Archive for Tuesday, September 24, 2013

Dole Institute exercise reveals trade-offs in federal budget cutting

September 24, 2013, 12:00 a.m. Updated September 24, 2013, 10:23 a.m.

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Monday's federal budget deficit exercise at the Dole Institute of Politics at Kansas University did the seemingly impossible: It made people feel compassion for Congress.

That may seem hard to believe, when four-fifths of the country disapproves of the job Congress is doing, but trying to reduce the deficit is a little more difficult when you are the one faced with the decisions, which have wide-ranging impacts on the lives of real people.

That said, it's easier to do when it's just an exercise. That showed Monday, when most of the handful of "committees" made up of members of the public were successful in cutting at least $2 trillion from the federal deficit over the next decade; one even got to $3 trillion. It's easier still when there are no lobbyists around to try to change your opinion, you all live in the same geographic area, and only a small number of constituencies are represented.

TRY IT YOURSELF

Play the federal budget challenge here

While the federal budget deficit is projected to be down nearly half from the last fiscal year, to $670 billion from $1.7 trillion, long-term budgetary issues remain, mainly because of the projected increases in spending on programs like Medicare, Medicaid and Social Security.

"We can't continue to borrow $1 for every $3 we spend," former U.S. Rep. Tom Tauke, R-Iowa, said Monday.

Jim Slattery, Lawrence's former congressman, commented that it isn't fair for one generation of Americans to stick the one behind it with the bill. But coming up with a solution will require compromise, as it did when Slattery was in Washington.

"We learned that if we would listen to each other and learn from one another, there were ways to solve big problems in this country," said Slattery, a Democrat. "I'm still old fashioned enough ... to believe that our elected leaders do reflect the will of the people."

But event organizers left it up to about 25 community members to decide: If you were in Congress, how would you cut the deficit?

"You won't have enough time. You won't have enough information. You won't have as many options as you thought you had," said Robert Bixby, executive director of the Concord Coalition, which designed Monday's exercise.

Attendees split into groups of five or so, and took on the task of reducing a more-than-half-a-trillion-dollar deficit in the budget of the U.S. government, which was harder than it sounds. Because even among groups of seemingly like-minded people, contrasts existed: the Social Security recipient who would be reluctant to have his benefits reduced, the self-employed woman who believes she pays more than her fair share in taxes already, the college student who will cut just about anything because not much of it affects him.

And the options that would reduce the most from the deficit? Those seem like the ones to target, until you realize they are the biggest because they affect the broadest spectrum of Americans.

In real life, these decisions have obvious ramifications. Make the wrong one, and it becomes the content for your opponent's next campaign ad. Or worse, it negatively impact the lives of the people you were elected to represent.

That's why Slattery reminded participants that there are "immediate and direct political consequences to each of these choices."

The other option, though, is to continue with the status quo. As Tauke said, "Do I want to pass on to my kids a legacy where I took and expected them to pay?"

Comments

William Weissbeck 1 year, 8 months ago

And the answers were? Might help to report some specifics - if for no other reason than to ask our Congressmen why a non-partisan group of citizens given input from both sides could come up with a plan.

George Lippencott 1 year, 8 months ago

I am not sure that the participants would agree that consensus was achieved or even that rational choices were made. In a time compressed environment many groups picked the largest cuts that had been grouped for them by the functions sponsors. Rational decision making was just not possible in the time available. Suggesting that because a self-selecting segment of the public could play a game means that cutting our deficit is easy is a bit over stated.

It was also interesting that the two ex-congressmen featured who were pushing for significant cuts are now up there among the top few percent in net worth. Their focus on social security and medicare seemed a bit out of place when they have no need of either program. Half of all seniors live on social security alone. Cutting their income in any manner will introduce hardship. By all means cut benefits for those who are ”rich” but be far more judicious with those who are not.

It was interesting that the younger crowd seemed to focus on cutting benefits for seniors but avoided any notion of cuts/tax increases that might affect them (there were few such choices offered). It seems to me that we may have a significant inter generational battle brewing. That would be a shame.

chootspa 1 year, 8 months ago

The social security debate should be separate - way separate from the current deficit discussion, but I'm surprised young people didn't go for the obvious solution and remove the cap on contributions rather than cutting the benefits.

