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Sunday, May 14, 2006

Scott Burns is Disingenous again...

Compared to the General Fund Deficit, Social Security's impending deficit in 2040 is not a problem. [source] Medicare is in significant trouble, but before things get too bad, we'll simply be forced to have a rational, national healthcare system like all the other industrialized countries (and have better health outcomes to boot, what a tragedy), so that problem is a matter of political will, not an inevitable disaster.

The General Fund deficit, however, will persist as long as Republicans stay evil and as long as they keep winning the three branches of government. The fact that they're not currently popular doesn't mean that they won't resort to other methods of stealing the election.

1 comment:

Ein Ingenieur said...

You seem to misunderstand Scott Burns, and economics and the s(h)ituation (WITHOUT counting Medicare) that the USA is in. Firstly, Burns says the budget crunch will come in "six to nine years" (see link below) not in "2040" as you seem to think.

Secondly, Burns reports that the General Fund writes credits to the Social Security fund (we taxpayers still pay for it, whether we pay to the General Fund or S.S.I.) and "When the IMAGINARY [my emphasis] payments [from the General Fund to S.S.A.] are included, the Social Security and Medicare are running at a tranquilizing surplus..." but "what happens if we take out the funny money? [that which is transferred from the General Fund to S.S.A.]" The answer: We have a $1.3 trillion deficit when we DON'T include Social Security/Medicare, over the last 8 years, and a whopping $3.3 trillion over the same period if we DO add Social Security/Medicare's effect on the budget.

CBO.gov not only agrees with Burns, but states that Social Security WITHOUT COUNTING MEDICARE still has a projected deficit in the trillions for just the next 18 years(http://www.cbo.gov/ftpdoc.cfm?index=3982&type=0), that the program will still give us a 1.5-times LARGER deficit than Medicare thru 2012, and "The looming fiscal strains are not a temporary phenomenon caused by the retirement of post-World War II baby boomers over the next few decades. They reflect a growing imbalance driven by currently prescribed entitlements as well as long-lasting and powerful demographic trends". "demographic trends" = Unless we get people to have more babies over an infinite timespan and colonize the moon and beyond (we'd run out of room eventually ;-) ), it IS "inevitable" that someone will take a hit and pay for the first generation of Soc-Sec/Medicare recipients who got benefits but never paid into the system, because (duh) the food/medicine that that first generation consumed didn't just magically appear. Or as ssa.gov/OACT/TRSUM/trsummary.html shows, Secial(ist) Security NOT INCLUDING MEDICARE will rise to >6% of our GDP by 2030 (currently is 2/3rd's of that % of our GNP); so unless we have 150% more kids, have them at younger ages (teen pregnancy anyone?), or our kids become 150% more productive every 25 years or so, then Soc-Sec (WITHOUT Medicare) will continue to become a bigger % of our GNP whether or not we control medical costs, until it becomes so much of the GNP that we have nothing else: no education, no defense, etc.

Of course Medicare is getting worse, faster, than Social Security: both are hit by the worsening ratio of retired-workers-to-unretired-workers and the ratio of retired-workers-to-GNP...but only Medicare is ALSO hit by rising costs-per-person with medical costs moving much faster than inflation. But you say: "Social Security's impending deficit in 2040 is not a problem". Not a problem? Well then boy-genius, how do you intend to fix the following problem: that Secial Security WITHOUT COUNTING MEDICARE is approx 12% of our annual budget and should double within 10 years? (So forget about 2040, ok? Because if you don't cure THIS problem, there will be no USA by 2100. US Bonds are already being downgraded in international markets, as is the USDollar, and the interest rate lenders are charging to the US government is increasing relative to what they charge other governments -- the same way credit card co's charge a higher interest rate to INDIVIDUALS at-risk of defaulting: and when you can no longer get loans to pay for fancy military equipment, the "repo man" -- our biggest lender is China, who is transitioning its army to be high-tech -- can send approx 300 million troops to "collect" [and that only includes 90% of MALES under 50 presently, no females nor the fact that they are still growing].)

The only way to keep Social(ist)Security (WITHOUT Medicare) from consuming the USA's budget is (1.)to reduce the pay-outs so that several generations pay for that first generation who got benefits w/o paying into the system (this isn't even accounting for the interest as we gave those citizens trillions circa the 1940's and interest 1940 thru 2010 is a HUGE loss that needs to be paid for somehow), (2.) give it only to seniors will to live in group-housing (to reduce costs), or else (3.) hope for a miracle that raises GNP (doubtful given that we've reduced spending on education for the last 2 decades, to the point that kids in other industrialized nations LAUGH when they hear the questions that >50% of American kids got wrong).

To cure Medicare and general medical costs (a SEPARATE problem), you don't need to emulate the UK (as this study shows we were giving better care at a lower cost relative to the UK, approx 10 years ago with non-socialized medicine: cafehayek.typepad.com/hayek/2006/02/youve_had_your_.html), you merely need to regulate the hospitals, insurers, etc. instead of treating them as cronies, as Bush and many in Congress do:

But if socialized medicine is so great, why do wealthy Brits, Australians, etc. have a "two tier" (you can google for the quoted term) system where the wealthy pay extra as individuals (i.e. non-socialism) for FASTER medical care? [e.g. quicker treatment of cancer can be life-saving] Even wealthy Canadians have resorted to it more in recent years.