A Troubling Prospect To Consider

[Guest]

In the January 19, issue of TIME magazine, columnist Jeffrey D. Sachs authored an article entitlled "The Case For Bigger Government". I was drawn to the article because it's title ran counter to the way I've thought for a long time. But after reading the article and re-reading it, I've found it hard to debate with Sachs' argument, other than in a simple emotional way. I certainly could not come up with an argument or scenario that would render his thesis incorrect.

Read the entire article at http://www.time.com/time/nation/article/0,8599,1870268-1,00.html

When you finish, see if you can come up with a strong argument why Sachs is wrong in his conclusions. I've read it twice and I'll read it again. But I haven't gotten comfortable with any strong argument that I could use to prove Sachs wrong in his conclusions.

[Guest]

Great article and certainly food for thought. I find myself more leaning toward the Ron Paul feeling that LOWER taxes will create jobs more efficiently and quickly than just throwing money out there.

I admit, and have many times, that this economic crisis is a bit beyond me, but my "gut" tells me that throwing our government money at everything with absolutely no control over what happens to it is going to create more of what we all scream about.....some folks will get rich...the problem will remain.
Mainly because it is controlled by POLITICIANS...we saw what our "leaders" did when they were warned two years ago or more about what was occuring...NOTHING except defend those institutions that were driving us into a hole ...WHY...because the got campaign funds from those folks.

Are any of the members of congress going to turn down their automatice pay increase this year ? I would bet NO...but we should tighten our belt !!!!!!

Only one area that I would consider throwing some government money at is healthcare, but even in that area I need to be totally convinced about the motivation and the controls.

I know this is a shallow response to a complicated problem, but I am not prepared to throw away our free enterprise system this fast and this soon. We dont seem to want to talk about HOW we got here much because we say it is spilt milk or whatever but isnt that the way to remedy the future ? Perhaps, those who have a bit of "milk on their face" do not want to talk about how we got here, but when I hear the mortgage crisis and I hear WE KNEW THIS MAY HAPPEN TWO YEARS AGO, I just get angry. When I hear we will now bail out folks who should not have had a mortgage in the first place so they can move on and retain their ownership while us poor slobs had to earn it..I just get angry. When I hear we want to throw money at people with no control over it I get angry.

And when I hear that the folks making the decision on how much and to whom are the same folks that ignored the problem and probably are much of the root cause I get REALLY ANGRY.

Sorry...not much substance but I feel better !

[Guest]

Good article. People forget that government exists soley to provide the survices that we deem necessary to run a orderly society, and do not lend themselves to making a profit. ie: education, care of the poor, care of the sick, care of the elderly, care of the infrastructure, care for the enviornment, defence of our borders, dealing with the criminals etc.

In a crisis government must step in and provide the fix. Demonizing government programs and glorifing privatization of all of the things that should not be tied to profits began with the Regan trickle down boys. "Run government like a business" sounded like a good idea but couldn't work.

[Guest]

I have seen similar “Europe/Asia is smarter and better than the U.S” articles. The statistics often quoted sound impressive, but they rarely take into account the diversity of populations within U.S. jurisdictions, and their freedom of choice.

When we look at the United States, not only are there the obvious populations within the 50 states, but also the Indian nations, the territories and trusts(Guam, Puerto Rico, the Virgin Island, the Oceanic Islands) and the illegal aliens which comprise 8% of the total population. This level of diversity and ratios is unmatched in scope, cultures, and desire to be visible to any European or Asian nation. In most other nations, there is a dominant ethnic group and a very few others comprising a minority which does not skewer the statistics. The U.S. does not have a majority ethnic group - “Caucasian” is comprised of many ethic groups which happen to share a pigmentation - so the factoring of all genetic, cultural and societal factors of all of the ethnic groups comprising “Americans“ against what is often a mono-ethnic society is statistical gamesmanship.

If we were to compare what can be considered as “middle class” in each country, we’d find that within the U.S. there is: 1) greater percentage (quite sizeable) which own their own home; 2) greater percentage with more-than-one car; 3) more creature comforts (central air conditioning, etc): 4) greater access to information and entertainment (e.g., many countries license television receivers).

We could make all sorts of similar comparisons, but the bottom line is this: The U.S. from its conception is based upon civil liberties for the masses, and government intervention upon these civil liberties shall be at a minimum. Most European countries are either still monarchies or are basically conversions which places regal authority into a form of parliament, in essence keeping the same “governmental” level of control over the populace and dispensing degrees of civil liberties when the government sees fit. Add to this a general mindset differential between the average American and the nationals of other countries - we see government as our servant, versus how others perceive themselves as subjects of the government.

Our Bill of Rights still brings peoples from around this planet to come to the U.S. even from the “enlightened” European world. Asian immigration to the U.S. continues to rise, despite all of the negativity regarding U.S. schools, health care, et cetera. That ability to have freedom of choice - for health care providers, schools, entertainment and everything else - beats all the “efficiencies” supposedly available to the masses “for their own good, of course” that a large government footprint can provide.

I may seem selfish about this, but I compare my lifestyle to several European and Asian friends who are or have been professional peers. My housing is better. I have better and more household vehicles. My access to health care (cost considered) is better. My access to radio, TV and Internet is not subject to governmental licensing. In addition, my tax liability is less.

In short, there is no free lunch. The more services that “government” becomes the dispenser, the greater the cost to the taxpayer and the fewer the choices (if any at all) the public - including the taxpayer - has, resulting in reduction in particular civil liberties until eventually the number of civil liberties is reduced to a scant few, if any at all.

So, if there is a desire to make government bigger, that brings with it a matching reduction in personal freedoms. It’s the old “for every action there is a corresponding opposite reaction.” Which freedoms are worth trading for ______? In my lifetime, I cannot remember a single time when government took control of anything and then ever released control whether things got better, remained the same, or worse.

For those who think bigger government is necessary - how big? When is it "big enough? Can it ever get too big?, and if so, how can you make it relinquish control? The only way I have ever seen government relinquish control or reduce in size/power has been by violent revolution. Hasn't once - the creation of this nation - been enough?

[Guest]

...“for every action there is a corresponding opposite reaction.”

I agree with all that you said, but the quote above jumped out at me. But it impressed me in a quantitative way.

If our tax revenues are about 18% of our GDP (plus or minus depending on the economic cycles), then for every increase in spending for something there has to be a decrease in some other spending--a decrease in spending on other things government spends on or more government borrowing resulting in a further increase in national debt.

If we simply look at the things that we know are very likely to increase--defense spending (at least for a few years), Social Security (as the population ages), Medicare/Medicaid (as those costs continue to increase), and the interest on our national debt (which is likely to grow at a rate higher than almost anything else)--we're looking at some pretty significant spending increases which are almost unavoidable.

If the premise that further increases in borrowing simply can't be sustained, that leaves only two ways that those fairly "fixed" expenses can be paid for--either "corresponding and opposite" reductions in government spending on other programs, or increases in taxes.

Surely there is some spending cuts that are possible. But would they be sufficient to pay for the almost certain increases in other areas mentioned? That calls for a stretch of one's imagination. Less on infrastructure, the space program, education, social programs, the environment, foreign aid, various research programs, public broadcasting, regulation of various things...etc.? All to pay for increased spending on defense, Social Security, Medicare, interest expense? That would amount to an "involvement" by government in our lives--but in a negative way. Government would be required to discontinue spending on things we've become to accept as basic rights.

