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December 05, 2012

We Picked a Bad Week to Stop Drinking...

What's wrong with this picture?

Supporting retirees is now the federal government’s main activity. There’s a huge redistribution from young to old — a redistribution that will be made worse if retiree programs are largely excluded from deficit reduction, as many liberal groups urge. Either taxes will rise steeply or other federal programs (defense, food stamps, environmental protection) will be cut sharply. The young will pay more and get less.

Doubters should ponder the numbers. In fiscal 2012, non-interest federal spending totaled $3.251 trillion. Of that, $762 billion went for Social Security, $469 billion for Medicare (insurance for the 65 and over population) and $251 billion for Medicaid (insurance for the poor — two-thirds goes for long-term care for the aged and disabled). Altogether, that’s 46 percent of non-interest spending. Defense, $651 billion and declining, was 20 percent.

As baby boomers retire and health costs rise, this spending will mount. In 2010, there were 40 million Americans 65 and older. By 2020, that number is projected to be 55 million; by 2030, 72 million.

All these trends are old news; I have repeatedly written about them. If we had begun cutting benefits years ago, changes could have occurred slowly. People would have received ample notice. Now we lack the luxury of time. Benefit cuts will be unfair to retirees; but avoiding cuts will be unfair to the young. That we have arrived at this juncture indicts our democratic system and many Democratic politicians, who have obstructed constructive change in retiree programs.

So we have a system that over time is becoming more and more dependent on taxes paid by younger workers, coupled with a generation that is less inclined to create enough younger workers to support it. How long will it be before the current talk of "economic patriotism" is replaced by talk of reproductive patriotism?

The retreat from child rearing is, at some level, a symptom of late-modern exhaustion — a decadence that first arose in the West but now haunts rich societies around the globe. It’s a spirit that privileges the present over the future, chooses stagnation over innovation, prefers what already exists over what might be. It embraces the comforts and pleasures of modernity, while shrugging off the basic sacrifices that built our civilization in the first place.

More and more these days, reading the news resembles the low-budget 70s sci-fi flicks we used to roll our eyes over. Where's Charleton Heston when you really need him?

Oh yeah. We are so screwed.

Posted by Cassandra at December 5, 2012 04:32 AM

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Comments

I know how to count
My house has six TVs
American Dream.

Posted by: spd rdr at December 5, 2012 09:58 AM

Child-rearing versus bearing children?

The Nazi state and Russia rewarded mothers who had lots of children because they fed the state.

Then too, there are the arguments about outsourcing and paying slave wages for serious talent because we can't or won't pay for it here...because of socialism.

Wandering around in my thoughts...

#1 son is on his second job. He is lucky in that he is gifted with things mechanical and there is a Huge Need for people who know how to Keep Things Running.

Posted by: Puff'sMom at December 5, 2012 10:01 AM

It's simply the Dynastic Cycle with a western spin. We are in decline and the Mandate of Heaven is there to be seized by the next Dynasty.

Posted by: Dan Irving at December 5, 2012 10:19 AM

What's wrong with this picture, you ask?

Why plainly, it's all the extraneous distractions. Defund and eliminate DoD. Get rid of State. Do away with all the Executive Branch except The Man and his IRS. That pesky House of Representatives? Pfft. Judges? We don' need no stinkin' judges.

Get our government focused on its primary job--transferring all that money to those who deserve.

Now would be good.

Eric Hines

Posted by: E Hinesq at December 5, 2012 11:27 AM

At a time and in a country where the once honored dead (the past) are now dead white males, slaveholders and no-accounts blackened by a litany of social sins; and in that same time and country where the only concern given the unborn (the future) is how much of a burden they are, we are left with the present where the living contentedly consider themselves superior to the past, and for that, entitled to the future.

All societies wax and wane but only those that take no account of the past or future collapse. Now's precisely the time to take up drinking – moderately, as always, of course.

Posted by: George Pal at December 5, 2012 12:00 PM

"$762 billion went for Social Security"

Some percent of this is return of the monies paid into the system by the "subscribers," and is no more a true "expense" than is the money that the bank pays back to you when you withdraw it from your checking or savings account. Another piece of it is *interest* in disguise...ie, money that was loaned from the SS "trust fund" to the rest of the government and hence displaced borrowing that otherwise would have resulted in real legally-enforceable Treasury debt owed by the government.

What we see now, and are going to see a lot more of, is bitterness on two sides...older people who were led to believe that their SS contributions were something like a commercial annuity, and that they actually had a right to the advertised benefits, and younger people who believe they are being taxed to support older people who are making out like bandits.

Posted by: david foster at December 5, 2012 12:10 PM

One can't help but wonder how much of this has been exasperated by the abortion of over 50 million potential tax-payers from the system....

