January 24, 2011

So Much For The Nixon Going To China Moment

In a move that surprises no one but simply continues politics as usual and adds further assurance that we will run our national debt into fiscal oblivion one day during my lifetime, the President has announced that he opposes changing either the retirement age for Social Security or the amount of benefits people will receive under it in the future. This means that the only ways to deal with the looming drawdown of the Social Security fund will be to a) raise taxes or b) divert money from on-budget programs to SSI or c) both.

Democrats, your leader has made it clear that he has no taste for entitlement reform. Republicans have already done the same -- not just for Social Security but also for Medicare. (But they are opposed to "socialism.") Without entitlement reform, there can be no serious discussion of deficit reduction -- defense is only about one-fifth of the total budget, cannot be cut completely, and our spending problem is much bigger than that.

This is the public policy equivalent of a gangrene patient opting to not take antibiotics and other nutritional improvements, and also opting to eschew debridement or removal of the necrotized tissue, proclaiming, "It'll heal on its own." No, it won't. Social Security won't get better on its own. The budget won't get better on its own. We have to cut, something, at some point. The sooner we do it, the less painful it's going to be. Just like pulling off a band-aid, it'll be better if we do it fast and all at once than if we do it slowly and over time.

1 comment:

Barry said...

Well, no. first, the alleged deficit is waaaaaaaaaay the heck out, and IIRC would result in a 20% benefit cut in the worst likely case.

Second, the last time the American people accept such a 'fix' was the Greenspan commission, where one (going on two) generations of Americans agreed to pay extra SS taxes, to help fund their retirements.

That money was immediately spent on reducing the taxes on the rich, which was supposed to result in increased economic growth, which it didn't.

Third, let's ramp up taxes on the rich. It's clear by now that the right-wing claims that this would cause problems are simply wrong; massive tax reductions resulted in no positive effects, and many negative (asset prices bubbles).