Market politics

[dmunjal]

The two biggest items in services are Medicare ($986 billion) and Social Security ($895 billion) and those are funded from their own separate tax. Paul Ryan's dream for his entire time in Congress has been to gut these programs. The Defense part of the budget is all discretionary and is over 50% of that part of the budget. The entire discretionary budget is $1.2 trillion and $886 billion is for Defense.

Outside of Social Security and Medicare, the social budget is tiny compared to the big wad of cash that goes to the DoD.

So it depends a lot on how you look at the budget. I don't count Social Security and Medicare because they are separate things funded by their own tax. Medicare goes back the LBJ, but Social Security is FDR's thing.

If these programs were truly self funding, the government wouldn't need to put in a trillion to make up the shortfall. I would think this point would be obvious.

Certainly, they were designed to be self funding but the baby boom and increased life expectancy killed that.

These programs are desperately in need of an overhaul.

 

[neroden]

If these programs were truly self funding, the government wouldn't need to put in a trillion to make up the shortfall. I would think this point would be obvious.

Certainly, they were designed to be self funding but the baby boom and increased life expectancy killed that.

These programs are desperately in need of an overhaul.

No, they're not. They're still self-funding over the long run, particularly Social Security.

To be clear about this, the Social Security tax raises about a trillion a year, and the Social Security budget is about a trillion a year. So. Any "shortfall" is merely a projection of a future shortfall years down the road, and is small in any case. In fact, the main problem is that the rest of the budget (i.e. military spending) has been borrowing from the Social Security trust fund, which is NOT cool.

About half of Medicare's funding is from general taxation, because the Medicare tax is a lot lower than the Social Security tax. Medicare does need to be allowed to negotiate drug prices (it's getting ripped off) -- the ban on negotiating drug prices was a George W. Bush special, a giveaway to big pharma.

Of course, a single-payer system could replace Medicare and Medicaid and the VA while covering everyone in the country -- for less cost than we currently pay for Medicare, Medicaid, and the VA. The paperwork overhead of having multiple systems is very high.

What really needs an overhaul is the *trillion dollars a year* which we waste *every single year* on a military which *loses every war it gets into*, *spies on Americans without warrants*, *classifies criminal activity in order to cover up crimes*, and... well, it makes me mad.

 

[dmunjal]

No, they're not. They're still self-funding over the long run, particularly Social Security.

To be clear about this, the Social Security tax raises about a trillion a year, and the Social Security budget is about a trillion a year. So. Any "shortfall" is merely a projection of a future shortfall years down the road, and is small in any case. In fact, the main problem is that the rest of the budget (i.e. military spending) has been borrowing from the Social Security trust fund, which is NOT cool.

About half of Medicare's funding is from general taxation, because the Medicare tax is a lot lower than the Social Security tax. Medicare does need to be allowed to negotiate drug prices (it's getting ripped off) -- the ban on negotiating drug prices was a George W. Bush special, a giveaway to big pharma.

Of course, a single-payer system could replace Medicare and Medicaid and the VA while covering everyone in the country -- for less cost than we currently pay for Medicare, Medicaid, and the VA. The paperwork overhead of having multiple systems is very high.

What really needs an overhaul is the *trillion dollars a year* which we waste *every single year* on a military which *loses every war it gets into*, *spies on Americans without warrants*, *classifies criminal activity in order to cover up crimes*, and... well, it makes me mad.

Your data is wrong.

The data show that the social security tax and the Medicare tax only raise a trillion while the expenses for both is closer to $2T. That's a trillion dollar shortfall every year and it's growing.

How do we make up that shortfall? Defense should be cut by 50% at least I agree but even that's less than half of the difference.

Btw, the problem gets worse over the next 10-20 years before it gets better.

Here is what I would do:

- gradually raise the retirement age
- means test benefits
- remove the cap on payroll tax

This should be common sense reform but it won't happen and we will once again deal with a crisis.

 

[lolachampcar]

No matter how you slice it, we are an insurance company with an army.

 

[Xenius]

Could always stop cutting tax rates, especially on the top percentages.

Sorry, though, that's commie talk.

 

[dmunjal]

Could always stop cutting tax rates, especially on the top percentages.

Sorry, though, that's commie talk.

I think the Trump tax cuts were about $200B a year while the entitlement hole is $1T. Even if we go back to the Obama tax rates, where do we get the other $800B? We can cut defense in half and we'd still be short $300B.

And as I said earlier, the projection for this shortfall is to double over the next 10-20 years. I'm sorry, just raising taxes and cutting defense is not enough.

