Sammy, how many times have we seen this: “it’s never hurt us before, we’ve always handled it, just tax the rich and corporations.”?
Lest we forget we also hear get out of (fill in the name of your favorite countires here) to save even more. But, we can never et to the actual numbers that would likely save.
I don’t know about other blogs, or liberals. But here and now, you may get ignored because of the way you present the problem. After an arguably intelligent beginning to fall into partizan hackery and name calling.
Let us begin by trying to parse out the problem so that it is understandable. When you cite “entitlements” are you aware that Social Security is self funding? So perhaps you should take SS cost, and SS revenues out of “the problem” and set them aside, at least for the moment. And if you wish to make the point that SS will need to be “funded” in the near future by the government repaying the money it owes to Social Security, at least don’t call that “entitlement” spending, but “repaying the debt”.
Then, before you get into parisan hackery, what are we to make of Dick Cheney’s famous “deficits don’t matter”?
At least as far as the deficit goes, it is not so much a matter of ‘taxing the rich’ as of “taxing the people to pay for what they didn’t pay for when they should have.”
you see, it is not very illuminating to have a conversation with someone who has pre packaged answers to everything and can’t be bothered to make sense.
We are spending $1.40 for every $1.00 in revenue. You want to raise taxes 40% across the board, or higher on just the rich and corporations? Then you wonder why they take their ball and go elsewhere?
Try this one on for size: That evil coberly, all he cares about is getting his social security check to the penny. He is so selfish. He is forcing cuts in programs for the medical care for the elderly and poor (medicare/medicaid), he is taking money from poor single moms (AFDC). He is denying poor people food! (Food stamps). He won’t even modify his pet program to reduce benefits for the richest elderly recipients. All he cares about is that he gets his Social Security check in the mailbox to the penny.
One issue is that in terms of Medicare, there are three pieces, only one of which has a dedicated tax (part A hospital). Way back when it was by far the largest piece, with part B (outpatient services and physicians) being smaller. This is funded by general revenue and the premium with the base premium only paying 25% For higher income folk a larger percentage is paid by premium. The same is true with a different percentage for part D (drugs). So when people talke about Medicare its big current problem is part B and D note that for reference if you did not pay long enough into the medicare trust fund the premium for part A is now 454/month.
Speaking only to the spending side here, it’s not social security, it’s not defense, and it’s not interest payments that will drive federal budgets up to truly historic levels as a percent of our economy (not counting WWII). Like our politicians’ talking points, AB comments about the spending side of our budget challenge prefer to ignore the growing elephant in the room, because it’s too difficult to tackle. But thankfully the CBO keeps pointing to it (here’s one old CBO graphic: http://en.wikipedia.org/wiki/File:Medicare_and_Medicaid_GDP_Chart.png) and pointed to it again in testimony this week:
—– From msnbc.com’s Tom Curry: The day after the Congressional Budget Office released its new estimate of a $1.5 trillion budget deficit for this fiscal year, CBO chief Douglas Elmendorf told the Senate Budget Committee that health care is the biggest driver of the budget problem.
Responding to a question from Sen. Rob Portman, R-Ohio, who asked him to identify the single largest fiscal challenge facing the United States, Elmendorf said, “the part of the spending that is growing very rapidly, and much faster than GDP, is spending on the government’s large health care programs, both because of the aging of the population … and because of rising health spending.”
He added, “The crucial underlying factor here … is the rising number of older Americans, relative to working Americans, and the rising cost of health care, relative to other things in the economy.”
This should come as no surprise, Elmendorf said. “Those fundamental forces have been foreseen for decades and, I think, are inexorable under current policies.” The CBO’s budget estimate released Wednesday projected that over the next several years, Medicare spending will grow at an average annual rate of nearly 7 percent, while Medicaid will grow at an average annual rate of 9 percent – even while the nation’s economy itself is growing at a rate of less than 3 percent a year.
(Medicaid is the government’s insurance program for poor people of all ages, but the elderly and disabled account for 70 percent of its outlays.) ——-
BTW, one deficit reduction plan–from Democratic Congresswoman Jan Schakowsky–proposes action to reduce medical cost growth (aka “the rising cost of health care”). And that plan is the one least-focused on the spending side of the ledger.
” Its not my definition of entitlements/mandatory spending.”
No and it is not CBOs or OMBs either. Instead it is doublespeak promoted by a combination of groups founded and funded by Peter Peterson or the Koch brothers plus AEI.
The real difference between ‘mandatory’ and ‘discretionary’ is the way they are treated during the Budget and Appropriations process and not to any legal subordination of one to the other. In any given year Congress can change the levels of most ‘mandatory’ spending or eliminate the programs altogether, on the other hand the Constitution mandates that both Courts and the Navy have to be funded. So which is actually ‘mandatory’?
Which is why the argument is so frustrating, the Right simply manipulates technical terminology to make rhetorical claims that are meaningless in actual political reality. And the smarter ones know this full well and devise the talking points with malice aforethougt.
Bruce, a SS expert here, in an outstandind example of “double speak” said: “In any given year Congress can change the levels of most ‘mandatory’ spending or eliminate the programs altogether, on the other hand the Constitution mandates that both Courts and the Navy have to be funded. So which is actually ‘mandatory’? ” Dopuble speak? Because to meet the letter of the law Congress can, and has cut spending to the USN to minimal levels, whil he and Dale and the other liberals here laughing call SS the political third rail. Nice deflection, Bruce, but not actually part of the point.
Which is why the solution is so frustratingly political. As I described, the Democrats think they have set a budget trap.
PJR, nice clarification of the entitlements/mandatory spending side of the federal deficit ledger. For me it goes a long way to explain the animosity to the Obamacare Bill, as it was passed with shoddy fiscal promises. Passing a huge, new healthcare entitlement program smack in the middle, as you and Elmendorf describe it, of the deficit hole was just fidacally irresponsible.
In my formal education I was taught that the entitlement elephant would eventually take over the budget (or similar cautionary descriptions.) Those days are here or so close that the tipping point is palpable.
As Sammy pointed out the tipping point’s catalyst may very well be debt interest. Democratic recession recovery policies seem to exacerbate, and move forward the tipping point. Spending our way out of it; borrowing to increase federal spending; adding a huge new entitlement; monetizing the debt, are not policies making the deficit problem better.
Playing politics with it ohnly worsens the problem and, in my estimation, will point directly back to Democratic/progressive actions.
An expansion of why I reacted to Bruce’s deflection of definitions for mandatory spending. The appear to have none. It is understood as foundational constructs of budgetting.
However, I did find this: “Mandatory Spending
Definition Spending not controlled by annual budget decisions (nondiscretionary spending, automatic spending, etc.)
Examples of Acceptable Explanations • Budgetary constraints make it difficult to accomplish policy goals. • It is difficult to make budget cuts that might accomplish policy goals.
Which was from this interesting source: AP® UNITED STATES GOVERNMENT AND POLITICS 2008 SCORING GUIDELINES Question 2 6 points
Yup! The High School Advanced Placement Test! No OMB/CBO defintion, but clearly fundamental to understanding Government and Politics.
An expansion of why I reacted to Bruce’s deflection of definitions for mandatory spending. CBO/OMB appear to have none. It is understood as foundational constructs of budgetting.
However, I did find this: “Mandatory Spending
Definition Spending not controlled by annual budget decisions (nondiscretionary spending, automatic spending, etc.)
Examples of Acceptable Explanations • Budgetary constraints make it difficult to accomplish policy goals. • It is difficult to make budget cuts that might accomplish policy goals.
Which was from this interesting source: AP® UNITED STATES GOVERNMENT AND POLITICS 2008 SCORING GUIDELINES Question 2 6 points
Yup! The High School Advanced Placement Test! No OMB/CBO defintion, but clearly fundamental to understanding Government and Politics.
“Trouble is, the government will raise a lot less than that amount . . . “
So the problem is that tax rates are too low for gov’t expenditures. Most people would conclude that a key part of the fix is for the gov’t to raise more money.
No, such a political move would just reinforce the views of Republican hypocrisy, and even move the issue to the political forefront.
Is it being willfully ignored? Or, maybe it’s willful ignorance?
Bruce, stay on topic please. It is Why is the Federal Deficit issue not covered on economic blogs? What you provided was some deflection about the CBO/OMB definitions. Find them for us, please, because after a short search they were not readily available. So your comment is just deflection.
An expansion of why I reacted to Bruce’s deflection of definitions for mandatory spending. CBO/OMB appear to have none. It is understood as foundational constructs of budgetting.
However, I did find this: “Mandatory Spending
Definition Spending not controlled by annual budget decisions (nondiscretionary spending, automatic spending, etc.)
Examples of Acceptable Explanations • Budgetary constraints make it difficult to accomplish policy goals. • It is difficult to make budget cuts that might accomplish policy goals.
Which was from this interesting source: AP® UNITED STATES GOVERNMENT AND POLITICS 2008 SCORING GUIDELINES Question 2 6 points
Yup! The High School Advanced Placement Test! No OMB/CBO defintion, but clearly fundamental to understanding Government and Politics.
How about staying on topic! Why can we not have an open discussion of the deficit and the solutions?
Joel, raising tax revenue certanly is part of the solution. We can not responsibly raise taxes the needed amount to balance the budget without risking collapse of the economy. Today, we need to raise revenues by ~40% with looming increases of interest, SS payments, Medicare and Medicaid payments, it would only be a short term solution. Most payments are indexed and will continue to go up.
So just raising taxes is a high risk, short term solution.
That’s a red herring, CoRev. Nobody said anything about “just” raising taxes. When I referred to “a key part,” that’s what “part” means. Not all, but a key and indispensible part.
I noticed that you willfully ignored tax increases entirely on this thread until I brought it up.
Joel, speaking of “red herring” the topic is Why is the Federal Deficit issue not covered on economic blogs?
BTW, I have been on record for months supporting the tax increases by letting the Bush tax cuts expire as a partial solution to reducing the deficit. OTH, I have supported their extension on purely political threads. There is a difference, which is the underlying theme of my submission of this comment thread.
“…all he cares about is getting his social security check to the penny…”
Which is less than a grand for the majority of recipients (who paid into the program for their entire working life, remember.) Can you live well on $12,000 a year?
Far better to patch up Bush’s tax-cut, foreign war deficits by welching on prepaid SS obligations and letting seniors live in their kids’ basements.
I truly HATE the word “entitlements.” Are you “entitled” to be paid if you sell something, or recieve an item you paid for? No, its a contractual obligation, and if one side or the other doesn’t honour their part of the bargain, that’s called fraud.
PJR, I looked at her plan. It is an interesting start. ~64% increase in revenue, coupled with some marginal entitlement cuts mostly through efficiency and administrative gains, and defense cuts along with some minor other discretionary cuts.
It probably represents the handful of views espoused here, when we can get to a discussion.
Deficit spending is simply deferred taxing. Why should I worry that I am creating debt to be rolled to my great grand kids?
I am not going to dwell on the war machine uses 20% of all US federal expenditures, every year and that is 3 times the Brits’ rate and 6 times the German rate. They just seem to be secure with more entitlements and less empire.
And that is almost three times the percent the US G outlays for medicare, which someone said is the elephant in the room of future deficits.
Aside from that my thought exercise: How does the US government engage in raising cash to spend for outlays it refused to tax people to fund?
So, I work for a defense manufacturer as a consultant. I send my monthly invoice in on 1 XXX 11. The company runs, it pays me and somehow they get cash from the DoD from the contribution I made to the war machine.
The company gets cash from DoD from an expenditure process where the comptroller of the buying agency writes a check. The check is a demand on the treasury.
The treasury has a cash balance which is increased every month from receipts of taxes, fees etc.
When the US treasury has less cash than the expenditures for a given month they go out and “sell” t bills.
People who buy t bills have cash that is not better used elsewhere.
My point is that cash should be taxed.
If the economy can give up the cash then the economy can pay taxes.
Yes, the federal reserve gets this all boloxed up, but the bottom line is:
Spending is taxing.
Why pay interest on t bills to folks who should have been taxed?
ILSM said: “Why pay interest on t bills to folks who should have been taxed? ” because to do otherwise make the sale of t-bills even more difficult, raises the interest on them to make them saleable, or restricts/drives sales to tax exempts/foreigners. Furthermore it guts reserve requirements around the insurance/banking communities.
Finally, your solution requires amind set wher the sovereign/government is the owner of ALL PROPERTY. Just a minor constitutional adjustment can solve that.
ILSM said: “Why pay interest on t bills to folks who should have been taxed? ” because to do otherwise make the sale of t-bills even more difficult, raises the interest on them to make them saleable, or restricts/drives sales to tax exempts/foreigners. Furthermore it guts reserve requirements around the insurance/banking communities.
