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LJWorld.com weblogs Loyal Opposition

The Future for the "Have Nots"

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This chart is from OMB – they work for Mr. Obama not the Republicans. What this chart says is that we will be broke like Greece by 2020 (or earlier). We are spending 60% more than we take in every year. We will be increasing that amount by about $300 billion per year each year into the future. Our annual deficit today is greater than the total federal income tax take (from all of us). If we doubled the income tax, we could not get out of the red.

Many of those costs are in social security, social services, Medicaid, Medicare and the new health care initiative. The social security trust fund would have avoided the coming trillion dollars a year payment to social security but we spent it (right now income more or less equals outgo.). All the health programs are/will be expanding faster than inflation. Nothing has been done to slow that rate. Exactly how to slow it without rationing is debatable.

States like Kansas cannot run a deficit. To that end, the state increased our sales tax by 20 percent. The county is increasing our property tax by 9 percent. The school district is increasing the property tax burden by 4.4 percent. If we pass the library initiative, the city tax take will go up by 7.5 percent. Still we had to cut some services. As the federal government cuts, will we be expected to increase our local taxes to hold the “poor” harmless?

Now we could be draconian at the federal level. We could increase income taxes by 50%. We could reduce social security by 5% per year starting now. In ten years that means a cut of about half. We could double the Medicare payment for all and perhaps buy a few years before it goes back into the red. Combine this with a mild form of rationing as in Great Britain and we might just flatten out medical costs for the elderly (not for everyone). We could eliminate the subsidy under Obama care for all but the really poor consistent with the Medicare change above). All of those changes will hit about 50% of the population – the middle – those working for a living or retired on fixed incomes. The top are insulated. Just how long do you think the impacted groups will be willing to absorb such hits while the ”poor” are held harmless (Medicaid, CHIPs, welfare, schools (the latter two big at the state and local level))?

Now there is this insatiable demand for more goodies from the Lawrence blog world hoard. People there is no money. The game is over. It is time to pay the piper. The “have nots” are going to have even less!

Comments

camper 4 years, 4 months ago

The “have nots” are going to have even less!

By this logic, the have's must also give up a piece of the pie. The statement above is politically incorrect, so I feel free to be politically incorrect as well. If we are serious about balancing the budget, we need to disengage from these two wars, slash military, and slash medicare as well. All you need to do is look at a pie chart of where federal outlays go, and these are the two biggest elephants in the room.

Some of the most conservative people I know are retired, and almost all of them complain about the big bad government. But when you mention Medicare and Social Security, they are completely happy with this. For some reason this is not government to them. One major procedure, as almost all of us will have, will cost way more than you ever contributed to medicare.

I am all for balancing the budget, but some of this stuff coming from the right is literally, "we got ours" and I don't care about you young folks. It's the same ole walking to school uphill both ways in the snow kind of story.

Or my arch conservative uncle who collects 100k each year from his pension. He got laid off from his "retirement job" and now collects unemployment as well. All the while listening to Rush and complaining about liberals who are trying to turn our country into a Marxist state.

It seems like the haves are ok to take care of themselves, but when younger folks want affordable health care and opportunity it is called Socialism.

George Lippencott 4 years, 4 months ago

You know I agree with you - thought that is what I wrote. Couple of thoughts.

Medicare part A is pre-paid but you are correct that the payments are small. Medicare Part B is pay as you go so raising it breaks no promises

Pensions are more challenging. If the government promised a pension (or it was an element of your work contract) and you do not deliver than what should others think about new government promises and the possibility they will be broken in the future. Could undermine the whole process.

I tried to say that it would be difficult to provide more to the "have-nots" when you are taking away from those who paid/served not to make funds available but to cover the excessive promises already made.

There is a moral dilemma as to just how hard you hit those already retired. After all they are not evil. I noted some major cuts. At some point, there will be a very strong backlash if we go too far.

camper 4 years, 4 months ago

George, you are a good man. Most people I know who are retired go to the doctor almost as much as they go to the golf course. The cash register is ringinging for those in the health biz. And I don't complain. If you are retired, go to the doctor, take care of yourself.