And in the background is the quality of the services we already have, as bad as they have become. The author points out where we are after forty or so years of governance under the "old system"--our child-poverty and infant-mortality rates are the highest, our life expectancy is the lowest, our budget deficit as a share of gross domestic product (GDP) is the highest, our 15-year-olds rank among the lowest on tests of math and science, and our healthcare cost per capita is double that of other countries even though 50 million Americans have no health insurance.

So the question remains--can we both improve those factors of our everyday life (education, healthcare, poverty, infant mortality, etc.) and at the same time fund the additional spending that clearly is necessary through the use of the economic principles and tools used for the last forty years? Or will our choice become greater taxation and government involvement in our lives--the alternative being a fundamental change in our way of life with fewer and fewer government-provided services because we can no longer afford them?

I've read the article a third time and I still don't have an alternative argument with which to defeat the author's premise. The problem is one of simple arithmetic, not one of comparitive economic systems or political priciples. How can we finance the functions that we have come to expect from our government?

[Guest]

...

...
How can we finance the functions that we have come to expect from our government?
You have just hit the nail on the head - Are we expecting too much from our government? Why is there an expectation that a super-parent called "government" instead of mommy and daddy is supposed to take care of all us as "dependents?" When do we become responsible for our own successes, failures, wants and needs?

We have now welfare families who are multi-generational. The list of "entitlements" is becoming endless, and they are generally paid for by persons who don't have any desire for them.

Yes, we are expecting too much from the few who pay taxes to fund this super-parent. When "the State is Mother; the State is Father," the child never is allowed to become an adult, but instead remains in economic bondage and never ever acquires the freedoms the Founding Fathers wanted their progeny to experience.

[Guest]

...Are we expecting too much from our government?...

In principle, I don't disagree with your posit. But when it's reduced to actually coming up with a list of things which can no longer be afforded, the question becomes more difficult.

Try this list on for size. I wish I could be more precise in the effect on balancing the federal budget that could be attributed to each item--I could if I took the time to do enough reserach, but life is too short for all that work. So let's just say that the following changes were made in the federal budget. I'm guessing the effect on our deficit would be pretty dramatic.


Eliminate any Social Security payments to any citizen who has reported taxable income exceeding $50,000 per year or owned assets (real estate or financial) exceeding $500,000.
Reduce Medicare coverage to only "catastrophic" coverage for any citizen who reports taxable income of $50,000 or more or owned assets (real estate or financial) exceeding $500,000.
Eliminate all federal funding for Medicaid. Such healthcare coverage should be the responsibility of the states.
Eliminate all federal funding for roads and highways except those that are currently classified as "interstate highways". All other transportation infrastructure expenditures (roads, highways, bridges, public transportation, etc.) shall be funded by the states. (The theory here is that the federal government should be responsible for transportation needed for interstate commerce with the states and locaities funding transportation assets needed for intrastate commerce.
Eliminate any and all agricultural subsidies. Let the free market determine which agricultural products should be produced within the U.S. and which are better produced elsewhere in the world.
The IRS Code shall be discontinued and the IRS disbanded. The federal income tax shall be replaced with a flat tax of 25% of reported income for every American citizen and all properly documented foreign nationals, with no deductions, exclusions or credits of any kind. "Income" is defined as all income of any kind.
The IRS Code shall be modified to require a 35% tax payment by all commercial enterprises based on revenues with no deductions, exclusions or credits of any kind.
The federal government shall assume the cost and responsibility for the operation and funding of all public schools in the country. Concurrently, any and all local taxes levied for education by state and local governments shall be discontinued. The federal government will fund the operation of all schools from the proceeds of a value added tax assessed on the sales revenues of any and all commercial enterprises with sales greater than $100,000 per year. Schools shall be operated according to standards and regulations established by the federal government. Only the children of U.S. citizens and those of properly documented laiens shall be enrolled in public shcools.(This change is made in recognition that education is fundamental to the national economy and should not be managed by states or localities.)
All federal welfare payments or programs shall be discontinued. They should be the responsibility of states and localities.
A national program of medical insurance shall be introduced covering every American citizen and foreign nationals residing here with proper documentation. The federal government will negotiate payments for all medical, surgical and prescription medical care. The premiums for this medical insurance shall be paid by each and every taxpayer as a flat percentage of their reported income (citizens with lower income will pay less than those with high income). No private medical insurance will be permitted or used to fund healthcare. There shall be no payment for medical care for anyone other than U.S. citizens or properly documented foreign nationals. Nor will hospitals or doctors be required to provide treatment to foreign nationals who are not properly documented.
The federal budget shall require that the total of all federal expenditures be limited to 95% of trailing year actual revenues. The remaining 5% of revenues shall be used to retire federal debt until such time as debt is reduced to a level of 20% of trailing year GDP, after which time the "debt reduction" element can be used for resumed spending programs.
A special payroll tax shall be created which would apply to any employer caught employing undocumented workers. Such tax would be a penalty amounting to 300% of the payroll payments reported on their tax returns. Alternatively, a payroll amount could be estimated for violators who have filed inaccurate tax returns by the Department of Immigration & Naturalization.


There, that's probably a good start at reducing federal expenditures and shifting responsibility for a number of functions to individuals and the localities or states where they reside.

And, oh, a couple of other changes might help, as well...


There shall be term limits on all federal offices--two terms for President, two terms for Senators, and four terms for members of the House of Representatives.
Federal elections for all offices shall be federally funded, with no spending by candidates of any kind or for any purpose permitted.
Both primary and general elections shall be "national " elections, held on the same day.
Campaigning for election will be limited to a period of eight weeks before each of the primary and general elections. A part of the condition for the federal funding of campaigns will be that at least 50% of all campaign appearances by each candidate for federal office be face-to-face appearances with their opponent(s). (Voters would have the opportunity to compare the candidates more closely and campaign travel costs could be shared between candidates.)
Corporate campaign contributions to political organizations or by the corpoations themsleves, for the purpose of funding advertsing, shall carry a special tax of 100%.


Anyone think they could get elected on this platform?

[Guest]

In principle, I don't disagree with your posit. But when it's reduced to actually coming up with a list of things which can no longer be afforded, the question becomes more difficult.

Try this list on for size. I wish I could be more precise in the savings that could be attributed to each item--I could if I took the time to do enough reserach, but life is too short for all that work. So let's just say that the following changes were made in the federal budget. I'm guessing the savings would be pretty dramatic.