Finally, your solution requires amind set wher the sovereign/government is the owner of ALL PROPERTY. Just a minor constitutional adjustment can solve that.
“So just raising taxes is a high risk, short term solution.” CoRev
That’s an opinion not a fact. Those who continue to spin the BS concerning the “high” rate of corporate US taxation should better educate themselves. Start here for a good summary: http://mediamatters.org/research/201004260006
And how long do I have to wait before one of our “conservative” contributors to the discussion addresses the real spending junkets in Iraq and Afghanistan. Those two expeditions and the related, but indirect, costs are tallied in the trillion dollar range. That’s real money.
I think you missed the point. Instead of borrowing the money to buy guns, just tax the people to buy guns. Saves the interest on the borrowed money (t bills).
As for the owners of ALL PROPERTY, if the people want to buy guns, they need to pay for it.
Somehow you seem to have the idea that you can have a BIG ARMY and not have to pay taxes.
After all, you can “borrow” the money from Social Security and not ever have to pay it back, right?
not very well. I paid for my social security. So did/does everyone else who gets a check.
You don’t need to raise taxes 40%… at least so far. About 3% would would pay for the current debt over a period of about ten years. Of course you can’t keep spending 40% more than you take in. But the answer is not to cheat the people who paid for Social Security and use the money to pay for two wars or a recession caused by the financial geniuses of both parties.
we can’t discuss them with you because you don’t understand them. and you seem to think that fraud is okay as long as it reduces the impact of borrowing to buy the things you want.
all this is true enough. but it’s what comes from mucking with the “worker pays for what he gets” formula that so far has kept SS “self funding” even if CoRev doesn’t understand the concept.
Absdolutely true, when you total the past nearly 10 years. We can average that at ~$100B/Yr, while the 2011 deficit was just estimated by CBO to be $1.48T. Totally cutting war spending helps, but doesn’t solve the deficit problem.
the biggest driver is ignorance. the medical costs can be paid for. all people have to do is decide they want to pay for them. it’s true the costs can and should be reduced. but that will take some intelligent effort. meanwhile, if we want the medical care, the safest way to pay for it is through something like Medicare. it’s also the cheapest so far.
people talk about “the budget” as though there was some magic size it cannot go beyond. well, there is no magic size. you pay for what you need.
projections for the future show people having real incomes twice what they are today. out of that money they can either pay for arguably better medical care, or a second lexus. or another war.
there is no “budget crisis.” there is only a political crisis.
by the way, Elmendorf is lying, and you are making a horrible math mistake.
The 1.5 trillion dollar budget deficit this year is not caused by medical spending. it’s caused by the recession, and that was caused by the bankers. Elmendorf and others are just using the deficit as a scare puppet to get cuts in programs the people need.
the math mistake is that Medicare may grow 7% and the economy grow 3%, but the bases are different, Medicare is growing 7% of about 3% of the budget. and the economy is growing about 3% of the whole economy. So quick, what’s bigger, 7% of a hundred billion dollars, or 3% of 15 trillion dollars?
Or is there some law that all of your expenditures must always and forever remain a fixed percent of your budget, however big the budget grows? When I was making only ten thousand a year food was 25% of my budget. Now that I am make a hundred thousand, should food food still be 25% of my budget? Or, when I was young, medical costs were less than a tenth of a percent of my budget. Now that I am old, should I expect medical costs to remain a tenth of a percent of my budget.
Folks this is a carnival trick being played on you because all carnies know the rubes can’t think too good. Or won’t take the time to think.
NO. there is no need to raise taxes 40% if the current deficit is temporary, as it should be. If you buy a new care for 30 thousand, you don’t have to raise your income by 30,000 a year to pay for it.
Dale, at least this is close to the topic. Even though saying this: “the mandatory – discretionary distinction you are so fond of means absolutely nothing from a policy standpoint.” begins to move away from it.
LOL at Dale’s undersstanding of reality. Is this why there is so little econblog discussion of the deficit. Do you folks really understand it like Dale?
LOL at Dale’s understanding of reality. Is this why there is so little econo blog discussion of the deficit. Do you folks really understand it like Dale?
NO. there is no need to raise taxes 40% if the current deficit is temporary, as it should be.
Yes, you are correct if the deficit is temporary. Only it isn’t temporary. This is where your laziness, lack of intellectual curiosity, and high self-assessment hinders you. See the CBO projections at the link I provided.
I do not agree that Elmendorf is lying on this issue, and I would not describe myself in the past as one of his biggest fans. Here he’s talking about the long-term budget “problem” that is down the road. He has elsewhere indicated that the proximate cause of huge near-term budget deficits is the extension of the Bush tax cuts topped by even more tax cuts in the deal made late last year.
I don’t think the long-term problem is entirely like you describe, Coberly. The only significant growth in projected budget spending (as a percent of GDP) is medicare/medicaid, and it’s huge growth over time as a percent of GDP. Most of it is due to cost growth, not the aging population. If we simply raise taxes to cover all of the price increases, we’ll need to greatly increase the percentage of GDP going to the federal budget. Instead of a budget of about 20 percent of GDP, it will be 30-35 percent. I certainly do not oppose increasing taxes to cover additional medical spending, but I also think it’s just stupid to keep paying more and more for less and less (we’re down to 36th in life expectancy despite pouring money into the system like no other country). That’s the behavior driving most of the future growth in spending. Liberal Jan Schakowsky at least makes an effort to address this behavior, which is ironic since she’s the big taxer/spender among those proposing deficit reduction plans.
Yea, it is to bad Boy-George Bush didn’t keep the wars on budget and planned future budgets after 2010 with the 2001/2003 tax breaks still in force. This was in the only way he could side step the issue of having to explain why we would have such magnifiicent deficits today. We are paying for Boy-George Bush’s fiscal irresponsibility.
Now, since I only searched on “deficit”some of these will be trade deficit, but that’s aso a worth-while topic. You can reine the search, if you so chose.
Run, at least you are talking about deficits. I don’t know how many ways and times this must be repeated, but funding via “Supplemental Funding Bills” is still on budget. Indeed they are more visible and make it easier for Congress to adjust, pass, or vote against. It seems to be a common misunderstanding on the left.
I’ve said this many times, but when we compare Clinton and Bush budget/deficit history we find Bush on the same path as Clinton to a balanced budget (deficit reduction was falling at similar rates.) The big differences were, Bush did not have the full 8 years Clinton had, and he lowered the deficit rates while fighting a war and lowering taxes. Except for a bursting bubble, Bush spending policies were projecting a balanced budget by 2011, which was actually very conservative. Private estimates projected balanced budgets as early as 2009. Then ofcourse we had a bubble burst, and all projectiosn went out the window.
Including the tax cuts in his future budgets turns out to be historically true. Deficits in 2008 and 2009 are both his and the Dem Congress’s responsibility with 2009 also shared with Obama. 2010 and (at least to this point in) 2011 deficits are all Dems).
JzB, thanks! I found the DeLong posts, but ignored them as they were 3 yrs old. I also searched on US deficit and federal deficit. Not just deficit. I agree, several of the finds were for trade and not budget.
No, that’s wrong, CoRev. Raising taxes on top earners, as has been domonstrated here many times, will not cause an economic downturn. What we have is a revenue problem, not a spending problem. It comes from three causes: 1) tax rates are too low on the wealthy, 2) the recession has depressed wages and therefore tax reciepts, and 3) many corporations making RECORD PROFITS, frex, BIG OIL, pay little or no taxes, due to loop holes and other chicanery.
If you would read the many econ blogs that address deficit issues (see my other comment), you would know that.
Meanwhile, i can offer you this, from my own work.
run75441, I agree with every single sentence that you typed, with the exception of what you apparently believe that I said or think. Maybe you didn’t read my second posting above–I stated (referencing the the growth of health care spending) “Most of it is due to cost growth, not the aging population.” The key word is “not.” Elmendorf does cite aging and costs as factors that are increasing health care spending; CBO projections support this statement AND also make clear that costs are by far the greater of the two drivers. As I mentioned, I’m not a big Elmendorf fan, but I think this is a rather minor “foul” on his part. Or perhaps I’ve become desensitized to egregious fouls by Mankiw-types. I give him credit for pointing to the correct budget category, which is more than most do.
jazzbo that’s because there will not long be an SS. the cap is what keeps SS from becoming welfare as we knew it.
the poor deluded liberals who want to raise the cap so the rich guy pays don’t seem to understand that they would just be playing into the hands of the Big Liars who claim that the rich guy is paying now.
when you have people wanting to kill SS because they think their taxes are too high, that is not the time to “save” SS by raising their taxes.
raising the “tax” of the people who get the benefit by forty cents per week would be an entirely different matter.
don’t kill the program by trying to save forty cents per week.
if (IF) we are going to need more expensive medical care, and the best (safest) way to pay for it is through Medicare, what difference does it make if “federal spending” goes from 20% to 30%… if that extra 10% is what you’d be spending for medical insurance anyway?
and you are going to have twice as much money left over after paying taxes as you do today.
JzB to what are you referring? “No, that’s wrong, CoRev. Raising taxes on top earners, as has been domonstrated here many times, will not cause an economic downturn.” I dfon’t remember talking about raising traxes on top earners.
What I see here is raising taxes to solve the deficit problem with little to no reference to cutting spending. The tax raising strategy requires annual increases to stay with inflation, increased indexed spending, covering the grwoing difference in SS revenue and expenditures, etc.
I can not see any economist recommending that we solve the deficit problem with taxes alone without adding serious economic risk. We’re talking about a 40% differential between revenues and spending.
About 3% would would pay for the current debt over a period of about ten years.
If we are spending $1.40 for every $1.00 in tax revenues and we raise tax revenues 3% that would mean we would be spending $1.40 for every $1.03 in tax revenues. You greatly overestimate your math skills, by a factor of 14, just in year 1.
JUst wanted to make sure people really understand that the medicare part of OADSI only pays for hospital care not the rest. I don’t think the media make this clear enough. I suspect that back in the 1960s part B was small because most serious treatment was done in hospitals, but then to keep the cost down there was a push to do more treatment out of hospitals. Note that 75 % of the cost of part B does come from general revenues for lower income recipients, part B is already means tested. Note that for part B if you delay signup your permiums go up 10% a year.
i hope you don’t include me in “you guys” because i agree with you. my only point was that even under current projections we could afford to pay for the health care. what is stupid is acting as if there is some magic line “the budget” cannot cross if “the budget” is the best way to pay for what we need.
misdirection is a kind of lying. it’s like “dad I wrecked the car, my god look at your doctor bill!”
the deficit today is not caused by health care.
it’s possible that health care tomorrow will be expensive, and we will have to pay for it. but it has nothing to do with the deficit today. and there is no reason it should cause a deficit tomorrow… all we have to do is pay for what we need.
one of us is lazy for sure. i can’t “answer” the CBO report. I can answer what you make of it. You have not shown me that your understanding of it is accurate. Certainly you have a poor idea of what a “factor of 14” means.
Run, we can not have any meaningful discussion when you fail to research the meanings of “on/off” in reference to the budget deficits. Frankly, that misunderstanding completely negates anything you said re: Bush deficits.
You further claim that Bush’s balanced budget prediction included the endign of the tazx cuts. But, this is what he actually said: “President Bush said on Tuesday that he would propose a plan that he insists would, if followed, achieve a balanced budget by 2012, the most optimistic he has been in at least five years, and he said the goal could be achieved without rescinding any of his big tax cuts.”
Private estiomates actually had a different scenario as shown below in graph 1. Graph2 provides an alternaive format for the deficit data. Finally, graph3 shows the actual revenue showing both recessions and the tax cuts.
To summarize, you are wrong on your understanding of “on/off” budget, your perceptions of what actually happened with deficits/revenues during the Bush administration. A simple projection of trend from 2004-2007 even to 2009 gets to near or at a balanced budget. My point was with the exception of the bubble bursting (did not happen for Clinton), Bush’s economic policies were as effective as Clinton’s.
Is it this misunderstanding about what is a deficit, or how it’s calculated that leaves us not directly addressing it here and other econo-blogs, or is it too painful as it reflects on Dem economic policies?
Run, let me include the following definition so that we can compare apples to apples: “Definition: The budget authority, outlays, and receipts of certain Federal entities that have been excluded from budget totals under provisions of law. Most of the off-budget amount is from the Social Security trust fund, with a minor amount from Postal Service revenues.”
BTW, for those who can not understand how SS revenue affects deficits: “Payroll tax receipts that go into the Social Security Trust Fund are considered “off-budget”, but are nevertheless used as revenue in the current budget.“
Since deficits are simple calculations of differences between revenue and expenditures….
Finally, I think, Run, if you use the Wiki explanation of “emergency supplemental” and impacts on budget deficit, it is my feeling that they forgot to add one word, estimate(s), when describing how they impact deficit calculations.
