Media Shocker: Newsweek Tells Truth About Budget Deficits
I'll just paste some clips of the article and comments to follow:
First, budget deficits are not automatically an economic calamity. At present the effect of deficits is modest; otherwise, rates would be higher than they are (about 5 percent on 10-year Treasury bonds).
I've said that many times and while the Right is in power the Dem's turn to page 76 of the playbook to say that the deficit is only important and a tragedy when the Right is in power.... (page 76 is not available during Liberal rule)
What truly matters is government spending. If it rises, then future taxes or deficits must follow. There's no escaping that logic. The spending that dominates the budget is for retirees. Social Security, Medicare (health insurance for those 65 and over) and Medicaid (partial insurance for nursing homes) already exceed 40 percent of federal spending. As baby boomers retire, these costs will explode. Unless they're curbed, they'll require tax increases of 30 percent to 50 percent over the next 25 years.
I've said many times that the govt should worry about protecting the people first (military) and if they could cut down on the welfare and socialism, we would have PLENTY of money...
Just as Republicans now say their policies have cut deficits, Democrats contend their policies produced budget surpluses from 1998 to 2001. Nonsense. Those surpluses resulted mainly from the end of the cold war (which lowered defense spending) and the economic boom (which created an unpredicted surge of taxes). In a $13 trillion economy, much of what happens has little to do with the White House's economic policies. The bipartisan reflex is to claim credit where little is due.
Yes, both sides play politics...but the Left LOVES to say THEY created a surplus...after I am done laughing, I say nope.
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22 comments:
Social Security is not THE problem. Social Security is a self-funded program which requires no money from the the general fund or Federal Income Taxes. In fact Social Security has a surplus of over $1 Trillion.
If left alone, Social Security will pay all scheduled benefits through 2040 without taking any money from the general fund or Federal income taxes.
If left alone, Social Security will pay about 75% of currently scheduled benefits from 2040 on indefinitely. With minor changes, like raising the FICA cap, Social Security could pay 100% of currently scheduled benefits indefinitely.
Social Security is one of the most efficient government programs of all time. It pays out over 99% of every dollar collected.
The only problem is that the Federal Government is borrowing from the $1 Trillion Social Security Surplus, the Trust Fund. The government needs to pay that money back. But they can't pay it back by giving almost a half Trillion dollars in tax cuts to the wealthiest individuals in the country.
Jim,
you were doing just fine...then the tax cuts for the rich comment
THE RICH PAY ALL THE TAXES...
Why do we have to keep going over this...look in the archives if you want to see the graphs...
Yes, SS could be doing better than it is, and last longer than it will if we didn't steal from it.
However, the rate of return does suck and I could do much better with my own money...but that is getting into a WAY different topic.
You really didn't comment on the total point of the post...govt spends too much money on the socialist state...
I have a TSA, I don't expect ANYTHING from ANYONE...the way it used to be, the way it should be...the only thing that pisses me off is I get so much of my check taken out that I will never see...or money I could invest and then later buy a home in Hawaii...
The rate of return on Treasuries and CDs over time sucks compared to the rate of return on the stock market. But Treasuries and CDs are guaranteed and the stock market is not. Any money manager will tell you that a diversified portfolio of low return-low risk AND moderate to high return HIGHER risk is prudent. That's why Social Security plus TSA or 401(k) makes great sense.
Of course the rich pay the most taxes. They also have the most money. I understand that.
But I'll ask you this: Is it better that the rich get back money from tax cuts at the risk of your losing your future Social Security benefits, or that the rich give a little more so that your retirement money and mine is certain?
Is there a greater good involved?
Jim--
One, we get a *much* better return on our money in the market than we do with social security.
Secondly, social security makes sense when there are seventeen people paying in for each person receiving benefits. That was the state of affairs when the socialist program was created. The ratio will reach 2:1 during my lifetime. If social security didn't exist, it would not be rational today to create it.
Third, Social security and Medicare as they stand today have at least 24 TRILLION dollars in unfunded liabilities. As CATO explains,
"In this year's report, Social Security's trust fund is projected to remain solvent until 2041, so cash deficits prior to that date are ignored by many opponents of reform. However, the payroll tax shortfall in 2039 is now projected to be $353 billion, $10 billion larger than in last year's projections. The simple truth is that if full benefits are to be paid, the government must make up Social Security's payroll tax shortfalls regardless of whether there are bonds in the trust fund. The fund's bonds constitute a claim on general government funds, but they do not constitute those funds themselves. Hence, what matters is the size of the program's cash shortfalls, not the size of the trust fund."
That's what I've been saying. Government IOUs are NOT a trust fund. As a result, in about 10-15 years, the government will either have to raise taxes or reduce payments. To fund the program by the existing mechanism payroll taxes will have to be raised from 12.4% to 18%, which will kill the Democrats' beloved working class.