Eliminate any Social Security payments to any citizen who has reported taxable income exceeding $50,000 per year or owned assets (real estate or financial) exceeding $500,000.
Reduce Medicare coverage to only "catastrophic" coverage for any citizen who reports taxable income of $50,000 or more or owned assets (real estate or financial) exceeding $500,000.
Eliminate all federal funding for Medicaid. Such healthcare coverage should be the responsibility of the states.
Eliminate all federal funding for roads and highways except those that are currently classified as "interstate highways". All other transportation infrastructure expenditures (roads, highways, bridges, public transportation, etc.) shall be funded by the states. (The theory here is that the federal government should be responsible for transportation needed for interstate commerce with the states and locaities funding transportation assets needed for intrastate commerce.
Eliminate any and all agricultural subsidies. Let the free market determine which agricultural products should be produced within the U.S. and which are better produced elsewhere in the world.
The IRS Code shall be discontinued and the IRS disbanded. The federal income tax shall be replaced with a flat tax of 8% of reported income for every American citizen and all properly documented foreign nationals, with no deductions, exclusions or credits of any kind.
The IRS Code shall be modified to require a 20% tax payment by all commercial enterprises based on revenues with no deductions, exclusions or credits of any kind.
The federal government shall assume the cost and responsibility for the operation and funding of all public schools in the country. Concurrently, any and all local taxes levied for education by state and local governments shall be discontinued. The federal government will fund the operation of all schools from the proceeds of a value added tax assessed on the sales revenues of any and all commercial enterprises with sales greater than $100,000 per year. Schools shall be operated according to standards and regulations established by the federal government. (This change is made in recognition that education is fundamental to the national economy and should not be managed by states or localities.)
All federal welfare payments or programs shall be discontinued. They should be the responsibility of states and localities.
A national program of medical insurance shall be introduced covering every American citizen and foreign nationals residing here with proper documentation. The federal government will negotiate payments for all medical, surgical and prescription medical care. The premiums for this medical insurance shall be paid by each and every taxpayer as a flat percentage of their reported income (citizens with lower income will pay less than those with high income). No private medical insurance will be permitted or used to fund healthcare. There shall be no payment for medical care for anyone other than U.S. citizens or properly documented foreign nationals. Nor will hospitals or doctors be required to provide treatment to foreign nationals who are not properly documented.
The federal budget shall require that the total of all federal expenditures be limited to 95% of trailing year actual revenues. The remaining 5% of revenues shall be used to retire federal debt until such time as debt is reduced to a level of 20% of trailing year GDP, after which time the "debt reduction" element can be used for resumed spending programs.


There, that's probably a good start at reducing federal expenditures and shifting responsibility for a number of functions to individuals and the localities or states where they reside.

Anyone think they could get elected on this platform?

VK,

First of all, I have no idea what I am doing in Political. What was I thinking? But here I am, and before I flee for the exit, I just have to say something.

VK, I have read through this list 3 times. I might be missing something here. I admit, I did not really carefully read the Time article that you linked.

But I read this list 3 times. I am sitting here trying to convince myself that this list is satire.

Where did this list come from? VK, if this list is your list, you must immediately set fire to it. Some politician might see it.

About that SS thing you have on there, first thing. For years, I have been saying that it will come to that. A hot topic of discussion among my early boomer friends is when to take it. I always say to take it as soon as you can and run as fast as you can. (My theory only. I do not give professional financial advice.) VK, I have no doubt that Number 1 on that list will come true. The numbers might vary. But it will come true. It might be good to be an old boomer.

State and local governments absorbing welfare completely, huh. Gives new meaning to the term "Welfare State." Gee, I wonder which state they would all move to.

And don't get me started on the evisceration of our public schools. That's another thread all together, and I am not going there. Boomer mostly likes to have fun around here.

VK, please tell me that list is satire. You and Jonathan Swift, right? If so, please indicate.

Actually, I am begging you, please set fire to that list immediately.

That list is indeed Orwellian.

Burn it before somebody does get elected on it.

Has anybody read Boomsday? I just hope Christopher Buckley has not sold the movie rights. Somebody will take it seriously when it hits the masses.

In the book Boomsday a blogger starts the idea of the government giving tax incentives to boomers, along the way, if they agree to bump themselves off after a certain point. The blogger thinks she is writing satire. Well, guess what. Somebody gets elected on it.

Burn, VK, burn.

Boomer

[Guest]

Interesting article, however so much was left out and the focus was limited to the positive aspects of European government. I have spent a lot of time in Europe and there are some positive things. But when you talk to the people and compare how they live to how we live you end up thinking their way of big government is a failure.

Take things like % of income that is taxed. Runs a minimum of 50% to a high of over 85% Dependant on country. Talk to the people about that and there is a definite lack of incentive to grow your income.

Home ownership is significantly less for the average citizen than the US. Most people are forced to rent because they can't afford a home. Only what we would call "high income" people own their own home or it has been in the family for generations. And then most a very concerned about losing the home due to taxes.

Vacation is good but an issue. Most people get 6 weeks vacation the first year of employment. And they also get up to 20 holidays. Sounds great right? However the impact this has on productivity, the cost of doing business and the lack of being competitive with other countries is staggering. It forces a much more protection type import and export stance.

Health care. Free to all, again sounds great. But talk to the people. They wait forever for appointments, if missed they go to the end of the cue, and EVERYONE has a story about how a friend or relative or someone they know died because they could not get the proper care in a timely manner. And your choice of doctors is very limited.

So make sure you look at all sides of the big government issue. He paints everything in a positive light and reality is not discussed. Also what have you ever seen our government do effectively? If they did, UPS and Fedex would not exist. And there are many other examples as well.

[Guest]

VK,

When I responded to that list earlier, I was talking about the first part. That election stuff you added later -- oh yeah. Term limits all around.

And now, I am really, really out of here. I promise.

Boomer

[Guest]

VK,

Your list is interesting, and for everything proposed to be cut, something else seems to be added to take its place.

Social Security benefits have always been an interesting item. It is either a government-forced contributory retirement plan OR it is a tax which the money is lost to the contributor/payor unless changeable criteria are met.

Government-forced medical insurance exists as MediCare/Aid, and it's "success" depends upon which end of the table you sit. From my experience (albeit limited) Medicare without a private Medicare-supplement policy has questionable value due to its limiting payout schedule. So, any government-forced medical insurance for the masses, for which the delivery system is private, is only going to result in a corresponding private insurance supplement being needed, as long as the delivery system is private industry. The other alternative is the expansion of HHS' Public Health Service hospital system to provide public medical care. Somehow, I just can't see the nationalization of the American medical industry, and would fear the quality of care that would provide.

One thing that keeps getting trampled upon during most discussions on what services/actions the federal government should control is the Constitution, specifically the 10th and 14th Amendments. States' Rights and Due Process are not idle concepts, and the rush to have a super-federal must stand Constitutional scrutiny.

The "government" who takes over is just a bunch of men and women, no smarter than those who hang around the average water cooler, and who probably also have a personal financial stake in the outcome. When government screws up and says "Oops," miliions are impacted. That's why there are all sorts of checks and balances to insure the "oops" are minimized.

One think I like about The VIllages is that it is in Florida, a state which more than most respects the civil rights of people and imposes little upon the citizenry in the way of social experimentation. I feel more secure in Florida than I ever have in any Northeastern state. If the federal government was more like the states who don't try to ramrod programs into existence witthout appropriate funding from the target audience to receive the services, or try to meld the doctrines of Jefferson and Marx into a hybrid society, there would be fewer fiscal problems.

[Guest]

Of course my list was somewhat satirical, as Boomer suggested. But only to a degree. "Orwellian" was the way the list was described. Unfortunately, it might be -- because we're facing a financial problem that may require an "Orwellian-size" solution.

Here are some numbers I put together to further define the problem we're facing. Are they precise? No. Nothing in government ever is. But in scale, they are generally correct and reliable. Before you begin to frame your responses, try not to respond with an argument for one political or economic idealology or another. Rather, just concentrate on the problem as defined by the numbers.

Consider this...

The problem that needs to be addressed is the issue of a federal budget which has costs somewhere in the neighborhood of 25-35% higher than the revenues it takes in. That problem is redoubled as the result of what we're spending the revenues on. If the author of the article is correct and that our federal revenues are nearly exhausted by just four areas of spending: Social Security and other retirement programs, health programs such as Medicare and Medicaid, defense, and interest payments on the public debt, with all the rest of our government expenditures — from education and infrastructure to international diplomacy and much more — funded by borrowing, how do we balance the budget? How do we fix the imbalance while also providing for a repayment plan to reduce what will soon be a national debt of about $3 trillion?