The key difference is that “spending deficits” (totals in versus totals out) when calculated by Treasury reflect actuals and not estimates.
Dale, I’m sure Sammy can defend himself, but please enlighten us how a 3% rise in taxes on 2010’s revenue of $2.381 trillion pays for $14.1T (Jan), err $14.2T (Feb), umh $14.3T (Mar)… in debt in ten years? If you can not do the math that’s $.07143T/Yr, or over ten years it approximates a total inclrease in revenue of $.7 to .8T.
BTW, CBO projects the deficit to increase by over $6t between 2011 and 2020 making the 2020 deficit ~$20T.
Now that the fundamentals are defined, care to explain your math, or your analysis, or whatever is going on in your head to make such a strange claim re: a 3% rise in taxes.
Be careful here. You don’t want anyone to think you are completely disconnected from reality or as you say innumerate.
the 3% raise in tax will start to bring down the deficit, resulting in lower interest costs, and an improving economy will raise taxes (not the same as tax rates). yes, i am reasonably sure a 3% increase will do the job, but it’s hard to explain a moving target to someone who can only think one thought at a time.
true enough. I only argue about paying the cost of OASDI. and I point out that the costs of HI are affordable according to current (high) projections.
I think that ALL of Medicare should be paid for by the workers themselves with a capped payroll tax. But that argument just makes me enemies on all sides.
The issue, for me, is that instead of panicking and killing the baby with the bath water, we calm down and look at what things are likely to cost us, and how much money we will have, and what is the best way to pay for what we need.
This is somewhat different than projecting huge costs increases, ignoring the similar increase in wages, and cutting off our heads because the best way to pay for it might be to tax ourselves.
Consider… what is the difference between paying 10% of your income to a private insurance company and paying 6% of your income for the same health insurance through a government “tax.”
at the most it’s an ideological difference. as matter of dollars and sense, the best answer is the tax increase.
Dale, I see. Now you backing off from your statment: “About 3% would would pay for the current debt over a period of about ten years. How does $.7 to .8T. equal (pay for) today’s $14T or 2020’s $20T?
Sammy and I have tried to explain how wrong you were, but you are so arrogant you can not accept it. Rephrase it anyway you want, but you are flat wrong! Don’t start calling us names, it will just reflect back.
In reply to my comment regarding the wars in the middle east costing about a trilion dollars, above, CoRev makes the following assertion: “Absdolutely true, when you total the past nearly 10 years. We can average that at ~$100B/Yr, while the 2011 deficit was just estimated by CBO to be $1.48T. Totally cutting war spending helps, but doesn’t solve the deficit problem.”
In effect he would have it understood that the middle east wars have been averaging about $100 Billion annual cost. he doesn’t say where such paltry dollar amounts come from. So I’ll defer to Joseph Stiglitz who, IMHO, makes a much better source of such tabulations than CoRev. The following is from an article published by Stiglitz att he beginning of 2008 so his amounts are for only the first five years of warfare in the middle east. He notes that the costs had been steadily rising and his dollar estimates are astounding amounts. http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article3419840.ece
“As the fifth year of the war draws to a close, operating costs (spending on the war itself, what you might call “running expenses”) for 2008 are projected to exceed $12.5 billion a month for Iraq alone, up from $4.4 billion in 2003, and with Afghanistan the total is $16 billion a month. Sixteen billion dollars is equal to the annual budget of the United Nations, or of all but 13 of the US states. Even so, it does not include the $500 billion we already spend per year on the regular expenses of the Defence Department. Nor does it include other hidden expenditures, such as intelligence gathering, or funds mixed in with the budgets of other departments.”
Jack, rolling in the DoD budget, intelligence, the State Dept, each state’s homeland security effort, US Homeland Security, Congressional studies, your research, my research, our children’s research, college security on each campus, shared costs with the UK, NATO, UN forces, are all war costs, and gets us to a very high discretionary spending number. Sigh, but it does not solve the deficit problem!
Moreover, your article can be trumped with this one: “As President Obama prepares to tie a bow on U.S. combat operations in Iraq, Congressional Budget Office numbers show that the total cost of the eight-year war was less than the stimulus bill passed by the Democratic-led Congress in 2009.
According to CBO numbers in its Budget and Economic Outlook published this month, the cost of Operation Iraqi Freedom was $709 billion for military and related activities, including training of Iraqi forces and diplomatic operations.
Does cutting a fraction of that discretionary spending get us close enough to solving that looming deficit problem? I think not. So propose away, and let’s see where we go with the spending deficit.
It’s got to start some place and the best place to start when cutting expenses is on the least useful activities that generate a significant amount of the total costs. War has got to be it. Then start to increase tax receipts, especially those of corporations that have enjoyed significant profitability over the past several years. As I said, you have to start some place and you can’t do it by refusing to honor your debt payments.
coberly, as usual, provides an exaggerated illustration of Liberal thought pathology. It is comforting to him that for only a 3% tax increase (on others) we can solve our deficit problem and continue to spend on things that make him feel good about himself. Just like we can solve Global Warming by requiring little slow electric cars in the city. In neither case will he put a pen to paper for only 10 seconds to figure out that he is really asking a lot more of his fellow citizens to carry out his whims.
People in general have a difficult time comprehending large numbers, like $14T. For almost all of our existence we have never had to comprehend more than a couple of thousand units. We also have a hard time facing up to the idea that there are finite resources. For libs, these two factors are compounded by the urgency of self image enhancement: government spending = virtue, and that virtue is transferrable to them if they advocate higher spending. This way they can feel good about themselves and be A Great Guy/Gal without having to sacrifice their own money or volunteer their time. It’s really quite efficient for them.
coberly, as usual, provides an exaggerated illustration of Liberal thought pathology. It is comforting to him that for only a 3% tax increase (on others) we can solve our deficit problem and continue to spend on things that make him feel good about himself. Just like we can solve Global Warming by requiring little slow electric cars in the city. In neither case will he put a pen to paper for only 10 seconds to figure out that he is really asking a lot more of his fellow citizens to carry out his whims, so it is not as easy to call them names such as “greedy” and “selfish” and whatever other more elaborate ad homs he is so quick with.
People in general have a difficult time comprehending large numbers, like $14T. For almost all of our existence we have never had to comprehend more than a couple of thousand units. We also have a hard time facing up to the idea that there are finite resources. For libs, these two factors are compounded by the urgency of self image enhancement: government spending = virtue, and that virtue is transferrable to them if they advocate higher spending. This way they can feel good about themselves and be A Great Guy/Gal without having to sacrifice their own money or volunteer their time. It’s really quite efficient for them.
Your starting point is still too small to make a big enough difference. Please look at the actual numbers to see how small are your changes. You also said: “…you can’t do it by refusing to honor your debt payments.” Who is refusing to honor our debt? What happens when after your heroic efforts are successfully implemented, and the deficit continues to go up by substantial percentages?
You obviously have a predetermined agenda that is going to insist that only the government activities that you disagree with are going to be sufficient to reach your goal, what ever that may be. No matter what starting point is suggested you find it inadequate. That’s an interesting approach which when taken to its logical conclusion would mean, don’t start to deal with the task because nothing I, meaning you, don’t agree with is sufficient. As both Coberly and I have tried to make clear, you’re not discussing an issue. You’re demanding that its your way or nothing. Reminder: Angry Bear is a slightly left of center economics blog. The goal is to find solutions that have all Americans chipping in to share the burden. It seems that any solution that includes less than a strident right wing (reactionary) approach is insufficient to you. It’s interesting that your arguments are little different than those offered by the original right wing in France at the Estates-General assembly wherein the left tried to compromise, but the right said no may, but the highway. That approach ended badly.
Jack, that’s another interesting approach. I merely said your approach is “too small to make a big enough difference.” There was no value judgement included in that response.
I then asked two questions: the one I wished to have answered was: “Who is refusing to honor our debt?” The second question was rhetorical in hopes you would do more indepth analysis.
Your angy response had no relationship to that which it referenced. My overarching comment was written to try to get an understanding of why there is so little direct writing on the econ-blogs re: the deficit issue/problem. A corollary was, but not written, that the dialog is too often ideological and angry.
After much prodding, you admitted that the deficit was an issue/problem. But, when discussing it and possible solutions, you fall right back into ideological anger. If its a problem, why can we NOT discuss it rationally?
You seem to have reading comprehension difficulties as well as total math failure. Go back and read Sammy’s original comment re spending 1.40 for every 1.00 in revenue. I said that can’t keep up. But the CURRENT .40 deficit could be paid for at the rate of .03 per year for ten years. then i clarified that by reminding you that the economy should recover. In this case there should be about an extra .10 in revenue with no tax rate increase at all. if you don’t raise spending then you have about .13 extra revenue per year to pay off that .40 debt from this year.
This is very informal, with lots of hand waving, but lots closer to reality than sammy “factor of 14” or CoRev’s fugue into using the .03 to pay off the accumulated debt of 30 plus years in ten years. that is not what i said.
read better. get help with the math.
you might also remember that i have advocating raising the tax across the board, including the SS tax on poor people, so don’t accuse me of wanting to soak the risk. you got the wrong guy.
good to see you are till here. I answered your confusion about a 3 cent tax paying a 40 cent deficit in 30 years back near where you outdid yourself with superciliousness. i see you are keeping up the tone here with jack. good luck with that. i have real work to do, so i won’t be back until late. be interested to see if you have figured it out.
Dale, as I have already said, now you are backing off your origianal statment. You now want us at AB to believe that .13 equals .4. You also want us to believe that using terms like debt meant this year’s .4 deficit.
So let me repeat my earlier: “Sammy and I have tried to explain how wrong you were, but you are so arrogant you can not accept it. Rephrase it anyway you want, but you are flat wrong! Don’t start calling us names, it will just reflect back.”
So let me add another descriptor for you, deceitful (meaning: intended to deceive; misleading; fraudulent).
Dale, as I have already said, now you are backing off your original statement. You now want us at AB to believe that .13 equals .4. You also want us to believe that using terms like debt meant this year’s .4 deficit. Looking at 10 years of marginal revenue increases, based mostly on hoping the economy recovers to cover one year’s deficit is a ludicrous policy. With your policy, for ten years we are increasing the yearly deficit by .27 cents for each dollar of revenue.
So let me repeat my earlier: “Sammy and I have tried to explain how wrong you were, but you are so arrogant you can not accept it. Rephrase it anyway you want, but you are flat wrong! Don’t start calling us names, it will just reflect back.”
So let me add another descriptor for you, deceitful (meaning: intended to deceive; misleading; fraudulent).
“After much prodding, you admitted that the deficit was an issue/problem. But, when discussing it and possible solutions, you fall right back into ideological anger. If its a problem, why can we NOT discuss it rationally?” CoRev
What is it that you’re reading, because it certainly seems that you aren’t reading my comments? You continue to harp on your perception of anger in others. I don’t see it though one would be justified in being angered by your continuous refusal to ignore what is actually written in favor of what you would like to believe. When offered an approach to cost cutting you claim that it isn’t enough in spite of it being a beginning. then you go on to claim that no solutions are being offered. So take the ball and run. What is the best approach to reducing the deficit? What spending cuts are enough to meet your critieria of enough to make a difference? Or, what revenue sources has the Treasury been ignoring?
OK Jack, challenge accepted, but first let’d correct one error: “Or, what revenue sources has the Treasury been ignoring?” Treasury does not selectively enforce tax law without direction from the top.
Before we get to planning an approach we need to set some preliminary goals. 1) to balance the budget or not? 2) how long should it take? 3) How to implement?
Goal: Let’s get to a balanced budget.
Time frame 1 year is possible but way too risky. To balance the budget in 1 year all we need to do is stop raising the debt ceiling.
For longer time frames it is a simple formula of fixing budget growth to the GDP growth rate, and a combination of spending cuts and revenue increases matched to the time frame targeted (3, 5, 10 years.) I favor the mid time frame around 5 years to try to capture the inevitable gain from the improving economy. A five year goal requires an average REAL annual budget change (cuts + increased revenue) in the ~7-8%/Yr (~$290-300B) range. At the end of five years the budget would be changed by ~40% +/- GDP growth from 2011. In actuality, I think that the ~7-8%/Yr (~$290-300B) range will be too low due to things like rising interest on the continued borrowing, growing inflation due to QE2, and indexing of entitlement payments.
Implemetation: Freeze entitlement spending to solve the indexing issue. Put spending limits on the Executive Branch discretionary budget equal to the chosen annual limits. Have the various apropriations committees adhere to those same annual limits. To insure that happens set the first budget limit at 2008 spending levels. Then lower the discretionary budget ceiling limit to the FY2006 spending amount resulting with those two cuts of ~30% cut in borrowing. After that cut things get much harder to reach that added 10%.
