if the budget were to be balanced just by cutting spending, we would have had to cut ALL of the spending so far this year at Health and Human Services (that includes all of Medicare), ALL programs at the Department of Labor (not just extended unemployment benefits), ALL of the spending at Housing and Urban Development, ALL of the Department of Agriculture (not just food stamps), ALL spending at the Department of Transportation (hey, who needs highways, anyway), along with eliminating NASA, the EPA, as well as the Departments of State and Justice (that includes the FBI as well as all of the federal prosecutors.
1- Only if you want to balance the budget immediately. I care about budget deficits this large, but I wouldn't call for immediate balance.
2 - Only if you focused all the cuts just in those areas.
3 - A lot of that spending should be eliminated. The biggest item there, Medicare, probably has some justification despite not exactly being one of the most wonderfully run government programs, but we do need to seriously reduce its future growth, if that means being "meaner" than we shouldn't let that stop use.
Department of Labor - the unemployment benefits do have a potentially positive contra-cyclical effect, so I probably wouldn't eliminate them, but I would eliminate their constant expansion for every downturn, and I'd eliminate most of the rest of what the department does.
HUD - It should at least face severe cuts.
Department of Agriculture - Fine eliminate it.
Department of Transportation - I wouldn't get rid of all spending, but I would cut it back and then cap its growth.
EPA - Does too much, cut the regulations it enforces, both in terms of scope and complexity, then you can cut the enforcement efforts. But the agency, or something else to do its job, if I did eliminate it, it would only be in terms of restructuring, and I'm not sure I see the benefits of any new structure right now. I would not eliminate the idea of federal environmental law.
Justice - Legalizing or decriminalizing drugs, while stopping and reversing the trends of federalizing crime, would allow for a lot less spending on federal law enforcement, courts, prisons, and administrative overhead for these things.
To get the deficit back under control, the key is going to be to grow the economy, allowing tax revenues to rise, while keeping spending under control.
That much I can agree with.
Social Security has its own dedicated stream of tax revenues, the payroll tax. It is largely paid by the poor and working class.
Taxes are taxes, spending is spending. It doesn't matter much if the tax has the same name as the spending, or that it was created by the same law. People trying to argue that Social Security spending does not contribute to the deficit because its paid for by Social Security taxes are just wrong. (I'm not saying Dirk van Dijk or you are doing this, but many who mention the "dedicated stream of tax revenues" do exactly that.)
Also going forward Social Security spending will more and more be paid for by non-Social Security taxes.
While on paper, half of it is paid by the employer, and half shows up on the pay stubs of workers in the form of FICA, in economic reality, it is impossible to distinguish who pays how much of it.
Good point.
but after someone has earned $106,000, the tax stops and that person gets a nice temporary “raise” in each paycheck.
Not exactly. The only raise they get in each paycheck is the extra amount they are being paid. The tax stopping is not itself a raise. Getting past $106K doesn't lower the tax burden here, it just stops rising at that point. Also the benefits stop going up.
and in the process has built up a trust fund of over $2.5 trillion...That surplus has been invested in the safest and most conservative investment around: Treasury notes and bonds.
Not really. A IOU to yourself is not a real asset.
In other words, the Bush tax cuts forced the poor and working class to lend to the wealthy.
No. The poor are often net recipients from the government. Also the rich do most of the lending to the government. While the poor do very little.
But people who propose the largest rip-off in recorded history through cutting Social Security benefits that have been already paid for get put on prestigious presidential commissions.
The benefits have not already been paid for, for most future and some current recipients. The expected pay out is larger than the amount that was taken in. Also the taxes where not buying some future income stream, they where paying taxes for federal spending, just as paying taxes for defense spending, or the Department of Interior is. There are practical differences with how the personal income tax, and Social Security tax are structured, but they are essentially the same thing, a way for the government to get revenue.
Cutting Social Security isn't ripping anyone off, because no one owns their future stream of social security payments, any more than anyone owns their future stream of agricultural subsidies, or their estimate future salary. Cutting off Social Security is not a rip off, just as cutting the ag payments, or firing someone is not ripping them off. Social Security is just spending, like any other form of government spending. It is something people have come to rely on, but many people rely on their salaries as well. There are practical and political reasons to be careful about cutting social security, but eliminating it entirely starting tomorrow wouldn't be ripping anyone off.
What is ripping people off is making them pay even the taxes they do now, let alone the tax increases Dijk is calling for.
Make no mistake, raising the retirement age is an across-the-board cut in benefits.
Agreed.
And that's what we should do.
In other words, he wants the rich to be able to walk away from the debt they have run up to the poor and working class.
There is no such debt.
Spending is coming under control.
Not really. Not yet at least. Its still at way too high of level, and its still increasing.
That is a good start, and more or less reverses the budgetary damage that was done during fiscal 2008
HA!
Deficit FY 2008 - $455 billion
Deficit FY 2011 est. - $1.27 tril (with the estimate relying on strong growth, otherwise it will be higher) |
