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There's the problem.The political cons uency for accelerated mandatory spending, including AARP and health providers, is powerful on both sides of the aisle. But the coalition for en lement reform should be broad as well...
En lement Reform an Uphill Battle
By Michael Gerson
WASHINGTON -- On the federal debt crisis, inertia has all the momentum. A compelling political logic favors inaction.
America's debt problem is mainly an en lement spending problem. Serious en lement reform would involve concentrating limited resources on the poor, eliminating subsidies for the rich and moving support for the middle class from a system of defined benefits to defined contributions. However skillfully this transition is designed, it will mean a middle-class benefit cut. That's why, in 2005, Republicans and Democrats both fled from Social Security reform like startled grouse. Even worse, this year President Obama and the Democratic Congress created a new health en lement funded mainly by taking money from Medicare, making that program more difficult to stabilize in the future. The Obama administration has not only avoided reform; it has complicated the job for future administrations.
The need for en lement reform is almost universally conceded. The politics of en lement reform, however, seem hopeless. The only consistent advocates of responsibility are congressional deficit hawks -- generally a finger-wagging, dyspeptic bunch. Being right does not make them attractive, and there will never be enough of them to carry a political task this heavy. If the debt debate is defined in Congress as pitiless austerity against business as usual, business as usual will regularly prevail.
But the vast scale of the debt problem creates an unexpected political possibility. According to the Congressional Budget Office, spending on mandatory health programs and Social Security is expected to grow from about 10 percent of gross domestic product today to roughly 16 percent in 2035. By way of historical comparison, government spending on all of its programs and activities has averaged about 18.5 percent of GDP over the last four decades. Put another way: In 25 years, nearly the whole portion of the economy we spend on government will be spent on en lement programs alone. Just about every other function and priority of the federal government will be swallowed up by increased spending on health care and retirement, or the percentage of the economy taken by taxes will need to dangerously increase. This is the other option.
Members of Congress should take special notice. Are you an advocate of growth-oriented tax cuts like, say, Sen. Jon Kyl, R-Ariz.? Without en lement reform, future tax reductions are a budgetary impossibility. Support defense spending like Rep. Duncan Hunter, R-Calif., or increased resources for child nutrition like Rep. George Miller, D-Calif.? Want more emphasis on fighting poverty, low-income housing, foreign assistance, health research, national parks, environmental protection, border patrols or plain old congressional pork? All will be severely constrained by the current trend in en lement spending growth.
Every federal budget involves a debate between liberal and conservative priorities on discretionary spending and tax reductions, expressed in the production of 12 annual appropriations bills. But the trajectory of mandatory spending threatens all of those priorities. Properly understood, the budget battle is not between big spenders and budget hawks. It is between those who want to spend larger and larger portions of the budget on health care and transfers to the elderly, and those who want to use budget resources for anything else.
The coming debt debate will be sensitive and uncomfortable because it has undercurrents of generational conflict. Since the New Deal, America has seen a massive transfer of wealth from young to old through en lement programs such as Social Security and Medicare, with many dramatically positive results. But that transfer is quickly escalating. Baby boomers are now beginning to retire in surging numbers. People are living longer and collecting benefits for more years -- a good thing, but expensive for federal programs. And health costs are increasing faster than are other forms of inflation. In an en lement system, these public commitments expand automatically, requiring political intervention to change. Devoting resources to the sick and elderly counts many achievements and benefits. But we are reaching a point where these important priorities threaten to overwhelm everything else.
The political cons uency for accelerated mandatory spending, including AARP and health providers, is powerful on both sides of the aisle. But the coalition for en lement reform should be broad as well, including everyone from tax cutters to poverty warriors to pork spenders. When members of Congress find their legislative discretion severely narrowed by mandatory commitments, they may awaken to difficult, necessary responsibilities. For them, it is a choice between reform and irrelevance.
En lement reform remains an uphill political cause -- but maybe not a hopeless one.
michaelgerson(at)washpost.com
Copyright 2010, Washington Post Writers Group
Page Printed from: http://www.realclearpolitics.com/art...ll_battle.html at July 31, 2010 - 08:06:38 AM PDT
There's the problem.The political cons uency for accelerated mandatory spending, including AARP and health providers, is powerful on both sides of the aisle. But the coalition for en lement reform should be broad as well...
