay for the military.
In other words they favor increased tax revenues to pay for the military but they want to also get even more money by cutting entitlements.
"Looks like I'm right about the entitlements. Don't touch a penny of Larry's bankrupt Medicare and Social Security, screw the future generations."
I don't think you know your head from a hole in the ground when it comes to entitlements guy.
Name the entitlements that are a problem right now and show the source of their funding and how much money they are currently costing the current budget.
I bet you don't know.
you're just parroting the right wing blather about "entitlements" in general without really knowing any specifics.
A REAL PLAN means you KNOW the specifics. You KNOW the numbers.
Both deficit commissions AND Rand Paul ...show REAL NUMBERS...
The Republican leadership has NO PLAN that shows REAL NUMBERS.
Look at Paul Ryan's bogus plan... he basically has no numbers... he just says CAP SS and Medicare.
SS is funded from FICA - not income taxes.
It WILL BE CAPPED - BY LAW if no changes are made.
In 2037 it will pay out at 75%.
That's a cap that already existed.
So what "cap" is Ryan talking about?
Go look at Rand Pauls attempt which uses real numbers, real projections and real logic because it acknowledges that SS is no where near the problem that it is being portrayed as being compared to the other components of the budget.
there ARE entitlements that are at issue but it's not SS.
so you tell me me what they are..how they are funded and how much they are costing RIGHT NOW in the CURRENT BUDGET or else you wear the "moron" tag.
" The Laffer Curve certainly doesn't say that"
but I'm pretty sure Paul Ryans "plan" relies on tax cuts to generate more revenues......
so Ryan's budget is actually even MORE than the CURRENT budgets.
He's counting on MORE money to fund government.....and he thinks that money is coming from reduced taxes rates that will generate increased tax revenues.
He does that to fund non-entitlements govt... but he "caps" entitlements.
" Don't touch a penny of Larry's bankrupt Medicare and Social Security, screw the future generations."
you need to identify WHICH Medicare guy. There are FOUR of them and two in particular are the culprits and neither of them are funded from FICA but instead income taxes...
so you're be wrong.. about what I think about those two.
I'm totally in favor of cutting the subsidies to Medicare Part D and B.
But right now - this minute - do you really know how much each of these is costing the current budget?
You ought to know if you think they are big problems and that by cutting them we'll balance the budget... and start paying down the debt.
So how about listing out each of the entitlements... and how much they cost in the current budget?
"I believe it was Clinton who handed Bush and the Republican majority a slight surplus AND the OPPORTUNITY to roll back even more the Democrat excesses."
Actually, Clinton handed Bush and a fairly evenly divided Congress - with a slight Dem majority in the Senate, and a slight Rep majority in the House - scroll down to the chart at this link - a budget surplus. Each year of his Presidency, the national debt increased due to additional borrowing. How can this be? Where did the surplus come from if more was borrowed? Well, through accounting gimmicks like intragovernment borrowing from...guess where?...that's right, your favorite, the SS trust fund. That's why there's not 2 trillion in it now, but only IOUs.
So, when you spout this common but erroneous meme about a surplus, be aware of the actual facts.
"well FOOL it's NOT what Obama did not offer.. "
Well, that's a start. After all this time of insisting Obama had a plan it finally penetrated your thick skull he offers only blather.
"..don't think you know your head from a hole in the ground when it comes to entitlements guy."
I do now know for sure you are getting your government checks and you want to make sure your unsustainable gravy train is not touched in the slightest bit. This makes you part of the problem. What did you say about the blame game? Oh yeah, I also blame you greedy bastards who don't give a shit about what these programs do to the rest of us coming up behind you.
"Name the entitlements that are a problem right now and show the source of their funding and how much money they are currently costing the current budget."
Are you kidding? They're all a problem now and into the future. Social Security went into the red last year. Here's the problem, these programs are being paid for out of my paycheck. Now follow this closely,Larry, I know you have a comprehension problem: That means the taxes I'm paying to fund the SS and Medicare ponzi schemes cannot be used to pay for the rest of the bloated, bankrupt, government. It all comes out of the same pocket, not a FICA pocket and an income tax pocket. When I fund your cushy retirement with a dollar, that means I can't pay other government bills with that same dollar.
Sit back and let that soak in for a few minutes before you post another stupid reply.
" Each year of his Presidency, the national debt increased due to additional borrowing. How can this be? Where did the surplus come from if more was borrowed?"
are you counting the interest on the debt?
If you borrowed money and did not pay it down... you'd owe both the principle and the interest.
but you splitting hairs now.
whether or not there was a "technical" surplus or not or "accounting gimmicks" - the INCREASE in the deficit and debt in the following years was SUBSTANTIAL ..NOT inconsequential.
and did Bush and company NOT use the same accounting gimmicks in THEIR budget?
Do you think having two wars off budget is an "accounting gimmick"?
" Are you kidding? They're all a problem now and into the future"
that's what I thought.
you don't know shit from shineola"
It MATTERs what the numbers are relative to each other and relative to the other parts of the budget to know how big a problem they are.
if you don't know the numbers and you're running your mouth about entitlements.. you're the clueless one...simply parroting propaganda that you don't have the first idea about the real numbers ....
Do you think that SS is 1% of the budget? 10%, 30% 50%?
you don't know do you?
Note to paul:
There are persistent rumors Rick Perry is a closet homosexual. This photograph leads me to conclude the "Perry is a homo" rumors may be true.
As a Texan, can you tell me is this the sort of tie a heterosexual Texans wear?
http://www.cnn.com/2011/OPINION/08/11/moore.perry.candidate/index.html
I lived in Texas for two years, but that was a long time ago. I may no longer know what passes for manly wear in Texas.
Maybe Perry can get support from the Log Cabin Republicans.
"It MATTERs what the numbers are relative to each other and relative to the other parts of the budget to know how big a problem they are."
How exactly does that deviate from anything I said?
"if you don't know the numbers and you're running your mouth about entitlements.. you're the clueless one...simply parroting propaganda that you don't have the first idea about the real numbers ...."
Now Larry, I told you to sit back and soak that in before you posted another stupid reply. Looks like my request was in vain. I just pointed out SS was tens of billions in the red last yr and this yr. You also need to address the opportunity cost of my paying for your cushy retirement vs. the rest of the government before you tell me these galactic size entitlements aren't part of the current problem. I only have so much money you old vultures can get your grubby paws on. Every dollar I pay for your leisure lifestyle is a dollar I can't pay towards defense, interest on the debt, etc.
