Tuesday, March 3, 2015

Hard to Believe

Michael, in the comments to my previous post had this to say: "I find it hard to believe that we could not find cuts in other places and save Social Security and Medicare..."

Total foreign aid for 2012, the most recent year I could find data for, was $37 billion. That's about 3 days of federal spending. We could shut down the military, eliminate NASA, turn off all foreign aid, shut down all of the federal bureaucracy, cut absolutely everything but entitlements, and we are still headed for the cliff.

Start looking and the information is right out there in plain sight. The politicians know it, the economists know it, and while we should know it, we get weeks of "How much air was in the footballs?" instead.

There's only two mathematically significant spending items left. Interest payments on the debt and the major entitlements. Add the Affordable Care Act to this and it just speeds up the date where this happens.

More taxes are no fix to this. You could take 100% of the income of the Fortune 500 companies, every dime from every citizen that makes $250,000 or more, and you don't even pay for a year of this spending, and what do you do the next year? Taxes at any sustainable rate, whatever sort of "Tax the Rich Until They Squeal!" program you envision, do not touch this curve.

We will cut these programs. Sooner or later, we will have no choice. The only question is do we do it in some controlled fashion that moderates the impact or do we continue on the current spending path and wait to see what the collapse looks like?


burt said...

It won't be a collapse. And there won't be a "controlled" impact.

It will be a catastrophic ending, like hitting a rock wall at 200mph, an instant devaluation of the dollar by 90%, a zero-based reset of the market. It will make the Great Depression's "run on the banks" look like a pleasant stroll on a summer day.

Anyone who thinks that the US has friends in China, Russia, India, anywhere in Europe, or anywhere else in the world is dreaming. They need to take off their 3D glasses, put down the kool-aid, and stop singing songs of praise to *either* the Democrats *or* the Republicans.

This nation is about to find out that, where feeding one's family is concerned, nobody GIVES A DAMN about the US or its dollar.

No, the solution isn't gold or silver, or any precious metals, precious or semiprecious stones, although having something *other* than the US Dollar is highly advisable.

It won't be war, or invading barbarian hordes, or even a non-nuclear terrorist attack that will bring down this country.

It will be the greed of post-WWII generations who "had it easy" and never learned the meaning of "sacrifice".

May those who invented credit cards and pushed "buy now - pay later" be forever damned.

Have a nice day!

Daddy Hawk said...

There are none so blind as those who will not see.

Old NFO said...

I have to agree with Burt... They will never scale back anything!!! Sigh

Divemedic said...

Michael is actually the proof that this will never get fixed. See, he is convinced, as are so many others, that this problem can be fixed by cutting the money that the other guy gets.
Touch SS as a politician and see the AARP vote you out of office within a week. They are the 800 pound gorilla in the room, and make the NRA or any other lobbying group you can think of look like lightweights.

Michael said...

Actually Divemedic, I am fortunately gainfully employed, and not really counting on any SS money for my retirement. I'd I don't have any skin in the game when it comes to Medi-care and Social Security but I do worry about the health care coverage once I retire. One serious medical issue without good coverage and my life savings could get wiped out. I do find it a bit sad that the programs so many of our seniors rely on are the ones that ultimately we will have to defund to maintain solvency. I was just really hoping there was some other way to avoid national bankruptcy than to put seniors out in the streets.