Most wonder why propose salami slice cuts versus targeted cutting. Salami slice cuts is the budget cutting process to which the Executive Branch is accustomed to responding. Furthermore it places the detailed decision making on how best to implement the cuts in the hands of the programmatic experts, and lessesn the opportunity for politicians demagogging.
My little secret: If we could achieve a borrowing cut to the 2006 level we could probably live with the results provided the economy recovered. BUT, it only puts off the pain till the next business cycle down turn.
Implementation is everything. Entitlements is a small word, but constantly waivering meanings. Are we going to change mandated entitlements or appropriated entitlements? Is the word entitlement even legitimate in the case of programs legislated and already paid for? Is a program entitled to be paid the debts owed to it after its assets have been utilized for other programs and activities. Don’t hide behind the vague terminology of a political ventriloguist. What do you intend to include in the term entitlement?
Oh, I almost forgot. Where does defense and defense related spending come into your plan the reduce the deficit. The total ranges between $1.0 and $1.4 Trillion annually. Now we’re talkin’ real money.
Defense-related expenditures2011 Budget request & Mandatory spendingCalculationDOD spending$721.3 billionBase budget + “Overseas Contingency Operations”FBI counter-terrorism$2.7 billionAt least one-third FBI budget.International Affairs$10.1–$54.2 billionAt minimum, foreign arms sales. At most, entire State budgetEnergy Department, defense-related$20.9 billionVeterans Affairs$66.2 billionHomeland Security$54.7 billionNASA, satellites$3.4–$8.5 billionBetween 20% and 50% of NASA’s total budgetVeterans pensions$58.4 billionOther defense-related mandatory spending$7.5 billionInterest on debt incurred in past wars$114.8–$454.2 billionBetween 23% and 91% of total interestTotal Spending$1.060–$1.449 trillion
Jack, the definition of entitlements and the class of spending is defined in every year’s budget. The list of budget items changes little, only the amounts change annually mostly due to indexing, inflation, and some legislative changes.
Here’s a Wiki link explaining most of the misconceptions (budget deficit/(spending) deficit/ entitlements & mandatory spending/discretionary spending/ on & Off budget) http://en.wikipedia.org/wiki/United_States_federal_budget you use here.
When you define mandatory spending as you have above in your list, it shows a complete lack of undertanding of the term. The only mandatory item(s) I can identify are the Veterans Pensions and interest on debt. The rest is all discretionary spending.
I assume from your list you are suggesting we not meet our debt interest obligations. Anyone else?
It’s a list of cuts right? Which do you think will be politically possible? AFAIK neither Obama nor the current Republicans are willing to cut defense spending much, let alone completely as you suggest. Are you really ILSM in disguise? 😉
Finally, asking this: “Oh, I almost forgot. Where does defense and defense related spending come into your plan the reduce the deficit.” just comfirms your budget ignorance. I said: “Put spending limits on the Executive Branch discretionary budget equal to the chosen annual limits.” I then went on to describe those limits. Can you guess where those ole defense and defense related budget line items lies?
If you temper all this spending with some revenue gains, you might be able t make a poltical case for implementing. You should look at Democratic Congresswoman Jan Schakowsky’s plan.
“Do a search! “US deficit” or “federal deficit” search here at Angry Bear or pick your favorite Econo Blogs from the pick list and see how few articles there are on this high priority issue. “
CoRev continues to define his terms as the argument best suits him. Social Security spending is legislatively mandated. That legislation is now about 75 years old and has been successful over that entire period. he’s going to say, but no, I didn’t include SS, but he’s going to define terms so that it is impossible to exclude SS. What CoRev continues to deny is that the gorilla in the budget is military spending and particularly the wars in Iraq and Afghanistan.
We’ve not even touched upon the disparate distribution of income which has led to a drier and drier well from which to draw receipts, especially if so-called unearned income is either taxed at lower rates or excluded entirely. Maybe greater focus should be given to the unearned classification and recognition to the fact that if its unearned then its undeserved and should be subject to a higher rate of taxation. But no source of additional receipts is adequate in the world according to CoRev, therefore, leave it alone. And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for.
By the way, a counter revolutionary is otherwise referred to as a reactionary force. Nothing must change in the best of all possible worlds. That is the world of the counter revolutionary/reactionary partisan.
Jack, your rant is again a misunderstanding or willful ignores what i have presented. The only SS/entitltements comments in my plan was to freeze them at their currently indexed rates. I even agreed, as a valid approach, with your list of proposed cuts, but commented that I thought it was less politically viable than you. I didn’t discuss constituiionaltiy issues why it not possible.
We didn’t discuss redistribuion of income because it wasn’t brought up.
I admit to skating on the revenue side of the plan I submitted. although I did referent it and am on record o supporting raising taxes to the pre-Bush level. Here is what I said re: revenue: “A five year goal requires an average REAL annual budget change (cuts + increased revenue) in the ~7-8%/Yr (~$290-300B) range.” Like Dale, I rely on an improved economy for much of that revenue increase.
BTW, this sentence is unintelligible: “And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for. ”
My bottpm line conclusions from this submission are that Democrats are moslty unwilling to talk about solving the deficit problem. From this and prior threads I can only conclude that they find it less of a problem than the average independent and conservative voter. Moreover, it is obvious that most of the terms is misunderstood (budget deficit versus spending deficit, on/off budget, discretionary/mandatory spending, etc) which make it difficult to have a meaningful discussion.
Finally, of the two politcal plans discussed, Ryan’s and Jan Schakowsky’s, Ryan’s more closely fits the Deficit Commission recommendations. I have no position either way on them, other than they are proposals at trying to solve the deficit problem.
Jack, your rant is again a misunderstanding or willfully ignores what I have presented. The only SS/entitltements comments in my plan was to freeze them at their currently indexed rates. I even agreed, as a valid approach, with your list of proposed cuts, but commented that I thought it was less politically viable than you. I didn’t discuss constitutionality issues why its not possible. For those not familar with Jack’s proposal, the core of which he abolishes DoD, large parts of Homeland Security, FBI, and the intelligence agencies.
We didn’t discuss redistribution of income because it wasn’t brought up.
I admit to skating on the revenue side of the plan I submitted. Although I did reference it and am on record of supporting raising taxes to the pre-Bush level. Here is what I said re: revenue: “A five year goal requires an average REAL annual budget change (cuts + increased revenue) in the ~7-8%/Yr (~$290-300B) range.” Like Dale, I rely on an improved economy for much of that revenue increase. This plan was based first upon freezing the budget at 2008 and laterat 2006 levels.
BTW, this sentence is unintelligible: “And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for. ”
My bottpm line conclusions from this submission are that Democrats are moslty unwilling to talk about solving the deficit problem. From this and prior threads I can only conclude that they find it less of a problem than the average independent and conservative voters. Moreover, it is obvious that most of the terms are misunderstood (budget deficit versus spending deficit, on/off budget, discretionary/mandatory spending, etc) which make it difficult to have a meaningful discussion.
Finally, of the two politcal plans discussed, Ryan’s and Jan Schakowsky’s, Ryan’s more closely fits the Deficit Commission recommendations. I have no position either way on them, other than they are proposals at trying to solve the deficit problem.
“For those not familar with Jack’s proposal, the core of which he abolishes DoD, large parts of Homeland Security, FBI, and the intelligence agencies.” CoRev That is not supported by facts in evidence. Significant reductions are needed across the DofD board and possibly Homeland Security is the biggest crock of crap ever devised, but you doth protest too much.
“BTW, this sentence is unintelligible:(CoRev) “And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for. ” Some what colloquial possibly, but unintelligible is a gross exaggeration. Though it does seem that you would rather not understand what you don’t agree with. “My bottpm line conclusions from this submission are that Democrats are moslty unwilling to talk about solving the deficit problem.” CoRev
Now you’re talking like a fool. The only thing you can conclude from the material presented on the entire thread is that lots of people on this blog disagree with you. That’s not terribly surprising given that Angry Bear describes itself as, “Slightly left of center commentary on news, politics and the economy.” Or is that statement also unintelligible.
Jack you have proposed cutting war spending in several comments, then you provided a list of what you considered war spending. It started with: “Defense-related expenditures2011 Budget request & Mandatory spendingCalculationDOD spending$721.3 billionBase budget + “Overseas Contingency Operations…” Note the list’s very first item and your proposal. If you were unclear in that list, if it was not a proposal for budget cuts, or if it represents something other than a spending list, just say so. You’ve now had several opportunities to correct my understanding of what that list was meant to infer, but have chosen to do otherwise.
The rest of your comment is just more personal attack or reaction to questioning of prior comments.
Jack, Dale and anyone else still listening, here is a basic demonstration of the budget deficit, and the Obama 2009 approach. It is a good visual explantion. http://wimp.com/budgetcuts/
CoRev, The guy shows us a clever penny map rendition of the budget. He then clearly states that half of that “map”, on the left side of a white line, is committed budget expenses made up of Medicare and Social Security. Honk!! Honk!! That’s my deception alert. You and he seem to want to disregard the fact that so-called unified budget (that’s the budget wise guys use when they want it forgotten that SS has its own funding stream) and that combining the two budgets is contrary to legislated law. One more time to remind you that SS benfits are not part of the deficit. Interest earned by the Trust Fund Special Treasury notes are a cost item in the general budget. And so too is repayment of debt as it becomes due. The Trust Fund assets are no different than are the Treasury notes held by any other entity.
You are one persistent and pesky deceiver. Why not give it a break and recognize that your distortions of fact are not going to gain traction on Angry Bear, where the typical reader has better than a FoxNews level of education? Why don’t you move over to Sarah Palin’s blog where your deceptive commentary will be more acceptable to the fools who admire her and her ilk, of which I include you.
Keynes was a crank.
Sammy, how many times have we seen this: “it’s never hurt us before, we’ve always handled it, just tax the rich and corporations.”?
Lest we forget we also hear get out of (fill in the name of your favorite countires here) to save even more. But, we can never et to the actual numbers that would likely save.
CoRev,
I don’t know about other blogs, or liberals. But here and now, you may get ignored because of the way you present the problem. After an arguably intelligent beginning to fall into partizan hackery and name calling.
Let us begin by trying to parse out the problem so that it is understandable. When you cite “entitlements” are you aware that Social Security is self funding? So perhaps you should take SS cost, and SS revenues out of “the problem” and set them aside, at least for the moment. And if you wish to make the point that SS will need to be “funded” in the near future by the government repaying the money it owes to Social Security, at least don’t call that “entitlement” spending, but “repaying the debt”.
Then, before you get into parisan hackery, what are we to make of Dick Cheney’s famous “deficits don’t matter”?
At least as far as the deficit goes, it is not so much a matter of ‘taxing the rich’ as of “taxing the people to pay for what they didn’t pay for when they should have.”
you see, it is not very illuminating to have a conversation with someone who has pre packaged answers to everything and can’t be bothered to make sense.
cobs,
We are spending $1.40 for every $1.00 in revenue. You want to raise taxes 40% across the board, or higher on just the rich and corporations? Then you wonder why they take their ball and go elsewhere?
Try this one on for size: That evil coberly, all he cares about is getting his social security check to the penny. He is so selfish. He is forcing cuts in programs for the medical care for the elderly and poor (medicare/medicaid), he is taking money from poor single moms (AFDC). He is denying poor people food! (Food stamps). He won’t even modify his pet program to reduce benefits for the richest elderly recipients. All he cares about is that he gets his Social Security check in the mailbox to the penny.
There. How does it fit?
One issue is that in terms of Medicare, there are three pieces, only one of which has a dedicated tax (part A hospital). Way back when it was by far the largest piece, with part B (outpatient services and physicians) being smaller. This is funded by general revenue and the premium with the base premium only paying 25% For higher income folk a larger percentage is paid by premium. The same is true with a different percentage for part D (drugs). So when people talke about Medicare its big current problem is part B and D note that for reference if you did not pay long enough into the medicare trust fund the premium for part A is now 454/month.
Dale, we’ve had this discussion re: sense and your hyper sensitivity to SS. Its not my definition of entitlements/mandatory spending.
Using arguments that it is “self funded” is meaningless and frankly a misstatement. More accurately it does have a dedicated funding stream.
Speaking only to the spending side here, it’s not social security, it’s not defense, and it’s not interest payments that will drive federal budgets up to truly historic levels as a percent of our economy (not counting WWII). Like our politicians’ talking points, AB comments about the spending side of our budget challenge prefer to ignore the growing elephant in the room, because it’s too difficult to tackle. But thankfully the CBO keeps pointing to it (here’s one old CBO graphic: http://en.wikipedia.org/wiki/File:Medicare_and_Medicaid_GDP_Chart.png) and pointed to it again in testimony this week:
—–
From msnbc.com’s Tom Curry: The day after the Congressional Budget Office released its new estimate of a $1.5 trillion budget deficit for this fiscal year, CBO chief Douglas Elmendorf told the Senate Budget Committee that health care is the biggest driver of the budget problem.
