4 ms·

" The reality is just that they're taking less money. Bit of a difference." Can you afford to take a year off from work? It's just taking less money. The fact

" The reality is just that they're taking less money. Bit of a difference." Can you afford to take a year off from work? It's just taking less money. The fact is that tax cuts aren't free. If they aren't matched by spending cuts, you're just deferring the tax increase until later and incurring deficits in the meantime. So you have to decide what you're going to cut. Which means weighing, say, decent healthcare for veterans, versus the benefit of the tax cut to people who are probably quite well-off already. The Republicans in the Bush years were not willing to do that. So they cut taxes. And raised spending. And we could afford neither.

cletus 16y ago
Nice try but no sale. This is the problem: talking about this issue will get you labeled as being anti-<insert emotive issue here> (health care for veterans in your case). The budget is blowing out for three reasons: Social Security, health care and the military. Of the three only the last is largely discretionary (being the ongoing cost for campaigns in Iraq and Afghanistan). When FDR introduced Social Security there was something like 50 working people for every retired person and the average life expectancy was probably only 60 or so. It's a straight money goes in money goes out system with no saving or planning for future spending. Everyone knows this is unsustainable. It's merely a question of when something will change and what. The smart money is on raising the retirement age. Health care costs are spiraling. This is a much more complicated and multi-faceted problem. Personally I think part of the problem is the blank chewue mentality we have to health care. Basically it doesn't matter how much it costs to research and develop pharmaceuticals and medicine, we expect to be provided it. So companies largely ignore the costs. It's a bit like saying to a subcontractor: you can choose to spend as much as you like and I'll pay you a 20% margin on top of that. What is the motivation of that subcontractor and the inevitable outcome? Also I think you need to look at the structure of the health care system. I suspect the US has the most expensive health care in the developed world. I think systemic inefficiencies and overprotective IP laws play a bigpart in this.
- jfager 16y ago
  I don't get how anything you wrote after "Nice try but no sale" disagrees at all with what the person you replied to said.
- jshen 16y ago
  I'm kind of confused. The big three are our biggest expenses (which includes healthcare for veterans). So giving tax cuts to the super rich (or anyone really) without addressing the big three is the problem that the person you're replying to is pointing out. How is that a "no sale"? Cause he mentioned veterans?
  - cletus 16y ago
    http://www.comw.org/qdr/fulltext/100223williams.pdf http://www.comw.org/qdr/fulltext/100223williams.pdf > Growth in Budgets for Military Health Care > The DoD's health care costs rose from about $20 billion in 1998 to $47 billion in 2010 (FY 2010 dollars)—an annual growth rate of 7.4 percent above inflation. Absent changes in policy, CBO projects they will at least double between now and 2028. It's no sale because it's ~2% of the budget masked in emotion, which is at best an irrelevant distraction and at worst a deliberate attempt to demonize opposing views. Limit the focus to just the (increasingly ill-named) "defense" budget and even then it's only around 10% and is dwarfed by the cost of discretionary operations within that budget/department.
    - natnat 16y ago
      That last argument was about tax cuts, though, and not military health care spending. Even if we held military spending constant, it still would have been irresponsible to cut taxes because there was no corresponding spending cut that ensured those tax cuts were paid for.
    - mattrepl 16y ago
      I believe you want the Department of Veteran Affairs. The 2010 budget was $114 billion. http://www.va.gov/budget/products.asp http://www.va.gov/budget/products.asp
    - jonhendry 16y ago
      I agree with what you're saying about the big issues and the 3 sources of deficits. But when considering something like the estate tax cut, it makes sense to consider the 'cost' of it in terms of either borrowing necessary to replace the lost revenue, or the cost of cutting government programs to make up for the lost revenue. The $50 billion or whatever cost of the estate tax cut might be a drop in the bucket compared to the overall deficit, but it should still be dealt with responsibly.
- fleitz 16y ago
  The budget is blowing out because of simple economics combined with electoral pressure, there are a large number of people who desire increased services and a large number who desire decreased taxes, politians deliver both. This combined with services paid for by A, delivered to B and provided by C are destined to be delivered inefficiently. When you combine all these factors you get a lot of services at high cost for which no one will pay for. The only answer that solves all these issues in the short term is raising debt. However as Keynes aptly put it in the long run we're all dead
- pragmar 16y ago
  I'd like to clarify one point. That is the Social Security hasn't been pay as you go since a commission headed by Alan Greenspan put forward legislation to deal with the baby boomers in the 80s. Under Reagan, Social Security went from pay-go to a trust fund. The social security crisis is not a matter of depleted resources in trust (some 2.4 trillion in 2009 - http://www.ssa.gov/policy/docs/statcomps/supplement/2009/4a.html http://www.ssa.gov/policy/docs/statcomps/supplement/2009/4a....), but a crisis of whether the US government will pay these Treasury Bonds at face value or not. The real crisis is the government not having the political will to tax in order to pay its debts. http://www.ssa.gov/oact/progdata/fundFAQ.html#n7 http://www.ssa.gov/oact/progdata/fundFAQ.html#n7
MichaelSalib 16y ago
Indeed, your comment reminds me of that radical leftist Milton Friedman who once wrote "Remember, to spend is to tax." What a pity that so many have forgotten Friedman's words.

