4 ms·

This is super naive. For much of the past decade, congress could have removed the entire discretionary budget (yes, including the military) and still had a def

This is super naive. For much of the past decade, congress could have removed the entire discretionary budget (yes, including the military) and still had a deficit. The deficit is driven by social security, medicare, and medicaid. If you want to balance the budget, you have to reform those.

dragonwriter 11y ago
> For much of the past decade, congress could have removed the entire discretionary budget (yes, including the military) and still had a deficit. Two fiscal years in the past decade (2010 and 2011) had deficit exceeding discretionary spending. That's not "much of the past decade". (The highest deficit was in 2009, but discretionary spending was actually higher.) > The deficit is driven by social security, medicare, and medicaid. If you want to balance the budget, you have to reform those. The deficit is driven by a shortfall of revenue vs. spending. Even if your portrayal of the spending side was accurate, ignoring the revenue side is not. If you want to balance the budget [0], you probably shouldn't ignore one side of the balance. [0] The question of whether you should want to is one which is rarely addressed directly, merely assumed.
guelo 11y ago
Social Security runs a surplus.
toomuchtodo 11y ago
> The deficit is driven by social security, medicare, and medicaid. If you want to balance the budget, you have to reform those. Or increase taxes? Social security taxation is limited to the first ~$120K of someone's income. Why?
- binarycrusader 11y ago
  Because taxing those people won't solve the real issue? I pay more in taxes every year on my income than many millionaires do because my income is primarily salary instead of stocks, etc. 120k may seem like a lot, but it isn't in several parts of the US now (e.g SF Bay Area, New York).
  - toomuchtodo 11y ago
    > 120k may seem like a lot, but it isn't in several parts of the US now (e.g SF Bay Area, New York). And national tax policy shouldn't be dictated by ~2 major urban metros. I agree that tax policy needs to encompass more than just the salary of the working class, but let's not joke ourselves. Medicare already taxes your entire wage base, there's no reason Social Security shouldn't. We keep kicking the can down the road, and its time to own up to the liabilities we've created.
    - someguydave 11y ago
      >We keep kicking the can down the road, and its time to own up to the liabilities we've created. I'm afraid it's quite impossible to 'own up' to those liabilities. Look at the debt clock: http://www.usdebtclock.org/ http://www.usdebtclock.org/ The GAAP liabilities of USG amount to $100 trillion, yet the net assets of the entire US are only $116 trillion. Nearly all of the assets in the entire country would need to be sold to pay for the liability to be incurred. I'm afraid the only solution is to reduce benefits, primarily reducing social security payments (particularly when most of the boomers are drawing on them) and cutting medical spending - probably by instituting controls on what the government will pay for in terms of end-of-life care.
      - toomuchtodo 11y ago
        > primarily reducing social security payments (particularly when most of the boomers are drawing on them) Disagree. Removing the payroll cap for social security taxation causes Social Security to become solvent permanently [1]. > and cutting medical spending - probably by instituting controls on what the government will pay for in terms of end-of-life care. Sort of agree. The US needs to go single payer, and institute price controls on health services. [1] http://www.pbs.org/newshour/making-sense/what-impact-would-eliminating/ http://www.pbs.org/newshour/making-sense/what-impact-would-e...
  - dragonwriter 11y ago
    > Because taxing those people won't solve the real issue? I pay more in taxes every year on my income than many millionaires do because my income is primarily salary instead of stocks, etc. Taxing capital income like other income is another possible solution.
- dragonwriter 11y ago
  > Or increase taxes? Social security taxation is limited to the first ~$120K of someone's income. Why? The theory, I believe, is that this is tied to the maximum amount of income that is counted in the benefits formula for SS. OTOH, there's no reason you couldn't count more income toward benefits (there's already at least one bend point where the amount of benefits for each additional dollar of lifetime qualifying income/contributions is reduced, so if you are concerned with the distribution of benefits if more income is counted, you could also add additional bend points.) If you wanted to go further, you could include personal capital income (perhaps with some limit, or perhaps open ended, with additional bend points, as necessary, as discussed above for increasing/removing the limit on labor income) as SS taxable (and in SS benefit calculations). Given that at least some capital returns are a result of active personal management that can become less practical with age or disability for the same reason that labor can, it makes as much sense to preserve a safety-net retirement for those retiring from such active management as for those retiring from wage labor.
- morgante 11y ago
  > Or increase taxes? Social security taxation is limited to the first ~$120K of someone's income. Why? Because social security is billed as a retirement scheme, not a wealth transfer scheme. The idea being that you get back out approximately what you get in. Since benefits are capped, payments necessarily are. If you want to change social security into an explicit wealth transfer scheme, expect heavy resistance.
  - toomuchtodo 11y ago
    > Since benefits are capped, payments necessarily are. If you want to change social security into an explicit wealth transfer scheme, expect heavy resistance. You eat an elephant one bite at a time.
gohrt 11y ago
Why bother? social security, medicare, and medicaid generate quality of life improvements. Money redistributed isn't hurting anything, and a future govt can inflate away that debt
- lintiness 11y ago
  Increasing taxes and redistribution for "quality of life" necessarily decreases savings and investment. investment is where long term quality of life is determined.

