Promoted by Steven D
If I hear or read about another billionaire claiming that the current economic woes we are suffering as a nation is due to our “entitlement” programs, I am going to scream. The latest in the long line of billionaire apologist is Pete Peterson. Mr. Peterson, is a longtime opponent of Social Security, Medicaid, and any other government programs targeted to help the needy, who appeared on Charlie Rose. According to Mr. Peterson it is not greed and speculation that has reeked havoc on our economy for the past 30 years, it is the entitlement programs. All this time I have been thinking that not being able to know when you’ve had enough is the problem. Come to find out I am looking in the wrong direction. Greed has been around for a long time, entitlements have not. The Crash and the Depression occurred prior to entitlements; I wonder who Mr. Peterson blames those on.
I believe the Social Security Trust Fund belongs in the first tier of classic oxymorons. In the first place, the Social Security Trust Fund should not be trusted, and it is not funded. We anesthetize the public with highly reassuring long-term statements that the trust funds are solvent for decades. Yet, we do not tell the public that the payroll taxes of our children and grandchildren would have to double to cover the costs of Social Security and Medicare. That is an unthinkable burden. We do not tell the public that whether you have a trust fund or not, you still face the same three hard choices: increased taxes, cut benefits, or try to borrow unprecedented amounts.
Now how much would we have to borrow? I think it’s time we started thinking in cash flow terms, because these programs are obviously pay-as-you-go programs. The projected cash flow deficits for Social Security and Medicare go from a modest $25 billion in 2003, to a projected $783 billion in 2020, and trillions of dollars thereafter. Peterson Institute
These statements on the surface seem reasonable enough, we have not done a good job funding and fixing the entitlement programs. Instead of facing some tough realities and questions the politicians have continued to ignore them, afraid of providing the American public the ugly truth, ugly truths do not win elections. The problem I have with these guys is they present the picture as though the entitlements were the only item in the budget. So rather than saying it is a matter of priorities they present the picture as a zero-sum game. Nowhere do they mention the military budget, the tax-cuts, or the other government programs that make up the complete budget. We are left to believe that the entitlements exist on some island, isolated from the other expenditures.
Mr. Peterson discussed the Prescription Drug benefit that was added to Medicaid as an example of making a bad situation worse. I agree, but he doesn’t mention that he is a Republican and it was the Republicans who created the Bill that forbid the Government from negotiating prices for the prescriptions. I wish just once these guys would take responsibility for the messes they make. The Republicans built in astronomical profits for the benefit of the big pharmaceuticals, just as they did for big oil who is recording unprecedented profits. Nowhere does he mention the billions of dollars that were made during the mortgage meltdown by those same companies who are now crying bankruptcy. Is it me or did billions of dollars just disappear into thin air? Someone had to profit from all of those loans, why is this information never debated? Nor, did he mention that it is the Republicans who are trying to bankrupt the system to force its collapse.
Mr. Peterson stated that he supports John McCain and was asked about Senator McCain’s flop on the tax-cuts, he presented the standard line that what McCain was against was not tax-cuts per se but tax-cuts without spending cuts. McCain and his supporters are backpedaling so fast from statements like the following it blows the mind:
“Mr. President, the principle that guides my judgment of a tax reconciliation bill is tax relief for those who need it the most–lower- and middle-income working families. I am in favor of a tax cut, but a responsible one that provides significant tax relief for lower- and middle-income families. And I commend Sen. Grassley for moving in that direction. But I am concerned that debt will overwhelm many American households. That is why tax relief should be targeted to middle-income Americans. The more fortunate among us have less concern about debt. It is the parents struggling to make ends meet who are most in need of tax relief.
“I had expressed hope that when the reconciliation bill was reported out of the Senate Finance Committee, the tax cuts outlined would provide more tax relief to working, middle-income Americans. However, I am disappointed that the Senate Finance Committee preferred instead to cut the top tax rate of 39.6% to 36%, thereby granting generous tax relief to the wealthiest individuals of our country at the expense of lower- and middle-income American taxpayers.” Senate floor statement during debate over President Bush’s tax relief package, May 21, 2001.
Senator McCain and Mr. Peterson have no problem today with the Feds bailing out Bear Sterns and the Wall Streeters, it is the average American who Senator McCain was concerned about in 2001 who don’t deserve any relief. Mr. Peterson said that while it was a dangerous precedence, he supported the bail-out to stem broader market drops. You have to love this line of, “we hate to do it and we know its bad business, but we have to. He gave the same excuse for all of the liquidity funds they have received from China. He didn’t seem to have any problem with China owning large sections of our banking industry. I’m no Nobel economist but even I know that can’t be a good idea.