"Without en lement reform, future tax reductions are a budgetary impossibility."
Exactly. Tax reduction doesn't stimulate growth, it accentuates ac ulation of wealth, and the power to use that wealth to increase its ac ulation, and widening of inequality. The tax-cut tide floats only the rich's boats.
Tax reduction pushed by the wealthy is really asymmetric class warfare. Reduce taxes on the rich, increase taxes on the poor (St Ronnie's formula). And the rich can and do afford focused buying of politicians (mainly Senators) while poor are completely disenfranchised.
Why aren't these en lements in the crosshairs (to use a gun-crazy US metaphor) of the Repugs/corps/capitalists/conservatives:
$700B military budget in fraud and mismanagement, en lement for the MIC
bogu war-for-oil, en lement for the MIC
farm subsidies (mainly going to BigAgrigculture, not family farmers, and certainly not black farmers)
corn ethanol/soy biodiesel subsidies, tax breaks
oil/gas/coal subsidies, tax breaks.
Why a state/federal sales tax on consumer goods, but no sales tax on Wall St trades?
The anti-en lement argument is so boring, so transparent, so racist (in racist America the people most in need of en lements are black and brown (and I'm not excusing those poor who scam, anymore than I excuse the doctors, clinics, hospitals who scam Medicare and Medicaid for 10 of $Bs every year).
The real problem of reforming it now is that they will have to admit the big lie. The Social Security "trust fund" makes Bernie Madoff look like a third grader stealing a piece of bubble gum at the Valero.
They would have to look the 50% of the population that currently provides 100% of the tax revenue in the eye and tell them "we lied to you".
"You have paid into SS for 50 years but you aren't going to get any money back because our "means test" says you don't need it. You don't feel rich? It says right here you have a house that is paid for and some retirement savings. That's more than 60% 0f the people your age. Sorry, but they need and deserve it more than you do"
"Social Security "trust fund" "
Myth: Social Security is going broke.
Reality: There is no Social Security crisis. By 2023, Social Security will have a $4.3 trillion surplus (yes, trillion with a 'T'). It can pay out all scheduled benefits for the next quarter-century with no changes whatsoever.1 After 2037, it'll still be able to pay out 75% of scheduled benefits--and again, that's without any changes. The program started preparing for the Baby Boomers retirement decades ago.2 Anyone who insists Social Security is broke probably wants to break it themselves.
Myth: We have to raise the retirement age because people are living longer.
Reality: This is a red-herring to trick you into agreeing to benefit cuts. Retirees are living about the same amount of time as they were in the 1930s. The reason average life expectancy is higher is mostly because many fewer people die as children than did 70 years ago.3 What's more, what gains there have been are distributed very unevenly--since 1972, life expectancy increased by 6.5 years for workers in the top half of the income brackets, but by less than 2 years for those in the bottom half.4 But those intent on cutting Social Security love this argument because raising the retirement age is the same as an across-the-board benefit cut.
Myth: Benefit cuts are the only way to fix Social Security.
Reality: Social Security doesn't need to be fixed. But if we want to strengthen it, here's a better way: Make the rich pay their fair share. If the very rich paid taxes on all of their income, Social Security would be sustainable for decades to come.5 Right now, high earners only pay Social Security taxes on the first $106,000 of their income.6 But conservatives insist benefit cuts are the only way because they want to protect the super-rich from paying their fair share.
Myth: The Social Security Trust Fund has been raided and is full of IOUs
Reality: Not even close to true. The Social Security Trust Fund isn't full of IOUs, it's full of U.S. Treasury Bonds. And those bonds are backed by the full faith and credit of the United States.7 The reason Social Security holds only treasury bonds is the same reason many Americans do: The federal government has never missed a single interest payment on its debts. President Bush wanted to put Social Security funds in the stock market--which would have been disastrous--but luckily, he failed. So the trillions of dollars in the Social Security Trust Fund, which are separate from the regular budget, are as safe as can be.
