T Nation

The Liberal Welfare State


#1

Are we taking notice, yet?

Yeah, I know, "Sloth there's nothing about homosexuals or religion here. Why drag down PWI with politics?" Too bad!

[i]The American people understand that these welfare programs are unaffordable. According to Gallup, two out of three Americans believe Social Security and Medicare costs are either already creating a crisis for the federal government (34 percent) or will do so within 10 years (33 percent). This reality, however, is just now beginning to sink in for perceptive liberals here and there. Mother Jones' Kevin Drum wrote Monday:

"The public is mostly in favor of raising taxes on the rich -- though I suspect its support is pretty soft -- but on the bigger issues they mostly aren't on our side. They think deficits are bad, they don't trust Keynesian economics, they don't want a higher IRS bill (who does, after all?), and they believe the federal government is spending too much on stuff they don't really understand."

Conservatives have indeed dominated the debate over the liberal welfare state in recent years because the facts are on their side. According to the program's 2011 annual report, Social Security added $46 billion to this year's deficit and will add $9.1 trillion to the national debt over the long term. Medicare was also in the red by $66 billion this year and will add $24.6 trillion to the debt over the same period. Income tax rates for all Americans would have to double to cover this level of spending. No wonder Americans are turning against the welfare state.[/i]

Read more at the Washington Examiner: http://washingtonexaminer.com/opinion/2011/08/america-comes-grips-liberal-welfare-state#ixzz1TzgG4LZj


#2

How'd my title get changed? I want answers!


#3

Now if we could just get the definition of welfare to include financial bailouts and militarism (welfare for bomb-builders and despots).


#4

Everybody realizes cuts need to be made, no one wants to face those cuts though so we'll go on the same until the whole thing comes crashing down.


#5

We are closing in on becoming a Finland or Sweden. Where the tax rates are so enormous that anybody with wealth flees the country like rats off the sinking ship.

Can't wait till that happens.


#6

It is funny , I was having a conversation with a coworker in their 50's who grew up in Germany and the netherlands. They were saying the when everything is factored in the tax rate is higher here. That after you take into account Federal, state and local income tax, state sales tax, property tax, school tax, capital gains tax. It is higher here, it is just not one blunt large tax.

I calculated the year before my son was born when my wife was working, our total tax rate was just over 59%.

And for what, it provides me nothing more than someone who pays a total of 10% total taxes for the year,

sorry for the rant. not sure it is totally in line with the thread.

But since my wife stopped working, we sold the other nice fancy expensive house, for a descent old farmhouse with some land and started running it as a farm, I bring in 40% less income overall, but have more actual money that can be used.


#7

Walter Russell Mead has written a number of insightful articles about the problems with the blue social model. Thought to share the latest that he wrote.

"The Progressive Crisis"

"...Greenberg is right to call this a crisis of legitimacy for liberal and progressive thought. A strong and active federal government is the cornerstone of progressive politics. If voters lose faith in the power of more government to better their lives, the progressive era has come to an end.
Attentive readers of these essays will recognize Greenberg?s legitimacy crisis as part of the larger plight of the blue social model Via Meadia and its readers have been analyzing in so many posts. The progressive, administrative regulatory state and more broadly the technocratic and professional intelligentsia who operate it sold themselves to the public as an honest umpire in charge of American life. No more corrupt urban bosses robbing city hall to feather their nests, they said. No more robber barons of the Gilded Age buying and selling legislatures and congresses.
Instead, we would have government by philosopher kings, or at least by incorruptible credentialed bureaucrats. Alabaster towers of objectivity such as the FCC, the FDA, the EPA, the FEC and so many more would take politics out of government and replace it with disinterested administration. Honest professionals would administer fair laws without fear or favor, putting the general interest first, and keeping the special interests at arm?s length. The government would serve the middle class, and the middle class would thrive.

That was the theory; as Greenberg eloquently tells us, fewer and fewer voters believe it describes the actual government in our actual world. The next questions for Democrats are obvious: what is the cause of this problem and how can it be treated?
Greenberg?s answer is a more sophisticated and comprehensive version of a classic progressive idea. It is not simply, Greenberg points out, that special interests fight progressive initiatives; special interests have actually managed to subvert the institutions of the government itself. The progressive state has been taken captive by those it was supposed to keep in check.
The weak point is the electoral process. The administrative state and its professional managers don?t sit in a vacuum. Elected politicians write the laws that the regulatory agencies enforce. Those politicians like to get re-elected. They depend on the campaign contributions the fat cats can give; that money power means that the state becomes the catspaw of the greedy few rather than the honest guardian of the toiling millions. The bulwark of justice has become the arsenal of plutocracy; the public is skeptical of government because a cash hungry political class has turned the state over to the rich.
This is not, I fear, a complete account of the problem, but it is not without merit....'