William Weissbeck 1 year, 8 months ago

Do they even know there's a cap? Most people don't because most people don't earn anywhere near the cap.

chootspa 1 year, 8 months ago

It's one of the choices in the interactive tool they link. But yeah, I imagine most people don't know there's a cap, because they never hit it.

George Lippencott 1 year, 8 months ago

In y group we had a self employed high income player who did not want to pay the additional taxes and won the support of the opthe young players.

chootspa 1 year, 8 months ago

Oh, the poor dear. He'd be so inconvenienced by extra taxes on his more than $113,000 income. Old people can eat cat food instead on their less than $14,000 income. It's cheaper than hamburger, and the chained CPI says that's what they should do.

I suspect they didn't understand the exact choice they were making on that one.

jafs 1 year, 8 months ago

Or they just don't relate to "old people" issues, being young themselves.

chootspa 1 year, 8 months ago

True. I guess young people are a bit immortal, and they're all going to be zillionaires someday. When they end up being middle class and haven't saved for retirement or have their retirement pension stolen in a merger (both common situations these days), I guess they'll figure it out. Let's hope their grandchildren are kinder.

chootspa 1 year, 8 months ago

Ah - so she thought others should eat cat food to support her caviar. My mistake.

George Lippencott 1 year, 8 months ago

Yep - her argument was apparently convincing to my fellow group members. She felt that having to pay both half's of the SS tax was - well punitive.

chootspa 1 year, 8 months ago

I agree that having to pay both halves can be a penalty for small business entrepreneurs, but that's a different discussion than removing the cap. The budget toy didn't offer a choice to stop charging self employed people both halves of the tax.

chootspa 1 year, 8 months ago

I take issue with some of the phrasing, since it mostly uses the rhetoric of the politicians that focus grouped the phrasing.

However, I was able to cut the deficit in half while increasing spending on investments and maintaining stimulative spending, which means the deficit would actually decrease over time.

chootspa 1 year, 8 months ago

I'll also mention that when I tried the Ryan/Tea Party plan, even when also cutting military spending (something they generally don't support), I ended up with a deficit three times HIGHER than when it started.

chootspa 1 year, 8 months ago

Ag subsidies (actually, I'd reform them and phase them out, but that's not an option), the $1 bill, oil subsidies, several military programs and anticipated war spending, added a single-payer option (which cut spending), removed the SS income cap, cut oil subsidies, phased out the Bush tax cuts, and increased taxes on gas and outsourced corporate income. That's what I remember anyway.

jafs 1 year, 8 months ago

Thanks - interesting ideas.

Did they have an option to cut out pennies and nickels, both of which cost more to make than they're worth?

Do any of your ideas result in any discomfort for you personally? Seems like everybody wants to cut spending that benefits somebody else, but few people will cut spending that benefits themselves.

chootspa 1 year, 8 months ago

Just the dollar bill. I'd cut small change, too.

Other than things like clean water and roads, there weren't a huge number of spending items on that list that benefit me personally. Ag spending needs to be better examined, imho, since I don't feel comfortable ending them in a way that instantly kills a bunch of family farms. I'm not a farmer, but I do live in a state full of them, so suddenly sending the industry into a nosedive would be bad for me, too.

I did elect to increase my own taxes on quite a few things, which probably counts. Oh, and the mortgage deduction. I'd end that. Not a popular move, but it actually works out better mathematically, and the benefit is designed poorly to disproportionately benefit the rich.

For me it's not as much a matter of making sacrificial spending cuts as it is a matter of making better revenue choices. Cuts to the tax cuts as it were. We can examine spending more closely when the economy is back on track, but right now austerity - and sequestration - are exactly the wrong things.

George Lippencott 1 year, 8 months ago

In defense of the sponsors they did not do dynamic scoring. The Republicans argue (rightly or wrongly) that their plan will increase tax revenue because more people will be gainfully employed.

chootspa 1 year, 8 months ago

When in reality, their plan would actually decrease tax revenue because it would depress the economy.

George Lippencott 1 year, 8 months ago

I was polite. depending on what plan we are talking about that may or may not be the case.