Responding to a question from Sen. Rob Portman, R-Ohio, who asked him to identify the single largest fiscal challenge facing the United States, Elmendorf said, “the part of the spending that is growing very rapidly, and much faster than GDP, is spending on the government’s large health care programs, both because of the aging of the population … and because of rising health spending.”
He added, “The crucial underlying factor here … is the rising number of older Americans, relative to working Americans, and the rising cost of health care, relative to other things in the economy.”
This should come as no surprise, Elmendorf said. “Those fundamental forces have been foreseen for decades and, I think, are inexorable under current policies.”
The CBO’s budget estimate released Wednesday projected that over the next several years, Medicare spending will grow at an average annual rate of nearly 7 percent, while Medicaid will grow at an average annual rate of 9 percent – even while the nation’s economy itself is growing at a rate of less than 3 percent a year.
(Medicaid is the government’s insurance program for poor people of all ages, but the elderly and disabled account for 70 percent of its outlays.)
——-
BTW, one deficit reduction plan–from Democratic Congresswoman Jan Schakowsky–proposes action to reduce medical cost growth (aka “the rising cost of health care”). And that plan is the one least-focused on the spending side of the ledger.
” Its not my definition of entitlements/mandatory spending.”
No and it is not CBOs or OMBs either. Instead it is doublespeak promoted by a combination of groups founded and funded by Peter Peterson or the Koch brothers plus AEI.
The real difference between ‘mandatory’ and ‘discretionary’ is the way they are treated during the Budget and Appropriations process and not to any legal subordination of one to the other. In any given year Congress can change the levels of most ‘mandatory’ spending or eliminate the programs altogether, on the other hand the Constitution mandates that both Courts and the Navy have to be funded. So which is actually ‘mandatory’?
Which is why the argument is so frustrating, the Right simply manipulates technical terminology to make rhetorical claims that are meaningless in actual political reality. And the smarter ones know this full well and devise the talking points with malice aforethougt.
Bruce, a SS expert here, in an outstandind example of “double speak” said: “In any given year Congress can change the levels of most ‘mandatory’ spending or eliminate the programs altogether, on the other hand the Constitution mandates that both Courts and the Navy have to be funded. So which is actually ‘mandatory’? ” Dopuble speak? Because to meet the letter of the law Congress can, and has cut spending to the USN to minimal levels, whil he and Dale and the other liberals here laughing call SS the political third rail. Nice deflection, Bruce, but not actually part of the point.
Which is why the solution is so frustratingly political. As I described, the Democrats think they have set a budget trap.
PJR, nice clarification of the entitlements/mandatory spending side of the federal deficit ledger. For me it goes a long way to explain the animosity to the Obamacare Bill, as it was passed with shoddy fiscal promises. Passing a huge, new healthcare entitlement program smack in the middle, as you and Elmendorf describe it, of the deficit hole was just fidacally irresponsible.
In my formal education I was taught that the entitlement elephant would eventually take over the budget (or similar cautionary descriptions.) Those days are here or so close that the tipping point is palpable.
As Sammy pointed out the tipping point’s catalyst may very well be debt interest. Democratic recession recovery policies seem to exacerbate, and move forward the tipping point. Spending our way out of it; borrowing to increase federal spending; adding a huge new entitlement; monetizing the debt, are not policies making the deficit problem better.
Playing politics with it ohnly worsens the problem and, in my estimation, will point directly back to Democratic/progressive actions.
An expansion of why I reacted to Bruce’s deflection of definitions for mandatory spending. The appear to have none. It is understood as foundational constructs of budgetting.
However, I did find this: “Mandatory Spending
Definition Spending not controlled by annual
budget decisions (nondiscretionary
spending, automatic spending, etc.)
Examples of Acceptable Explanations
• Budgetary constraints make it
difficult to accomplish policy goals.
• It is difficult to make budget cuts
that might accomplish policy goals.
Which was from this interesting source: AP® UNITED STATES GOVERNMENT AND POLITICS
2008 SCORING GUIDELINES
Question 2
6 points
Yup! The High School Advanced Placement Test! No OMB/CBO defintion, but clearly fundamental to understanding Government and Politics.
How about staying on topic!
An expansion of why I reacted to Bruce’s deflection of definitions for mandatory spending. CBO/OMB appear to have none. It is understood as foundational constructs of budgetting.
However, I did find this: “Mandatory Spending
Definition Spending not controlled by annual
budget decisions (nondiscretionary
spending, automatic spending, etc.)
Examples of Acceptable Explanations
• Budgetary constraints make it
difficult to accomplish policy goals.
• It is difficult to make budget cuts
that might accomplish policy goals.
Which was from this interesting source: AP® UNITED STATES GOVERNMENT AND POLITICS
2008 SCORING GUIDELINES
Question 2
6 points
Yup! The High School Advanced Placement Test! No OMB/CBO defintion, but clearly fundamental to understanding Government and Politics.
How about staying on topic!
– Edit – Moderate
LOL.
“Trouble is, the government will raise a lot less than that amount . . . “
So the problem is that tax rates are too low for gov’t expenditures. Most people would conclude that a key part of the fix is for the gov’t to raise more money.
No, such a political move would just reinforce the views of Republican hypocrisy, and even move the issue to the political forefront.
Is it being willfully ignored? Or, maybe it’s willful ignorance?
Bruce, stay on topic please. It is Why is the Federal Deficit issue not covered on economic blogs? What you provided was some deflection about the CBO/OMB definitions. Find them for us, please, because after a short search they were not readily available. So your comment is just deflection.
An expansion of why I reacted to Bruce’s deflection of definitions for mandatory spending. CBO/OMB appear to have none. It is understood as foundational constructs of budgetting.
However, I did find this: “Mandatory Spending
Definition Spending not controlled by annual
budget decisions (nondiscretionary
spending, automatic spending, etc.)
Examples of Acceptable Explanations
• Budgetary constraints make it
difficult to accomplish policy goals.
• It is difficult to make budget cuts
that might accomplish policy goals.
Which was from this interesting source: AP® UNITED STATES GOVERNMENT AND POLITICS
2008 SCORING GUIDELINES
Question 2
6 points
Yup! The High School Advanced Placement Test! No OMB/CBO defintion, but clearly fundamental to understanding Government and Politics.
How about staying on topic! Why can we not have an open discussion of the deficit and the solutions?
Joel, raising tax revenue certanly is part of the solution. We can not responsibly raise taxes the needed amount to balance the budget without risking collapse of the economy. Today, we need to raise revenues by ~40% with looming increases of interest, SS payments, Medicare and Medicaid payments, it would only be a short term solution. Most payments are indexed and will continue to go up.
So just raising taxes is a high risk, short term solution.
That’s a red herring, CoRev. Nobody said anything about “just” raising taxes.
But I noticed that you willfully ignored tax increases entirely on this thread until I brought it up.
That’s a red herring, CoRev. Nobody said anything about “just” raising taxes. When I referred to “a key part,” that’s what “part” means. Not all, but a key and indispensible part.
I noticed that you willfully ignored tax increases entirely on this thread until I brought it up.
Joel, speaking of “red herring” the topic is Why is the Federal Deficit issue not covered on economic blogs?
BTW, I have been on record for months supporting the tax increases by letting the Bush tax cuts expire as a partial solution to reducing the deficit. OTH, I have supported their extension on purely political threads. There is a difference, which is the underlying theme of my submission of this comment thread.
Why can we not discuss the deficit issue?
Joel, I missed it, and reacted to the snark. Sorry.
“…all he cares about is getting his social security check to the penny…”
Which is less than a grand for the majority of recipients (who paid into the program for their entire working life, remember.) Can you live well on $12,000 a year?
Far better to patch up Bush’s tax-cut, foreign war deficits by welching on prepaid SS obligations and letting seniors live in their kids’ basements.
I truly HATE the word “entitlements.” Are you “entitled” to be paid if you sell something, or recieve an item you paid for? No, its a contractual obligation, and if one side or the other doesn’t honour their part of the bargain, that’s called fraud.
Noni, changing the word doesn’t change the budget impacts. Why can we not bring ourslves to discuss those budgettary impacts on the econo blogs?
PJR, I looked at her plan. It is an interesting start. ~64% increase in revenue, coupled with some marginal entitlement cuts mostly through efficiency and administrative gains, and defense cuts along with some minor other discretionary cuts.
It probably represents the handful of views espoused here, when we can get to a discussion.
Deficit spending is simply deferred taxing. Why should I worry that I am creating debt to be rolled to my great grand kids?
I am not going to dwell on the war machine uses 20% of all US federal expenditures, every year and that is 3 times the Brits’ rate and 6 times the German rate. They just seem to be secure with more entitlements and less empire.
And that is almost three times the percent the US G outlays for medicare, which someone said is the elephant in the room of future deficits.
Aside from that my thought exercise: How does the US government engage in raising cash to spend for outlays it refused to tax people to fund?
So, I work for a defense manufacturer as a consultant. I send my monthly invoice in on 1 XXX 11. The company runs, it pays me and somehow they get cash from the DoD from the contribution I made to the war machine.
The company gets cash from DoD from an expenditure process where the comptroller of the buying agency writes a check. The check is a demand on the treasury.
The treasury has a cash balance which is increased every month from receipts of taxes, fees etc.
When the US treasury has less cash than the expenditures for a given month they go out and “sell” t bills.
People who buy t bills have cash that is not better used elsewhere.
My point is that cash should be taxed.
If the economy can give up the cash then the economy can pay taxes.
Yes, the federal reserve gets this all boloxed up, but the bottom line is:
Spending is taxing.
Why pay interest on t bills to folks who should have been taxed?
That is as Austrian as I want to be.
ILSM said: “Why pay interest on t bills to folks who should have been taxed? ” because to do otherwise make the sale of t-bills even more difficult, raises the interest on them to make them saleable, or restricts/drives sales to tax exempts/foreigners. Furthermore it guts reserve requirements around the insurance/banking communities.
Finally, your solution requires amind set wher the sovereign/government is the owner of ALL PROPERTY. Just a minor constitutional adjustment can solve that.
Other than that it is a simple. Right?
ILSM said: “Why pay interest on t bills to folks who should have been taxed? ” because to do otherwise make the sale of t-bills even more difficult, raises the interest on them to make them saleable, or restricts/drives sales to tax exempts/foreigners. Furthermore it guts reserve requirements around the insurance/banking communities.
Finally, your solution requires amind set wher the sovereign/government is the owner of ALL PROPERTY. Just a minor constitutional adjustment can solve that.
Other than that it is simple. Right?
“So just raising taxes is a high risk, short term solution.” CoRev
That’s an opinion not a fact. Those who continue to spin the BS concerning the “high” rate of corporate US taxation should better educate themselves. Start here for a good summary: http://mediamatters.org/research/201004260006
And how long do I have to wait before one of our “conservative” contributors to the discussion addresses the real spending junkets in Iraq and Afghanistan. Those two expeditions and the related, but indirect, costs are tallied in the trillion dollar range. That’s real money.
CoRev
I think you missed the point. Instead of borrowing the money to buy guns, just tax the people to buy guns. Saves the interest on the borrowed money (t bills).
As for the owners of ALL PROPERTY, if the people want to buy guns, they need to pay for it.
Somehow you seem to have the idea that you can have a BIG ARMY and not have to pay taxes.
After all, you can “borrow” the money from Social Security and not ever have to pay it back, right?
sammy
not very well. I paid for my social security. So did/does everyone else who gets a check.
You don’t need to raise taxes 40%… at least so far. About 3% would would pay for the current debt over a period of about ten years. Of course you can’t keep spending 40% more than you take in. But the answer is not to cheat the people who paid for Social Security and use the money to pay for two wars or a recession caused by the financial geniuses of both parties.
CoRev
we can’t discuss them with you because you don’t understand them. and you seem to think that fraud is okay as long as it reduces the impact of borrowing to buy the things you want.
Lyle
all this is true enough. but it’s what comes from mucking with the “worker pays for what he gets” formula that so far has kept SS “self funding” even if CoRev doesn’t understand the concept.
by SS I mean OASDI.
CoRev
“stay on topic” this is bull shit. Bruce was replying to you. you say “stay on topic” when you want to limit the argument to only your points.
which are stupid points. the mandatory – discretionary distinction you are so fond of means absolutely nothing from a policy standpoint.
