It’s a tragedy that President Trump didn’t use this moment to try to cut more, and to cut the biggest unsustainable spending: Medicare and Social Security.
Source: Hacking Away at the Budget Is the Humane Thing To Do – Reason.com
Hear, hear! When you’re deep in debt, the thing to do is decrease your spending, not double down. Works for governments the same as the rest of us.
You emphasize the last comment made by the author, and although I agree that our government has made poor decisions regarding managing money, and that reducing waste and unnecessary spending are enormously important, I disagree with “cutting” Social Security and Medicare, if those cuts would take away from the retired, the poor, and the needy.
I paid a tax on my wages, all my working life, so that those who were then receiving Social Security (my parents and grandparents) would have some reliable income in their retirement years. My employers also paid taxes, based on what they paid their employees, for the same purpose. In fact, since I do a small amount of work now, I still pay taxes for that purpose. It is called “Self-employment Tax.”
The money is supposed to be kept in a trust fund until it is needed. But history shows that the Social Security trust fund was “borrowed” from to fund other programs, such as space exploration, and that what was “borrowed” has never been repaid.
Social Security and Medicare are not “entitlements.” They don’t fall into the same category as welfare. They were set up so that workers would help support those who have been workers. The way it was set up, it was self-sustaining. The way to handle it is to leave the income from the Social Security & Medicare taxes to do the work for which they were imposed and to count the amount borrowed from the fund as a debt to be repaid. And to take seriously the need to repay the debt.
Of course, this is the real world, and I don’t expect any politician to behave the way I would like. I also don’t expect everyone to see things the way I do. But I couldn’t let this post go by without comment!
If the government had been trustworthy enough to maintain the trust fund, I would absolutely agree, and even now I think those above a certain age (40? 50? I don’t know, except “too close to retirement to make other plans.”) should have the obligations the Feds committed to honored. But the way they ran the program turned it into a Ponzi scheme, and I seriously think it needs to be phased out somehow. What would make sense to me is turning it into interest-bearing individual savings accounts and perhaps something like an HSA for medicare, but that’s another idea that no politician will ever endorse.
Well, I think if it is changed, it will be made worse. (I am being optimistic, here 🙂 )
No matter what, if money and power are involved, people will behave corruptly. It is our nature.
Possibly, although if it isn’t changed somehow I expect it will drive us bankrupt in my lifetime.