 

[Unpilot]

I think the Trump tax cuts were about $200B a year while the entitlement hole is $1T. Even if we go back to the Obama tax rates, where do we get the other $800B? We can cut defense in half and we'd still be short $300B.

And as I said earlier, the projection for this shortfall is to double over the next 10-20 years. I'm sorry, just raising taxes and cutting defense is not enough.

But it is a start. The fact that the can has been kicked this far down the rd. shows how this type of thinking is wrong headed.

 

[wdolson]

If these programs were truly self funding, the government wouldn't need to put in a trillion to make up the shortfall. I would think this point would be obvious.

Certainly, they were designed to be self funding but the baby boom and increased life expectancy killed that.

These programs are desperately in need of an overhaul.

By the Social Security Administration's report for 2017, they are still taking in about $40 billion more than they pay out.
December 31 2017 Fact Sheet on Social Security

It's been a GOP talking point for years that Social Security is going to go broke. Though there are lots of arguments that Social Security is holding up just fine and it's still taking in a bit more than it's paying out. The big bust the skeptics envisioned when all the Baby Boomers retired has failed to happen because a large number of Boomers never really retired. They may be getting Social Security, but many are still paying into the system with payroll taxes too.

There are some other social service programs paid for out of the general budget, but Social Security and Medicare should be removed from both sides of the equation before discussing them. But when you compare those other program's budgets to the DoD budget, they are a fairly small part of the overall US budget. If we reigned in defense spending to something reasonable and did an honest restructure of taxes so we weren't doing trickle down economics anymore (but the richest weren't completely screwed either), we could balance the budget and possibly increase spending on programs to help the less fortunate.

 

[bobinfla]

I think the Trump tax cuts were about $200B a year while the entitlement hole is $1T. Even if we go back to the Obama tax rates, where do we get the other $800B? We can cut defense in half and we'd still be short $300B.

And as I said earlier, the projection for this shortfall is to double over the next 10-20 years. I'm sorry, just raising taxes and cutting defense is not enough.

Cutting defense spending in half doesn't save half the money. Moves a lot of military, civil service and contractor employees to unemployment, reduces revenues for contractors who provide, service or support the military, and the companies and suppliers who support them, and all the way down the food chain. And all of the above reduces the tax base being brought in. I don't know how all the moving parts would calculate out, but probably enough to cause a severe economic downturn.

 

[dmunjal]

By the Social Security Administration's report for 2017, they are still taking in about $40 billion more than they pay out.
December 31 2017 Fact Sheet on Social Security

View attachment 324527
It's been a GOP talking point for years that Social Security is going to go broke. Though there are lots of arguments that Social Security is holding up just fine and it's still taking in a bit more than it's paying out. The big bust the skeptics envisioned when all the Baby Boomers retired has failed to happen because a large number of Boomers never really retired. They may be getting Social Security, but many are still paying into the system with payroll taxes too.

There are some other social service programs paid for out of the general budget, but Social Security and Medicare should be removed from both sides of the equation before discussing them. But when you compare those other program's budgets to the DoD budget, they are a fairly small part of the overall US budget. If we reigned in defense spending to something reasonable and did an honest restructure of taxes so we weren't doing trickle down economics anymore (but the richest weren't completely screwed either), we could balance the budget and possibly increase spending on programs to help the less fortunate.

Social Security may be just $40B today but Medicare and disability is a lot more. I don't think you've looked at the latest numbers and how bad it's going to get.

The Future of America’s Entitlements: What You Need to Know about the Medicare and Social Security Trustees Reports - AAF

 

[wdolson]

Social Security may be just $40B today but Medicare and disability is a lot more. I don't think you've looked at the latest numbers and how bad it's going to get.

The Future of America’s Entitlements: What You Need to Know about the Medicare and Social Security Trustees Reports - AAF

I take anything the American Action Forum with a large grain of salt (or as a friend would say, a salt lick). Their board of directors are mostly big GOP backers. They have ties to a number of shady right wing individuals and groups including organizations the Koch brothers have founded or been involved in.

 

[neroden]

Your data is wrong.

No, it's right. :sigh:

The data show that the social security tax and the Medicare tax only raise a trillion while the expenses for both is closer to $2T. That's a trillion dollar shortfall every year and it's growing.

No, there isn't. There's a half-trillion "shortfall" (funded from general taxation) in Medicare. There is no shortfall in Social Security.