"Do you think that SS is 1% of the budget? 10%, 30% 50%?"
Wow, do you really think everyone is as clueless as you are, Larry? I'm sure everyone on this blog is familiar with at least the general breakdown of the federal budget. But on this very thread today you discovered the well known Rand Paul plan and the lack of one from Obama(though you insisted until the very end that he had one.)YOu shouldn't project your general ignorance on the rest of us.
Benji,
Your link doesn't work. I've heard those rumors, appear to be unfounded, but who gives a shit? He'd be a thousand times better than your boyfriend.
here Paul:
http://www.ssa.gov/oact/TRSUM/index.html
show me where SS is in deficit.
in 2011 - the ONLY reason there was a deficit at all was that Obama reduced the FICA tax by 2%.
so tell me of the 1.5 trillion annual deficit.. guy...
how much of that deficit is due to SS?
how much of that 1.5 trillion is due to Medicare Part A?
if you cut the part for SS and Medicare Part A - how much of the 1.5 trillion deficit would remain?
you don't know guy.
you're clueless.
you blather on about SS and entitlements and you don't know bat crap from guano.
" I'm sure everyone on this blog is familiar with at least the general breakdown of the federal budget"
nope. and not you either. You don't know what the entitlements are.. nor how much of the budget they cost.
you are typical of the folks who blather on about the debt and deficit... instead of really getting the facts and really knowing what you are talking about.. you just parrot what the propaganda sites say.
no credibility Paul.. zilch...
if you really knew - you could rattle off the entitlement numbers.... but it's obvious you don't know.
the Republicans seem to have the same problem. It would be a simple thing to provide a list of cuts that total to 1.5 trillion - if you really knew the numbers.
John Stossel says he knows the numbers but when you look at his list.. it's clear he also does not understand the entitlements.
If you want to make entitlements THE problem Paul - you need to KNOW the data... and guy - you don't.
Paul-
Too bad the link doesn't work. The guy picked the most fey tie I have ever seen. Rock Hudson he does look like.
That said, I must agree with your sentiments in some regards. I would vote for Kukla, Fran & Ollie if they could get the economy going again.
"he goes on to talk about the problems SS WILL HAVE - which I AGREE WITH but the issue right now is what role is SS playing in the CURRENT deficit and debt and the answer is VERY LITTLE ..ESPECIALLY compared to the other things that contribute to the 1.5 trillion annual deficit and 14+ trillion debt."
Very little? Have you even read the SS Trustee's report you keep pointing to? Do you see that one of the sources of income for all four programs is interest earnings? The total for all four is $134bn. That is interest paid by the treasury on the IOUs it has left in place of actual funds. For OASDI the amount is $117.5bn. As tax revenues don't cover the entire federal budget, this is part of the deficit, so yes, it IS currently a problem, and will get progressively worse each year.. Why is this so hard for you?
"social security added $1.4tn to unfunded liabilities in 2010 alone. medicare added another $1.8tn."
not according to this:
http://www.ssa.gov/oact/TRSUM/index.html"
Nothing has changed. You still don't understand the meaning of unfunded liabilities.
"but you splitting hairs now."
What are you talking about? do you call taking more than $2tn out of the SS piggy bank and calling it income splitting hairs? Did you read the refereence I gave you? No, I didn't think so, or you wouldn't have written that.
If you spent $10k more than your income some year, and borrowed $12k from your 401k to make up the shortfall, would you say "Oh look! We had $2k more income this year than we spent. A surplus! Yippee!"
"whether or not there was a "technical" surplus or not or "accounting gimmicks" - the INCREASE in the deficit and debt in the following years was SUBSTANTIAL ..NOT inconsequential."
What is a "technical surplus"? that's not an accounting term I've ever heard.
"and did Bush and company NOT use the same accounting gimmicks in THEIR budget?"
No, they didn't. There was no trust fund money left that could be renamed income.
"...dog-whistle racists..."
What are "dog whistle racists? are you making up new descriptive terms now?
"he has a plan - you don't agree with it."
Well yes, he does have a plan, to keep spending at unprecedented rates, and no, I don't agree with it. I guess I should have specified, a plan to cut spending and reduce the deficit until the budget is balanced. He certainly doesn't have one of those.
"Charging seniors $100 a month for health care is ridiculous..."
Well yes, it is, but the entire reason it was enacted was to provide seniors with medical coverage that didn't cost them very much. In effect, a welfare program.
"...and characterizing it as an 'entitlement' leaves the impression that people are entitled to it."
Well yes. That's a clever way to avoid calling it a welfare program.
Those who suggest means testing to determine eligibility must realize that there could no longer be any pretense that it's anything BUT a welfare program.
"What you are saying in essence is that because Obama is not a leader that the other side does not have to lead either - even though they are the ones who claim the high ground of fiscal conservatism."
Larry, the "other side" isn't President of the United States! It is the President's job to lead, not Congress. They legislate, he executes. Were you out taking a whiz during that civics lesson also? Sad.
"...MedicAid to be capped at a fixed % of GDP or equivalent measure."
Now, there's an interesting idea, during tough economic times, when GDP is lower, all those people without jobs will also find they can't get as much medical treatment as they did when times were good.
Good thinking, Larry.
"more blather."
I've noticed you use this response when you don't understand the discussion, which is most of the time. What would you like explained in simpler terms?
" Current tax revenue is roughly 16% of GDP."
divide that out into FICA and non-FICA please."
That's not necessary, Larry. It all goes into the same pot, and comes out of the same pot. Your serious logical disconnect with this is hurting you.
You can label any input or any output any way you like, but insisting on total separation only causes you problems, as they don't stay separate.
You might as well insist that Canadian crude oil and Saudi crude oil be kept separate at the refinery.
"we take in 1.1 trillion in income taxes.
tell me what % THAT number is of GDP..."
You aren't really serious about needing help with that simple math, are you?
"Step 1: GOP takes a commanding control over the Senate, and Barack "cant cut any more spending" Obama gets the steel toe."
Say! I like that one. Steps 2 thru x should be pretty easy after that one.
"show me that you really understand the entitlement data."
The only one having trouble with the data is you. If you want help with it, you need to ask nicely.
These petulant "show me" and "list the 5" demands aren't going to get you anywhere.