George Lippencott 1 year, 8 months ago

We also used the OMB baseline. That made for example eliminating Obama Care a net cost. In the Obama care pot is a whole bunch of tax increases and a major cut in Medicare. If you eliminate Obama Care the sponsors assumed the cuts to Medicare would not happen. Of course the trustees (non-political) of the program have gone public with a statement that the proposed cuts can not be achieved without substantial cuts to the services provided.

When playing a game on budget cutting with predefined pots I suspect the average citizen does not realize or want to realize the implications of the cuts being made. They just focus on items they do not agree with. The problem is that every item has a proponent who will die to preserve that item. So massive cuts as suggested by the choices offered by the "game" sponsors are very unlikely to occur.

Unfortunately the process used suggests we can do the deed relatively painlessly by cutting the items that the specific player does not support. It should be teaching that if anything useful is to happen we may all need to give up some of what we hold absolutely dear.

jafs 1 year, 8 months ago

Well said.

What would you be willing to give up to balance the budget?

George Lippencott 1 year, 8 months ago

I would be happy to be taxed more - but not 5 per cent of my income more. I would be willing to see reductions in my benefits but not 5 % of my income. My group chose options that would increase my taxes by about 4 percent of income and would reduce my income by about 5%. I think that is way to much to ask of middle class people at the end of their run even if I have a house you consider too big..

What would you give up. My group eliminated deductions fro children and EIC although I don't think they realized it hence my comment on not enough time and inadequate understanding of the consequences of the various options.

jafs 1 year, 8 months ago

Well, how much would you be willing to have cut, on the income and benefit side then?

I'd be ok with small increases in income taxes as well, if they actually resulted in a balanced budget, and cuts as long as they don't hurt the most vulnerable.

As far as personal benefit, we don't have much in the way of government benefits yet, although when we retire we'll have SS and Medicare like most people. I'd support a means testing program for both of those, so that those who really need them get them, but not everybody. I don't know where we'd fit in that scheme.

George Lippencott 1 year, 8 months ago

I answered the income side already.

The difficulty- I remind you - is that we need to raise or cut a tillion dollars a year., Since we take in about a trillion three it would appear we need to almost double income tax takes if we continue to protect the most vulnerable. (I am confident our definitions of that set vary immensely)

That is why this is so hard. .

jafs 1 year, 8 months ago

No, you said not 5%, on either side. So, what's your cutoff? If we decided (as a nation) to raise your taxes by 4% and cut your benefits by the same amount, is that ok with you?

It would result in a net loss for you of 8%.

Historically, we would only need to raise revenue by about 4%, and cut spending by about 6%, at least last time I looked. The mismatch between revenue and spending was rather small. I was using Clinton's numbers, the last time (and only time in a long time) that we had a balanced budget.

jafs 1 year, 8 months ago

I question the idea that Congress doesn't have enough information, or time, and not as many options as they think they have.

They have access to tons of information, and if they don't wait until the last minute and waste time on other nonsense, like voting 42 times to repeal the ACA, they should have plenty of time. Also, given their access to information, there's no reason that they don't actually know what their options are.

George Lippencott 1 year, 8 months ago

They need to compromise. Cutting Defense and raising taxes on the middle class is not a compromise

Where did the notion that they do not have enough time come from??

George Lippencott 1 year, 8 months ago

I remind you that about half of the people voted for Mr. Obama an about half the other way. If we are so badly split how do you expect the elected officials to do anything.

Compromise requires reductions in public services, tax increases on everybody, a slow down in regulatory costs, prioritization of new initiatives coupled with a funding source to address them.

We can not continue, as we do on this list, to demand more and more and avoid who pays other than the notional "rich". There was even a wealth tax in the choices but it raised so little that most groups passed it by.

jafs 1 year, 8 months ago

It's a challenge, but it's also their job.

Continuing this incredibly polarized and toxic atmosphere in Washington isn't what most of us want.

What in your list comes from the left? It mostly seems to come from the right to me.

George Lippencott 1 year, 8 months ago

I do not understand your comment?? What I offered was about me. It included benefits cuts and tax increases both of which affect me negatively., There was no left right piece. If you think there was then the problem is even more immense.