As for me, I never stopped drinking in the first place. And 5 o'clock seems to come earlier each day.
*sigh*

Posted by: DL Sly at December 5, 2012 01:17 PM

What we see now, and are going to see a lot more of, is bitterness on two sides...older people who were led to believe that their SS contributions were something like a commercial annuity, and that they actually had a right to the advertised benefits, and younger people who believe they are being taxed to support older people who are making out like bandits.

Military people feel that way about their retirement, too. People make decisions about whether to stay in or get out based on things like retirement or medical benefits.

And I don't see how the federal govt will be able to make good on all their present promises, let alone ones to future retirees.

Posted by: Cass - Confirmation Bigot-in-Training at December 5, 2012 01:53 PM

Call me cynical.

If it can be done to children, what moral imperative could prevent it being used on inconvenient seniors.

Posted by: Yu-Ain Gonnano at December 5, 2012 02:25 PM

Some percent of this is return of the monies paid into the system by the "subscribers," and is no more a true "expense" than is the money that the bank pays back to you when you withdraw it from your checking or savings account.

Couple things wrong with this. For one thing, what I put into my bank and later take back out is my choice. Including the intermediate steps of what I do with that money, and so the return I earn on it (the "interest"). Not so with Uncle Sugar's Social Security System. What I pay in is determined by the government, what I get back is determined by that same government. It's not costless. There's an enormous opportunity cost.

For another, that return. I've done better--by orders of magnitude--with my own savings for my own retirement in the last 15 years than the government has done over my lifetime.

For another, if I screw up my retirement plan, I only hurt myself and those few others who might come to my aid. When [sic] the government screws up its retirement plan for me, it screws up not just me, but the entire nation. And all of us cannot make whole all of us.

For another, the government holds demographics irrelevant to its retirement plan for all of us. My retirement plan has no demographic considerations.

For another, the government's retirement plan is anti-family. The monies it confiscates from me--from my family's weal--goes to a current retiree; it is not available for my retirement or my family's well-being.

Eric Hines

Posted by: E Hines at December 5, 2012 04:41 PM

if I screw up my retirement plan, I only hurt myself and those few others who might come to my aid. When [sic] the government screws up its retirement plan for me, it screws up not just me, but the entire nation. And all of us cannot make whole all of us.

This is what gets me - the systematic transfer of risk from the private sector to the public sector.

If people want to make lifestyle choices that backfire and only hurt them, that's one thing. When they demand the right to make lifestyle choices that backfire and then want to stick folks who were more careful/farsighted with the bill, that's entirely another.

Posted by: Cass - Confirmation Bigot-in-Training at December 5, 2012 04:44 PM

So was that the Charleton Heston from Soylent Green you think we need? Or was it the one from Ten Commandments? Combimation?

Posted by: CAPT Mongo at December 5, 2012 04:45 PM

When they demand the right to make lifestyle choices that backfire and then want to stick folks who were more careful/farsighted....

It's especially disastrous when it's the government that's making those lifestyle choices that backfire.

Eric Hines

Posted by: E Hines at December 5, 2012 05:49 PM

Posted by: spd rdr at December 5, 2012 06:05 PM

Charleton Heston from The Omega Man.

Eric Hines

Posted by: E Hines at December 5, 2012 06:08 PM

Meanwhile...

The U.S. House voted to remove the term “lunatic” from sections of federal law, while the word “idiot” would remain.

Makes sense. If they took the idiocy out of federal law there'd be nothing left to enforce.

Posted by: spd rdr at December 5, 2012 06:12 PM

SS was raided to fund Johnson's Great Society.
Personally, I have had a better rate of return on my OWN Roth IRA, and would like to take the SS contributions and put them where I think they will do the most good, not government.

Posted by: the womyn behind the curtain at December 5, 2012 09:55 PM

To the limited extent that it's not simply a Ponzi scheme, Social Security is just the kind of dilemma that nationalized healthcare is. First we decide we can't bear to watch old people run out of money for living expenses (or sick people run out of money for medicine). Then we decide society has to step in and foot the bill. Then we resent how much all this is costing, and notice that we're running out. Then we look around for someone else to pay for it.

Posted by: Texan99 at December 6, 2012 08:39 AM

Then we resent how much all this is costing, and notice that we're running out. Then we look around for someone else to pay for it.

Then we decide that seniors don't really need that much money for living expenses and sick people don't really need all that medicine, so we start deciding how seniors should live and how much medicine sick people should get. And that's okay because now we all* run out of money equally - which is what's really important.

*Except, of course, for the rich and the politically connected - which mostly includes the people who enacted these ideas in the first place - who are living high on the hog and getting medical care in Costa Rica.

Posted by: Elise at December 6, 2012 09:09 AM

Enter the death panels.

Posted by: Another One behind the curtain at December 6, 2012 01:18 PM

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