"WHY should we vote them into a majority when the last time they were a majority they added 5 trillion in debt..."
Because even that atrocious rate of debt increase over an 8 year period, is preferable to 4.5tn in only 2.5 years.
"if you advocate supply-side policies are you not saying that cutting taxes will result in MORE tax revenues?"
No, Larry, not directly, you may be confusing this with the Laffer curve.
Is this one more subject you don't understand? Is there anything you can actually discuss intelligently?
Supply side economics suggests that prosperity and growth result from production, and that reducing barriers to production such as taxes and regulation allow increased prosperity and growth.
"is that essentially what supply-side economics is?
more tax revenue?"
No it isn't.
"so isn't advocating supply-side policies advocating more taxes and tax revenue as a solution to deficits?"
No, Larry, Look up "supply side economics" and learn something about it before you further embarrass yourself.
"It MATTERs what the numbers are relative to each other and relative to the other parts of the budget to know how big a problem they are.
Do you think that SS is 1% of the budget? 10%, 30% 50%?"
Here it is, Larry, this isn't nearly as hard as you make it out to be.
Why do you keep asking others to find information for you, that you can easily find for yourself?
"even if I buy the premise as Obama being the SOLE person responsible for the 14 trillion "
He is responsible now, Larry, He's the guy in charge. His predecessors no longer have any control - thank God. He has been elected to lead, and to undo the damage done earlier, but after 2.5 years he hasn't done it, in fact he has done still more damage, at an even faster pace. This is exactly the opposite of what we want and need. Blame has no bearing here, Larry, it's now up to the guy in charge, and he has shown himself to be clueless and incompetent.
"if you really knew - you could rattle off the entitlement numbers.... but it's obvious you don't know."
Do you really believe people have nothing to do all day but rattle off numbers at your request? It's pointless to provide you with information, as you don't know what the discussion is about in any case.
You should find some of these numbers for yourself so you could have something to say about them, instead of just remaining clueless.
You aren't testing other peoples knowledge with your silly requests, you are testing their patience.
" Very little? Have you even read the SS Trustee's report you keep pointing to? Do you see that one of the sources of income for all four programs is interest earnings? The total for all four is $134bn. That is interest paid by the treasury on the IOUs it has left in place of actual funds. For OASDI the amount is $117.5bn. As tax revenues don't cover the entire federal budget, this is part of the deficit, so yes, it IS currently a problem, and will get progressively worse each year.. Why is this so hard for you? "
here's the report so we are both on the SAME PAGE literally:
Now skip down to where it says
"TRust Fund Results"
Notice the Income = 677 billion
Notice the Outgo = 585 billion
now you tell me why it is so HARD for YOU to understand.
you folks are such fools.
you're so bound up on your propaganda and ideology that you can't even see straight facts when put right in front of you... you've got to twist it somehow to meet your own perverted views.
SS is going to have a big problem in the coming decades as boomers retire but consider this.
If Congress does nothing about it at all - the MOST it can affect the general revenue side of the budget is to get back the 2.1 trillion it has accumulated over the years.
After that - no money will come out of the general fund and SS will gradually reduce payouts to individuals to about 75% of scheduled benefits.
the program won't go broke.
it won't go into deficit.
it will reduce benefits - unless other changes like pushing the retirement age are done in lieu of that.
But MOST IMPORTANT is that RIGHT NOW with respect to the CURRENT 1.5 trillion deficit - it's part of that 1.5 trillion is minuscule compared to the other budget items that comprise the debt.
and yet.. you fools consistently say that SS is THE problem and it needs to be dealt with FIRST and at the same time you make that foolish argument - you don't bother to name any of the other parts of the 1.5 trillion deficit that need to be dealt with - NOW.
so you're all focused on a non-problem as part of your ideological agenda.. and it has almost nothing to do with the simple facts and reality that are the real components of the 1.5 trillion deficit.
and you have the nerve to ask what I can't see that SS is the "problem".
Honesty about the problem is not something you consider important apparently.
For myself, I don't see how we can actually deal with the actual parts of the budget that ARE contributing to the deficit if we refuse to look at the realities and instead focus on our own prejudices and ideologies.
No matter what one's view is about the CONCEPT of SS - at least be honest enough to get the data right about the current realities.
I don't agree with Larry G very often, and I'm certainly never going to agree with his defense of Obama. But I think those of you who see Social Security as a big problem - either now or in the future - are mistaken.
Social Security's future funding problem can be easily fixed. Just a small tweak to the benefit formulas will take care of that.
Please note that I am referring to Social Security - not Medicare and Medicaid. I do not believe there is any fix for Medicare until beneficiaries are forced to share in the cost of treatment.
Medicaid is simple theft, and I am convinced that Democrats will continue to play Robin Hood with Medicaid as long as they are allowed to do so.
"... never going to agree with his defense of Obama"
I don't really defend Obama except to point out that ANYONE who became President in 2009 had a very bad hand to deal with - and there can (and obviously is) honest debate about what steps he should have taken to deal with the problem and yes.. he tends to hew to the spendy habits of his base.
I'm more of a critic of those who advocate cuts but don't have the political courage to say which ones but who bill themselves as fiscal conservatives.
And I have extra special disdain for folks who can't or won't deal with the simple facts - like those associated with SS and who use the budget issue as a proxy for attacking SS because they disagree with it as a concept.
So instead of really dealing with the budget and deficit in terms of what the real drivers are - they ignore the realities and just use it as a pretext to go after things they don't like.
In other words, they are not really interested in the budget, deficit and debt at all.
When I look at Rand Pauls' 5-year budget proposal, I see NONE of this illicit propaganda and he focuses quite honestly on the realities - in ways I don't totally agree with - but I can RESPECT him for honestly pursuing his principles AND someone like that.. I'm willing to accept some of his proposals even if I don't particularly like them if I feel it's strong medicine but we must take it.
So now I no longer say "not a single Republican has show the cuts" but I DO say that ONLY ONE has done a real budget and when his colleagues were asked if they supported it - only 7 stood up while the rest of them continue their illicit "we must cut but I won't name the cuts" blather.
"I'm more of a critic of those who advocate cuts but don't have the political courage to say which ones but who bill themselves as fiscal conservatives." -- Larry
Interestingly, you're even less of a critic of those that advocate dramatic increases in government spending but don't have the political courage to say how much taxes will have to be increased to pay for them. Or, those that resist any attempt to reform entitlements, like Social Security, despite the fact that these entitlements are headed toward insolvency, yet they bill themselves as compassionate champions of the little guy.