Reviewing the numbers: the U.S. GDP is in the range of $13-14 trillion per year. Tax revenues are approximately $2.6 trillion per year. We have been spending about $3.3 trillion per year. Those are the numbers until this year and next, when the stimulus expenditures will cause the annual deficit spending number to skyrocket. And at the same time, our GDP and tax revenues may actually decline. The "hole" that needs to be filled -- either with reduced spending or increased tax revenues -- looks like it is approaching $1 trillion per year.

In addition, no one is planning on any sort of amortization schedule to repay the national debt. Let's just say that we think we can eliminate annual deficit spending and that we should pay off the national debt over a 25-year amortization period. That kind of schedule would add somewhere in the range of $120 billion per year to our budget shortfall for principal repayments.

In total then, we need to find about $1.1 trillion per year in either reduced spending or increased revenues. Reduced spending would mean that an across-the-board budget cut of about 8% would be necessary. That sounds doable until one recognizes that much of our federal expenditures are essentially fixed. There is little chance that expenditures for Social Security and other retirement programs, health programs such as Medicare and Medicaid, defense, and interest payments on the public debt could be cut by 8%, particularly with an aging population and with the country fighting two wars. So if we look to the remaining part of government spending as the part that would need to be cut, even a complete elimination of all other expenses wouldn't produce the $1.1 trillion per year in needed in cost cuts.

So I continue to accept the thesis of the author of the article. Not only will the services provided by government have to be cut so deeply that they will be a lifestyle changing experience, but taxes will have to be fairly dramatically increased as well. The decades-old theory of reducing taxes in order to stimulate the economy simply won't work with numbers this large. It is simply not reasonable to project the U.S. economy growing to the point that these budget shortfalls could be resolved by any reasonable level of growth of the U.S. GDP.

To expect free market capitalism to solve the problem when it hasn't for forty years or so probably isn't realistic. Some form of government involvement in what heretofore have been private enterprises looks like it might be necessary. One example -- in addition to our banking industry, which has already been taken over by government -- might be healthcare. Free enterprise has produced an industry whose total costs are escalating at a rate more than double inflation, with 50 million Americans still having no health insurance at all, and by all quality measures Americans are less healthy than almost all of the rest of the developed world. Tell me how government intervention isn't needed to solve this problem?

Show me how to solve the problem -- not ideologically or theoretically, but with numbers. In the end it will be the cold, hard consideration of revenues and expenses that will solve the financial problem we're facing, with little room for political or economic idealology. This is the problem being faced by our political leaders.

[Guest]

The problem isn't the quantum of revenue - it"s Congress each year coming up with some new idea to spend money that isn't there.

Most of the programs within the federal budget that don't fall into your Top-Four categories are idyllic versus necessary. It's part of the "I gotta bring home some pork to get reelected" concept. The only way you stop that is to vote for Congressional change with voter-controlled term limits. That will do more to balance the budget than anything.

I respectfully disagree that the federal government has any role in education. There are no federal universities other than the service academies, and the only federal K-12 schools are run by DoD on military installations. Elimination of the Department of Education would not hurt the nation.

If you really want to see where money goes nowhere, take a hard look at the list of independent federal agencies which were created to satisfy some special interest, and really accomplish very little - in other words, no bang for the buck. Just google "Plum Book" and review the list. Why we still need a "Barry Goldwater Scholarship and Excellence in Education Foundation, Christopher Columbus Fellowship Foundation, Delta Regional Commission, Harry S. Truman Scholarship Foundation, Japan-United States Friendship Commission, Office of Navajo and Hopi Indian Relocation, U.S. Commission on International Religious Freedom, and the Vietnam Education Foundation" befuddles me. These are examples of money spent on behalf of special interest only - there are others, but these are classics. For the life of me, why we have a Department of Housing and Urban Development is still a mystery - and it should be iced.

We can probably debate health care forever. I cannot see a national program of any kind because there are so many differences in need due to the diversity of the population across so many regions. There is no question that health care costs rise faster than other areas, but that's mainly due to the costs involved in not only maintaining current capacity, but also the costs in research as well. Nationalizing health care would stifle most research, and such nationalization would have no choice but to cap compensation costs to providers, causing US medical schools to scale back medical education in order to make the cost of such education more affordable so that school loans don't further outstrip physician income.

Health insurance is no different than any other kind ovf insurance - many contributing into a fund whose payoffs are less than payments. If there is "public health insurance" which does not cover the bill because those who use it don't pay enough in premiums, I presume your concept is that you and I open our wallets to pick up the difference. Again, there is no free lunch, so where else does the money come from, if not from you and me (and others who are marginally solvent thanks to continuous devaluation of our currency).

So, has government failed us? I'd say YES in the sense that Congress keeps creating programs so certain congressfolk have legacies. Let the states alone take care of education and health care within their jurisdictions, as they are more adept at taking care of regional populations better than the dreamers within Sodom-on-the-Potomac.

Numbers discussion means nothing until the corporate culture of bring-home-some-pork and take-care-of-the-campaign-contributors is reversed. That change can only happen by en masse replacement of congressiional incumbents.

[Guest]

made me think "here we go again', the same old socialist propaganda for bigger government. barf When are we Americans going to remember our history lessons that show that GOVERNMENT is the PROBLEM, not the answer?

We threw off the shackles of European taxation and created a great nation, composed of strong people willing to take care of themselves and there are those that want to throw it all away for a Nanny State!!

"Freedom to Choose", the right to provide what I want for myself and my family, not have some idiot politician in Washington tell me what is best for us.

Why do YOU think that of all the countries in the WORLD, EVERYONE wants to come to the U.S.? Do YOU think it is because they are fleeing something better to come here? Balderdash!! barf

Vote ALL the politicians out of office, reduce or eliminate the nanny state, and once again be a FREE and SELF SUFFICIENT PEOPLE!!

Thank you Stevez for being more eloquent in your responses. I appreciate your intellect.

[Guest]

More than anything else, my objective in starting this thread was to get people thinking about the financial problems facing the country and begin to consider the alternatives available for their solution. Again, too few people posted a response, but I was heartened to see that as of Sunday night 356 people at least read the thread.

While there were some sincere responses by members committed to their beliefs, there were no members who actually responded with specific opinions or ideas to address the problem that our elected representatives will be facing in the days, weeks and months ahead. With only a few exceptions, it sounded like the sound bites we hear from our politicians on TV.

The U.S. has a $1.1 trillion budget shortfall staring at us in each of the next few years to come. HOW WILL WE FILL THAT GAP? It must come from cutting government spending, increasing revenue from taxes or borrowing more from the countries around the world who think we are creditworthy. This time, it will not be possible to "grow our way" out of the problem with some fine-tuning of monetary policy. Either the cutting of government-funded programs or an increase in taxes, or a combination of the two, will be lifestyle-changing events in our lives. Neither will be modest little tweaks. We will all be hurt -- that much is certain and inevitable. I would hope that we would have thought about the possibilities enough to have an opinion on which of a series of bad choices will be most acceptable to us.

It's pointless to recite the general principles and beliefs that we believe got the U.S. to where it is, what has worked, what will work and what won't work. Those types of things are important, of course, but cannot serve as the solution to the current financial mess. Non-specific flag-waving won't produce the plans needed to balance the budget. It has been that kind of rhetoric, with no specific plans following the words, that got us into the fix we're in now. We'll certainly see some of our elected representatives blathering on in the same way as they debate what to do in the weeks and months ahead. Hopefully, some of those we've sent to Washington can come up with some very specific plans for consideration by the Congress and the public.