The rest can be read at:


#8

What happens when all the rich folk leave Utahlama and I agree with you it's a disgrace but what happens to America. And Apbt55 your right Ive been paying taxes since I was 17 years old I am now 29. As a teenage punk sacking groceries I owed the Feds 348.00 in US Dollars and during half that time I was 16.
Like they say work harder because people on welfare depend on you.


#9


The pie chart above is based on the published $782 billion Pentagon budget for 2009, but based on an analysis of actual military spending, the US spent 1.5 trillion in 2009. This puts actual military expenditures at close to 40% of total federal spending.

Personally, I think we need to see a concrete deficit reduction plan put in place for the medium term. I think this should include cuts across the board. This should include entitlements AND military spending.


#10

In a historical context, I also think we need to look at where we are and where we want to go. When the country was in two/three wars and facing the largest economic downturn since the great depression, I think many would expect spending and borrowing to have increased.

Now we are in the midst of a very sluggish recovery. We have huge numbers of people getting assistance for unemployment and even food. http://www.economist.com/node/18958475 We are also facing a continued terrorist threat worldwide (not just in Afghanistan and Iraq). China is increasing its power, Pakistan is looking worse with every new report. The middle east and north Africa have continued unrest.

We are in serious times and need to seriously look at our priorities. As I said above, I think entitlements and military spending need to be cut. However, we are facing serious challenges and cannot ignore (for example) Yemen only in order to save a buck.


#11

The problem today is that it's probably impossible to spend short term, cut medium term. As the population ages Medi/SS is going to become even more insatiable. You have a growing voter bloc invested in obstructing meaningful cuts and reform. Because of social changes, these older folks don't have the family ties of the past to rely on, when compared with not so distant history. They want, perhaps need, every single dollar they can squeeze out of Washington. And of course, the diminished voice of the voting public made up of the active, young, taxed, worker becomes a whisper amongst the demands of the aged and sick.

Politically, today, messing with these programs seems like the last thing any politician wants to day. Imagine in another decade or two, when the reliant are have captured more voting power. So with keeping the other 'D' word in mind, Downgrade, I'm thinking whatever reform and cuts had better start coming soon. And the GoP needs to be ready to give up to make lasting, sustaining, reforms a reality. Taxes can always be reviewed later. At the same time, let's be honest about taxes. We aren't going to gut SS and Medicare so quickly in the near future, all at once, that merely taxing the rich more (even a lot more) will do. No, the tax base will have to be a bit wider than that narrow slice of the population.

We've a demographic problem that makes this very, very difficult.


#12

US debt shot up $238 billion to reach 100 percent of gross domestic project after the government's debt ceiling was lifted, Treasury figures showed Wednesday.

Treasury borrowing jumped Tuesday, the data showed, immediately after President Barack Obama signed into law an increase in the debt ceiling as the country's spending commitments reached a breaking point and it threatened to default on its debt.

The new borrowing took total public debt to $14.58 trillion, over end-2010 GDP of $14.53 trillion, and putting it in a league with highly indebted countries like Italy and Belgium.

http://news.yahoo.com/us-aaa-rating-still-under-threat-204040123.html


#13

"Why are we in this debt fix? It?s the elderly, stupid."

"These transfers have become so huge that, unless checked, they will sabotage America?s future. The facts are known: By 2035, the 65-and-over population will nearly double....

...But facts are no match for the self-interest of about 50 million Social Security and Medicare recipients and a natural sympathy for older people and for people who eagerly look forward to retirement. Public opinion becomes contradictory. While 70 percent of respondents in a Pew Research Center poll judged budget deficits a ?major problem,? 64 percent rejected higher Medicare premiums and 58 percent opposed gradual increases in Social Security?s retirement age."


#14

Let's face it, producing below 2.0 children/mother, putting down around a million children a year, and increasing the life of the elderly has skewed things to the point where the base of structure is smaller than the top.

Demographic suicide, this also causes economic suicide.


#15

Relevant to your point.

More Women Than Ever Are Childless, Census Finds

"Twenty percent of women ages 40 to 44 have no children, double the level of 30 years ago, the report said; and women in that age bracket who do have children have fewer than ever �¢?? an average of 1.9 children, compared with the mean average of 3.1 children in 1976."

Who, exactly, will be the revenue base for all those dependent elderly? Who will be the doctors, nurses, and caretakers for an increasingly childless elderly?

I'll stop there and refrain from anymore finger-wagging about culture and tradition.


#16

Good question. I think the obvious answer is immigration. I hear the Japanese are even considering opening their boarders. Is the population of the US increasing or decreasing?