The toxic atmosphere in DC is because there is no compromise. The Republicans speak for about half the population and the Democrats for the other half. Without real compromise nothing will happen. I am afraid that real compromise includes some impacts to what you define (from posts on here) as the most vulnerable.

jafs 1 year, 8 months ago

You used the word "compromise" - that generally means both "sides" give a little and get a little.

Most of your list is palatable to those on the right much more than those on the left, as far as I can tell.

In fact, the only part that seems "leftish" is increased taxes, but the left probably doesn't like the idea of increasing them on everybody, and would prefer targeted increases.

Even though Americans have different views, most of us want the government to work and solve problems, not be gridlocked like they have been - why isn't that happening?

George Lippencott 1 year, 8 months ago

Cuts in Defense, Eliminating Corporate Welfare,eliminating farm subsidizes , the several versions of tax increases and the like are cuts to the right. Of course that depends on where you stand. What do you perceive were cuts to the left?

George Lippencott 1 year, 8 months ago

If you and I can not agree on something as easy as left right how can the Congress. Despite comments to the contrary there are a lot of people to my right.

jafs 1 year, 8 months ago

Sure, but you didn't mention those in your post.

You said "reductions in services, tax increases on everybody, less regulation, etc."

Those on the left don't like reductions in services, less regulation, or tax increases on everybody. They prefer more regulation, targeted tax increases, and maintaining services, generally speaking.

With your new list, it seems more balanced to me, with things that both sides wouldn't like much.

George Lippencott 1 year, 8 months ago

We need to separate my ideas on me from what was provided in the exercise.

Now when I enter the picture I come with all that I have posted here. Using any reasonable measure of tax increases on the rich we get about ten to fifteen percent of the annual deficit. That leaves about 900 billion to address. That is 80% of the current personal federal income tax level.

To achieve that we would need to increase the tax on those that pay it by 170%. ( If you now pay $17K you would need to pay 29K) These numbers are consistent with my consistent analysis of a family with the kids out of the nest at $100K income. I have posted that the results are that the two wage earner professional family will see little reason to seek higher income as the increase will lead to more than half being consumed by taxes.

I have also provided mathematical analysis that suggests that the people in the upper half of the middle class are already paying essentially what they would have under the pre-Reagan rates. That is because along with the rate decreases deductions for those people were limited and the brackets were adjusted a bit. So Choots notion of a return to pre Reagan rates actually raises taxes on those people above what existed pre-Reagan. Only those above about $500K are better off now. Since the Obama administration limited the tax increase on those people to 4% while continuing to allow them to enjoy capital gains( about half the in come at those levels) and special treatment for dividends ( about 10 to 20% at those income levels) he really did very little to the rich.

So if you raise taxes on the tax paying portion of our citizens (about half) about 10% (remember they are already paying more than pre-Reagan) you might obtain as much as $130 billion per year (and I assure you non-compliance will increase).

So taxing the rich and socking it to the upper half of the middle class still leaves you with a shortfall of somewhere between 600 and 700 Billion a year.

jafs 1 year, 8 months ago

To use historical examples from the only time in quite a while that we had a balanced budget, we need to increase tax revenues by about 4% of GDP and reduce spending by about 6% of it.

Right now, revenue is at about 14% of GDP and spending at about 24% - doing the above would bring them both to about 18% of it, which is what we had with Clinton.

No reasonable people believe that only revenue increases or only spending cuts will fix the problem.

George Lippencott 1 year, 8 months ago

Thank you for agreeing with me. To raise tax revenues by 4% of GDP essentially does what I suggested above. That kind of increase on the middle class will be destructive of what we supposedly are.

George Lippencott 1 year, 8 months ago

Now growing the economy without a bunch of added government expenditures just might increase the revenues side of this discussion enough to make the pain less severe. But unless you want to walk away from SS and Medicare some portions of the social safety net may need to be reexamined. Of course if you mess with programs for the seniors it might become necessary to apply the same limits to private insurance holders and those on Medicaid.