If the financial problem we're facing is to be fixed, both the voters and their elected representatives must have some idea on what specific steps to take. What specific spending should be cut? How much will it save per year? Can we cut spending enough to fill the trillion dollar-plus shortfall in the coming years? If not, where will the money come from? Should we keep borrowing until no one will lend to us us any more? Should taxes be raised to fill the void? Taxes on what? Taxes on whom?

Until Americans begin to think about the specific alternatives with some precision, how are we to understand what our government is doing? Until we have an informed opinion on what we're willing to live without and what things government provides that we believe are basic to our lives -- and how much we're willing to pay for them -- how will we ever be satisfied with the result of the governance of our country?

[Guest]

The U.S. has a $1.1 trillion budget shortfall staring at us in each of the next few years to come. HOW WILL WE FILL THAT GAP?

It's easy. Don't spend it.

With all that money people are now lining up for there are always strings attached. Some of those same strings got us in this mess in the first place.

There are solutions to this problem that have worked and will work again. The problem is too many people have put their faith in the wrong place. I guess we deserve what we get and trust me, we're going to get it.

We know what works and what makes this country prosperous. We are now turning away from all of it.

Don't over analyze it. The solution is simple and works every time it's tried.

[Guest]

It's easy. Don't spend it.

With due respect, DK, if those were the marching orders that you gave the Congress and they came back with ideas like...

Means test Social Security payments so that only the lowest-income Americans, who had no other means of support, recieved payments.
Eliminate Medicare insurance for all but those Americans who can't afford to pay for their own healthcare insurance.
Simply stop spending on infrastructure projects.
Draw down our military and reduce defense expenditures to peacetime levels.
Or, stop completely any and all payments to foreign countries for aid to their sick, homeless or threatened citizens.

...would you be satisfied? Those types of steps would certainly meet the objective of "...simply stop spending". But would you be satisfied with the result?

We really do need to form some specific opinions on what we expect from our government, what we're willing to give up, and whether we're willing to pay any more for what government provides.

[Guest]

The government has a budget and they have enough money in that budget to take care of business. What I’m talking about is the extra 1.5 trillion they want to spend on their misguided and totally irresponsible “stimulus” plan that will put us so far in debt we’ll never get out not to mention it hasn’t worked and it won’t work.

What I’m saying is the solution is crystal clear and so simple and I can’t believe some can’t see it. Obama talks about creating millions of new jobs. The ONLY jobs government creates is government jobs. The government does not stimulate the economy.

Everyone knows the economy has its ups and downs just like the housing market does. We’ve been here before and it’s the government right now that’s depressing the economy and consumer confidence. Private sector are the job creators and they always have been. The longer businesses is worried about Obama’s tax increases and out of control spending the longer they will sit on their capitol and the more they will cut back jobs or at the very least stop hiring.

Ok, I’ll ask it again directly to you. When in history has the government ever successfully spent an economy out of a recession?

I'll ask it in another way to all of you reading this. If you've ever had times when your budget was tight or were having personal financial problems, when did spending money like a crazy person help you out of the problem?

Big government is not the answer it is the problem.

[Guest]

With due respect, DK, if those were the marching orders that you gave the Congress and they came back with ideas like...

Means test Social Security payments so that only the lowest-income Americans, who had no other means of support, recieved payments.
Eliminate Medicare insurance for all but those Americans who could afford to pay for their own healthcare insurance.
Simply stop spending on infrastructure projects.
Draw down our military and reduce defense expenditures to peacetime levels.
Or, stop completely any and all payments to foreign countries for aid to their sick, homeless or threatened citizens.

...would you be satisfied? Those types of steps would certainly meet the objective of "...simply stop spending". But would you be satisfied with the result?

We really do need to form some specific opinions on what we expect from our government, what we're willing to give up, and whether we're willing to pay any more for what government provides.

What is being missed is that it does not matter what piecemeal solution is recommended by the general populace. Our Congress is going to do what it d^@%#d well pleases to do - just like it always does. All the spreadsheet proposals in the world have less of an impact than a 75% change-over of who holds the title of Congressperson in November 2010. Then and only then will there be true concern of what the knowledgeable within the populace recommend and prefer.

We're stuck with increasing deficits, pork-a-la-carte, K Street influence brokering and all of the other chicanery which got us into this mess. They perpetuate the problems and each election promise to "change" things. They never do, and laugh all the way back to office on how gullible we all are. They always seem to make sure the only pain felt is by anyone not involved in their reelection and with more than $10.00 in their wallet.

All of the plans in the world are worthless unless that 9%-Approval-rated Congress sees a flushing...

Until November, 2010 we have to endure. If there is no change in the Congressional roster, we endure longer.

[Guest]

To DK:

I'm not certain there is an answer to your question, "When in history has the government ever successfully spent an economy out of a recession?" The financial crisis we're facing is of the same scale as only one other instance in history -- the 1929 Depression and the faltering economy of the 1930's. A big difference between then and now is that our economy, financial system and the availability of monetary tools to effect economic activity are far more multi-national and sophisticated than "back in the day". FDR did a lot of spending, but with the closed economy and monetary tools we had then, it took almost a decade for economic activity to begin to rebound to some normalcy. It's for that reason that I am arguing that it does little good to look backward, because of that fact that there are such huge differences between what worked or didn't work then and what may work in the future. We should remain grounded in democratic values and idealology, but that alone cannot solve the current complicated economic problems.

You have also completely avoided my question, "how can we balance the federal budget and begin to repay our national debt?" You have focused only on the proposed stimulus legislation. They are two completely different things -- other than the fact that they both contribute to deficit spending and increase the national debt. If the Congress agreed with you and concluded that regarding stimulus they should simply stop spending, an absence of any substantial action to "fill the hole" of the $1.1 trillion annual deficit in the U.S. Budget, would simply add that much each year to the national debt.

So, again focusing on the federal budget deficit -- specifically what spending cuts would you find acceptable (and how much would they reduce the deficit) or would you be willing to pay more (in taxes) for the government services being provided in order to fill the deficit gap? Or, I suppose, would you propose to simply continue borrowing to finance our deficits until we can borrow no more?

To SteveZ:

I can't agree that the only "say" we have is at the time of federal elections. If that were true, there would be a whole lot of pollsters who provide information on public sentiment to elected officials who would be out of work. And while I know I tend to be more pragmatic that enthusiastic, whether the news is good or bad, I'm going to try hard to avoid the cynicsm that you suggest regarding the power of the democratic system. If we had so little control over those we elect to represent us, one might conclude that some other system might be better. I'm not there yet.
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This has been a pretty good thread. I only hope that the exchange of posts has gotten people to think a little more deeply about the crises we face and the things that can be done to correct them.

[Guest]

With due respect, DK, if those were the marching orders that you gave the Congress and they came back with ideas like...

Means test Social Security payments so that only the lowest-income Americans, who had no other means of support, recieved payments.
Eliminate Medicare insurance for all but those Americans who could afford to pay for their own healthcare insurance.
Simply stop spending on infrastructure projects.
Draw down our military and reduce defense expenditures to peacetime levels.
Or, stop completely any and all payments to foreign countries for aid to their sick, homeless or threatened citizens.

...would you be satisfied? Those types of steps would certainly meet the objective of "...simply stop spending". But would you be satisfied with the result?

