Friday, October 16, 2009
Read it. The only thing I would add is that when this results in a sudden crashing collapse of creditworthiness, the greedy private sector will inevitably be blamed. Reminds me of a friend of mine's crazy mother who set up salt shakers on the floor near doors and then yelled at people for knocking them over.
The thing that worries me is when the whole thing (Medicare/Medicaid/Social Security/Obamacare) goes crash-boom-bang, the Government will come out of DC in full blown panic mode. They will be faced with massive bills and a sudden absence of cash, and will be forced into one of the traditional forms of governmental power-grabbing: Inflation, Confiscation, or Conquest. Well, I’m not worried about conquest, I can not picture this group of weenies declaring war on anybody larger than Newfoundland. But a couple years of frozen COLAs on all Government spending, along with double digit inflation, would balance those books just fine (except for the chaos that would ensue, and be blamed on Bush). The real danger is a sudden governmental strike on an unprotected pile of money just sitting around unguarded. 401K and pension plans.
With a single stroke of a pen, Congress could strip away any tax protection for these retirement plans, and with another stroke they could enforce some stupidly huge tax on it or simply take it away from you and place it in a government-run plan (GRA). The poor are insulated from this by not having money to start with, and the ultra-rich are sheltered by having the resources to hide their money better (or purchase some handy tax exclusions for a few targeted campaign donations), but we middle class would be royally (censored). GRAs are projected to have a 3 percent rate of return (before inflation) and only half of the balance would be available for your heirs.
I’m not quite to the point of digging a hole in the back yard to bury some money, but I am visiting Costco a bit more.
It's going to hit the fan, and the One's policies and cut of COLA for SS is going to hurt him even further with the elder vote. Any person who cannot see where this flavor of change has left many truly hopeless that he's got a working plan. I predict the GOP runs spoofs on HopeChange in the next cycle.
Take my cash, I might just have to go make it back the old fashioned way. Jack up taxes, see how many go Galt.
We will clearly not be 'better off then we were before this clown'.
Congress is like a teenager suddenly left home alone by permissive parents who then consumes ALL the booze and throws a huge party because...well...the parents will only get SO angry regardless of what they do.
We'll be home when the polls open in a little over a year.
I certainly hope that, by then, there is something left to save.
Megan wrote, "At best, when we do start cutting back, we will make various people who planned their lives around current government policy substantially worse off. That's something that we should be thinking carefully about, not blithely endorsing."
To which I agree. Our government has proven that it is sometimes spectacularly incapable of making hard decisions that would help us. Something needed to be done about illegal immigration 40 years ago, and the problem was patched up and ignored. Likewise Tort Reform, Environmental Impact costs, Regulation costs and a tax code that leads to 47% who pay no taxes. For that matter, we have a tax code so complicated that the IRS has proven that it cannot get consistent results when it's own people check tax forms.
84 mph is unsustainable, so President Obama and the Democrats are putting the pedal to the metal and trying t get to the crash faster.
But that idea presumes that someone somewhere is benefiting from all aspects of each spending program, a premise I cannot believe.
I have absolutely no idea what the Education Department actually does, but I'd bet you we can spend 90% less on whatever that is. Same for much of the Commerce, Energy and Labor departments.
Each of these patronage holes have their own congressional sponsors and employ tens of thousands of people, and probably do some good things (at least the Energy Department might) and no one can point out what aspect of citizen's daily lives are improved by our national full monty of spending on the full panoply of their pet programs. Hence, I believe they continue to exist, really to thrive, because they employ sons and daughters, nieces, in-laws, uncles and aunts of congressmen past and present.
Happily, the demographics of federal workers are reputedly getting older and closer to the golden retirement with which the the nameless toilers have feathered their nests in negotiation after negotiation with their relatives in Congress these many years. The feds will need lots of new workers to staff these useless dependencies.
Let 'em atrophy! Shutter the vast majority if them. Move the workers who are displaced over to fill emptying jobs in other useless government dependencies. What's the difference where these people collect their stipends, anyway?
The days of plenty are over. We're poor, or at least on our way to poor. Let's be ruthless! My dream is to see a department or two go away!
Giving seniors a $250 bonus check should be an outrage. $17 billion is literally a drop in the bucket when we're running a $1.4 trillion deficit, but it's symbolic. Someone has to pay in the end, that's the way it works. It'll be some combination of the young, the Chinese, the thrifty, and the harder-working. Some of these folks "won't get fooled again", which will add to our predicament. "Checks for seniors" is another symbol of profligacy, to which "deciders" will react. Deciders include FX traders and anyone in business thinking about hiring or firing. It reinforces adverse trends in the dollar exchange rate -- which we see in higher gas prices -- and unemployment.
The closest historical analogy to Obamism is Peron and Argentina, as I've said here before. The rich get comparatively richer, is the irony. Ask a Goldman Sachs trader -- they love the volatility.
James Carville & Co have come out with a provocative study: The Very Separate World of Conservative Republicans -- Why Republican Leaders will have Trouble Speaking to the Rest of America. You can get it here: http://big.assets.huffingtonpost.com/TheVerySeparateWorld.pdf
Coming from Carville, to some extent this study has its own agenda. If Obama falters, expect Hillary to run against him in 2012 -- "the Lady doth protest too much" when she says she won't ever run again.
I agree with a lot of what's in the Carville study. Our body politic is divided in three parts, roughly: Republican, Independent and Democratic. Carville says that the Republicans are painted in a corner. I don't believe they have to be. Winning back independents is key to this. There is a consensus that can be built. Republicans have figured Obama out. Independents haven't ... but will at some point. If the Republicans want to win back Independents, they need to bury Bush-Cheney: No stupid wars, no profligate spending, look out for the little guy ... it's not that hard a program.
Although they're the early favorites to get the Republican nomination, Palin, Romney and Huckabee are problematic in the 2012 general election ... unless Obama has already burned down the Plantation. Carville would agree with this -- and he's pretty smart at this. If you're not from old money, an HBS grad, or a Mormon -- it's too easy for a Democrat to make you hate Romney -- unfair but true. Palin has high negatives with Independents -- unfair but true. Ironically, she could be a great candidate with Independents if she got a fresh start ... but she can't do this if she's seen as just Rush's darling. MSM won't ever let her.
Sidebar to CC: Carville & Co looked for racism in their focus groups of right wingers, but couldn't find it.
Check out the video of this guy trying to talk sense to Chris Matthews. He's great (I particularly like the part where he says "that's crazy talk!" to the douchebag Matthews), and, IMO, he typifies the sort of American the next great politician needs to speak for and to.