Recent comments

robert,

What do you mean "Social Security is not a problem"?

I assume you are saying (1) that official projections are overly pessimistic and that Social Security should be currently projected to be fully (or near fully) "solvent" forever without any changes, and (2) that if Social Security were projected to be fully solvent forever, that would mean that Social Security spending is unrelated to our overall fiscal imbalance, does not contribute to it, and should not be considered as one type of spending to include as we consider spending cuts to reduce our overall fiscal imbalance because reducing projected Social Security spending would not help reduce the overall fiscal imbalance.

Is that what you're saying?

If so, it's nonsensical. Even if SS were projected to be fully "solvent" forever under current SS FICA tax rates and applicable income, reducing SS spending could still be part of our means of reducing our overall fiscal imbalance. We would just have to combine cuts on projected SS spending with cuts in SS FICA taxation and offset that revenue loss with increases in other taxes, resulting in lower projected overall spending, unchanged projected overall revenues, and therefore lower projected deficits.

By calling social services "entitlements" you have already slanted the discussion towards those who want to cut them back or eliminate them. The idea of a commission is also part of this effort.

The public has stated time and again that they support government-administered social services and want to see them expanded. So all ideas of "studies" are simply a way to thwart this desire.

None of the points in my prior comment were addressed.
1. Where is the willingness to stop using euphemisms?
2. Where is the discussion of excessive militarism?
3. Where is the acknowledgment that Social Security is not a problem?
4. Where is the acknowledgment that current problems with health care are a result of excessive privatization, not of "entitlements"?
5. There isn't even any discussion (just an axiom) that lowering the deficit or balancing the budget is a "good thing".

As for the chart that I cited, it's not mine, so if you have an arguments with the data, take it up with the authors, however you can do the math yourself, it's all on the CBO web site.

If prior militarism is now creating a continuing expense for the government (debt, veteran's care and benefits) then all the more reason to alter policies so that these "long-term entitlements" don't continue to grow.

If you are young and healthy you may think that you won't need these "long-term entitlements", but you may change your mind someday. It would be pretty ironic if your commission had eliminated them just when you need them most. Or perhaps you are sufficiently rich that you may never need to worry about living in retirement or paying for some catastrophic illness out of your own pocket.

Libertarians (or whatever they call themselves these days) are either foolish or heartless, take your pick.

If those are your views, then you should be 100% behind my suggestion of including the on-budget account--of which military spending is such a large portion--in the Commission's mandate to restore budget balance.

How about avoiding euphemisms like "long-term entitlement programs" and saying what you mean - Social Security and Medicare/Medicaid.

Then once you have done that, you might also want to consider where the bulk of the federal budget actually goes and then explain why that should not be looked at as a cause for our deficits.

In case you are puzzled about what the mystery "entitlement" program that eats up 54% of the budget is, it's militarism.

Here's a nice chart:
Pie Chart

Starting wars, maintaining 750+ overseas bases and spending billions on useless military hardware is OK, but ensuring that people don't die in misery is an "entitlement".

How perverted the discourse has become when destruction is favored over health and welfare. And if you really want to get into the economics of the issue, then Social Security is not in any danger, it is not going to grow at a rate that will be a problem.

Medicare/Medicaid are self-made problems brought on by the unwillingness of congress to adopt any of the proven national systems found elsewhere which provide better care at about half the cost. The only ones getting the "entitlements" are the private firms in the health industries which are making obscene profits. Are they "entitled" to mark up a pill which cost $4 per month as a generic to $250 while they keep competition off the market? How about the chemo treatments for which they charge $100K per round?

Apparently using euphemisms allows the heartlessness of the anti "entitlement" position to slip by.

Plain talk and practical examples will get you further than wonkish charts and numbers.

Ask them what they think the economy will be like in 5 or 10 years. Will the grandkids have jobs with benefits? Will the grandkids have the same job for 30 years, with a nice pension? What is happening to our economy, and what is making us less competitive in the global economy? Are healthcare costs a factor?

Can we afford these deficits? Are we good stewards of the future? What can and should we be doing to build economic vitality?

Regarding this and Steuerle's comments about "the very undemocratic impact of our generation's promises to ourselves on the tax burden of the next", it seems like the famous Intergenerational Compact is finally beginning to take a beating in some quarters.