We really do need to form some specific opinions on what we expect from our government, what we're willing to give up, and whether we're willing to pay any more for what government provides.The means Test for SS troubles me.... here's why: We're told that Uncle Sam will take our $$$$ over 40 years of hard work via a Soc Security Tax but not to worry because it is "our money" and that when we reach a certain age we can get our mone back. But now, because of fiscal mismanagementby our gov't and useles politicians., you say I can't get my money back.... even though the politicians have a golden parachute that is better than anyone... it's like I'm getting penalized for doing all the right things over all of these years. Sounds like a good case for privatization of Soc Security.

[Guest]

Here’s your answer. Every time tax burdens have been dramatically lowered the revenues to the government actually increased. It’s a fact. That combined with less government spending and a balanced budget will pay down the debt, give consumers confidence and crank up the economy. Everyone knows governments are some of the most wasteful spenders on earth. They have plenty of room to trim their budgets. I have no idea how many thousands of wasteful programs they have but there are those who do and only seek to create even more.

I guess on one note I’m a little more radical than most. Any government program that forcibly transfers money from one person to another should be on the budget chopping block.

“Here’s my idea of social justice. You keep what you earn and I’ll keep what I earn. Do you disagree? Then tell me how much of what I earn belongs to you and why?

One another note, we are not even close to where we where during the great depression. Unemployment was 25% or more and many would argue the reason it went on so long is precisely because government when on a spending binge. Now they want to do it all over again.

Though the economy is not good right now , the government is running a huge scare tactic all in the name of convincing people the government is their only solution. You may buy it but I don’t. Neither did Reagan. In many ways the government is the solution but not in the way they are proposing that’s for sure.

[Guest]

"When we look at the United States, not only are there the obvious populations within the 50 states, but also the Indian nations, the territories and trusts(Guam, Puerto Rico, the Virgin Island, the Oceanic Islands) and the illegal aliens which comprise 8% of the total population. This level of diversity and ratios is unmatched in scope, cultures, and desire to be visible to any European or Asian nation. In most other nations, there is a dominant ethnic group and a very few others comprising a minority which does not skewer the statistics. The U.S. does not have a majority ethnic group - “Caucasian” is comprised of many ethic groups which happen to share a pigmentation - so the factoring of all genetic, cultural and societal factors of all of the ethnic groups comprising “Americans“ against what is often a mono-ethnic society is statistical gamesmanship."


That is who America is, and always has been, like it or not. And I am joined by the majority that is not going to stand for reducing our great melting pot to a homogenious state.

Our diversity makes us strong. We will no longer have to stand for reducing our country to a place where only wealthy white people get an education, health care, jobs, housing etc. Welcome back hope and opportunity for all Americans!

[Guest]

http://funding-programs.idilogic.aidpage.com/funding-programs/

And note that the ad on the top of the page says!! Get your piece of the government feeding trough and you don't even have to pay it back. I could find A LOT of cuts to make in this list. As I've said in other posts, our government wants to be Mom and Dad to all of us, to keep us voting them into office.:cus:

[Guest]

We will no longer have to stand for reducing our country to a place where only wealthy white people get an education, health care, jobs, housing etc.

I'm not exactly sure what you mean by all that but you do realize we just elected an African American as President right?

Remember Condoleezza Rice, Colin Powell, Clarence Thomas and many others? I'm pretty sure they all got a good education and jobs.

Most of the diversity you speak of in the USA are actually doing very well compared to other countries. Illegals should all be deported, that's another huge drain on our economy especially in California.

[Guest]

"When we look at the United States, not only are there the obvious populations within the 50 states, but also the Indian nations, the territories and trusts(Guam, Puerto Rico, the Virgin Island, the Oceanic Islands) and the illegal aliens which comprise 8% of the total population. This level of diversity and ratios is unmatched in scope, cultures, and desire to be visible to any European or Asian nation. In most other nations, there is a dominant ethnic group and a very few others comprising a minority which does not skewer the statistics. The U.S. does not have a majority ethnic group - “Caucasian” is comprised of many ethic groups which happen to share a pigmentation - so the factoring of all genetic, cultural and societal factors of all of the ethnic groups comprising “Americans“ against what is often a mono-ethnic society is statistical gamesmanship."


That is who America is, and always has been, like it or not. And I am joined by the majority that is not going to stand for reducing our great melting pot to a homogenious state.

Our diversity makes us strong. We will no longer have to stand for reducing our country to a place where only wealthy white people get an education, health care, jobs, housing etc. Welcome back hope and opportunity for all Americans!

What a lot of intellectual crap! I don't believe for one instant that America is benefited by the fracturing of our country into separate, but equal ethnic groups. That is exactly what what is weakening us in modern times.

No longer do emigrants come to this country to be "American". They now come and demand rights and privileges specific to their separate nationalities. Spanish is demanded in our schools, consumer labeling, television access. Head scarves are demanded to be allowed in our courtrooms and interpreters at the governments expense. Free health care and driver licenses for "ILLEGALS" entering our country.

"Homogeneous" does not mean that we are devoid of our cultures, but that we willingly adopt America, it's culture and language, and not come here and demand that we change to make it "Our/America". There is too much (your nationality here)/American and too little I AM AN AMERICAN AND I ACCCEPT ALL THAT MAKES AMERICA WHAT IT IS.

This is NOT a country where only rich white people get an education, health care jobs, housing etc. We are a nation where one can achieve the highest goals that our intellect, abilities and hard work allow. No one holds Americans back but themselves. I am sick of hearing that this culture or that race can't get an even break in America. Many of the people that are successful in our country came here without knowing the language and penniless. Why is it that multi-generational Americans cannot be as successful? We have the "freedom to choose" our destinies and if we don't apply ourselves then only we are to blame.

[Guest]

OK, Gnu, I'm with you in completely eliminating every single one of the government programs listed in your article. That will reduce government spending by $120 billion a year.

Now, where do we cut the other $980 billion a year in order to balance the budget?

Are we getting back to "means testing" Social Security and Medicare benefits and reducing defense spending? Where are the other costs totaling $980 billion that are candidates for cutting?

[Guest]

Any government program that forcibly transfers money from one person to another should be on the budget chopping block...You keep what you earn and I’ll keep what I earn..

Hmmm, that would put a lot of government programs out of business. And as you say, maybe they should be. But do we really want to discontinue the following...

Any form of aid to foreign countries?
Free Medicare and Medicaid healthcare for those who can't afford to pay the premiums?
Any of the funding of education or healthcare programs for low income children?
Eliminate funding to any of the faith-based social programs created in recent years?
Medicare Part D Rx coverage for any who can't afford to pay the premium?

For sure this list could go on and on. But before I keep mine and you keep yours, maybe the results require just a little forethought.

[Guest]

Hmmm, that would put a lot of government programs out of business. And as you say, maybe they should be. But do we really want to discontinue the following...

Any form of aid to foreign countries?
Free Medicare and Medicaid healthcare for those who can't afford to pay the premiums?
Any of the funding of education or healthcare programs for low income children?
Eliminate funding to any of the faith-based social programs created in recent years?
Medicare Part D Rx coverage for any who can't afford to pay the premium?

For sure this list could go on and on. But before I keep mine and you keep yours, maybe the results require just a little forethought.I just started reading Ron Paul's book "The Revolution - a Manifesto" Early on he advocates the elimination of all foreign aid. I am enjoying the book tremendously. I can't wait to see how many more things on this list he addresses.