dragonwriter 11y ago

> For much of the past decade, congress could have removed the entire discretionary budget (yes, including the military) and still had a deficit. Two fiscal years in the past decade (2010 and 2011) had deficit exceeding discretionary spending. That's not "much of the past decade". (The highest deficit was in 2009, but discretionary spending was actually higher.) > The deficit is driven by social security, medicare, and medicaid. If you want to balance the budget, you have to reform those. The deficit is driven by a shortfall of revenue vs. spending. Even if your portrayal of the spending side was accurate, ignoring the revenue side is not. If you want to balance the budget [0], you probably shouldn't ignore one side of the balance. [0] The question of whether you should want to is one which is rarely addressed directly, merely assumed.

guelo 11y ago

Social Security runs a surplus.

toomuchtodo 11y ago

> The deficit is driven by social security, medicare, and medicaid. If you want to balance the budget, you have to reform those. Or increase taxes? Social security taxation is limited to the first ~$120K of someone's income. Why?

binarycrusader 11y ago
Because taxing those people won't solve the real issue? I pay more in taxes every year on my income than many millionaires do because my income is primarily salary instead of stocks, etc. 120k may seem like a lot, but it isn't in several parts of the US now (e.g SF Bay Area, New York).
- toomuchtodo 11y ago
  > 120k may seem like a lot, but it isn't in several parts of the US now (e.g SF Bay Area, New York). And national tax policy shouldn't be dictated by ~2 major urban metros. I agree that tax policy needs to encompass more than just the salary of the working class, but let's not joke ourselves. Medicare already taxes your entire wage base, there's no reason Social Security shouldn't. We keep kicking the can down the road, and its time to own up to the liabilities we've created.
  - someguydave 11y ago
    >We keep kicking the can down the road, and its time to own up to the liabilities we've created. I'm afraid it's quite impossible to 'own up' to those liabilities. Look at the debt clock: http://www.usdebtclock.org/ http://www.usdebtclock.org/ The GAAP liabilities of USG amount to $100 trillion, yet the net assets of the entire US are only $116 trillion. Nearly all of the assets in the entire country would need to be sold to pay for the liability to be incurred. I'm afraid the only solution is to reduce benefits, primarily reducing social security payments (particularly when most of the boomers are drawing on them) and cutting medical spending - probably by instituting controls on what the government will pay for in terms of end-of-life care.
    - toomuchtodo 11y ago
      > primarily reducing social security payments (particularly when most of the boomers are drawing on them) Disagree. Removing the payroll cap for social security taxation causes Social Security to become solvent permanently [1]. > and cutting medical spending - probably by instituting controls on what the government will pay for in terms of end-of-life care. Sort of agree. The US needs to go single payer, and institute price controls on health services. [1] http://www.pbs.org/newshour/making-sense/what-impact-would-eliminating/ http://www.pbs.org/newshour/making-sense/what-impact-would-e...
- dragonwriter 11y ago
  > Because taxing those people won't solve the real issue? I pay more in taxes every year on my income than many millionaires do because my income is primarily salary instead of stocks, etc. Taxing capital income like other income is another possible solution.
dragonwriter 11y ago
> Or increase taxes? Social security taxation is limited to the first ~$120K of someone's income. Why? The theory, I believe, is that this is tied to the maximum amount of income that is counted in the benefits formula for SS. OTOH, there's no reason you couldn't count more income toward benefits (there's already at least one bend point where the amount of benefits for each additional dollar of lifetime qualifying income/contributions is reduced, so if you are concerned with the distribution of benefits if more income is counted, you could also add additional bend points.) If you wanted to go further, you could include personal capital income (perhaps with some limit, or perhaps open ended, with additional bend points, as necessary, as discussed above for increasing/removing the limit on labor income) as SS taxable (and in SS benefit calculations). Given that at least some capital returns are a result of active personal management that can become less practical with age or disability for the same reason that labor can, it makes as much sense to preserve a safety-net retirement for those retiring from such active management as for those retiring from wage labor.
morgante 11y ago
> Or increase taxes? Social security taxation is limited to the first ~$120K of someone's income. Why? Because social security is billed as a retirement scheme, not a wealth transfer scheme. The idea being that you get back out approximately what you get in. Since benefits are capped, payments necessarily are. If you want to change social security into an explicit wealth transfer scheme, expect heavy resistance.
- toomuchtodo 11y ago
  > Since benefits are capped, payments necessarily are. If you want to change social security into an explicit wealth transfer scheme, expect heavy resistance. You eat an elephant one bite at a time.

gohrt 11y ago

Why bother? social security, medicare, and medicaid generate quality of life improvements. Money redistributed isn't hurting anything, and a future govt can inflate away that debt

lintiness 11y ago
Increasing taxes and redistribution for "quality of life" necessarily decreases savings and investment. investment is where long term quality of life is determined.