You're simply a partisan hack. And judging by the quality of your arguments, a not too well informed one.
"And I have extra special disdain for folks who can't or won't deal with the simple facts - like those associated with SS and who use the budget issue as a proxy for attacking SS because they disagree with it as a concept." -- Larry
Here's a simple fact for you, if the Democrats get their way and no reforms are made to these entitlement programs there will be no Social Security - period. You cannot separate the fate of Social Security from that of Medicare because they will both ultimately depend on the same pool of tax dollars for funding. Get it? Here's another fact, these programs are literally Ponzi schemes. What kind of person supports the use of the coercive power of government to force people to contribute a large part of their earnings - earnings that they will be dependent on in their old age - into a Ponzi scheme? Apparently, people like you who agree with "the concept".
"But MOST IMPORTANT is that RIGHT NOW with respect to the CURRENT 1.5 trillion deficit - it's part of that 1.5 trillion is minuscule compared to the other budget items that comprise the debt."
Translation: The most important thing is Larry is still getting his government checks and free health care, screw the rest of us younger folks.
I see Larry still fails to grasp, or doesn't want to understand, that the FICA and income tax entries on my paycheck are accounting shell games. It all comes out of my same pocket and gets emptied into the same rat hole, regardless of which category they fall under. To make matters worse, Larry has the balls to advocate RAISING my income tax even further rather than taking even the slightest hit on his welfare checks that fund his bingo nights and early bird specials, but will be bankrupt by the time I'm eligible.
How about we slice into that trillion + from the two government behemoth programs, along with cuts in the other staggeringly wasteful government programs, and leave my taxes alone?
che is dead: "What kind of person supports the use of the coercive power of government to force people to contribute a large part of their earnings - earnings that they will be dependent on in their old age - into a Ponzi scheme?"
I don't agree with the Social Security concept. But I also don't believe the nation can suddenly change the program and leave 50 million seniors without retirement income. So I do support a gradual change to privatization.
Also, I don't believe Social Security - as the laws are currently written - is a Ponzi scheme in the strict sense of that term.
A Ponzi scheme requires an increasingly larger pool of contributors to pay benefits to past contributors. Social Security law does not require a larger pool of contributors. Rather, the benefit levels are capped by the amount of funds available from FICA taxes.
Paul: "Larry has the balls to advocate RAISING my income tax even further rather than taking even the slightest hit on his welfare checks that fund his bingo nights and early bird specials, but will be bankrupt by the time I'm eligible."
I haven't read all Larry's arguments, so I'm not sure if that's what he is arguing. But just so we're clear, Jet Beagle does not agree that young people should bear the complete burden of unshackling the nation from these socialist programs. I would agree to a gradual privatization of retirement programs which included:
1. an immediate and growing reduction in seniors' benefits; and
2. a gradual transition of FICA taxes to individual retirement accounts.
What would really tick me off, though, is means testing. If my siblings who saved nothing for retirement get to keep their full SS and Medicare benefits - and I lose mine because I did save for the past 30 years - I would be royally pissed off.
you boys are real dunderheads when it comes to SS which is funded from FICA and not income tax/general revenues.
this is why the trustees say that if no changes are made to the formula that SS will continue to pay out at 75% - and while it is doing that - no general revenue money is used at all under current rules.
I'm totally opposed to any general revenue money to be used to make up the difference in SS shortfalls.
It has to remain within the statutory confines of FICA - which is a position that is 100% consistent with both deficit commission proposals AND Rand Pauls approach.
More importantly - with the current 1.5 trillion deficit - there is virtually no impact from SS at all and yet the real partisan hacks here want to attack SS - at the same time they willingly ignore the real components of the current deficit.
so Che makes this blatantly ignorant or propaganda LIE about SS:
" ....no reforms are made to these entitlement programs there will be no Social Security - period"
wrong. the worst case is 75% pay out.
you clearly don't understand SS and FICA OR you are a big phony/partisan hack who really doesn't care about dealing with the truth.
" You cannot separate the fate of Social Security from that of Medicare because they will both ultimately depend on the same pool of tax dollars for funding."
Once again you show your abject ignorance or wanton willingness to lie.
Medicare Part A is funded from FICA taxes and is firewalled from SS.
There are actually 4 separate trust funds... and Medicare Part A has it's own FICA percent.
Medicare Part B/D on the other hand is NOT funded from FICA but 3/4 from Federal Income Taxes and 1/4 from subscriber premiums.
It too has a trust fund - that is entirely separate from SS and Medicare Part A.
Neither or Paul know shit from shinola on these issues OR you do but you willingly engage in lying about it.
either way - you have no credibility on the issue because clearly you don't want to deal with the truth and the realities.
By far.. without question the bigger threat to the deficit right now is Medicare Part B/D but when you have dunderheads who don't even know the difference between the two very different parts of Medicare.. it's easy to see how they also don't know the difference with SS.
When you guys can deal with the fact, we could have an honest debate about the issue but until then.. ya'll need to do some serious homework and/or reform your own selves from your parroting propaganda poop habits.
"More importantly - with the current 1.5 trillion deficit - there is virtually no impact from SS at all and yet the real partisan hacks here want to attack SS - at the same time they willingly ignore the real components of the current deficit."
Larry again buying into accounting fictions and shell games because it suits him financially. His lazy dayz shan't be interrupted!
We could take some money out of SS and Medicare right now to help with the deficit, but then Larry might have to get off his ass and go be a part-time greeter at Wal Mart.
Better instead to tax the shit out of Paul in order to avoid that horrifying scenario.
" We could take some money out of SS and Medicare right"
why would you do that when the program is solvent and not in deficit?
the one govt program that has actually stayed within it's funding and you'd reward it by stealing it funds?
are you really saying you want MORE money for the budget instead of cutting it?
sure sounds like it.
so much for your fiscal conservative credentials.. you sound like a tax&spend guy to me.. you just want MORE rather than actually cut.. eh?
I thought you were a "cut" guy.
true colors coming through?
Some people refute the Ponzi scheme comparison largely on the grounds that unlike a traditional Ponzi scheme, Social Security is completely disclosed, was never sold to as a way to make anyone rich, and that it has good intentions rooted in compassion for the poor.