Even a legal authority, Sandra Day O'Connor, just had an article in the WaPo saying that for a contract to be valid it must be fully agreed to by both sides instead of being imposed by one on the other -- yes, even if it is a "social contract".

But the problem is, all these appearances before Congressional committees and words in WaPo op-eds don't reach the people who are driving the politics of the matter -- which is why McCain and Obama aren't merely mute on all this but actually are promising more tax cuts and more entitlements that would make things trillions of dollars worse.

Some years back Gordon Tullock, IIRC, suggested that since economics (unlike say physics and chemistry) is applied through politics, the publishing requirement of professional economists should mandate a certain number of op-eds written for tabloid newspapers, and educational appearances at local political clubs and the like, and dealing with the all the rough feedback. Instead of only making presentations to each other that the political decision makers ignore while responding to the tabloid-reading voters and political-club influence dealers.

Now, I'm no professional economist but I have gone over to the AARP.org message boards, and I have given them links to the S&P report saying the US credit rating is on course to fall from AAA to "junk" in just the 10 years 2017 to 2027 ... to the CBO report on the 50% income tax increase (even on SS benefits!) needed by 2030 ... that dropping such a huge burden on the young is unfair ... and all the rest. Plenty of them.

And I can tell you that their response, in a polite description, is to go uniformly frothing mad. I mean, into a rage of name-calling anger. If you want to feel like you've had your "blood shed" in a discussion, try that.

And I submit that every economist who is really seriously concerned about this issue should try that.

Because all the Congress critters who hear all the alarming numbers in testimony are on their bottom line going to respond to that instead, just like they always have. They are going to think to themselves, "Yes, yes, these numbers are very bad, very alarming -- but I'm not going to get myself unelected this year, so we'll just have to put off dealing with it until to later ..." Like they have since 1994 or so.

IOW, there is going to be no political progress until at least some people at AARP and in like groups admit there actually is a problem to deal with.

So I am absolutely deadly, morbidly serious -- PhD economists who strongly care about this should go over to the AARP.org message boards and like forums to try to figure out some way to frame these issues so they, over there, grasp and understand and admit the problems -- to see if there is some way to turn at least part of the crowd away from the rabid denialists over there. Because that's what's necessary to get any real political progress before the very last fiscal gun-at-the-head minute, IMHO.

That's going to take one whole 'nuther kind of explaining, believe me, because citing commissions and CBO, GAO, S&P and the rest just doesn't cut it. And if you do go try, when you come back you'll really feel like a bloodied band of brothers.

But in the end, that's the audience that has to be reached and at least partly turned. IMHO, FWIW.

To explain why he can’t fulfill all of his promises, President-elect McCain or Obama will have to explain why the budget outlook is so much worse than the one that had been presented by the Bush administration.

The current situation may allow the elected president to grab a "Get Out of Campaign Promises" card, but that card can be played only once. The president-elect can amend his domestic economy campaign promises after a big November or December economic meeting, but he will be held to those amended promises. However, history shows that even the amended promises are soon broken, and, given the public's very short memory, blaming the previous administration a second or a third time won't work. I predict that the new president will have to make new excuses by 2011.

There used to be a time when Republicans were Americans. Sorry. Bipartisanship doesn't work any more.

Good to see you are honest about your lack of support for Democracy. I think you are in the right party bro. Your post was very funny. Sort of like Steve Colbert's line about the facts being liberal. Please post often.

>> I think it's far easier to make a rational argument that these economic problems were created or exacerbated by policies promoted by Democrats, not by Republicans or George Bush.

These are the same people that can't shut up about how poor people are poor cause they aren't responsible.

And now that they have broken everything they want you to know that it's all somebody elses fault.

If you weren't making money in Bill Clinton's America you must have been in a crack-induced coma. Remember those arguments we used to have about what to do with the budget surplus?

If you have been making money in W's America you must be a criminal, oilman or Halliburton shareholder.

Even W's net worth has gone done in the years he's been prez--that's got to tell you somethin'

I think it's far easier to make a rational argument that these economic problems were created or exacerbated by policies promoted by Democrats, not by Republicans or George Bush.