Blog on the Run: Reloaded

Monday, December 20, 2010 8:43 pm

Eat the rich before they eat you?

Filed under: I want my money back. — Lex @ 8:43 pm
Tags: ,

Having reached a hideous “compromise” with Republicans on tax cuts, sometime soon, possibly in his next State of the Union address, President Obama is going to propose some spending cuts.

The conventional wisdom in Washington is that these cuts will require “tough decisions,” which is code for cutting Social Security. But if you’re one of the people actually making the decision, it really ain’t all that tough:

As you can see, people in the top 40% of earners, and particularly in the top 20%, rely far less on Social Security for their retirement income than do the less fortunate of us in the American majority.  (And it’s worth remembering that congresscritters and most prominent DC journalists aren’t just in the top 20%, they’re in about the top 5%.) Conversely, if we go cutting Social Security to try to balance the budget, you can see what kind of damage it’s going to do to the least fortunate in this country.

And the even bigger picture is this: 1) Federal taxation is at its lowest in 60 years relative to GDP, and that was the case even before the recession. 2) Our deficit problem is, to a large extent, a health-care cost problem and is, to an almost complete extent, a combination of a health-care cost  problem and ahistorically low tax rates on the highest earners and wealthiest individuals. If we fix health care (which the Affordable Care Act was well on the way to doing) and start taxing the wealthy at anything like historical averages, then most if not all of our deficit problem goes away.

These statements are arithmetical facts. But you won’t hear politicians or DC journalists mentioning them, and now you know why.

Beware those who profess bravery in the face of other people’s suffering.

2 Comments

  1. This is yet another in the long series of obvious solutions to seemingly intractable problems. The difficulty arises, yet again, from the politician’s Prime Directive: Retain power. In order to do that, they have to pander. Particularly to the rich and — following a blazingly stupid Supreme Court decision — to companies. And therein lies the intractibility. So here’s another simple solution to a difficult problem, which could help unblock the logjam: Term and campaign-spending limits. Now. Unfortunatley there are only two chances of this happening: Fat and no.

    Comment by Blair — Tuesday, December 21, 2010 2:11 am @ 2:11 am

  2. Blair, I think Citizens United may have been the point of no return. What to do about that? Well, my options are somewhat limited while my kids are still in school, but I am a student of history.

    Term limits, even if constitutional or imposed via constitutional amendment, won’t help. The problem is that once they get in, congresscritters are motivated not only by the desire to get all that corporate cash for their re-election campaigns but also by the desire for a high-paying corporate or lobbyist job after their congressional careers end. If anything, term limits might worsen the pandering problem by making ‘critters feel they had to do MORE, NOW, to ensure themselves a lucrative postcongressional career.

    Yes, you can, theoretically, ban ex-‘critters from lobbying, even for life (although I’m guessing the Roberts court would strike down a lifetime ban), but that doesn’t preclude their landing a corporate gig somewhere, or even heading a trade association and staying in DC if they like.

    Nope, I think this is one pooch we can’t unscrew.

    Comment by Lex — Tuesday, December 21, 2010 8:25 am @ 8:25 am


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