Hold on to your wallets. Just because a fraud is being perpetuated in full view doesn’t mean it’s not a fraud. It simply means people are either not paying attention, or don’t understand what they’re looking at. Regarding not trying to make anyone rich, that’s precisely correct, if only ironically. The creation of Social Security probably did incalculable damage by disincentivizing saving and investing. It ratcheted up moral hazard big time, and nudged untold millions of people into looking towards government for solutions, rather than to themselves and the private sector. And as for good intentions, isn’t that what a certain road to a certain nasty place is paved with? Or at the minimum, The Road to Serfdom?
What’s that saying about walking and talking like a duck?
"Why Social Security is a Ponzi Scheme", Forbes
Paul: "We could take some money out of SS and Medicare right now to help with the deficit"
Conrgess has been doing just that for the past 25 years, of course.
The combined OASDI (Old Age and Survivors + Disability Insurance Funds) is no longer generating positive cash flow. In fiscal year 2010:
Income ($billions)
employment taxes: .........647
income tax on benfits: .....23
Total cash in: ............669
Outflow ($billions)
benefit payments: .........695
admin .......................6
xfer to RR retirement .......4
Total cash out ............706
OASDI was $37 billion cash negative in FY2010.
As you referred to them, Paul, the interest "income" shown on the Trustees report is an accounting gimmick, and not real cash.
"I would agree to a gradual privatization of retirement programs" -- Jet Beagle
Gotcha covered:
House Republicans on Friday introduced legislation that would allow workers to partially opt out of Social Security immediately, and fully opt out after 15 years.
Rep. Pete Sessions (R-Texas), who chairs the National Republican Congressional Committee, and several other Republicans introduced the Savings Account for Every American (SAFE) Act. Under the bill, workers would immediately have 6.2 percent of their wages sent to a "SAFE" account each year.
That would take the place of the 6.2 percent the workers now contributed to Social Security.
Another 6.2% is sent to Social Security by employers. Under the Sessions bill, employers would continue to make this matching contribution to Social Security, but after 15 years, employers could also send that amount to the employee's SAFE account.
The Hill
Now, if we could just get certain people out of the way ...
che is dead,
I say SS is not a Ponzi scheme because it does not require increasing numbers of contributors in order to pay the benefits specified under Federal law. By law, when the income of SS is insufficient to pay full benefits, those benefits must be reduced. So, no matter how many workers are paying taxes, the beneficiaries should only expect the total cash flow generated by those workers.
The problem with this whole plan, of course, is that Congress never specified exactly who would have their benefits reduced,
Social Security - from the very beginning was billed as a pay-as-you-go system.
It was never advertised as anything else.
That part has been promoted by the ideologues who don't like the concept of SS - more dishonesty.
FICA-funded SS, unlike the income-tax funded Fed budget has pretty much stayed within it's funding - not for one or two years but for over 60 years...
what kinds of ponzi schemes last for 60 years?
calling SS a ponzi scheme just underlines the dishonest nature of those who use that argument.
SS works just like your auto insurance does and is your auto insurance a "ponzi" scheme?
Nope.
che is dead,
I'm willing to have my benefits gradually reduced - as long as every other retiree has their benfits also reduced. What I'm going to fight is means-testing. And every proposal I've seen so far for privatizing social security calls for means testing people like me out of all our benefits.
I'll be damned if I'm going to quietly take all the burden and see my seven siblings continue to get full SS benefits.
Larry,
"why would you do that when the program is solvent and not in deficit?"
Once again, you are unable to comprhend basic logic, either because it fills your rice bowl, or because you're an idiot. a) The programs are not solvent in the future, and b) they are part of the overall federal budget which is waay out of balance. It's simple math, reduce Medicare and SS expenditures and the deficit goes down. There's nothing sacred about your welfare checks, you just think you are "entitled" to them at current funding. Somewhere it's cast in stone you should forever get the free money coming out of my pocket..excuse me, the FICA pocket.
"are you really saying you want MORE money for the budget instead of cutting it?
sure sounds like it."
No, you only think that because you were jerking off the day they taught addition and subtraction.
" The combined OASDI (Old Age and Survivors + Disability Insurance Funds) is no longer generating positive cash flow. In fiscal year 2010:"
show your source....
http://www.ssa.gov/oact/TRSUM/index.html
Income during 2010 677.1
Outgo during 2010 584.9
Income during 2010 677.1 104.0 215.6
Outgo during 2010 584.9 127.7 247.9
DI and HI are in deficit - yes - to the tune of about 55 billion.
SS itself is not.
Remember - EACH of these is a SEPARATE TRUST FUND with a separate FICA.
On your paystub - you will see TWO FICA deductions.
but let's do say that there is a 55 billion deficit....
out of a 1.5 trillion dollar deficit how big a problem is that?
and how would you fix it?
SS is not affected because it still pulls in enough FICA to pay benefits.
so your basic premise that SS is a big problem in the current budget is totally wrong... incorrect... propaganda... disinformation...ignorance...
(pick one or more).
" The problem with this whole plan, of course, is"
the problem with SS is fixed forever if they simply index retirement age with life expectancy... to meet the original requirements that SS was intended to cover the time span between retirement and death.
that span has widened considerably and even though it has the program has stayed solvent but it has reached the point where changes must be made.
The primary point that is ignored here is that for 60+ years SS has remained solvent and has kept pay-outs within it's revenues
UNLIKE the rest of the Federal Budget which has blown a gasket...
but the folks who are opposed to SS in concept here focus NOT on the real problems with the 1.5 deficit in the general revenue budget...
nope.. they go after SS using lies and propaganda to depict it as a bankrupt ponzi scheme when the facts say otherwise...
and while these idiots are making their illicit arguments against SS - they totally ignore the real drivers of the deficit and debt.
H Y P O C R I T E S
" Once again, you are unable to comprhend basic logic, either because it fills your rice bowl, or because you're an idiot. a) The programs are not solvent in the future, "
look FOOL.
they are solvent RIGHT NOW when a ton of other things in the budget are not.
we have a 1.5 trillion dollar deficit and a 14+ trillion debt and you ignore them to attack SS.
what kind of an idiot are you?
" "are you really saying you want MORE money for the budget instead of cutting it?
sure sounds like it."
you sure are.
instead of advocating cuts in the general revenue side of the budget - you want to steal money from FICA to pay the deficit down.
that's tax and spend anyway you cut it...
and coming from someone who claims to be a fiscal conservative.. it's truly scandalous....
shame...