Absdolutely true, when you total the past nearly 10 years. We can average that at ~$100B/Yr, while the 2011 deficit was just estimated by CBO to be $1.48T. Totally cutting war spending helps, but doesn’t solve the deficit problem.
pjr
with all respect to your point, which is valid,
the biggest driver is ignorance. the medical costs can be paid for. all people have to do is decide they want to pay for them. it’s true the costs can and should be reduced. but that will take some intelligent effort. meanwhile, if we want the medical care, the safest way to pay for it is through something like Medicare. it’s also the cheapest so far.
people talk about “the budget” as though there was some magic size it cannot go beyond. well, there is no magic size. you pay for what you need.
projections for the future show people having real incomes twice what they are today. out of that money they can either pay for arguably better medical care, or a second lexus. or another war.
there is no “budget crisis.” there is only a political crisis.
Sigh!!! And he claims I missed the point??!!??
by the way, Elmendorf is lying, and you are making a horrible math mistake.
The 1.5 trillion dollar budget deficit this year is not caused by medical spending. it’s caused by the recession, and that was caused by the bankers. Elmendorf and others are just using the deficit as a scare puppet to get cuts in programs the people need.
the math mistake is that Medicare may grow 7% and the economy grow 3%, but the bases are different, Medicare is growing 7% of about 3% of the budget. and the economy is growing about 3% of the whole economy. So quick, what’s bigger, 7% of a hundred billion dollars, or 3% of 15 trillion dollars?
Or is there some law that all of your expenditures must always and forever remain a fixed percent of your budget, however big the budget grows? When I was making only ten thousand a year food was 25% of my budget. Now that I am make a hundred thousand, should food food still be 25% of my budget? Or, when I was young, medical costs were less than a tenth of a percent of my budget. Now that I am old, should I expect medical costs to remain a tenth of a percent of my budget.
Folks this is a carnival trick being played on you because all carnies know the rubes can’t think too good. Or won’t take the time to think.
Please stay on topic, Dale. This isn’t about fraud or SS! It is about: Why is the Federal Deficit issue not covered on economic blogs?
CoRev
NO. there is no need to raise taxes 40% if the current deficit is temporary, as it should be. If you buy a new care for 30 thousand, you don’t have to raise your income by 30,000 a year to pay for it.
Dale, your understanding is so offbase I can not even respond. Anyone else care to try?
But, please get back on topic.
Dale, how does this follow the topic?
Dale, at least this is close to the topic. Even though saying this: “the mandatory – discretionary distinction you are so fond of means absolutely nothing from a policy standpoint.” begins to move away from it.
LOL at Dale’s undersstanding of reality. Is this why there is so little econblog discussion of the deficit. Do you folks really understand it like Dale?
LOL at Dale’s understanding of reality. Is this why there is so little econo blog discussion of the deficit. Do you folks really understand it like Dale?
NO. there is no need to raise taxes 40% if the current deficit is temporary, as it should be.
Yes, you are correct if the deficit is temporary. Only it isn’t temporary. This is where your laziness, lack of intellectual curiosity, and high self-assessment hinders you. See the CBO projections at the link I provided.
I do not agree that Elmendorf is lying on this issue, and I would not describe myself in the past as one of his biggest fans. Here he’s talking about the long-term budget “problem” that is down the road. He has elsewhere indicated that the proximate cause of huge near-term budget deficits is the extension of the Bush tax cuts topped by even more tax cuts in the deal made late last year.
I don’t think the long-term problem is entirely like you describe, Coberly. The only significant growth in projected budget spending (as a percent of GDP) is medicare/medicaid, and it’s huge growth over time as a percent of GDP. Most of it is due to cost growth, not the aging population. If we simply raise taxes to cover all of the price increases, we’ll need to greatly increase the percentage of GDP going to the federal budget. Instead of a budget of about 20 percent of GDP, it will be 30-35 percent. I certainly do not oppose increasing taxes to cover additional medical spending, but I also think it’s just stupid to keep paying more and more for less and less (we’re down to 36th in life expectancy despite pouring money into the system like no other country). That’s the behavior driving most of the future growth in spending. Liberal Jan Schakowsky at least makes an effort to address this behavior, which is ironic since she’s the big taxer/spender among those proposing deficit reduction plans.
CoRev:
Yea, it is to bad Boy-George Bush didn’t keep the wars on budget and planned future budgets after 2010 with the 2001/2003 tax breaks still in force. This was in the only way he could side step the issue of having to explain why we would have such magnifiicent deficits today. We are paying for Boy-George Bush’s fiscal irresponsibility.
CoRev –
Here, I did your homework for you.
Krugman – 246 items
http://krugman.blogs.nytimes.com/?s=deficit
Now, since I only searched on “deficit”some of these will be trade deficit, but that’s aso a worth-while topic. You can reine the search, if you so chose.
econbrowser
http://www.econbrowser.com/cgi-bin/mt-search.cgi?IncludeBlogs=1&search=deficit
This one’s really good.
http://www.econbrowser.com/archives/2010/10/the_everexpandi_1.html
Thoma – 9450? Must be some double counting.
http://www.google.com/search?q=deficit&btnG=Google+Search&domains=http%3A%2F%2Feconomistsview.typepad.com&sitesearch=http%3A%2F%2Feconomistsview.typepad.com
Delong –
http://delong.typepad.com/.services/blog/6a00e551f08003883400e551f080068834/search?filter.q=deficit
I’m no economist, but I posted extensively on the deficit, with real facts and data, and stuff.
http://jazzbumpa.blogspot.com/#uds-search-results
Have fun – I’m delighted to help you.
Cheers!
JzB
screw raising the SS %. Remove the ceiling, and there will NEVER be a shortfall.
JzB
CoRev –
Focus, man. i did your homework for you.
Krugman.
http://krugman.blogs.nytimes.com/?s=deficit
Delong
http://delong.typepad.com/.services/blog/6a00e551f08003883400e551f080068834/search?filter.q=deficit
Thoma
http://www.google.com/search?q=deficit&btnG=Google+Search&domains=http%3A%2F%2Feconomistsview.typepad.com&sitesearch=http%3A%2F%2Feconomistsview.typepad.com
Chinn and Hamilton
http://www.econbrowser.com/cgi-bin/mt-search.cgi?IncludeBlogs=1&search=deficit
Now, since I searched on “deficit” some of these will be trade deficit, rather than fed. Bear with me on thst.
Happy to be ble to help.
Cheers!
JzB
P.S. This is my third attemot to post. Sorry if there’s a duplicate.
Run, at least you are talking about deficits. I don’t know how many ways and times this must be repeated, but funding via “Supplemental Funding Bills” is still on budget. Indeed they are more visible and make it easier for Congress to adjust, pass, or vote against. It seems to be a common misunderstanding on the left.
I’ve said this many times, but when we compare Clinton and Bush budget/deficit history we find Bush on the same path as Clinton to a balanced budget (deficit reduction was falling at similar rates.) The big differences were, Bush did not have the full 8 years Clinton had, and he lowered the deficit rates while fighting a war and lowering taxes. Except for a bursting bubble, Bush spending policies were projecting a balanced budget by 2011, which was actually very conservative. Private estimates projected balanced budgets as early as 2009. Then ofcourse we had a bubble burst, and all projectiosn went out the window.
Including the tax cuts in his future budgets turns out to be historically true. Deficits in 2008 and 2009 are both his and the Dem Congress’s responsibility with 2009 also shared with Obama. 2010 and (at least to this point in) 2011 deficits are all Dems).
JzB, thanks! I found the DeLong posts, but ignored them as they were 3 yrs old. I also searched on US deficit and federal deficit. Not just deficit. I agree, several of the finds were for trade and not budget.
BTW, no dupe, yet!
No, that’s wrong, CoRev. Raising taxes on top earners, as has been domonstrated here many times, will not cause an economic downturn. What we have is a revenue problem, not a spending problem. It comes from three causes: 1) tax rates are too low on the wealthy, 2) the recession has depressed wages and therefore tax reciepts, and 3) many corporations making RECORD PROFITS, frex, BIG OIL, pay little or no taxes, due to loop holes and other chicanery.
If you would read the many econ blogs that address deficit issues (see my other comment), you would know that.
Meanwhile, i can offer you this, from my own work.
http://jazzbumpa.blogspot.com/2011/01/government-spending-and-great.html
Cheers!
JzB
Looks like two fails and one success. A pretty good major league batting average.
At Delong’s, they’re not in calender order, unless you hit the “most recent” button.
http://delong.typepad.com/.services/blog/6a00e551f08003883400e551f080068834/search?pager.sort=created_on&filter.q=federal+deficit
He has posted on the deficit in the health care context as recently as yesterday.
http://delong.typepad.com/sdj/2011/01/harold-pollack-on-sensible-economists-support-health-care-reform.html
Many similar posts in the last few days.
This one by Chinn totally destroys the run-away spending myth.
http://www.econbrowser.com/archives/2010/10/the_everexpandi_1.html
Happy reading! There’s a lot there.
Cheers!
JzB
run75441, I agree with every single sentence that you typed, with the exception of what you apparently believe that I said or think. Maybe you didn’t read my second posting above–I stated (referencing the the growth of health care spending) “Most of it is due to cost growth, not the aging population.” The key word is “not.” Elmendorf does cite aging and costs as factors that are increasing health care spending; CBO projections support this statement AND also make clear that costs are by far the greater of the two drivers. As I mentioned, I’m not a big Elmendorf fan, but I think this is a rather minor “foul” on his part. Or perhaps I’ve become desensitized to egregious fouls by Mankiw-types. I give him credit for pointing to the correct budget category, which is more than most do.
jazzbo
that’s because there will not long be an SS. the cap is what keeps SS from becoming welfare as we knew it.
the poor deluded liberals who want to raise the cap so the rich guy pays don’t seem to understand that they would just be playing into the hands of the Big Liars who claim that the rich guy is paying now.
when you have people wanting to kill SS because they think their taxes are too high, that is not the time to “save” SS by raising their taxes.
raising the “tax” of the people who get the benefit by forty cents per week would be an entirely different matter.
don’t kill the program by trying to save forty cents per week.
i see.
in CoRev speak, “on topic” means “agrees with me. “off topic” means “disagrees with me.”
PJR
think this through.
if (IF) we are going to need more expensive medical care, and the best (safest) way to pay for it is through Medicare, what difference does it make if “federal spending” goes from 20% to 30%… if that extra 10% is what you’d be spending for medical insurance anyway?
and you are going to have twice as much money left over after paying taxes as you do today.
sammy
present your argument. don’t ask me to find it for you.
JzB to what are you referring? “No, that’s wrong, CoRev. Raising taxes on top earners, as has been domonstrated here many times, will not cause an economic downturn.” I dfon’t remember talking about raising traxes on top earners.
What I see here is raising taxes to solve the deficit problem with little to no reference to cutting spending. The tax raising strategy requires annual increases to stay with inflation, increased indexed spending, covering the grwoing difference in SS revenue and expenditures, etc.
I can not see any economist recommending that we solve the deficit problem with taxes alone without adding serious economic risk. We’re talking about a 40% differential between revenues and spending.
coberly,
About 3% would would pay for the current debt over a period of about ten years.
If we are spending $1.40 for every $1.00 in tax revenues and we raise tax revenues 3% that would mean we would be spending $1.40 for every $1.03 in tax revenues. You greatly overestimate your math skills, by a factor of 14, just in year 1.
JUst wanted to make sure people really understand that the medicare part of OADSI only pays for hospital care not the rest. I don’t think the media make this clear enough. I suspect that back in the 1960s part B was small because most serious treatment was done in hospitals, but then to keep the cost down there was a push to do more treatment out of hospitals. Note that 75 % of the cost of part B does come from general revenues for lower income recipients, part B is already means tested. Note that for part B if you delay signup your permiums go up 10% a year.
run
i hope you don’t include me in “you guys” because i agree with you. my only point was that even under current projections we could afford to pay for the health care. what is stupid is acting as if there is some magic line “the budget” cannot cross if “the budget” is the best way to pay for what we need.
pjr
misdirection is a kind of lying. it’s like “dad I wrecked the car, my god look at your doctor bill!”
the deficit today is not caused by health care.
it’s possible that health care tomorrow will be expensive, and we will have to pay for it. but it has nothing to do with the deficit today. and there is no reason it should cause a deficit tomorrow… all we have to do is pay for what we need.
sammy
one of us is lazy for sure. i can’t “answer” the CBO report. I can answer what you make of it. You have not shown me that your understanding of it is accurate. Certainly you have a poor idea of what a “factor of 14” means.
Run, we can not have any meaningful discussion when you fail to research the meanings of “on/off” in reference to the budget deficits. Frankly, that misunderstanding completely negates anything you said re: Bush deficits.
You further claim that Bush’s balanced budget prediction included the endign of the tazx cuts. But, this is what he actually said: “President Bush said on Tuesday that he would propose a plan that he insists would, if followed, achieve a balanced budget by 2012, the most optimistic he has been in at least five years, and he said the goal could be achieved without rescinding any of his big tax cuts.”