[Guest]

[B]To SteveZ:

I can't agree that the only "say" we have is at the time of federal elections. If that were true, there would be a whole lot of pollsters who provide information on public sentiment to elected officials who would be out of work. And while I know I tend to be more pragmatic that enthusiastic, whether the news is good or bad, I'm going to try hard to avoid the cynicsm that you suggest regarding the power of the democratic system. If we had so little control over those we elect to represent us, one might conclude that some other system might be better. I'm not there yet.
--------------------------------------
This has been a pretty good thread. I only hope that the exchange of posts has gotten people to think a little more deeply about the crises we face and the things that can be done to correct them.

If the Congressfolk paid any attention to the public sentiment that pollsters report, there would not be an approval rate of 9 Percent. Again, the fault is ours, not theirs, because we keep them in office in spite of their paying no true attention to us.

A democratic republic is still a fabulous governmental system. I love it. I just think the American voter as a group has lousy long-term memory skills, or we wouldn't fall for the same garbage each campaign season.

All that being said, if we are going to print $1.5Trillion and pass it out like S&H Green Stamps to banks, auto makers and others; why is it that the very first "solution" you propose is that the little guy is to take it in the chin one-more-time via losing Social Security and Medicare benefits?

Can government reduce spending? Sure it can!

1) Eliminate all those pork-barrel independent agencies that nobody even knows exists (see http://www.gpoaccess.gov/plumbook/2008/index.html for a list of them all - and how many had you never heard of?)

2) dismantle the Departments of Education and HUD - neither does anything of merit, and the FHA has been instrumental in the housing debacle;

3) reduce all foreign aid by one-quarter across-the-board, and continue that until it is down to 25% of today's numbers;

4) place a tariff on all goods imported into the US which were made in countries where the labor rate is below what would have been paid to US workers to make the same goods - and the tariff would be 90% of the difference in equivalent labor cost (this would make money!);

5) bring all US troops stationed in NATO and other such staging-area countries back to the US - we don't need to pre-position troops (and their dependents) in Germany and other countries anymore - today's transportation systems make pre-positioning virtually obsolete and many US states could use the positive economic impact that US troops provide;

6) Require that if anyl new legislation needs public funding to be implemented, corresponding existing federal program(s) equating to the same public funds obligation must be terminated , so that the budget (and deficit) doesn't grow.

The above are representative actions which would provide significant changes in the budget/deficit situation. There is no need to screw the little guy with Social Security or Medicare cuts - there's plenty of pork and special interest areas which could easily be trimmed FIRST!

[Guest]

OK, Gnu, I'm with you in completely eliminating every single one of the government programs listed in your article. That will reduce government spending by $120 billion a year.

Now, where do we cut the other $980 billion a year in order to balance the budget?

Are we getting back to "means testing" Social Security and Medicare benefits and reducing defense spending? Where are the other costs totaling $980 billion that are candidates for cutting?

Defense spending, as much as it is hated by so many, is only 2% of the total budget. A popular place to cut, but, as we saw in the first gulf war not very smart to do. It took months to build a sufficient military force, after Clinton decimation of the budget left our services so under staffed and unequipped.

Social Security most certainly needs reform. What started a a security blanket, designed to keep the populace from poverty in retirement after the depression, has grown to another dependency at the government trough. It's the white elephant in the room that nobody wants to address, because it would cause ridicule to whoever broaches the subject and if they are a politician, would cost them their office.

Nobody, including me, wants to see their parents in their 80's, lose any of their meager SS income. But, we do need to change the whole idea of retirement so that Americans don't sit back and expect their SS deductions to be their only means of support in retirement. Retirement is NOT the governments obligation.

There are those among us, through not fault of their own, who were never in a position to support themselves, let alone save for retirement, and I will admit that some kind of support from society is needed. But there are MANY who don't need SS or a simply ripping off the system. (as I wrote in the thread "SS the new welfare". What are the numbers and cost of the people in the US, who never intended to do anything but retire at the governments expense

I personally support "means testing", after, not before the SS waste is eliminated. There was quite a row, between my Father in law and I about the subject, 20 years ago when I brought it up. I felt then, and still do now, that at some income point we need to take care of ourselves. Should we Americans not be self sufficient if possible? It seems not, when the government keeps saying "don't worry I'll provide for you" and generations have become dependent on SS as their savior.

One of the arguments that I hear over and over again is 'it's my money, I worked for it am entitled to it". The BIG ENTITLEMENT mentality!! When your children are out of school do you get tax money back? Do you get your share of defense money back if we're not at war? If you never have a fire do you get a tax refund? No to all I assume. Paying into the government, whether to SS or the general fund, does not guarantee you a return on the money put in. If in your lifetime you didn't have children, or there was no war, our you never needed the fire department, you don't get anything back for your taxes! SS is a TAX. People collecting TODAY are not collecting their own money back, but rely on other earners to pay their way.

As far as the rest of where the government can save, I believe in zero based budgeting. Start with zero and only add what passes the smell test.

I know that I will get a passionate response to my writings, but I am strong in my beliefs and have never backed out of what I believe in.

[Guest]

The only place where we may not agree is on the issue of Social Security. For as long as I have been alive, SS has been a contract between the government and the people based on the 1920-1940 economy. Only a few years ago the US Government changed its civil service retirement system - which formerly did not have SS contribution/deduction - to one which SS is now involved and marketed as one-third of one's overall retirement package.

For many people, SS may not be their only retirement funds, but it is indeed a significant percentage of it. Changing the rules in the middle of the game is just another raping of the little guy who has planned according to what was available.

I can understand that SS needs reformatting, but that should be for those entering the system, not those now getting ready to receive payout.

The reason why SS requires infusion from the General Treasury is because the Social Security Trust Fund has little funds - the moneys received by FICA has been diverted to the General Treasury which has given the SS Trust Fund non-negotiable Treasury Bonds instead. This fiscal sleight-of-hand has not helped the situation at all. But, here was a pile of money that Congress could tap without oversight, and Congress took full advantage of it.

Now, the interest on those Treasury Bonds needs to be paid, and some cashed in. Why is it okay to make sure that Citicorp, Bank of China, Prudential Insurance and others not only get paid, but mega-billion dollar bailouts are to be given to them because they did dumb things. Contrary, the little guy didn't make any mistakes, obeyed the law, paid the FICA each pay period, and now is to get screwed? Sorry, but if we can bail out AIG, FAnnie Mae and others, we are now supposed to tell seniors they don't count?

It's beginning to seem like this society is becoming like "Logan's Run." The most vulnerable of the population - the unborn and the senior citizens - are to be collateral damage in the Generation X's quest for pleasure.

[Guest]

OK, Gnu, I'm with you in completely eliminating every single one of the government programs listed in your article. That will reduce government spending by $120 billion a year.

Now, where do we cut the other $980 billion a year in order to balance the budget?

Are we getting back to "means testing" Social Security and Medicare benefits and reducing defense spending? Where are the other costs totaling $980 billion that are candidates for cutting?

I just reviewed the numbers from the web site that I posted. The numbers are not $120 BILLION dollars, it's ONE TRILLION, NINE HUNDRED SEVENTY FOUR BILLION, FORTY TWO MILLION, TWO HUNDRED FIFTEEN THOUSAND DOLLARS. nO SMALL SUM TO CUT!

[Guest]

[QUOTE=SteveZ;183930]The only place where we may not agree is on the issue of Social Security. For as long as I have been alive, SS has been a contract between the government and the people based on the 1920-1940 economy. Only a few years ago the US Government changed its civil service retirement system - which formerly did not have SS contribution/deduction - to one which SS is now involved and marketed as one-third of one's overall retirement package.