Larry,
First here's my source:
Trust Fund Data - Fiscal Year 2010
Three reasons why your source and mine show different results:
1. I was combining SS and DI, and I will continue doing so;
2. My source refers to Fiscal Year 2010 (which ended 9/30/2010) and yours referred to Calendar Year 2010;
3. The largest difference between our numbers is that you included the non-cash "interest income" in your Income total.
The interest income for OASDI is not a cash flow. it is an accounting gimmick. Basically, it is the accounting entry by which the federal government credits OASDI for the SS surpluses which Congress already spent.
When you are referring to the cash flow generated by OASDI or just by OAS, you should not include the non-cash accounting entry "Interest Income".
"you boys are real dunderheads when it comes to SS which is funded from FICA and not income tax/general revenues ... you clearly don't understand SS and FICA OR you are a big phony/partisan hack who really doesn't care about dealing with the truth." -- Larry
You are one of the stupidest people I've ever encountered. You do not have to believe my "lies and propaganda" douche bag, you'll get the same message from the OMB, delivered during both Clinton and Obama administrations:
The OMB explained that these trust fund “balances” are nothing more than a “bookkeeping” device. “They do not consist of real economic assets that can be drawn down in the future to fund benefits.” In other words, the Social Security trust fund contains — nothing … they are nothing more than “claims on the Treasury that, when redeemed, will have to be financed by raising taxes, borrowing from the public, or reducing benefits or other expenditures.”
The Washington Post
And the SSA concurs:
Neither the redemption of trust fund bonds, nor interest paid on those bonds, provides any new net income to the Treasury, which must finance redemptions and interest payments through some combination of increased taxation, reductions in other government spending, or additional borrowing from the public.
Social Security Administration
That means that once SS starts to run into deficits, all SS payments will have to come from increased FICA taxes, general revenue or increased borrowing. It will not matter to those of us paying the increased taxes whether they are FICA or income taxes, all that will matter is that our taxes will be going up dramatically. So, how's SS doing on the surplus / deficit front?:
... the CBO has determined that Social Security will run cash deficits next year and in 2011, and by 2016 will be more or less in permanent deficit mode ... By 2016, the deficits return, and begin to accelerate again. By 2019, the primary surplus runs $63 billion in the red, almost triple the deficit in 2017, showing the rapid decline of the Social Security system.
HotAir.com
So, according to the CBO, permanent deficits by 2016. Not to worry, surely Americans can afford to shoulder the extra tax burden needed to support this wonderful program, right?
The federal public debt, which was $6.3 trillion ($56,000 per household) when Mr. Obama entered office amid an economic crisis, totals $8.2 trillion ($72,000 per household) today, and it's headed toward $20.3 trillion (more than $170,000 per household) in 2020, according to CBO's deficit estimates.
That figure would equal 90 percent of the estimated gross domestic product in 2020, up from 40 percent at the end of fiscal 2008. By comparison, America's debt-to-GDP ratio peaked at 109 percent at the end of World War II, while the ratio for economically troubled Greece hit 115 percent last year.
The Washington Times
You live in a fucking fantasy land. Your bullshit, socialist Ponzi schemes are failing and you have absolutely no answers. Get the fuck out of the way and let the adults take charge!
Larry G,
At the risk of being referred to as a "fool" and an "idiot", I'm going to politely disagree with you.
"Social Security" is a program which includes both OASI and DI. Combined, these funds are not generating positive cash flows. The Trustees report only shows Income greater than Outgo because it includes as Income the promise from the rest of the government - the IOU - that the cash previously borrowed will be repaid with interest.
Congress has not specified how either the cash it borrowed or the interest it imputed will be restored to the OASDI funds. Because there is no plan for restoring those funds, I do not see how one could argue that the cash-negative Social Security program is currently solvent.
Technically? Yes, Social Security is solvent.
Practically? I don't think so.
But, and this is important, I agree with your argument that Social Security is not a significant factor in either the short term or long term U.S. budget problems.
Medicare is a huge problem.
"I'm willing to have my benefits gradually reduced - as long as every other retiree has their benfits also reduced. What I'm going to fight is means-testing. And every proposal I've seen so far for privatizing social security calls for means testing people like me out of all our benefits." -- Jet Beagle
I feel you brother. First, they take your money by force promising to return it later, expecting you to be grateful. Next, when the mask falls and their programs are exposed as unsustainable, they ask those that have contributed the most to make sacrifices in order to delay the day when they must answer for their folly. Like Ayn Rand, I think that you should demand your money back:
"It is obvious, in such cases, that a man receives his own money which was taken from him by force, directly and specifically, without his consent, against his own choice. Those who advocated such laws are morally guilty, since they assumed the “right” to force employers and unwilling co-workers. But the victims, who opposed such laws, have a clear right to any refund of their own money—and they would not advance the cause of freedom if they left their money, unclaimed, for the benefit of the welfare-state administration." -- Ayn Rand, 1966, The Objectivist, on collecting Social Security, Medicare and the like.
In the long term, freedom is better served if people were brought to the understanding, painfully if necessary, that this kind of government overreach is unsustainable.
Che,
"So, according to the CBO, permanent deficits by 2016. Not to worry, surely Americans can afford to shoulder the extra tax burden needed to support this wonderful program, right?"
Larry doesn't give a crap about that as long as the welfare wagon keeps coming 'round to his house every month. The way he sees it, you just need to pay those higher taxes, including the revenues that fund his adult diaper budget, and STFU.
"the one govt program that has actually stayed within it's funding and you'd reward it by stealing it funds?"
Those funds have already been stolen, Larry, that you can't comprehend that is beyond belief.
You can't argue that SS is solvent for many years into the future, and that there are no general funds being spent on SS. That belief requires the existence of a trust fund with $2.4tn in actual assets in it. We know that isn't the case, accounting fictions notwithstanding. Naming something with an accounting entry, doesn't call it into existence.
Neither can you claim that no general funds are supporting SS and at the same time point to the interest payments on the trust fund as income.
There is no money available for SS benefits except what comes in from current contributions and interest. Beneficiaries are growing in number while contributors are not. It can't go on.