We are in a fine mess and it will not be easy to get out of it. There will be no compromises if the upper half of the middle class is to be assessed a major tax increase. It is the realization by intelligent people that such an increase will be required to address liberal demands to maintain our social programs intact that has motivated the existence of "Tea Party" not Mr. Obama's race

Now I am always will to listen to what is wrong with my analysis or a more honest statement of what the liberal community wants to do beyond raising taxes (unspecified) on the middle class and cutting programs (not theirs).

You know that SS and Medicare are already means tested. The charges in Medicare go up by double at several phase points (below Mr. Obama's "rich" point). Now SS was of course pre-paid by most of those currently on it because the creation of the no longer existent trust fund was to address the baby boomers (current payer are paying more than they should otherwise. Lastly SS is already means tested with , according to CMS, the higher end of the scale not even recovering their contributions (their and their employers payments plus the time value of money)

jafs 1 year, 8 months ago

In my view, the Tea Party came into existence out of frustration that neither D nor R have a very good record on deficit spending.

Why do you focus on the social safety net? In previous posts, you've mentioned other places to cut, like Defense.

The real problem is that the left doesn't want to cut SS/Medicare, and the right doesn't want to cut Defense, and those combined are a lot of our spending.

No, when I say "means tested", I mean that the programs are only available to those that need it, not to everybody. So millionaires wouldn't get either. How to define that exactly is a bit of a challenge, of course. But it would be a fundamental shift in the programs.

Well, yes, the trust fund was to prepay for BB retirement - unfortunately the government simply took that money and used it elsewhere. But, younger folks are also paying more than they should - it's not neat and tidy that current retirees funded their own retirement. Most people will use more SS/Medicare money than they paid into the systems.

I don't believe your last statement can possibly be true. Higher end folks pay less of a percentage of their income because of the cap, and they tend to live longer as well. I'm virtually certain that they get more out of SS than they pay into it. What is the "time value of money" exactly?

If it's the idea that they could have invested the money elsewhere, then that would be true for everybody, and not just apply to high earners, right?

So, I don't understand what you're trying to say there.

George Lippencott 1 year, 8 months ago

I did not say it, CMS said it - they are the government manager of SS. People with high net worth do not receive anymore ss than those at the cap level. So they actually receive a decreasing portion of their income from SS as their overall income increases.

And SS is already means tested. The formula to calculate benefits favors to a small degree those with lower incomes. I believe CMS indicated that those of lower income will get back more than they put in (same calculation). Why did you jump to the conclusion that my statement only applied to high income individuals. By the by what is a high income individual to you? What about a high income family? Do you believe that if a family has a total income of $100K they are "rich"

So means tested to you means people above some income level receive no SS at all. In your world does that phase in or is it abrupt. At what level does it kick in? Unless you get the middle class you do not get anywhere enough to finance an expansion of SS. IN fact SS will require a trillion and change over the next few decades from the general fund to meet current projections.

jafs 1 year, 8 months ago

Yes, their benefits as a percentage of their income is less, and so are their contributions.

The question is whether or not they pay enough into the system to cover their benefits, and I'd say that's very unlikely for higher income people with SS.

You said "higher end of the scale not even recovering their contributions".

Those are some of the details that would have to be worked out. But, my idea doesn't "expand" SS/Medicare, it diminishes them, since we're not providing benefits to people who don't need them.

George Lippencott 1 year, 8 months ago

Under Obama's budget Defense will be cut by about ten percent over the next decade. Under the sequestration it is closer to twenty percent. I did not mention it because I had already mentioned it above.

Now I happen to believe that Defense is driven by what we want it to do. We can certainly cut back to a constabulary force as we had in 1917. Getting there can be a bit painful. A lot of civilian employees will have to be cut and a lot of infrastructure eliminated (bases). Your do know that Defense pays for much of the guard and reservc so that will be gone. medial costs for soldiers and retirees are in the pot as well as retirement. Do you plan to abruptly end retirement payments to those already retired?

jafs 1 year, 8 months ago

No - anybody who's made employment decisions based on promised benefits should receive them, in either the private or public sector.

That's a bit extreme, going back to 1917. In between our current extremely large spending on military and that idea there's a lot of middle ground, which makes more sense to most of us.