The Social Security Trust Fund was built up over the decades precisely to deal with these demographic fluctuations. The so-called "deficit" in Social Security is the drawdown of the trust fund. It was built up by Baby Boomers paying in, it's being drawn down by baby boomers in retirement, and *that's how it's supposed to work*.

How do we make up that shortfall? Defense should be cut by 50% at least I agree but even that's less than half of the difference.

Military should be cut *80%*, that would mean we're spending the same amount as China plus Russia, which should be enough.

That gets us... more than all of the way.

Btw, the problem gets worse over the next 10-20 years before it gets better.

That's projected, not real. Every year the projected date of the trust fund "running out" moves out further into the future, because the projections are pessimistic projections created by Republicans to try to convince people to cut Social Security.

Here is what I would do:

- gradually raise the retirement age
- means test benefits
- remove the cap on payroll tax

We already did two of those things in the late 1980s and 1990s. Social Security benefits are taxable if your income is high enough -- there's the means testing; and we already raised the retirement age. Social Security is fine.

Though I'm all for removing the cap on payroll tax, since the capped tax is regressive and benefits the wealthy.

Medicare needs to be turned into single-payer, of course. It's part of the bigger health care problem in the US.

This should be common sense reform but it won't happen and we will once again deal with a crisis.

Bluntly, the "social security crisis" is a bullshit lie which has been spread by Republicans for the purposes of cutting Social Security. Don't believe it for a minute. They've been spreading this lie for *decades*. It's simply not true.

 

[wdolson]

Bluntly, the "social security crisis" is a bullshit lie which has been spread by Republicans for the purposes of cutting Social Security. Don't believe it for a minute. They've been spreading this lie for *decades*. It's simply not true.

The right has foisted two lies on us that are accepted as truth by many without much consideration and are completely false. The first is that trickle down economics benefits everyone and the other is that Social Security and Medicare are on the verge of collapse. I wish some politicians outside the GOP bubble would start calling bull pucky when people spout these things.

 

[ItsNotAboutTheMoney]

Cutting defense spending in half doesn't save half the money. Moves a lot of military, civil service and contractor employees to unemployment, reduces revenues for contractors who provide, service or support the military, and the companies and suppliers who support them, and all the way down the food chain. And all of the above reduces the tax base being brought in. I don't know how all the moving parts would calculate out, but probably enough to cause a severe economic downturn.

Well, we _should_ hope that canceling a very large, inefficient, work-creation scheme would free up a lot of skills and labor for real wealth-creation. Given that companies like to hire veterans, we could improve productivity by getting a lot of them into the regular job market sooner.

 

[wdolson]

Well, we _should_ hope that canceling a very large, inefficient, work-creation scheme would free up a lot of skills and labor for real wealth-creation. Given that companies like to hire veterans, we could improve productivity by getting a lot of them into the regular job market sooner.

Congress could ease the transition from a semi-war economy to a more peaceful one by allocating spending for road and infrastructure projects as well as do something like the Rural Electrification Administration to bring broadband to rural areas. Elon also said in the earnings call that one of the stumbling blocks to solar expansion is a shortage of electricians. Allocate money to re-educate unemployed defense workers as electricians too.

The big problem with the defense budget isn't the size of the military. I believe each branch of the military has about 500,000 active duty personnel. A lot of money is being wasted buying weapons even the military says it doesn't need. Some reduction of force could be done. The Navy really doesn't need an amphibious force anymore. It hasn't been needed since 1950. The amphibious support ships have been used in various humanitarian operations, which is a good thing, but the ships could be demilitarized and converted to better suit humanitarian missions and handed over to the merchant marine, or even left under the department of the Navy with a new branch of the service.

Reducing the defense budget would put more civilian workers out of work than military people.

 

[Unpilot]

I have tried to get an estimate for what 1 carrier battle group cost's. It is not easy to get a full accounting.
The newest aircraft carrier is the USS. Gerald Ford it cost 12.8 billion US Navy -- Aircraft Carriers and Their Importance | National Review

This is just the cost of the ship. the carrier never goes out without a battle group Carrier strike group - Wikipedia
The US has 11 such battle groups List of aircraft carriers - Wikipedia
Here is one estimate for the cost one one battle group https://www.quora.com/How-much-does-a-carrier-strike-group-cost

So 30 billion times 11 ...that is a lot of money for just the Navy and is probably a low estimate.

The problem is not money in the US....it is how we spend it.