But a line is crossed when these folks start complaining about younger people who desire the same healthcare for themselves and their families. For those who pay way more for health insurnace than the baby boomers had to pay for a home mortgage. If you remember, back in the good ole days, health insurance was a minimal expense. Now it often equals or exceeds rent or mortgage.

independant1 4 years, 4 months ago

Healthcare coverage is a whole lot more than it used to be. Incl. acupuncture,dental, chiropratic, psych therapy, lap band, many cosmetic proc., cosmetic dentistry, braces, same sex couple coverage, substance abuse, vision, electrolosis to add to your list.

George Lippencott 4 years, 4 months ago

Morning camper.

My intent with that graphic was to point out that the limitations on future growth in social services might just be the availability of resources.

It sounds like you want to make it into an inter-genaerational conflict about health care. OK. However, you need to be sure we are all on the same page when facts are involved.

Medicare is not free. For a mini family it runs about $2400 per year. It covers few preventive services, has a number of exclusions (including drugs) and cost shares at 20% with no limit. For many seniors who have only social security for income that is what you get (about 50% of seniors in Kansas). If medical expenses wipe you out you move to Medicaid - just like anyone else without money. If you raise the premiums too much the bill moves to Medicaid. Coupled with this are limits on available providers. Many limit or have frozen the number of Medicare patients they will treat.

For those seniors with incomes beyond social security there are commercial supplement policies. To continue coverage at the level of a standard employer provided policy runs about $7500 per year for a mini-family. You pay that – not the government. Note the total is about $10,000/year out of pocket. Have you determined that all these people are better suited to pay than the young?

Now some people are fortunate in that their employers underwrite all or part of their supplements. Not a lot of people in that pot. Some unions come to mind.

People with incomes in excess of $250 K or so may just get a high deductable policy and do most of their care as fee for service. They probably get better care. They can afford it!

If you move this all to national care seniors will probably get better care than Medicare provides and probably at a lower cost to them (higher cost to you) except for the rationing notion that is a different discussion.

Yes, I remember when health insurance was cheap. In fact I remember when there was no such insurance for most of us. If you got really sick you died.

I remember when health insurance became more common. That was back before the Reagan tax cuts when marginal rates were quite high. Employers found it cheaper to reward their employees with benefits like health insurance because salary increases were consumed by taxes.

I remember when health insurance spread to many (upwards of 70% of the employed). Each year advocates would argue for more coverage that drove up the costs (you know at one time you had to pay extra to have coverage for maternity care). Might also add that things like MRIs and CAT scans came along and drove up costs. Of course they saved lives. Really can not have it both ways.

I remind you that Medicaid and Obama Care are not specifically for seniors. They will consume a goodly portion of the increase shown – probably more than half). If Medicare is significantly impacted many seniors will gravitate to Obama care.

George Lippencott 4 years, 4 months ago

Yes, I see many seniors at the doctors. Life has this nasty habit of aging with a whole series of real maladies. Are some seeking solace – probably? Is that problem confined to seniors – not proven. That was why co-pays were established to discourage use of services for minor issues (personal costs have a very clarifying effect). Of course the whole notion of insurance was that you paid more when you were young and in return received more services when you were old. Did we get sold another “bridge” by our government?

Now I do not know exactly what you perceive as the challenge for the young. I vividly recall many young well paid professionals declining the employer paid insurance because of the costs. They did drive very nice cars and went on many trips. In a few cases they went bankrupt when the messy accident they had was their fault.

So, short of shooting everybody over sixty just what would you do? Maybe we are all in this together.

camper 4 years, 4 months ago

"So, short of shooting everybody over sixty just what would you do? "

George, hope I did not sound sarcastic. What would I do? Well for starters, I agree we are all in this together. No matter what age, everyone deserves a fair chance to receive care. In my mind, I would (tho I can't do nothing I'm just a blogger) support a public option and make it a branch of medicare. This would enable more people to get coverage and expand the insurance pool greatly. Right now, the pool is contracting, and the costs are being absorbed by those who have insurance and those on medicare. In a sense those who are covered are absorbing the overhead created by those without. If this trend continues, the insurance system as we know it will be unsustainable. Take home pay will continue to go down and medicare deductibles will continue to increase.