Myth: Social Security adds to the deficit
Reality: It's not just wrong -- it's impossible! By law, Social Security funds are separate from the budget, and it must pay its own way. That means that Social Security can't add one penny to the deficit.
http://pol.moveon.org/ssmyths/index.html?rc=homepage
A leftist vomits his mental contents.
"leftist vomits his mental contents."
An ignorant, chichen , less right-winger again fails to respond
High taxes on the job-creation class + strict regulations + large en lement programs = California. Their economy is awesome right now, eh?
California has the same problem as the Senate. The minority, obstructionist Repugs can block the majority Dems, because it takes more than 51% to pass budget legislation.
CA had a great state going when their taxes were high, an amazing, very wealthy, vibrant world-leading "country" that was the envy of red-staters.
Then the tax revolters in 70s started reducing/capping taxes while the people kept expecting to maintain the status quo. Disaster.
I do not doubt there is waste in CA govt (eg, city of Bell and SFO, retirement/pension bull ), but the response is to have War on Govt Waste rather than brutally starve the beast. U of CA system is now using tuition and fees to block the poor and underclass from college.
Why is that the when the conservatives "starve the beast", they only starve the parts of the beast that doesn't enrich conservatives?
God Damn, are you 13 ing years old?
That "surplus" is a hand full of IOU's from the Federal Government. The REAL money that was paid into the "social security lock box" was replaced with IOU's and has already long since been spent on other .
Those seniors aren't going to be able to spend those IOU's. They will need dollars.
The US Government is going to have to come up with real dollars from somewhere to pay off those Social Security IOU's so they can pay the seniors.
Your ignorance continues to absolutely amaze me.
Last edited by CosmicCowboy; 07-31-2010 at 02:04 PM.
"surplus" is a hand full of IOU's from the Federal Government."
link?
Google is you friend -for-brains.
http://lmgtfy.com/?q=social+security+trust+fund+assets
http://www.network-democracy.org/soc...faq/trust.html
A more current "plain english" explanation.
http://maxedoutmama.blogspot.com/200...rust-fund.html
You don't think that has anything to do with the housing bubble and bust that have killed the state's wealth?
I don't know how anyone can view a deduction from your paycheck by the federal government as anything other than a tax. Well, perhaps if you are a genius 20something with a wifi connection.
You're giving Boutons a lot of credit Matt.
If he's 20ish then he has to be bottom 30%. A serious intellectual bottom feeder.
Even NBADankneejerkleft and ChumpObamasucker won't try to defend the Social Security Scam.
BTW, this is not a Democrat or Republican issue. Both are equally guilty with this scam.
OK, true, SS has paid in far more than ever used. However, it is gone. Spent. It was stolen by our elected officials to pay for votes.
I've posted before that the Social Security trust fund is not filled with IOUs...it's filled with treasury bonds and bills backed by the US Federal government....you know, the same federal govt that has never, ever, missed an interest payment on its debt.....
...en lement spending is up because people, rich and poor, are living longer and require higher health-care costs in their older years, but wing-nuts like to scape-goat the poor children and welfare moms...
That same federal government that is now spending 1 TRILLION+ more dollars every year than it is getting in revenue.
The trust fund has been looted and there's no ing way they can pay it back.
Even the best Ponzi schemes eventually fail.
The difference here between the US Government and a conventional Ponzi scheme is they can print "dollars". They may not technically default but rather inflate their way out of the trap. The difference is the dollars they pay back won't be worth compared to the dollars that went into the "Trust Fund".
Cosmic, are you at work & bored (like me) or do you really care about this topic?
LMAO, naaa I'm procrastinating. I need to get outside and spray weeds and am finishing my coffee.Cosmic, are you at work & bored (like me) or do you really care about this topic?
If our currency fails then it wouldn't matter if we have 6.5 trillion dollars sitting in a bank account in the Caymans, the currency would be just as worthless....
this one is ready to fail, and bad.
We have more than enough revenue. The problem is liberal spending. Too much being spent on social services, buying votes for democrats.
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