cletus 16y ago

Nice try but no sale. This is the problem: talking about this issue will get you labeled as being anti-<insert emotive issue here> (health care for veterans in your case). The budget is blowing out for three reasons: Social Security, health care and the military. Of the three only the last is largely discretionary (being the ongoing cost for campaigns in Iraq and Afghanistan). When FDR introduced Social Security there was something like 50 working people for every retired person and the average life expectancy was probably only 60 or so. It's a straight money goes in money goes out system with no saving or planning for future spending. Everyone knows this is unsustainable. It's merely a question of when something will change and what. The smart money is on raising the retirement age. Health care costs are spiraling. This is a much more complicated and multi-faceted problem. Personally I think part of the problem is the blank chewue mentality we have to health care. Basically it doesn't matter how much it costs to research and develop pharmaceuticals and medicine, we expect to be provided it. So companies largely ignore the costs. It's a bit like saying to a subcontractor: you can choose to spend as much as you like and I'll pay you a 20% margin on top of that. What is the motivation of that subcontractor and the inevitable outcome? Also I think you need to look at the structure of the health care system. I suspect the US has the most expensive health care in the developed world. I think systemic inefficiencies and overprotective IP laws play a bigpart in this.

jfager 16y ago
I don't get how anything you wrote after "Nice try but no sale" disagrees at all with what the person you replied to said.
jshen 16y ago
I'm kind of confused. The big three are our biggest expenses (which includes healthcare for veterans). So giving tax cuts to the super rich (or anyone really) without addressing the big three is the problem that the person you're replying to is pointing out. How is that a "no sale"? Cause he mentioned veterans?
- cletus 16y ago
  http://www.comw.org/qdr/fulltext/100223williams.pdf http://www.comw.org/qdr/fulltext/100223williams.pdf > Growth in Budgets for Military Health Care > The DoD's health care costs rose from about $20 billion in 1998 to $47 billion in 2010 (FY 2010 dollars)—an annual growth rate of 7.4 percent above inflation. Absent changes in policy, CBO projects they will at least double between now and 2028. It's no sale because it's ~2% of the budget masked in emotion, which is at best an irrelevant distraction and at worst a deliberate attempt to demonize opposing views. Limit the focus to just the (increasingly ill-named) "defense" budget and even then it's only around 10% and is dwarfed by the cost of discretionary operations within that budget/department.
  - natnat 16y ago
    That last argument was about tax cuts, though, and not military health care spending. Even if we held military spending constant, it still would have been irresponsible to cut taxes because there was no corresponding spending cut that ensured those tax cuts were paid for.
  - mattrepl 16y ago
    I believe you want the Department of Veteran Affairs. The 2010 budget was $114 billion. http://www.va.gov/budget/products.asp http://www.va.gov/budget/products.asp
  - jonhendry 16y ago
    I agree with what you're saying about the big issues and the 3 sources of deficits. But when considering something like the estate tax cut, it makes sense to consider the 'cost' of it in terms of either borrowing necessary to replace the lost revenue, or the cost of cutting government programs to make up for the lost revenue. The $50 billion or whatever cost of the estate tax cut might be a drop in the bucket compared to the overall deficit, but it should still be dealt with responsibly.
fleitz 16y ago
The budget is blowing out because of simple economics combined with electoral pressure, there are a large number of people who desire increased services and a large number who desire decreased taxes, politians deliver both. This combined with services paid for by A, delivered to B and provided by C are destined to be delivered inefficiently. When you combine all these factors you get a lot of services at high cost for which no one will pay for. The only answer that solves all these issues in the short term is raising debt. However as Keynes aptly put it in the long run we're all dead
pragmar 16y ago
I'd like to clarify one point. That is the Social Security hasn't been pay as you go since a commission headed by Alan Greenspan put forward legislation to deal with the baby boomers in the 80s. Under Reagan, Social Security went from pay-go to a trust fund. The social security crisis is not a matter of depleted resources in trust (some 2.4 trillion in 2009 - http://www.ssa.gov/policy/docs/statcomps/supplement/2009/4a.html http://www.ssa.gov/policy/docs/statcomps/supplement/2009/4a....), but a crisis of whether the US government will pay these Treasury Bonds at face value or not. The real crisis is the government not having the political will to tax in order to pay its debts. http://www.ssa.gov/oact/progdata/fundFAQ.html#n7 http://www.ssa.gov/oact/progdata/fundFAQ.html#n7

MichaelSalib 16y ago

Indeed, your comment reminds me of that radical leftist Milton Friedman who once wrote "Remember, to spend is to tax." What a pity that so many have forgotten Friedman's words.