How can cost be reduced? I would support efforts to reduce malpractice insurance. It would also be effective if there was more supply as far as providers. Hospitals could run at lower cost if they reduced procedures. For instance I'm thinking of perhaps "basic care" hospitals and "specialized" hospitals. Maybe have more Mayo clinics and specialized hospitals for cancer patients, while you have "basic" care hospitals that will set a broken arm and deliver a newborn. This too will increase supply of care and reduce hospital overhead. I would also support programs and grants that encourage our finest to go into the medical profession.

It is unfortunate that a compromise was made (in the interest of the insurance biz) and the puplic option was not created. What we got was a watered down reform bill that is complex beyond measure. The option was not a Bolshevik plot to socialize medicine. It only centered on one component....payment. Ironic, if it was available, those covered, and those on Medicare just might have seen their costs go down. The Republicans tho really spread a lot of mis-information and fear.

tbaker 4 years, 4 months ago

The root of this evil is altruism, the perverse principle that “man has no right to exist for his own sake, that service to others is the only justification of his existence, and that self-sacrifice is his highest moral duty, virtue, and value” (Rand). In essecence now, and soon to be a fact, helathcare as a "right" actually negates individual rights. If one has no right to exist for one’s own sake, one has no rights whatsoever. The health-care measures passed may be touted as “good-faith efforts,” but that “good faith” is solidly rooted in an evil premise: That I must work for the life of another. That I have no other reason for existence besides serving others. In order for this to work, we must stamp out self-interest as a moral imperative. Who thinks that is going to happen?

Altruistic ideologues, such as those running our government, believe anyone who refuses to sacrifice, to serve others at his own cost, is harming those others by denying them their right to the product of his efforts. Thats what the chart is showing us: the day when our country will be forced to come to grips with this sad fact.

George Lippencott 4 years, 4 months ago

That just be a bit over stated. I like Ms. Rand but I really think we are beyond pure capitalism or objectivism. Markets are way too complex and we need the government in there to round the edges. Not sure we need them providing supplements to people making $80K per year?

beatrice 4 years, 4 months ago

Wait a second -- you mean the poor are going to be poorer? Gee, who ever saw that coming?

Any serious discussion about cutting the deficit and national debt can't be taken seriously unless it includes discussion of massive cuts to military spending. I'm stunned you didn't mention this little fact.

We can no longer afford to spend more on national defense than the next thirteen highest spending nations combined. http://www.globalfirepower.com/defense-spending-budget.asp

beatrice 4 years, 4 months ago

How exactly does spending less on the military equal the terrorists winning? Did the terrorists attack us on airplanes with box cutters as a way to shrink our military? I don't think so.

I'm not saying we shouldn't have a military, just that the cost of maintaining our empire is too great if we wish to do something about our deficits and debt. However, feel free to defend your ridiculous claim.

By the way, a federal judge stripped your avatar of all its muscle recently. You should try to think of a new one.

beatrice 4 years, 4 months ago

You still didn't answer the question -- how is spending less on the military equal the terrorists winning?

Also, Brewer asked for 250 troops be sent to the border, and Obama sent 1,200. That is doing is job.

George Lippencott 4 years, 4 months ago

Your right. Of course, it is not one of the bigger contributors. More importantly, it is harder to do than you think. Try closing a military base. Try eliminating civilian jobs. Try terminating an airplane. Despite the notions here, much of the costs in military expenditures are paying the troops (to include civilians) and running the base structure. A lot of the war costs are going in aid to the countries envolved - wil not end. The troops will be paid from some pot - now the cost is attributed to the war - when they come home - what?

I believe we will see proposals to cut end strength by upwards of a 100,000. Lot of people to lay off in a bad economy. I think there will be a base closure commission that may in several years close some bases. I am certain some acquisitions will be cut (tried to be cut). That means high paying civilian job loses - hard to do. More than likely they will stretch them out - cost much more - but not terminate them.

