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Title: Fiscal Shock
Source:
NY Times
URL Source: http://krugman.blogs.nytimes.com/20 ... -2/?src=twt&twt=NytimesKrugman
Published: Jan 6, 2011
Author: Paul Krugman
Post Date: 2011-01-06 15:07:10 by go65
Keywords: None
Views: 3704
Comments: 10
I see that the Washington Post editorial board is shocked, shocked to discover that the incoming Republicans aren’t serious about deficit reduction. Who could have suspected?
I was going to be snarky all the way here, but actually let’s be serious: the gullibility of much of the media establishment on all this amounts to journalistic malpractice..
Republicans have, after all, been the party of fiscal irresponsibility since 1980; the GW Bush administration confirmed, if anyone was in doubt, that unfunded tax cuts are now in the party’s DNA.
Then along comes a Democratic president who presides over all of two years of deficits in the immediate aftermath of a severe financial crisis – which is a time when you’re actually supposed to run deficits. Republicans begin inveighing against the evils of red ink – and, incredibly, get taken at face value.
And even if you didn’t know the history, if you actually paid attention to what leading Republicans were saying, their lack of seriousness was totally obvious. You had the Ryan plan, which claimed to reduce the deficit but, if you actually looked into it at all, relied completely on magic asterisks; you had the declarations by top Republicans that deficits are terrible but there’s no need to offset the cost of tax cuts.
The idea that these people were allowed to pose as deficit hawks is stunning.
Oh, and for those claiming that Republicans have always said that spending, not deficits is what matters: first of all, this is very much revisionist history; you can’t denounce the federal debt, then claim that you never cared about the revenue side of things. Beyond that, the deficit scare tactics lately have been all about solvency, not mere crowding out; repent, they said, or you’ll turn into Greeeeeece. That’s a scare story about solvency, for which the deficit, not spending, is what matters.
Why the blindness? I suspect a lot of it had to do with the desire to seem balanced. Journalists felt that they had to find Republican fiscal heroes, just to show how even-handed and open-minded they were. To say that the whole deficit thing was a political ploy, with no substance behind it, sounded shrill.
The truth often does.
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Begin Trace Mode for Comment # 5.
fyi - if the GOP was serious about fiscal policy they wouldn't write off tax hikes or cutting 2/3rds of the budget. They aren't interested in cutting the deficit, only in dismantling social programs.
#2. To: go65 (#1) (Edited)
They aren't interested in cutting the deficit, only in dismantling social programs.
LOL.
The social programs are the VAST share of the national debt. The REAL total debt of the USA is $200 TRILLION.
This includes (as detailed at http://www.kitco.com/ind/Dougherty/jan222010.html):
Medicare Part A ($36,700,000,000,000.00 underfunded; $36.7 trillion); Medicare Part B ($37,000,000,000,000.00 underfunded; $37 trillion); Medicare Part D ($15,600,000,000,000 underfunded; $15.6 trillion), Government and military pensions ($2,000,000,000,000 underfunded; $2 trillion), Food Stamps (current underfunding difficult to measure because the number of recipients is exploding; hundreds of billions underfunded versus original projections, minimum); and the list goes on. The above underfunding amounts are NET of projected tax receipts over the next 50 years. But the current recession has invalidated virtually all long-term budget and tax receipt assumptions, meaning that the true underfunded amounts are now greater than current, already mind-boggling estimates.
Get a clue, asshole.
#3. To: Capitalist Eric (#2)
The social programs are the VAST share of the national debt.
they haven't doubled in 8 years like defense spending.
But hey, if we get rid of medicare we can cut taxes for Bill Gates. Who cares if old folks die. Right?
#4. To: go65 (#3)
But hey, if we get rid of medicare we can cut taxes for Bill Gates. Who cares if old folks die. Right?
How much money REALLY exists in the so-called Social Security "lock-box?"
Answer: NONE.
As to cutting medicare, which one? A or B? Since A is $36 Trillion in the hole, it will be cut, no matter what. This is unavoidable. B is $37 TRILLION underfunded. It, too, will collapse.
Old people will die, because political whores of BOTH sides have utterly wasted every dollar available, and gutted the entitlement programs.
You can wish all you want, demand payment all you want...
But the money is GONE. THERE IS NO MORE.
GET IT????
#5. To: Capitalist Eric (#4) (Edited)
How much money REALLY exists in the so-called Social Security "lock-box?"
none, but we can fund social security relatively easily, and it won't break the bank like increasing defense spending since social security actually creates economic activity.
As to cutting medicare, which one? A or B? Since A is $36 Trillion in the hole, it will be cut, no matter what. This is unavoidable. B is $37 TRILLION underfunded. It, too, will collapse.
I've long favored turning it back into a catastrophic coverage plan and means testing it. Again, as with social security, it's possible to preserve the benefit without breaking the bank. But if your starting position is "we must get rid of social security & medicare so we can cut taxes on the wealthy and increase defense spending" then you will pretend that no fixes are possible.
Replies to Comment # 5.
I don't know how you hope to convince anyone without using large fonts and underlining.
#8. To: go65 (#5)
we can fund social security relatively easily
HOW, exactly. Please be specific. Where does the money come from? Please remember that the government takes in ~$2T/year in tax revenues.
it won't break the bank like increasing defense spending since social security actually creates economic activity.
The information displayed below, would contradict your wild (and completely unsupported) statements.
I've long favored turning it back into a catastrophic coverage plan and means testing it. Again, as with social security, it's possible to preserve the benefit without breaking the bank.
Have you ever balanced a checkbook? The "benefit" is actually a ponzi scheme, and the party's over. That IS reality.
But if your starting position is "we must get rid of social security & medicare so we can cut taxes on the wealthy and increase defense spending" then you will pretend that no fixes are possible.
Typical misrepresentation. I never said we "must get rid of social security... blah blah blah..." My point is that we are UTTERLY BANKRUPT. There is no way to "fund" such "benefits," because the treasure is not only empty, it's full of IOUs.
Defense spending, "entitlement" spending, government spending, ALL will come to an end, because THERE IS NO MORE MONEY.
What part of this, do you NOT understand???
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