George Lippencott 1 year, 8 months ago

I also mention that the total of all safety net programs across the government ads up to more than defense. The stuff is hard to find and some of it is actually in the Defense Budget.

jafs 1 year, 8 months ago

Sure.

Combining the two yields a very large percentage of our spending, which is why it's hard to cut it, since D resist cutting the social safety net programs and R resist cutting Defense.

jafs 1 year, 8 months ago

Also, the idea that employees get "credit" for the money employers have paid into the system is a little funny to me.

I'm pretty sure that money wouldn't be paid in salary if FICA wasn't required of employers, unless we forced them to do that.

I did a couple of quick calculations, and it's clear that it's very easy to take more out of the system than one pays into it.

Since the tax is capped at around $100K, and benefits are based on contributions, and FICA taxes include both SS and Medicare, higher earners are almost certain to take more than they pay in. If they live 10-20 years past retirement, and richer people tend to live longer than poorer ones, generally.

George Lippencott 1 year, 8 months ago

The CMS data is geared to life expectations and varies as that number changes. I have lost track of what the average is now but it is about 10 to fifteen years.

By the by when SS was invented the age of collection was three years after your expected demise. Now it is those ten to fifteen years later. I looked up the data. Rich people do live longer than poor people by a year or two. It is women who live substantially longer (few years) then men (both rich and poor).

CMS credits the employee with the money paid by the employer. You can have your own opinion but that is a fact.

CMS also acknowledges the time value of money. Money paid forty years ago is adjusted for inflation. They also calculate an imputed return on your money as if you had it to invest.

What did I miss?

jafs 1 year, 8 months ago

Well, using inflation and imputed investment returns might change things a little bit.

I'd have to look into that.

But, inflation and imputed investment returns (what number do they use?) would apply to all of us, not just rich people, right?

Your original comment was that those at the higher end don't even get their contributions back, which implies that those in the middle and bottom do - is that true according to your research?

Either way, I think using investment returns is a little funny - inflation less so. Investing is risky, and unless they just assumed everybody got a treasury bond or something, you can't really assume that you'll make money with investments.

I'll have to look at the report you mention - can you give me a name/source for it that I can look up?

jafs 1 year, 8 months ago

The 3 things I mentioned are the 3 assumptions that they gave to participants in this exercise - I assume that's in order to model what Congress deals with.

I just doubt very strongly that those 3 things are in play, or have to be, for Congress.

George Lippencott 1 year, 8 months ago

I do not recall a tie between the compressed time we had and an argument that Congress has a compressed problem. Members are very busy but they have very competent staffs to sort through all the details and the staffs have the time to do so (or should - if they are not co opted into glad handing the folks from home.

jafs 1 year, 8 months ago

Why did they give those parameters to the group then, if not to mirror Congress?

George Lippencott 1 year, 8 months ago

Because the problem is large and they had about two hours to solve it. Con gress has years and years.

WilburM 1 year, 8 months ago

This is truly an awful article. It doesn't capture the nature of the exercise. Writing from the first-person perspective of a participant would have been far more effective. What did the tradeoffs look like? Was the exercise realistic? Did compromise and deliberation occur? We get none of that.

jafs 1 year, 8 months ago

Moderate, let's start down here so as not to be overly "threaded".

I looked up life expectancy rates and found that those in the top half of income have about 5 years longer lives, on average, than those in the bottom half.

Their average is 21 years past retirement, while the lower income folks get about 16 years.

George Lippencott 1 year, 8 months ago

My data is probably dated as I looked it up last year. Whose data did you use. I used government data which as I recall was based on information from 2009 or 2010..

The CMS data was published in the WSJ some time ago. You can search their archives or go and search CMS.

Now this is my last post in response to you until you answer some of my questions.

Exactly who do you plan to extract that 4% from? Exactly who do you want to "means test" SS and Medicare?

If 20% from Defense is not enough what is?

What part of the social safety net would you offer up?

My take on all your posts is that you want substantial tax increases but want to avoid identifying from who you will take them using the old and tired argument of the "rich" or "well off".

No rational compromise will ever occur if the left really believes that they have the right to just about double income taxes.

BT

jafs 1 year, 8 months ago

I just looked it up and found an article with the source being the SSA.