 

[wdolson]

I have tried to get an estimate for what 1 carrier battle group cost's. It is not easy to get a full accounting.
The newest aircraft carrier is the USS. Gerald Ford it cost 12.8 billion US Navy -- Aircraft Carriers and Their Importance | National Review

This is just the cost of the ship. the carrier never goes out without a battle group Carrier strike group - Wikipedia
The US has 11 such battle groups List of aircraft carriers - Wikipedia
Here is one estimate for the cost one one battle group https://www.quora.com/How-much-does-a-carrier-strike-group-cost

So 30 billion times 11 ...that is a lot of money for just the Navy and is probably a low estimate.

The problem is not money in the US....it is how we spend it.

Add on top of that the cost to train all those sailors and aircrew and maintain all the on shore support for those ships. They aren't cheap. I do believe that even though the Ford class are expensive to build, they are cheaper to run. For one thing they will get by with a smaller crew.

I didn't mention the cost of carriers or their support because the US has actually used them in the last 70 years. Arguments can be made about their use, but they actually have done the job they were built for. The amphibious navy is built to fight WW II in the Pacific, which is a one off problem.

 

[ItsNotAboutTheMoney]

Congress could ease the transition from a semi-war economy to a more peaceful one by allocating spending for road and infrastructure projects as well as do something like the Rural Electrification Administration to bring broadband to rural areas.

As an aside, rural broadband subsidy is something I dislike. People want their large plots and large houses, but high service cost is the price of low density. I don't mindtaxpayers underwriting the provision of Internet, but the service price shouldn't be subsidized. I look forward to cellular, Starlink or other LEO satellite networks eventually eliminating the discussion entirely.

Elon also said in the earnings call that one of the stumbling blocks to solar expansion is a shortage of electricians. Allocate money to re-educate unemployed defense workers as electricians too.

Solar installation doesn't need much electrician time. It just needs inspection. Maybe he was just diverting from SolarCity's poor cost efficiencies.

The big problem with the defense budget isn't the size of the military. I believe each branch of the military has about 500,000 active duty personnel. A lot of money is being wasted buying weapons even the military says it doesn't need. Some reduction of force could be done. The Navy really doesn't need an amphibious force anymore. It hasn't been needed since 1950. The amphibious support ships have been used in various humanitarian operations, which is a good thing, but the ships could be demilitarized and converted to better suit humanitarian missions and handed over to the merchant marine, or even left under the department of the Navy with a new branch of the service.

Reducing the defense budget would put more civilian workers out of work than military people.

Some of those civilian workers are essentially subcontractors. Reduce the military, reduce the subcontractors.

 

[wdolson]

As an aside, rural broadband subsidy is something I dislike. People want their large plots and large houses, but high service cost is the price of low density. I don't mindtaxpayers underwriting the provision of Internet, but the service price shouldn't be subsidized. I look forward to cellular, Starlink or other LEO satellite networks eventually eliminating the discussion entirely.

Wireless is never going to be as fast as wired and will most likely be more expensive. And most people who live rurally are also poor. And because more and more of the world is online, they are missing out on most of it, including both educational and business opportunities that can open up their lives to pull themselves out of poverty.

This is why rural white people vote Republican. The total number of white poor is greater than any other ethnic group in this country (though as a percentage of the group, poor whites are smaller). When they hear Democrats talking about helping the poor, overwhelmingly the talk is about how to help urban poor, who are predominantly non-white.

Only one party is getting its message to the rural poor because they still use 20th century communication technology: broadcast and satellite TV as well as radio. Most of the radio and TV stations in those areas are owned by Sinclair Media, Clear Channel, or some other conservative media company. If they get broadband they may start to get exposed to new ideas they haven't seen before and maybe some will start to realize the Republicans are getting them to vote against their self interest.

Just the fact that Democrats are going for something that predominately helps rural whites will be a step in the right direction.

My world today doesn't include a lot of those rural whites, but I knew a lot of them when I lived with my sister in Bakersfield for a little while.

Solar installation doesn't need much electrician time. It just needs inspection. Maybe he was just diverting from SolarCity's poor cost efficiencies.

Maybe.

Some of those civilian workers are essentially subcontractors. Reduce the military, reduce the subcontractors.

How ever you slice it, you're going to be putting a lot of people out of work. Whatever cuts we make to the "tip of the spear" a lot of civilians will lose their jobs too. A lot more civilians are involved in defense work, from direct support of the military to defense contractors, than soldiers in uniform. The guy in uniform gets veteran benefits, but the guy who was installing the wheels on Humvees at the factory isn't going to get any veteran benefits if he gets laid off because the Humvee factory closes.

 

[JRP3]

As an aside, rural broadband subsidy is something I dislike. People want their large plots and large houses,

I take it you haven't spent much time in rural America.