As Paul correctly points out, it isn't reasonable to ask current workers to pay for something billed as a retirement plan, that they have no hope of collecting benefits from. And, it is beyond unreasonable to ask them to pay an even higher percentage of their earnings toward the retirement benefits of others.
You have, over time, argued, without basis or skill, every side of this issue. you can't have it both ways. A better knowledge of accounting, not to mention economics, would go a long way toward making your comments meaningful.
By the way, I see that you haven't returned your computer to the store, as I suggested.
If you doubt that the salespeople will believe your reason for returning it, you need only discuss some economic subject with them, and they will be thoroughly convinced. So, don't worry. Just get it done.
Ron H,
I agree that, under current law, taxpayers are on the hook for $2.6 trillion beyond what SS will take in. From a practical standpoint, then, OASDI is not solvent as I explained earlier. From a technical (legal) standpoint, OASDI is solvent because the federal government is required to pay back to the OASDI.
What many do not understand, of course, is:
1. after the $2.6 trillion is paid back to SS, social security benefits must be reduced - unless Congress increases the current tax "contribution"; and
2. there is no plan which explains how the $2.6 trillion will be paid back.
On the other hand, I agree with one point that Larry G made earlier: that SS - with the forced reduction in future benefits as the current law directs - is a small factor in both the short term and long term deficit problem.
Ron H: "it isn't reasonable to ask current workers to pay for something billed as a retirement plan, that they have no hope of collecting benefits from."
I disagree with the premise for this argument. SS will be able to fund approximately 77% of promised future benefits. If Congress will step up and set a schedule for the 23% reduction in promised future benefits, then SS funding is solved. Current workers should then have confidence they will receive the promised benefits.
If only the retirement benefit is considered, then there is no question that SS is a terrible investment for young people. I'm not sure how to value the disability insurance benefit portion of SS, so I can't say for certain that overall SS is a terrible investment.
Jet - "Also, I don't believe Social Security - as the laws are currently written - is a Ponzi scheme in the strict sense of that term.
A Ponzi scheme requires an increasingly larger pool of contributors to pay benefits to past contributors."
I'm at a loss to understand what the difference might be. Every dollar that comes in, goes back out right away, except any excesses that are skimmed off by the scammers.
"Social Security law does not require a larger pool of contributors. Rather, the benefit levels are capped by the amount of funds available from FICA taxes."
Again, I don't see the difference. The benefit levels of any Ponzi scheme are effectively capped by the level of contribution.
While you are correct that the law doesn't require an ever larger pool of contributers, the numbers of new workers entering the workforce in the past, increased at a rate relative to the number of retirees, that prevented a serious problem.
Since the so called baby boomers were first recognized as a demographic, it has been known that this crisis would eventually occur, but as a politician's future timeline only extends to the next election, the future problem has been ignored - until now, when it can't be any longer.
Having the trappings of legitimacy provided by being a government program, doesn't change the fundamentals, except that this particular scheme has continued for a very long time, and the promoters aren't in prison.
che is dead: "That means that once SS starts to run into deficits, all SS payments will have to come from increased FICA taxes, general revenue or increased borrowing."
Either I don't understand this sentence, or I disagree with it.
As I understand the Trustees report, once SS starts to run into deficits, only the deficits - not all SS payments, just the deficits - must be paid by increased FICA taxes, general revenue or increased borrowing.
Or, SS payments must be reduced to the level such that there are no deficits.
"No, you only think that because you were jerking off the day they taught addition and subtraction."
Now I get it, I really believed, at first, that he just went out to take a whiz, like you said.
Perhaps that's how it started, but then one thing led to another. "Well, while i'm standing right here with this thing in my hand..."
Ron H,
"Since the so called baby boomers were first recognized as a demographic, it has been known that this crisis would eventually occur, but as a politician's future timeline only extends to the next election, the future problem has been ignored - until now, when it can't be any longer."
Which is yet another reason why I have no problem slicing into these programs as part of deficit reduction. Everybody has known about these structural deficiencies for decades, obviously that includes the voters/current recipients who put these politicians into office.
"Notice the Income = 677 billion
Notice the Outgo = 585 billion
now you tell me why it is so HARD for YOU to understand."
Unbelievable! First, you quoted the entire explanation I gave you for why those numbers don't exactly mean what you think they do, and then you come right back with them.
Think, Larry, think.
"you folks are such fools.
you're so bound up on your propaganda and ideology that you can't even see straight facts when put right in front of you... you've got to twist it somehow to meet your own perverted views."
This appears to be your automatic response when you have nothing meaningful to respond with. Do you just copy & paste it? If not, you could save some time by doing so.
"what kinds of ponzi schemes last for 60 years?"
HMM. Let's see. Maybe one that is government sanctioned?
@JetB - okay thanks for explaining.
if FICA generated the money in prior years - then it is valid to use it to make up shortfalls - which in this case was caused by a 2% reduction in FICA as a stimulus measure to put more money in people's pay checks.
I admit that this merely adds to the deficit/debt but I also point out that out of 1.5 trillion dollars of deficit - making THIS ...THE PRIORITY CUT while ignoring the rest of the 1.5 trillion deficit is not kosher at all.
At the least if you think this needs to be part of the cuts to deal with the 1.5 trillion deficit, then list the other cuts with it.
Otherwise, it just appears that you have an ax to grind for one thing in the budget and don't care about the rest of it.
Che - the SS system operates EXACTLY the way it was initially designed to operate - douche bag.
no amount of twisting the truth or lying about it will change that reality.
can you not be honest guy?
is your persona just a lying DB?
I can disagree on the merits with you but when you just flat out lie about something you lose all credibility.
"SS works just like your auto insurance does and is your auto insurance a "ponzi" scheme?"
Your ignorance is shining through.
SS has been billed as a retirement plan, but as actually administered, it is basically a welfare program. People are promised certain benefits based on their contributions deducted from their earnings
My auto insurance, on the other hand, protects me against financial losses caused by certain unplanned events . This is known as "insurance". I am promised nothing in the future, and unless I suffer a loss, I might pay my whole life, and get no money back.
Yes, DI is called insurance, but it is really just another welfare program, as there are no assets reserved against payouts.
There's a world of difference, Larry.
@JetB -
" At the risk of being referred to as a "fool" and an "idiot", I'm going to politely disagree with you."
I ONLY - return the favor - JetB.
If you are polite - I am polite.
If you call me a moron or DB, it's coming right back at you.