Don't know the year - well, I looked again, it looks like a multi-year study, and shows that folks with more money have benefited disproportionally from gains in longevity over time.

Well, I guess this will be your last post then - I don't have definitive answers to your questions - this is a discussion forum, not a policy making one.

I don't have the power to "extract" 4% from anybody - I just pointed out that the mismatch between revenue and spending isn't as lopsided as many people think.

I don't understand your question - the government would do the means/asset testing, just as they do now with other programs.

I am reluctant to "offer up" the social safety net, but would be open to ways of modifying it so as to be more effective/efficient.

Your "take" is incorrect. We were discussing balanced budgets, and how they can happen. In my view, the most reasonable way is to raise revenue by 4% of GDP and lower spending by about 6% of it.

But, last time I looked at some ideas, removing the Bush tax cuts for the wealthy would raise a significant amount of money.

George Lippencott 1 year, 8 months ago

If you are going to suggest ideas for solving a problem it behooves you to understand them. An increase of 4% of GDP is an increase of a trillion dollars in tax revenue. That equates to a 170% increase on each and every actual tax payer. So that Blue collar two wage earner couple in NY would pay 29K as opposed to 17K. You really think that is appropriate??

This entire string is typical of how you operate. Your put foprward policy solkutiuons (meanse testing SS for example) bnut never deal with who would be impacted. It is in the impact that the money is raised. and you know thta.

I suspect you and your fellow liberals are conscioualy trying to duck thenmagnitude of the peoblem that you mostly have created.

My simple solution is to go back to the budget basline of 2008 and bring it forward fro inflation. That budget was out of balance by about 250 B with a war. That amount would be a candidate for tax increases not a trillion. Tho e tax increase should be on everyone and we should get rid of all the tax expenditures of whatever form.

Simple!

jafs 1 year, 8 months ago

Wow!

I don't know why you suddenly get personal and combative - I thought we were having a pleasant discussion.

I'm not the president, or a member of Congress, I'm just a guy sitting at the computer thinking about things - as such, I'm perfectly within my rights to discuss ideas and think about them without offering a completely worked out solution.

I haven't created any of this problem, and it's completely false to say that "liberals" have for the most part - Reagan tripled the national debt, for example. Both D and R at the Congressional level have a poor record on balanced budgets.

Your suggestion to equally tax everybody to raise revenue seems like a bad idea to me.

I'm trying to understand your last paragraph, but am having a hard time - are you suggesting we cut all new tax expenditures since 2008? And, I'm all in favor of simplifying things, but the simplest approach isn't always the best.

Any decisions on exactly how to structure a means tested SS/Medicare program would have to be made jointly, of course - I'm not, nor will I ever be, king or president. But, I would think in order to have it make sense it would have to be a level at which one can live modestly, but not luxuriously.

What do you think would be a reasonable level? It would have to differ a bit from place to place since costs of living vary, as well.

jafs 1 year, 8 months ago

I looked up a few numbers.

Federal spending in 2000 was about $1.7 trillion, and in 2008 almost double that, at $3 trillion.

By comparison, the 2012 budget was only about 1/2 a trillion more, at about $3.5 trillion. So, it looks like Bush added much more spending than Obama did, about 3 times more, in fact.

I really don't understand how R have managed to convince so many people that they're the fiscally responsible ones.

George Lippencott 1 year, 8 months ago

Actually the big plus up was the first Obama budget which was in part the last Bush budget. He submitted it and the Obama administration increased it. Check your dates.

Who said the Rs were any more responsible?? I did not!!

Fossick 1 year, 8 months ago

"If 20% from Defense is not enough what is?"

50%, for starters, then ratcheting up to 80%. $100 billion dollars a year will still leave us with the biggest and most expensive military in the world. Granted, it won't allow us to start a new war every 48 months, but that's not a bug, it's a feature. One example of how this might come about is William S. Lind's defensive grand strategy.

The fact that cutting - any cutting - is not even a choice just shows how narrowly Americans view our precarious budget situation. This is especially true for those Americans who are supposed to be making these choices. Our inflexible - and therefore brittle - approach is going to make it that much harder on us the next time something really, really big breaks. And I don't mean Syria. I mean the dollar.