Believe me I have tried. Senators and Congressman come out of the woodwork with sharp knives. More power to you if you can. I remember a delagation form one Congressional district demanding we keep open a plant that made sails - sails? They won - at least for a while.

George Lippencott 4 years, 4 months ago

Have we ever had peace? When we were not killing people somewhere we were worrying about the ruskies. I will look back and see. In recent years there has been a real increase - but see above.

George Lippencott 4 years, 4 months ago

Well I looked it up. Depends on how you want to reflect it. Inflation adjusted, percent of GDP, Base budget, contingency opertaions, etc. I am posting a chart of most (still not all) that is basically in then year dollars.

dalek6000 4 years, 4 months ago

Wow, a lot of intelligent discussion here. But a few basics missed:

For most of human existence, we lived short, arduous lives, with so much pain and suffering it was normal.

Now, in the most recent 0.01%, we are nearly immortal compared to what we were.

I am not planning on trying to live as long as I can. I put 5% (matched by work) of my gross income into a long term account, and save another 5% into savings, and am careful with my spending.. living below my means.

Even still I don't care about if I can get procedures paid for when I'm 80 that will improve my life 10% and I still die at 82.

LIVE NOW, LIVE YOUNG, and be somewhat reasonable. Don't wait forever to do what you want, but don't live on credit either.

I'm going to sell my assets mid-career and buy a boat and sail around the world. You think worries about medicare and crap like that will stop me? Hahahaha

George Lippencott 4 years, 4 months ago

More power to you. Just don't change your mind at sixty and ask the rest of us to pick up the tab

beatrice 4 years, 4 months ago

And how much would be saved if we end corporate welfare?

George Lippencott 4 years, 4 months ago

I have no idea. How much are we paying. How do you define it.

George Lippencott 4 years, 4 months ago

Ok Camper.

You want to debate something not even on the table

First of all a couple of your suggestions might be helpful. However, think about your hospital suggestion. Would we have two in Lawrence or would everyone requiring critical care need to go to OP?

The implied assumption that in moving to a national program the vast amount of resources committed to medical care by our private sector would some how still be there is highly questionable. Good luck. Those resources would have to be replaced somehow - taxes on somebody.

Those with your perceptions also argue that savings in medical costs would basically make the transition costless (less the loss of the private sector funds). Speculative at best. The assumptions by some that there is much real waste in the system is not validated by any responsible study. Of course generalities like excessive tests and the like are highly judgmental as to what might be excessive – keep those old people out of the offices for example.

Insurance company profits are another red herring. All, I repeat, all of my government medical programs are administered by for profit insurance companies with money I pay. . Some years (most years) I pay more than I use. Some years I pay less than I use. The insurance companies have little or no exposure. Those government entities are like bull dogs ferreting out excessive cost in that insurance.

Your real challenge is convincing people like me that I will be no worse off if we do what you want. I am not interested in a zero sum game where I lose so you can win. I fear rationing, long waits, denial of coverage and the like. Simply dismissing my concerns, as so many on your side of this argument do, will not assuage those concerns. In fact it accentuates them.

It is jut not conceivable to me that we can cover 40 million more people at the same or better level for less cost. So dream on with all kinds of rational discussion – you are in fact dealing with fears that are part rational and in part very emotional. I have coverage because I planned my life to have coverage. If you want to play fifty-two pick up with it you must convince me that I will not be a loser. That simple

I remind you that you too are eligible for Medicare - when you meet the criteria. Your implied notion that giving you government paid insurance is only fair because I get such insurance neglects to note I got no such thing when I was you age and you are denied nothing that I get - just wait your turn.

There is just no money for another big social expenditure like paying for medical care for 80% of the society - we already pay for about 40%. If you do not like what you have – reprioritize.

George Lippencott 4 years, 4 months ago

beatrice (anonymous) says… And how much would be saved if we end corporate welfare?

Hi. I asked how much this welfare includes. Do you have a number and a definition? Could this be another in your never ending series of five second sound bites with no substance behind it? Polly wants a ...

emaw 4 years, 4 months ago

Beatrice is just a bitter have not!

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