Private estiomates actually had a different scenario as shown below in graph 1. Graph2 provides an alternaive format for the deficit data. Finally, graph3 shows the actual revenue showing both recessions and the tax cuts.
To summarize, you are wrong on your understanding of “on/off” budget, your perceptions of what actually happened with deficits/revenues during the Bush administration. A simple projection of trend from 2004-2007 even to 2009 gets to near or at a balanced budget. My point was with the exception of the bubble bursting (did not happen for Clinton), Bush’s economic policies were as effective as Clinton’s.
Is it this misunderstanding about what is a deficit, or how it’s calculated that leaves us not directly addressing it here and other econo-blogs, or is it too painful as it reflects on Dem economic policies?
Run, let me include the following definition so that we can compare apples to apples: “Definition: The budget authority, outlays, and receipts of certain Federal entities that have been excluded from budget totals under provisions of law. Most of the off-budget amount is from the Social Security trust fund, with a minor amount from Postal Service revenues.”
BTW, for those who can not understand how SS revenue affects deficits: “Payroll tax receipts that go into the Social Security Trust Fund are considered “off-budget”, but are nevertheless used as revenue in the current budget.“
Since deficits are simple calculations of differences between revenue and expenditures….
Finally, I think, Run, if you use the Wiki explanation of “emergency supplemental” and impacts on budget deficit, it is my feeling that they forgot to add one word, estimate(s), when describing how they impact deficit calculations.
The key difference is that “spending deficits” (totals in versus totals out) when calculated by Treasury reflect actuals and not estimates.
sammy
thank you for revealing to our readers that you are completely innumerate.
Dale, I’m sure Sammy can defend himself, but please enlighten us how a 3% rise in taxes on 2010’s revenue of $2.381 trillion pays for $14.1T (Jan), err $14.2T (Feb), umh $14.3T (Mar)… in debt in ten years? If you can not do the math that’s $.07143T/Yr, or over ten years it approximates a total inclrease in revenue of $.7 to .8T.
BTW, CBO projects the deficit to increase by over $6t between 2011 and 2020 making the 2020 deficit ~$20T.
Now that the fundamentals are defined, care to explain your math, or your analysis, or whatever is going on in your head to make such a strange claim re: a 3% rise in taxes.
Be careful here. You don’t want anyone to think you are completely disconnected from reality or as you say innumerate.
Here is the pie chart for 2009 US G “spending”.
http://en.wikipedia.org/wiki/File:U.S._Federal_Spending_-_FY_2007.png
Spending is taxing……………..
Here is the pie chart for 2009 US G “spending”.
http://en.wikipedia.org/wiki/File:U.S._Federal_Spending_-_FY_2007.png
or for the 2011 estimates that show 2015 estimates as well, pg 153.
http://www.whitehouse.gov/sites/default/files/omb/budget/fy2011/assets/tables.pdf
CoRev
sammy thinks a factor of 1.4 is “a factor of 14.”
the 3% raise in tax will start to bring down the deficit, resulting in lower interest costs, and an improving economy will raise taxes (not the same as tax rates). yes, i am reasonably sure a 3% increase will do the job, but it’s hard to explain a moving target to someone who can only think one thought at a time.
Lyle
true enough. I only argue about paying the cost of OASDI. and I point out that the costs of HI are affordable according to current (high) projections.
I think that ALL of Medicare should be paid for by the workers themselves with a capped payroll tax. But that argument just makes me enemies on all sides.
The issue, for me, is that instead of panicking and killing the baby with the bath water, we calm down and look at what things are likely to cost us, and how much money we will have, and what is the best way to pay for what we need.
This is somewhat different than projecting huge costs increases, ignoring the similar increase in wages, and cutting off our heads because the best way to pay for it might be to tax ourselves.
Consider… what is the difference between paying 10% of your income to a private insurance company and paying 6% of your income for the same health insurance through a government “tax.”
at the most it’s an ideological difference. as matter of dollars and sense, the best answer is the tax increase.
Dale, I see. Now you backing off from your statment: “About 3% would would pay for the current debt over a period of about ten years. How does $.7 to .8T. equal (pay for) today’s $14T or 2020’s $20T?
Sammy and I have tried to explain how wrong you were, but you are so arrogant you can not accept it. Rephrase it anyway you want, but you are flat wrong! Don’t start calling us names, it will just reflect back.
In reply to my comment regarding the wars in the middle east costing about a trilion dollars, above, CoRev makes the following assertion:
“Absdolutely true, when you total the past nearly 10 years. We can average that at ~$100B/Yr, while the 2011 deficit was just estimated by CBO to be $1.48T. Totally cutting war spending helps, but doesn’t solve the deficit problem.”
In effect he would have it understood that the middle east wars have been averaging about $100 Billion annual cost. he doesn’t say where such paltry dollar amounts come from. So I’ll defer to Joseph Stiglitz who, IMHO, makes a much better source of such tabulations than CoRev. The following is from an article published by Stiglitz att he beginning of 2008 so his amounts are for only the first five years of warfare in the middle east. He notes that the costs had been steadily rising and his dollar estimates are astounding amounts.
http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article3419840.ece
“As the fifth year of the war draws to a close, operating costs (spending on the war itself, what you might call “running expenses”) for 2008 are projected to exceed $12.5 billion a month for Iraq alone, up from $4.4 billion in 2003, and with Afghanistan the total is $16 billion a month. Sixteen billion dollars is equal to the annual budget of the United Nations, or of all but 13 of the US states. Even so, it does not include the $500 billion we already spend per year on the regular expenses of the Defence Department. Nor does it include other hidden expenditures, such as intelligence gathering, or funds mixed in with the budgets of other departments.”
Jack, rolling in the DoD budget, intelligence, the State Dept, each state’s homeland security effort, US Homeland Security, Congressional studies, your research, my research, our children’s research, college security on each campus, shared costs with the UK, NATO, UN forces, are all war costs, and gets us to a very high discretionary spending number. Sigh, but it does not solve the deficit problem!
Moreover, your article can be trumped with this one: “As President Obama prepares to tie a bow on U.S. combat operations in Iraq, Congressional Budget Office numbers show that the total cost of the eight-year war was less than the stimulus bill passed by the Democratic-led Congress in 2009.
According to CBO numbers in its Budget and Economic Outlook published this month, the cost of Operation Iraqi Freedom was $709 billion for military and related activities, including training of Iraqi forces and diplomatic operations.
Read more: http://www.foxnews.com/politics/2010/08/30/cbo-years-iraq-war-cost-stimulus-act/#ixzz1CYfMwX28
I find it intriguing that we are forever comparing fractions of the annual deficits (2011 estimated to be $1.48T). I readily admit that War/DOD/Education/ etc. on and on in the discretionary side of the budget is mostly spent using borrowed money. Do you?
Does cutting a fraction of that discretionary spending get us close enough to solving that looming deficit problem? I think not. So propose away, and let’s see where we go with the spending deficit.
ILSM says: “Spending is taxing……………..” and/or borrowing!
It’s got to start some place and the best place to start when cutting expenses is on the least useful activities that generate a significant amount of the total costs. War has got to be it. Then start to increase tax receipts, especially those of corporations that have enjoyed significant profitability over the past several years. As I said, you have to start some place and you can’t do it by refusing to honor your debt payments.
CoRev,
coberly, as usual, provides an exaggerated illustration of Liberal thought pathology. It is comforting to him that for only a 3% tax increase (on others) we can solve our deficit problem and continue to spend on things that make him feel good about himself. Just like we can solve Global Warming by requiring little slow electric cars in the city. In neither case will he put a pen to paper for only 10 seconds to figure out that he is really asking a lot more of his fellow citizens to carry out his whims.
People in general have a difficult time comprehending large numbers, like $14T. For almost all of our existence we have never had to comprehend more than a couple of thousand units. We also have a hard time facing up to the idea that there are finite resources. For libs, these two factors are compounded by the urgency of self image enhancement: government spending = virtue, and that virtue is transferrable to them if they advocate higher spending. This way they can feel good about themselves and be A Great Guy/Gal without having to sacrifice their own money or volunteer their time. It’s really quite efficient for them.
CoRev,
coberly, as usual, provides an exaggerated illustration of Liberal thought pathology. It is comforting to him that for only a 3% tax increase (on others) we can solve our deficit problem and continue to spend on things that make him feel good about himself. Just like we can solve Global Warming by requiring little slow electric cars in the city. In neither case will he put a pen to paper for only 10 seconds to figure out that he is really asking a lot more of his fellow citizens to carry out his whims, so it is not as easy to call them names such as “greedy” and “selfish” and whatever other more elaborate ad homs he is so quick with.
People in general have a difficult time comprehending large numbers, like $14T. For almost all of our existence we have never had to comprehend more than a couple of thousand units. We also have a hard time facing up to the idea that there are finite resources. For libs, these two factors are compounded by the urgency of self image enhancement: government spending = virtue, and that virtue is transferrable to them if they advocate higher spending. This way they can feel good about themselves and be A Great Guy/Gal without having to sacrifice their own money or volunteer their time. It’s really quite efficient for them.
Your starting point is still too small to make a big enough difference. Please look at the actual numbers to see how small are your changes. You also said: “…you can’t do it by refusing to honor your debt payments.” Who is refusing to honor our debt? What happens when after your heroic efforts are successfully implemented, and the deficit continues to go up by substantial percentages?
You obviously have a predetermined agenda that is going to insist that only the government activities that you disagree with are going to be sufficient to reach your goal, what ever that may be. No matter what starting point is suggested you find it inadequate. That’s an interesting approach which when taken to its logical conclusion would mean, don’t start to deal with the task because nothing I, meaning you, don’t agree with is sufficient. As both Coberly and I have tried to make clear, you’re not discussing an issue. You’re demanding that its your way or nothing. Reminder: Angry Bear is a slightly left of center economics blog. The goal is to find solutions that have all Americans chipping in to share the burden. It seems that any solution that includes less than a strident right wing (reactionary) approach is insufficient to you. It’s interesting that your arguments are little different than those offered by the original right wing in France at the Estates-General assembly wherein the left tried to compromise, but the right said no may, but the highway. That approach ended badly.
Jack, that’s another interesting approach. I merely said your approach is “too small to make a big enough difference.” There was no value judgement included in that response.
I then asked two questions: the one I wished to have answered was: “Who is refusing to honor our debt?” The second question was rhetorical in hopes you would do more indepth analysis.
Your angy response had no relationship to that which it referenced. My overarching comment was written to try to get an understanding of why there is so little direct writing on the econ-blogs re: the deficit issue/problem. A corollary was, but not written, that the dialog is too often ideological and angry.
After much prodding, you admitted that the deficit was an issue/problem. But, when discussing it and possible solutions, you fall right back into ideological anger. If its a problem, why can we NOT discuss it rationally?
What is your response?
CoRev and Sammy
You seem to have reading comprehension difficulties as well as total math failure. Go back and read Sammy’s original comment re spending 1.40 for every 1.00 in revenue. I said that can’t keep up. But the CURRENT .40 deficit could be paid for at the rate of .03 per year for ten years. then i clarified that by reminding you that the economy should recover. In this case there should be about an extra .10 in revenue with no tax rate increase at all. if you don’t raise spending then you have about .13 extra revenue per year to pay off that .40 debt from this year.
This is very informal, with lots of hand waving, but lots closer to reality than sammy “factor of 14” or CoRev’s fugue into using the .03 to pay off the accumulated debt of 30 plus years in ten years. that is not what i said.
read better. get help with the math.
you might also remember that i have advocating raising the tax across the board, including the SS tax on poor people, so don’t accuse me of wanting to soak the risk. you got the wrong guy.
CoRev
good to see you are till here. I answered your confusion about a 3 cent tax paying a 40 cent deficit in 30 years back near where you outdid yourself with superciliousness. i see you are keeping up the tone here with jack. good luck with that. i have real work to do, so i won’t be back until late. be interested to see if you have figured it out.
and your little dog too.
Dale, as I have already said, now you are backing off your origianal statment. You now want us at AB to believe that .13 equals .4. You also want us to believe that using terms like debt meant this year’s .4 deficit.
So let me repeat my earlier: “Sammy and I have tried to explain how wrong you were, but you are so arrogant you can not accept it. Rephrase it anyway you want, but you are flat wrong! Don’t start calling us names, it will just reflect back.”
So let me add another descriptor for you, deceitful (meaning: intended to deceive; misleading; fraudulent).
Anyone care to defend Dale?