Do you own any Treasury Bonds, Jason?
jason comes through with facts showing how SS is going down...I knew it, why stick up for it....because it is a socialist program?
Jim--
I do not have any bonds, no.
All discussion about lock boxes and raided surpluses is irrelevant. The social security trust fund is a trust fund in name only -- it holds no real assets and does not generate funds to pay future benefits. The name was introduced by politicians as a labelling device to protect against the charge that funds are wrongly spent. It goes without saying that social security revenue encouraged the growth of irresponsible non-social security spending. The trust fund is only a mechanism for tracking social security outlays and revenues, and its "assets" are the sum of funds transferred from social security to finance other government operations. Marxist Democrats lie when they say social security is solvent through 2042, because they have no "assets" to pay the bills in the current pay-as-you-go system once the program starts running deficits in 2018.
Ms. Democrat may object that this is a SatanChimpyMcHitlerburton lie, and correctly point out the Social Security Act says the fund may only be invested in securities backed in full faith and credit of the federal government. True, but the government is "investing" social security funds by lending them to itself, and then spending the money on programs not related to social security, like defense, foreign aid, or education. The government pays back the money when the social security program redeems the bonds, but in 2018, the Treasury won't have the necessary cash on hand to pay back the fund. -- J.H. Bowden, March 30th, 2006
And your solution is .....?
Good post with excellent points! I found your site at Casting Pearls Before Swine and spotlight a Blog of the Week each Sunday. This week you are that spotlight. Keep up the great liberal combatting work.
Ken Taylor
wow, thanks
what a joke! The democrats EVER did anything good for America..anyone that reads this blog knows how silly that is.
why do the rich pay most of the taxes..they have most of the money! how unfair...
marxist democrats..ha ha ha ha..facist right winger
this is the funniest blog on the web.
I suggest you get professional help ron...
Obviously your emotional liberalism combined with everyone leaving your blog and the loss of the radio show have made you lose your mind...
and it is unfair to punish people for being successful....you make money, why should you have to pay for dead beats all the time...that is socialism and it will be the death of us...China will be the next loan superpower after the liberals are done destroying yet another one:
1. England...check
2. USSR....check
3. United States...still working on it
For those that are interested in the true government expenditure picture, here is a link directly from the budget web site
http://www.gpoaccess.gov/usbudget/fy07/hist.html The budget breakdown is in an Excel spread Table 3.1. Note that today the biggest expenditure Human Resource (aka welfare) at 64.2 percent, almost two-thirds, whereas defense is 20 percent. Social security is one-third of the Human Resources total.
It should be obvious from this chart that if govenment spending is to be cut without sacrificing our security, the Human Resources has to be reduced.
dodave said "Human Resource (aka welfare)"
So dodave, are your parents or grandparents receiving Social Security? Is that "welfare"? Are they deadbeats?
Veterans benefits and services? Are veterans welfare deadbeats, too?
Anti-bioterrorism activities and biomedical research, National Institutes of Health, Centers for Disease Control. Welfare deadbeats?
OHHHH thats cruel game..Im down and not out, I happen to be someone who can pull his boot strings and rise again..I have done it many times..its how this business is. I am confident in what I believe and I believe you are the one taken in by emotion and not the facts..otherwise you wouldnt be so radical.
For example
and it is unfair to punish people for being successful....you make money, why should you have to pay for dead beats all the time...that is socialism and it will be the death of us...China will be the next loan superpower after the liberals are done destroying yet another one:
How silly is that!!!?? Whos running this country anyway game..some liberal juggernaut..you are the one out of your mind.
Ok, in all seriousness game and anyone else who would like to reply..it is obvious that anyone even slightly left of center is way to liberal..we get the message..now tell me is it at all possible to be too far to the right!!?? If your answer is no then you fit the term extremist to a T. If it IS possible tell me what it would be..what would happen, what would it look like?
GWB has been bashed here by me when i is necessary...you forget that Ron?
conservatives are supposed to believe that people need to take care of themselves...but you could be "too far to the right" and never take care of ANYONE...some people need some help and the debate is how much help and to whom...
Once liberals start a socialist program there is no getting rid of it...so you can't blame the Right for all the socialism in the budget...except the stupid ass perscription drug benefit...but you still can't blame the Right, because if they Left was in charge, there would STILL be a drug benefit, but it would be even bigger
some people need some help and the debate is how much help and to whom...
Ok, I'm with you there game and I think a true debate would find us far more in agreement than you might think...many of the most blatantly abused programs have been limited to 5 years thanks to Clinton and the Repub. congress. The biggest abuses now come from people who claim "disability". I have seen more people that are on the right abuse that than people on the left..of course I live in an area where 70 some % of the people are right.
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