Wednesday, May 12, 2010
'How different, really, is the United States?'
The answer to the question when it comes to our debt compared to Greece's debt: Not much different. ...
Though I agree with the general premise of the story, the we're-all-to-blame narrative -- and the singling out of Social Security and Medicare -- is highly annoying. Medicare is clearly broken and out of control. But Social Security? The primary reason Social Security is in trouble is because Congress has already spent collected Social Security revenues that were supposed to be set aside in a "lock box," as Al Gore famously used to call it. Now Congress doesn't want to pay back the IOUs. Now lawmakers are talking about 'reforms' to 'fix' Social Security, i.e. they're going to change benefits to balance the books they screwed up. Here's a 100-percent guaranteed prediction: Social Security will be 'reformed' long before there any substanative 'reforms' to the bloated public-sector pension systems. Private-sector workers, the vast majority of whom heavily rely on Social Security for their retirement, will once again get shafted. ...
... Joel writes in about the 'We can't finance our social model anymore' post below:
The first sentence is a little mangled. But I know what he means and agree: Hedge funds, currency speculators, Wall Street types and others have played an ugly, predatory role in the current debt crisis. But they're just foxes circling a very flimsy chicken coop. To use another lame metaphor, Greece's financial situation was a house of cards waiting to topple. ... If you haven't already, read Mark Cuban's broadside against Wall Street.
Update -- From Bert:
The answer to the question when it comes to our debt compared to Greece's debt: Not much different. ...
Though I agree with the general premise of the story, the we're-all-to-blame narrative -- and the singling out of Social Security and Medicare -- is highly annoying. Medicare is clearly broken and out of control. But Social Security? The primary reason Social Security is in trouble is because Congress has already spent collected Social Security revenues that were supposed to be set aside in a "lock box," as Al Gore famously used to call it. Now Congress doesn't want to pay back the IOUs. Now lawmakers are talking about 'reforms' to 'fix' Social Security, i.e. they're going to change benefits to balance the books they screwed up. Here's a 100-percent guaranteed prediction: Social Security will be 'reformed' long before there any substanative 'reforms' to the bloated public-sector pension systems. Private-sector workers, the vast majority of whom heavily rely on Social Security for their retirement, will once again get shafted. ...
... Joel writes in about the 'We can't finance our social model anymore' post below:
Such debts are unsustainable as long as hedge fund managers get to pay at the 15% rate same as burger-flippers and pizza-deliverers. As long as big corporations get sweetheart tax credits.
The first sentence is a little mangled. But I know what he means and agree: Hedge funds, currency speculators, Wall Street types and others have played an ugly, predatory role in the current debt crisis. But they're just foxes circling a very flimsy chicken coop. To use another lame metaphor, Greece's financial situation was a house of cards waiting to topple. ... If you haven't already, read Mark Cuban's broadside against Wall Street.
Update -- From Bert:
I would love to see a state by state comparison of budget situations. Is Mass in that much worse shape than others or is that perception a function of us being so close (and pessimistic)? Do “liberal” states tend to be in more trouble than “conservative ones?”I haven't seen a list lately. But Massachusetts isn't close to being a California, New York or Illinois. I'm more worried about long-term problems, from the T (funding its operating budget via debt), the old Turnpike (thanks, Big Dig), the pension system, skyrocketing health-care costs, etc. ... I'm not as familiar with the federal budget.
And what role does military spending (Star Wars comes to mind) have in the nation’s long-term budget troubles? Are there other issues? Farm subsidies, bad grant funding to private companies, etc?
