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To: ajtj99 who wrote (254181)	6/14/2010 9:46:36 PM
From: Les H	Respond to of 306849

I recall that the entitlement programs assume roughly 5.4% employment in the economy. Government pension plans are also going to be a problem. 140-150 billion dollars of defense spending is consumed by pensions and healthcare. Within 10 years, it'll be one-third of the military budget.

To: ajtj99 who wrote (254181)	6/15/2010 11:49:11 AM
From: marcher	Read Replies (1) \| Respond to of 306849

James Galbraith on social security: June 15, 2010 Deficit hawks are using national security as an excuse to seek cuts in Social Security in Medicare, but they're wrong...In American public discourse, national security is the first refuge of scoundrels. For six decades good and dreadful ideas alike have been buttressed by claims that they will help make us secure. President Eisenhower used the claim to promote spending on highways and education. President George W. Bush used it to justify wiretapping and torture... Now deficit hysterics have started trilling the national security song to justify a coming attack on Social Security and Medicare... Was America stronger in 1980 than in 1946? No again. That year we elected Ronald Reagan, who campaigned on a promise to restore the United States to a position of strength. To that end, he promptly cut taxes and boosted military spending, actions that pushed the deficit back up to about 50% of GDP even as the economy recovered. ...Social Security and Medicare are not broken. They are successful, popular programs that protect America's elderly from poverty. Cutting them would be devastating. Today, at a time when people have lost jobs, investments and equity in their homes — the very things that an aging population counts on for economic stability — Social Security and Medicare are more important than ever. They are the most important bulwarks of middle-class life in America... The real cause of our deficits and rising public debt is our broken banking system. The debts our economic leaders deplore were largely due to the collapse of private credit, and to the vast giveaways the federal government made to banks to prevent their failure when credit collapsed. Yet those rescues have failed to reanimate private credit markets and job creation, as the latest employment reports show. And so long as that failure persists, public deficits and rising public debt must remain facts of life. Are broken banks a national security threat? Let's avoid going that far. But the only way to reduce public deficits eventually is to revive private credit, and the only way to do that is build a new financial system to replace the one that has failed. The "national security" case for cutting Social Security and Medicare is bogus. In economic terms, it's just a smokescreen for those who would like to transfer the cost of all those bank failures onto the elderly and the sick. latimes.com