Oh, by the way Mr. Peterson is making a donation of a billion dollars to help teach Americans how to save. First of all, how rich do you have to be to give away a billion dollars? Secondly, what he failed to mention is why the American family is in the situation it finds itself. Due to flat wage pressure being exerted by Mr. Peterson and his billionaire friends for the past 30 years, the wife has had to go to work to increase household buying power. After that money was spent, they began mortgaging their homes and running up credit card bills for expense money. Now that they have spent that money the well is now dry. And Mr. Peterson says if they had just saved money the economy wouldn’t be in this predicament. He wants consumers in a consumer economy to not consume or reduce consumption. That horse is already out of the barn, we have been bombarded since the age of television to buy. Where were the commercials for saving money?
“Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.” – John Maynard Keynes
The commercials advising Americans to save their money were in the same place as the ones telling us to not to eat at McDonalds every other day or to split the restaurant portions at TGIFridays with 2 other people. So now we’re poor, fat and lethargic.
In that same line of thinking, where are they going to run these commercials on saving? In between Today show segments selling us stuff like $400/night hotel rooms for a weekend getaway, or the latest $100 acrylic plastic bracelet that all the Hollywood stars are wearing?
There is a cashier at the grocery store, working for six bucks and hour, who has a Coach bag and D%G eyeglasses. I don’t get it, but I’m as guilty as the next guy for not saving money.
I’ll never get the Coach purse thing. But I have to admit, when I started working from home, a lot of my “needs” went way down, in part simply because I wasn’t exposed to as much stuff to want.
Btw, I think you’re pretty thrifty, with your cool craigslist and thrift shop finds. And it’s hard to save with kids and their tuition and orthodontist bills…
It’s easier to justify spending when it’s CL or Goodwill. 🙂
If you have a family, those years are spent treading water, financially speaking. I recall a co-worker, in a state of wonderment, explaining to me how they’d managed to pull ahead financially when the last child left home. He was right. Our thriftiness during the child rearing years paid off when our expenses went down but our habits didn’t change.
Thank you so much for saying this, because I often feel bad that I’m not saving more, then I look at where the money went, and realize that it’s not that I’m a wild spender, it’s just that the things I think are important (education, healthcare, good teeth) cost a lot. So it’s good to know there’s hope that all these kid expense will end someday. 😉
Gas prices — UP
Food prices — UP
Utility bills — UP
Tuition — UP
Health care — UP UP UP UP UP
Income — FLAT, drifting down, downward crash any day now.
I don’t want to hear about personal responsibility.
I want to hear about community responsibility.
We are constantly being told that we have to buy stuff to keep the economy going, but we are lacking in personal responsibilty for not saving enough. I refuse to take the blame for two mutually exclusive vices.
And the European economy is strong because of why?
Despite of all of their ENTITLEMENT programs, the Euro is stronger than ever.
DING DING DING DING DING!!!!!
We have a winner.
Those nasty foreigns, with their nasty socialisms.
I have a conservative friend that regales me with the horrors of the lazy Euros and how you can’t start a business over there and all the workers strike if you try to make them actually work and everyone dies waiting in line with a toothache.
He’s shut up about that stuff in recent months.
Personally, I have a dream that my oldest child will work for the state dept and eventually marry a nice European so I can retire over there and know that my grandchildren will have a better life.
Lack of corporate welfare….
Yeah, those entitlements are really lavish. For example, Food Stamps. When I was in college Prof. said that the people responsible for setting Food Stamp allowances figured out what a family of four would need and then halved that figure. That was a very long time ago, and things have not gotten any better.
As of two years ago some states had a Food Stamp allowance of $388/mo for a family of four. But you can’t buy paper products, cleaning products, pet food, alcohol. But who needs soap or toilet paper anyway, huh? Toothpaste? Nah, you don’t need that.
Back in the 90’s the entitlement programs were about 1% of the federal budget. I’d be surprised if it’s much higher now.
Being poor is neither a moral failing or a crime. I wish the “elites” in our country would stop acting as if it is both.
Considering how many of our military families have to resort to food stamps to survive, you’d think this would turn on a few light bulbs somewhere. But I guess the troop lovers just aren’t aware of that.
John Boehner-Philanthropist, Humanitarian and all around swell guy
There is apparently no more pressing need in Boehner’s district than to get Republicans elected.
Guess none of his constituents are included in this headline.
I guess Boehner’s attitude is “let them eat cake”.
What an inspiring gift. Boner.
According to Mr. Peterson it is not greed and speculation that has reeked havoc on our economy for the past 30 years…
wrecked havoc
I used that term just to agitate the grammar Nazis…