George Lippencott 1 year, 8 months ago

Sorry but the 10 billion barely pays the retirement and the health care of the veterans of our past conflicts.

Please provide support for your assertion that we would still have the biggest and most expensive military in the world.

I know Lind - I have been laughing at him for twenty years.

Yes we can do as you suggest and we will have a constabulary force.

Fossick 1 year, 8 months ago

"I know Lind - I have been laughing at him for twenty years."

Very well. I note, however, that we have spent a couple trillion dollars in Iraq and Afghanistan and what we have to show for it is two stateless regions and a whole lot of Americans with titanium legs. Oh, and Al Queda. Laugh all you want, his 4GW theory has been a far better predictor of the actual outcome than anything coming from the State Department the entire time.

"Please provide support for your assertion that we would still have the biggest and most expensive military in the world."

It's not like support is that hard to find. An 80% reduction from $700b is, what? $140b/yr? China is the next highest defense spender behind us at $129b. So we will still have the most expensive military.

Now, how about the biggest? Well, is it more expensive to build or maintain? It's more expensive to build, no? That means that we can afford to maintain more than China, since they are building. We have 11 carriers groups, they have I believe a single carrier and one they are building. For the same amount of money as they spend we can still have more military, because we don't need to build it. We will not have 11 carrier groups, but we will still have more than China for roughly the same money.

"we can do as you suggest and we will have a constabulary force."

That is precisely the point. For all geopolitical intents and purposes we are an island - neither Mexico nor Canada is a threat to us and no nation in the world has the troops or the transports to invade us across the water, "Red Dawn" notwithstanding. So all we need for real, actual defense is enough military to keep the shores swept free. We need a constabulary force.

All the rest, all of it, is offense, not defense. If we want to strike Syria for what its government allegedly did inside its borders, we may be morally justified, but we cannot possibly call it defense. It's not.

George Lippencott 1 year, 8 months ago

Interesting rationale.

  1. China has reported a low defense budget since Mao (and before) We price it by calculating what a similar capability would cost us. The two budgets trend together.

  2. Build is more expensive in most cases from maintaining. That said little of what went to the multiple wars of the last two decades is making it home as much of it is simply worn out. So what is left is not all that big - would support a constabulary force.

  3. All the wars that we have fought and all the loses we have suffered have indeed appeared as useless as our goals have not been achieved. Remember both parties voted for those wars. WE almost stated another a couple of weeks ago and this time the Democrats wanted to go at it. Being able to send million dollar missiles in numbers into an enemy heartland halfway around the world is not cheap.

  4. Your way of living is dependent on an international community where the rule of law in general applies. If we withdraw behind our moats (a constabulary force) that will likely change. We are not self sufficient.

  5. WE can certainly cut defense bu5 doing so rationally depends on a bit more though than you offered. Mr. Obama commissioned a full review of our national strategy and associated military strategy and came up with the 10% cuts. At least he though it through.

Fossick 1 year, 8 months ago

"Remember both parties voted for those wars."

I don't think it's a partisan issue at all; it's rather one of a lack of imagination. We have budgeted ourselves into a corner - and yet we do not even imagine a solution outside politically-accepted bounds. The "soft on defense" Dems would cut defense 10%, the "America, F-Yeah" GOP would not cut a penny. Neither imagines an option that does not include fighting 2 1/2 (non-essential) wars at the same time.

Therein lies the problem. We all know our current fiscal path is unsustainable, and defense, while not the whole problem, is part of it. The Dems mean to solve it by changing marginal rates on the rich, the GOP means to solve it by making marginal changes to domestic programs. Neither solves the problem, which is that we have overpromised across the board by an order of magnitude.

So the fact that we cannot even imagine a 50% cut in defense, which still leaves us outspending our nearest competitor by 2-1 under any scenario, is merely indicative of our inflexible and ultimately catastrophic ignoring of simple mathematics.

We cannot afford to run the world, and it does not conform to our wishes even when we spend every dollar we can. So we will either voluntarily and I hope rationally reduce defense (offense) spending, or we will do so in the midst of a fiscal catastrophe. But we will do it, because what cannot be sustained will not be.

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