I do agree with your statement and should have filled out my thoughts better after saying I wouldn't want to see my folks hurt by SS cuts. The current recipients beyond a certain age (30ish) have based their retirement on their contract with the government. The rest need to be reset to a self funded retirement system of their choice. It is true that we cannot retroactively dump on a lifetime of expectations, but change has to be made in how we continue into the future.

Now that that's said, means testing can still cut SS costs. There is currently a maximum amount that can be received from SS and I don't see why beyond a maximum amount of retirement income that benefits can't be cut. I don't believe that the introduction of SS into our society in the thirties foresaw the amount of corporate retirement that is available to us today. Upper income people, golfing in Florida, rely on their SS to pay their greens fees! Hardly what was intended by the SS act. There is some level of income where if you can support yourself adequately, for instance above the mean level of retirement income in the US, that your SS benifits be reduce, to wher at some point you receive none at all. Does Warren Buffet need SS? Bill Gates? Corporate execs with golden parachutes in the millions of dollars" I feel not.

[Guest]

[QUOTE=SteveZ;183930]The only place where we may not agree is on the issue of Social Security. For as long as I have been alive, SS has been a contract between the government and the people based on the 1920-1940 economy. Only a few years ago the US Government changed its civil service retirement system - which formerly did not have SS contribution/deduction - to one which SS is now involved and marketed as one-third of one's overall retirement package.


I do agree with your statement and should have filled out my thoughts better after saying I wouldn't want to see my folks hurt by SS cuts. The current recipients beyond a certain age (30ish) have based their retirement on their contract with the government. The rest need to be reset to a self funded retirement system of their choice. It is true that we cannot retroactively dump on a lifetime of expectations, but change has to be made in how we continue into the future.

Social Security reformation is not an impossibility, just as tax reform is not an impossibility. Just like flying to Jupiter is not an impossibility.

Earlier I posted my ideas for budget balancing - what should go and what fiscal restraints are necessary. I stand by those, because I don't see this as "the few funding the many" who may want.

As far as education is concerned, no child should be guaranteed a college education. That just cheapens college worse than it already has been.

Health care (catastrophic) is one thing. Health care (routine) is a personal matter. I know several people who don't have health insurance because it is "too expensive," but at the same time buy a new car every two-three years, have all the latest electronic toys, and manage to vacation in fun spots each year. Why should the person who does not spend their money on the fun stuff and instead does the responsible thing, get stuck with the tab for the good-time-Charlie? It's a matter of choices - and if you make bad ones, take the subsequent hit!

Some people can get very noble about what we should or should not do for our fellow citizens, lawful alien residents and illegal alien trespassers. However, that nobility seems to always be based on "the government" or someone else picking up the tab.

Let's be blunt. The wallet is empty. All this talk about care for this, or need for that, requires money. If we don't have the money, then we don't initiate any new programs, and need to stop funding the fluff stuff.

Sorry about the rambling, but any idea to curtail Social Security, but continue the operation of the Japan-United States Friendship Commission (and other outdated federal agencies) and pay foreign aid to countries who will not take back their citizens who break our laws is utter lunacy.

[Guest]

I don't necessarily agree with all the cuts you suggested, but it's going to be this kind of thinking that will have to take place in Congress if we are ever going to eliminate deficit spending and begin to whittle away at the national debt. Great work! Great list. There are going to need to be some very, very tough choices.

I'd love to know how much money could be saved by the eliminations you listed, but I also recognize that coming up with those numbers would be a whole lot of work. But it could be significant.

From the list, I think I'd start with an across-the-board cut of, say 10% of all the agencies in the Legislative and Executive branches. The under the long list of Independent Agencies, some real cutting and slashing seems like it would be possible. What do some of those agencies do anyway?

If we were able to "price" the savings, and if the author of the article that started this whoile thread is right, that might only be enough to begin to whack away at the deficit. Remember, he stated that our entire tax revenues -- about $2.6-2.7 trillion -- is spent on Social Security, Medicare, defense and interest payments on the national debt. We're actually spending around $3.3 trillion. So almost by definition, whatever cuts in spending that would result from our cutting and slashing wouldn't be enough avoid a spending deficit.

But at least we can all begin to understand the depth of the spending cuts that will be necessary to avoid more deficit spending and begin to repay our debt. Personally, I believe that sometime in the Obama first term we're going to begin hearing discussion of means testing for Social Security and Medicare. There doesn't seem to be any other way to balance the budget. It's not possible to cut our interest payments on the national debt and to think we could substantially reduce defense spending while we're still fighting a war in Afghanistan and trying to replace equipment used up in Iraq doesn't seem reasonable.

The subject of "sacrifice" is almost certain to be an important element in Obama's inauguration speech. I think that's just the beginning of easing the public into the necessary spending cuts that will be life-changing but unavoidable. My guess is that the new administration will concentrate on achieving economic recovery in the first couple of years and will get on with the elimination of deficit spending after the economy is stabilized. While I'd like to see everything done at once, I know that's probably not possible.

[Guest]

"The democracy will cease to exist when you take away from those who are willing to work and give to those who would not. " . . .Thomas Jefferson

Until the corporate culture within the Legislature and the Executive, no matter what cuts are made, adheres to Mr. Jefferson's notice, we're destined to find ourselves in the same cesspool. Are we all wise enough to heed his words?

Key within those items I listed was no new programs to be funded without a corresponding decrease (dollar value to dollar value) in existing programs. That's the discipline needed to prevent a repeat of this financial fiasco.

As has occurred over the last 40 years, the eventual further depreciation in the value of the dollar (by inflation or mandate) makes today's debt essentially smaller in the future. Ironically, that is a saving grace - provided the dollar-for-dollar obligation swapping occurs.

Here's to 2010, and a 75% "change" in the Congressional roster!

[Guest]

...if we are to understand what has to be done and communicate with our elected representatives as to what we want them to do. I only hope that they will listen. I'm not giving up on the hope that a lot of letters and e-mails somehow make it onto a log somewhere in each Congressman's and Senator's office as a point of reference anyway.

I'm encouraged on this initial day of the new administration that our new President seems to be seeking broader political consensus than he really needs just to pass some bill in Congress. If that pattern continues, maybe the level of political polarity, idealogical back-biting, and Congressional gridlock will decline. Without that, maybe our elected representatives really will begin to listen to what their constituencies want.

P.S. to Gnu...I erred with the $120 billion number that I used in an earlier post. I looked at a statement on the upper left of the web page you linked and read "...$10 billion per month" and missed the larger number below. The larger number is actually more encouraging in that it provides a larger opportunity for spending reductions. Maybe we won't have to make Draconian cuts to Social Security and Medicare.

[Guest]

Some SS information to ponder


http://www.newyorklife.com/cda/0,3254,11923,00.html

[Guest]

Some SS information to ponder


http://www.newyorklife.com/cda/0,3254,11923,00.html

The irony - you live longer and government poaching of the SS funds becomes a problem.

As crusty as this sounds, if the article's forecasts are accurate, most of us won't be around to see the effects of the problem. The workers - who are now 40 and younger, especially those 30 and younger - may see program changes such as moving retirement eligibility age to 70 for early retirement and full eligibility to 75. As the projected life span continues to rise, that may be realistic, and the most logical of all "fixes."

Gee, those folk may live 15-20 years longer than we will - and won't retire anyway. What a problem to have!