Dale, as I have already said, now you are backing off your original statement. You now want us at AB to believe that .13 equals .4. You also want us to believe that using terms like debt meant this year’s .4 deficit. Looking at 10 years of marginal revenue increases, based mostly on hoping the economy recovers to cover one year’s deficit is a ludicrous policy. With your policy, for ten years we are increasing the yearly deficit by .27 cents for each dollar of revenue.
So let me repeat my earlier: “Sammy and I have tried to explain how wrong you were, but you are so arrogant you can not accept it. Rephrase it anyway you want, but you are flat wrong! Don’t start calling us names, it will just reflect back.”
So let me add another descriptor for you, deceitful (meaning: intended to deceive; misleading; fraudulent).
Anyone care to defend Dale?
“After much prodding, you admitted that the deficit was an issue/problem. But, when discussing it and possible solutions, you fall right back into ideological anger. If its a problem, why can we NOT discuss it rationally?” CoRev
What is it that you’re reading, because it certainly seems that you aren’t reading my comments? You continue to harp on your perception of anger in others. I don’t see it though one would be justified in being angered by your continuous refusal to ignore what is actually written in favor of what you would like to believe. When offered an approach to cost cutting you claim that it isn’t enough in spite of it being a beginning. then you go on to claim that no solutions are being offered. So take the ball and run. What is the best approach to reducing the deficit? What spending cuts are enough to meet your critieria of enough to make a difference? Or, what revenue sources has the Treasury been ignoring?
OK Jack, challenge accepted, but first let’d correct one error: “Or, what revenue sources has the Treasury been ignoring?” Treasury does not selectively enforce tax law without direction from the top.
Before we get to planning an approach we need to set some preliminary goals. 1) to balance the budget or not? 2) how long should it take? 3) How to implement?
Goal: Let’s get to a balanced budget.
Time frame 1 year is possible but way too risky. To balance the budget in 1 year all we need to do is stop raising the debt ceiling.
For longer time frames it is a simple formula of fixing budget growth to the GDP growth rate, and a combination of spending cuts and revenue increases matched to the time frame targeted (3, 5, 10 years.) I favor the mid time frame around 5 years to try to capture the inevitable gain from the improving economy. A five year goal requires an average REAL annual budget change (cuts + increased revenue) in the ~7-8%/Yr (~$290-300B) range. At the end of five years the budget would be changed by ~40% +/- GDP growth from 2011. In actuality, I think that the ~7-8%/Yr (~$290-300B) range will be too low due to things like rising interest on the continued borrowing, growing inflation due to QE2, and indexing of entitlement payments.
Implemetation: Freeze entitlement spending to solve the indexing issue. Put spending limits on the Executive Branch discretionary budget equal to the chosen annual limits. Have the various apropriations committees adhere to those same annual limits. To insure that happens set the first budget limit at 2008 spending levels. Then lower the discretionary budget ceiling limit to the FY2006 spending amount resulting with those two cuts of ~30% cut in borrowing. After that cut things get much harder to reach that added 10%.
Most wonder why propose salami slice cuts versus targeted cutting. Salami slice cuts is the budget cutting process to which the Executive Branch is accustomed to responding. Furthermore it places the detailed decision making on how best to implement the cuts in the hands of the programmatic experts, and lessesn the opportunity for politicians demagogging.
My little secret: If we could achieve a borrowing cut to the 2006 level we could probably live with the results provided the economy recovered. BUT, it only puts off the pain till the next business cycle down turn.
Implementation is everything. Entitlements is a small word, but constantly waivering meanings. Are we going to change mandated entitlements or appropriated entitlements? Is the word entitlement even legitimate in the case of programs legislated and already paid for? Is a program entitled to be paid the debts owed to it after its assets have been utilized for other programs and activities. Don’t hide behind the vague terminology of a political ventriloguist. What do you intend to include in the term entitlement?
Oh, I almost forgot. Where does defense and defense related spending come into your plan the reduce the deficit. The total ranges between $1.0 and $1.4 Trillion annually. Now we’re talkin’ real money.
Defense-related expenditures2011 Budget request & Mandatory spendingCalculationDOD spending$721.3 billionBase budget + “Overseas Contingency Operations”FBI counter-terrorism$2.7 billionAt least one-third FBI budget.International Affairs$10.1–$54.2 billionAt minimum, foreign arms sales. At most, entire State budgetEnergy Department, defense-related$20.9 billionVeterans Affairs$66.2 billionHomeland Security$54.7 billionNASA, satellites$3.4–$8.5 billionBetween 20% and 50% of NASA’s total budgetVeterans pensions$58.4 billionOther defense-related mandatory spending$7.5 billionInterest on debt incurred in past wars$114.8–$454.2 billionBetween 23% and 91% of total interestTotal Spending$1.060–$1.449 trillion
Jack, the definition of entitlements and the class of spending is defined in every year’s budget. The list of budget items changes little, only the amounts change annually mostly due to indexing, inflation, and some legislative changes.
Here’s a Wiki link explaining most of the misconceptions (budget deficit/(spending) deficit/ entitlements & mandatory spending/discretionary spending/ on & Off budget) http://en.wikipedia.org/wiki/United_States_federal_budget you use here.
When you define mandatory spending as you have above in your list, it shows a complete lack of undertanding of the term. The only mandatory item(s) I can identify are the Veterans Pensions and interest on debt. The rest is all discretionary spending.
I assume from your list you are suggesting we not meet our debt interest obligations. Anyone else?
It’s a list of cuts right? Which do you think will be politically possible? AFAIK neither Obama nor the current Republicans are willing to cut defense spending much, let alone completely as you suggest. Are you really ILSM in disguise? 😉
Finally, asking this: “Oh, I almost forgot. Where does defense and defense related spending come into your plan the reduce the deficit.” just comfirms your budget ignorance. I said: “Put spending limits on the Executive Branch discretionary budget equal to the chosen annual limits.” I then went on to describe those limits. Can you guess where those ole defense and defense related budget line items lies?
If you temper all this spending with some revenue gains, you might be able t make a poltical case for implementing. You should look at Democratic Congresswoman Jan Schakowsky’s plan.
CoRev
just to let you know i read this. not worth replying.
“Do a search! “US deficit” or “federal deficit” search here at Angry Bear or pick your favorite Econo Blogs from the pick list and see how few articles there are on this high priority issue. “
Pages and pages and more pages of hits.
CoRev continues to define his terms as the argument best suits him. Social Security spending is legislatively mandated. That legislation is now about 75 years old and has been successful over that entire period. he’s going to say, but no, I didn’t include SS, but he’s going to define terms so that it is impossible to exclude SS. What CoRev continues to deny is that the gorilla in the budget is military spending and particularly the wars in Iraq and Afghanistan.
We’ve not even touched upon the disparate distribution of income which has led to a drier and drier well from which to draw receipts, especially if so-called unearned income is either taxed at lower rates or excluded entirely. Maybe greater focus should be given to the unearned classification and recognition to the fact that if its unearned then its undeserved and should be subject to a higher rate of taxation. But no source of additional receipts is adequate in the world according to CoRev, therefore, leave it alone. And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for.
By the way, a counter revolutionary is otherwise referred to as a reactionary force. Nothing must change in the best of all possible worlds. That is the world of the counter revolutionary/reactionary partisan.
Jack, your rant is again a misunderstanding or willful ignores what i have presented. The only SS/entitltements comments in my plan was to freeze them at their currently indexed rates. I even agreed, as a valid approach, with your list of proposed cuts, but commented that I thought it was less politically viable than you. I didn’t discuss constituiionaltiy issues why it not possible.
We didn’t discuss redistribuion of income because it wasn’t brought up.
I admit to skating on the revenue side of the plan I submitted. although I did referent it and am on record o supporting raising taxes to the pre-Bush level. Here is what I said re: revenue: “A five year goal requires an average REAL annual budget change (cuts + increased revenue) in the ~7-8%/Yr (~$290-300B) range.” Like Dale, I rely on an improved economy for much of that revenue increase.
BTW, this sentence is unintelligible: “And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for. ”
My bottpm line conclusions from this submission are that Democrats are moslty unwilling to talk about solving the deficit problem. From this and prior threads I can only conclude that they find it less of a problem than the average independent and conservative voter. Moreover, it is obvious that most of the terms is misunderstood (budget deficit versus spending deficit, on/off budget, discretionary/mandatory spending, etc) which make it difficult to have a meaningful discussion.
Finally, of the two politcal plans discussed, Ryan’s and Jan Schakowsky’s, Ryan’s more closely fits the Deficit Commission recommendations. I have no position either way on them, other than they are proposals at trying to solve the deficit problem.
Jack, your rant is again a misunderstanding or willfully ignores what I have presented. The only SS/entitltements comments in my plan was to freeze them at their currently indexed rates. I even agreed, as a valid approach, with your list of proposed cuts, but commented that I thought it was less politically viable than you. I didn’t discuss constitutionality issues why its not possible. For those not familar with Jack’s proposal, the core of which he abolishes DoD, large parts of Homeland Security, FBI, and the intelligence agencies.
We didn’t discuss redistribution of income because it wasn’t brought up.
I admit to skating on the revenue side of the plan I submitted. Although I did reference it and am on record of supporting raising taxes to the pre-Bush level. Here is what I said re: revenue: “A five year goal requires an average REAL annual budget change (cuts + increased revenue) in the ~7-8%/Yr (~$290-300B) range.” Like Dale, I rely on an improved economy for much of that revenue increase. This plan was based first upon freezing the budget at 2008 and laterat 2006 levels.
BTW, this sentence is unintelligible: “And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for. ”
My bottpm line conclusions from this submission are that Democrats are moslty unwilling to talk about solving the deficit problem. From this and prior threads I can only conclude that they find it less of a problem than the average independent and conservative voters. Moreover, it is obvious that most of the terms are misunderstood (budget deficit versus spending deficit, on/off budget, discretionary/mandatory spending, etc) which make it difficult to have a meaningful discussion.
Finally, of the two politcal plans discussed, Ryan’s and Jan Schakowsky’s, Ryan’s more closely fits the Deficit Commission recommendations. I have no position either way on them, other than they are proposals at trying to solve the deficit problem.
“For those not familar with Jack’s proposal, the core of which he abolishes DoD, large parts of Homeland Security, FBI, and the intelligence agencies.” CoRev
That is not supported by facts in evidence. Significant reductions are needed across the DofD board and possibly Homeland Security is the biggest crock of crap ever devised, but you doth protest too much.
“BTW, this sentence is unintelligible:(CoRev) “And no source of savings, save what CoRev deems unnecessary, is enough so leave that be and cut back on the rest,k especially what the tax payers have already paid for. ”
Some what colloquial possibly, but unintelligible is a gross exaggeration. Though it does seem that you would rather not understand what you don’t agree with.
“My bottpm line conclusions from this submission are that Democrats are moslty unwilling to talk about solving the deficit problem.” CoRev
Now you’re talking like a fool. The only thing you can conclude from the material presented on the entire thread is that lots of people on this blog disagree with you. That’s not terribly surprising given that Angry Bear describes itself as, “Slightly left of center commentary on news, politics and the economy.” Or is that statement also unintelligible.
Jack you have proposed cutting war spending in several comments, then you provided a list of what you considered war spending. It started with: “Defense-related expenditures2011 Budget request & Mandatory spendingCalculationDOD spending$721.3 billionBase budget + “Overseas Contingency Operations…” Note the list’s very first item and your proposal. If you were unclear in that list, if it was not a proposal for budget cuts, or if it represents something other than a spending list, just say so. You’ve now had several opportunities to correct my understanding of what that list was meant to infer, but have chosen to do otherwise.
The rest of your comment is just more personal attack or reaction to questioning of prior comments.
Jack, Dale and anyone else still listening, here is a basic demonstration of the budget deficit, and the Obama 2009 approach. It is a good visual explantion. http://wimp.com/budgetcuts/
CoRev,
The guy shows us a clever penny map rendition of the budget. He then clearly states that half of that “map”, on the left side of a white line, is committed budget expenses made up of Medicare and Social Security. Honk!! Honk!! That’s my deception alert. You and he seem to want to disregard the fact that so-called unified budget (that’s the budget wise guys use when they want it forgotten that SS has its own funding stream) and that combining the two budgets is contrary to legislated law. One more time to remind you that SS benfits are not part of the deficit. Interest earned by the Trust Fund Special Treasury notes are a cost item in the general budget. And so too is repayment of debt as it becomes due. The Trust Fund assets are no different than are the Treasury notes held by any other entity.
You are one persistent and pesky deceiver. Why not give it a break and recognize that your distortions of fact are not going to gain traction on Angry Bear, where the typical reader has better than a FoxNews level of education? Why don’t you move over to Sarah Palin’s blog where your deceptive commentary will be more acceptable to the fools who admire her and her ilk, of which I include you.
Giggle, giggle, guffaw! You just gave me a great response to your sillier comments. Thanks.