" "Social Security" is a program which includes both OASI and DI. Combined, these funds are not generating positive cash flows."
they are separate trust funds and they each have their own percent of FICA as funding - they are not commingled. There accounting is done separately.
If you want to reduce benefits in DI and HI to match revenues - I'm with you. Done deal.
Now tell me how we deal with the rest of the 1.45 trillion deficit.
and that's MY point (and you seem to agree) .. that SS..right now.. with respect to the CURRENT deficit is not a big part of it and you could cut HI and DI right now (and I support it) and it would not make hardly any difference in the 1.5 trillion deficit.
So what is cutting SS such a priority when it has little effect on the overall bigger problem?
Jet: You recommended the following:
"1. an immediate and growing reduction in seniors' benefits;
This reduction has been ongoing since 1992 when the new method of calculating CPI began.
" Medicare is a huge problem."
Now you have it.
Medicare Part B/D is a HUGE problem ...RIGHT NOW and will get much, much worse.
at 210 billion, it is a significant component of the budget/deficit/debt and it must be dealt with right away before it really gets out of control.
The reason Part B is in trouble is because it's NOT a FICA entitlement and it's not mandatory.
It's a voluntary program that offers Seniors fire-sale health insurance at $100 a month.
these are people that own their homes outright, often have vacation homes, several cars and hundreds of thousands of dollar of other assets - we sell them comprehensive health insurance at $100 a month.
I'm totally in favor of stopping that abuse but once again I point out that at 200 billion dollars it's not even a fifth of the 1.5 trillion deficit.
Larry,
"At the least if you think this needs to be part of the cuts to deal with the 1.5 trillion deficit, then list the other cuts with it."
We've done that on countless threads here. You, on the other hand, think these huge chunks of the federal budget should be off limits so you can enjoy your golden years catching Z's, Watching Matlock reruns, and feeding the ducks.
re: " Those funds have already been stolen, "
granted....
but that's not what funds SS.
What funds SS is the FICA tax that brings in almost a trillion a year and for the most part SS outgo matches it's FICA income (temporarily not because Obama reduced the FICA tax by 2%)
SS does not need the 2.1 trillion to pay benefits.
what happens if it does not get the 2.1 trillion is that instead of 2037 .. in 2017.. it starts paying out benefits at 75% of what was scheduled.
" As Paul correctly points out, it isn't reasonable to ask current workers to pay for something billed as a retirement plan, that they have no hope of collecting benefits from."
you and Paul are dumber than crap .... or just plain liars.
FICA continues to bring in almost as much revenue as income taxes and with that continuing revenue stream - they will be able to pay out at 75% for 50-75 more years - if no changes - like bumping the retirement age are made.
Why do ya'll insist on misrepresenting the facts ?
why can't you argue the issue on the merits - using the facts rather than falling back on your propaganda talking points?
that's dumb.
you guys say that SS is broke (not true) ..and is a major reason we have a deficit (not true) and that people in the future won't get benefits (not true)... and I could go on and on..
why do ya'll insist on these lies?
Jet: - "I disagree with the premise for this argument. SS will be able to fund approximately 77% of promised future benefits. If Congress will step up" and set a schedule for the 23% reduction in promised future benefits, then SS funding is solved. Current workers should then have confidence they will receive the promised benefits."
While you are technically correct, there's that almost insurmountable "if" in there.
I can't really see Congress stepping up to do the right thing any time soon. Any plan to adjust either benefits or contributions will be extremely unpopular with some large group of voters, and every one of those Congressmen wants to get reelected first and foremost. Fixing SS, although absolutely necessary, is still probably political suicide.
You also mentioned the trust fund that isn't. Repaying $2.6tn is next to impossible considering the size of the deficit now, and those projected for the future. As you pointed out, there's no plan anywhere in sight to do it.
The expected 23% reduction in benefits is meaningless unless the trust fund is made whole.
Even at that, you are asking current contributors to pay the same amount for a 23% smaller benefit. They are already angry, - isn't that right, Paul? - and they won't hold still for even more abuse. Any solution that doesn't include drastic reductions in benefits now, or much higher eligibility ages, will mean additional money required from current workers either as FICA contributors, or as taxpayers.
It would be interesting to know how many current FICA payers would give up all future benefits for complete elimination of their FICA contributions now.
I don't really have a good all around answer. This should have been dealt with years ago, in small relatively painless increments.
" The expected 23% reduction in benefits is meaningless unless the trust fund is made whole"
huh?
the Trust Fund is working EXACTLY as initially designed.
It was never designed to be anything other than a temporary place for excess funds to stay until needed.
More than a dozen times in the history of SS - the FICA Tax and/or the benefits have been adjusted to keep the program in balance.
It's a normal, typical thing that happened in Ronald Reagans term as well as other time periods.
One simple thing - pushing the retirement age - will make SS fully solvent and totally balanced for the next 50-100 years.
Fixing SS is easy compared to fixing Medicare Part B (which has nothing to do with SS or FICA) and fixing Medicare Part B is child's play compared to fixing MedicAid.
so what do folks focus on?
Social Security - which is the least of the problems in the budget.. almost minuscule compared to Medicare Part B and MedicAid but listening to the anti-SS folks here, you'd think that SS is THE whole reason why we have a deficit.
"Which is yet another reason why I have no problem slicing into these programs as part of deficit reduction. Everybody has known about these structural deficiencies for decades, obviously that includes the voters/current recipients who put these politicians into office."
While it's true that we get the government we deserve, You may be coming down a little hard on voters/current recipients.
It now seems obvious that few, if any, politicians can be believed any time they move their lips, but this cynical view, even if correct, wasn't always the common perception. I can recall times in the past, when it seemed that those we elected at least sometimes appeared to have our best interests at heart.
Most likely that was just me being naive, but I don't think I'm alone. Many people used to think that government was well intentioned, if clumsy.
When those in power shouted "This is a great deal, and you can rely on us to take care of you. Social Security is solvent now, and always will be, trust us.>" many of us believed them.
I think everyone now realizes how wrong that was, but many have reached retirement and have come to rely on the government handout disguised as retirement income. To take it away or reduce it now, when they have no chance to change their plans, seems a little cruel. They did, after all, pay into it all their working lives, even if they were wrong about the true nature of it.
We had a debt problem before Obama/Reid/Pelosi took over, but now it is a debt disaster:
http://pajamasmedia.com/instapundit/79840/
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