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Why We Have The Entitlement Programs We Have

By: Repair_Man_Jack (Diary)  |  July 12th, 2011 at 11:00 AM  | 

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Henry Blodgett, Business Insider

“There are solvency problems with both programs (Medicare and Social Security),” Sen. Olympia Snowe said in an interview on Friday, “They have to be addressed but not as part of the debt reduction talks.”

(Bangor Daily News)

This cowardice displayed by Senator Snowe in the face of reality, is the key assumption in the Democratic Party’s strategy to win the debt ceiling showdown and make The United States a nation that is more equalitarian and hostile to individual freedom, innovation and initiative. Democratic Senators, leaned hard to get to Olympia Snowe’s left-hand flank. They reacted with hostility to any suggestion that President Barack Obama offer to reduce entitlement spending as a part of any debt-ceiling agreement.

“We shouldn’t be giving away our advantage on Medicare,” said a source familiar with Murray’s thinking, in characterizing her objections in private meetings. “We should be very careful about giving away the biggest advantage we’ve had as Democrats in some time.”

(Greg Sargent, Washington Post)

So that is what may well prevent the US from ever amounting to anything in the future other than a failed socialist looter state. We currently make 60% of our Federal expenditures towards wealth-spreading government programs; Medicare, Medicaid, Social Security and other entitlements. In FY10, we spent $2Tr on those programs alone. We spent $1.5Tr on every other activity the Federal Government engages in.

The government specifically taxes for entitlement program support with the Social Insurance Taxes on payrolls. This brought in $865Bil or maybe 40% of the necessary revenue to fund current US entitlement expenditures.

This means that Democratic leaders of the US Senate are perfectly content with unquestioning support for a series of programs that accomplish nothing other than transfer of wealth and are only 40% paid for in the current tax codes. This explains why President Obama’s new budget proposal requires $1Tr in tax increases over the out years and backs away from previous promises to reform and reduce Medicaid and Medicare.

Without the Free-Stuff Army to intimidate weaker opponents of the full-blown Eurosoc welfare state, the Democrats lose the current argument going away. Without what Cloward and Piven once termed “The Weight of The Poor,” Democrats lose the leverage they require to defend their fiefdom of subinfeudated welfare recipients.

The Party of Government requires a host of retainers who live dependent upon government. This is what Senator Patty Murray means when she speaks of the Democrat Medicare Advantage.™ Take this weapon out of the Democrat arsenal, and these people would become about as frightening as a George Romero movie without the brain-munching zombies.

Stand the Democrats down on entitlements just once, and they are a bunch of busted criminals in search of a new raison d’être. The entitlement programs exist in their current form as a source of continued oxygen to the dying Blue Social Model. Bring them under control, and the Modern American Progressive Movement is left naked in a blizzard of its own unintended consequences.

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COMMENTS

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  • warrior06

    Well written sir. Brevity is the soul of wit, and repair man jack has condensed into one brief paragraph the dilemma of both the GOP,and the modern Democratic (socialist) party. Will we see the GOP finally face this boogieman of the Dems? We are fast running out of time.

  • http://charlemagne-the-hammer.blogspot.com/ DerKrieger

    …the Left insists on coercing the unwilling into participating in these programs. How many of us would opt out if we could? I’ve long maintained that Social Security is NOT loved by seniors but that they support it as the only way of getting their money back. Those of us with no or less investment in it aren’t supportive of it.

    • http://theminorityreportblog.com Repair_Man_Jack

      Nobody Younger than age 35 would stay in an optional SS program.

      • YnotNOW

        Social Security – and even more so Medicare – gives a poorer and poorer return on your investment as your income, and therefore your “contributions” increase. Those who pay very little into the system get a much better return on their “investment” – especially in Medicare where the poor pay a low percentage on a low income, but Medicare covers exactly the same benefits for all seniors.

        Therefore, those poor who are envious of the rich and greedily want to take from those who earned it, will continue to be supportive of income transfer systems. Not all, but way too many.

        (a sad but true statement on human nature)

      • YnotNOW

        Social Security – and even more so Medicare – gives a poorer and poorer return on your investment as your income, and therefore your “contributions” increase. Those who pay very little into the system get a much better return on their “investment” – especially in Medicare where the poor pay a low percentage on a low income, but Medicare covers exactly the same benefits for all seniors.

        Therefore, those poor who are envious of the rich and greedily want to take from those who earned it, will continue to be supportive of income transfer systems. Not all, but way too many.

        (a sad but true statement on human nature)

    • fmaidment

      …I want the option to exit Social Security. There’s no reason for me to keep paying in except to pay for the stupidity of people who didn’t plan for their own retirement.

      Disability? That’s such a small portion of it and for such specific cases that I can live with it, even if I bristle paying it. But retirement? That should be your problem, not mine. Welcome to the world of the Wal-Mart Greeter.

      If you eliminated the Social Insurance Taxes and their related expenses, our budget deficit in 2010 would have been about $175 billion. Instead, it was $1.3 trillion. That tells me all I need to know to tell me down which rat hole my money is really going.

      I don’t know what the traditional 26 week unemployment payments were, but I’d wager they’re under $300 billion. Without Social Insurance other than traditional unemployment, we’d have an $865 billion private sector stimulus and a $475 billion deficit. Even paying Obama’s $287k per job, that’s over three million jobs. At a more realistic $40k per job, that’s almost twenty two million jobs.

      Woah.

      Who said social insurance is stimulus?

  • chrysostom15

    The last series of cuts removed a good portion of the pork from the non-defense discretionary budget. That part of the budget is 12% of the budget, and is the part cut every time we realize that the 88% of the budget that is everything else continues to grow.

    We need to realize that if we fired every federal worker, closed down this entire 12% of the budget, and eliminated the EPA, Department of Defense, the Department of Commerce, the FCC, etc. If we closed it all down, we’d still have a huge and growing debt.

    The only way to balance the budget is to tackle the untouchable areas of spending growth: Entitlements and Defense.

    • fmaidment

      …with a greater focus on entitlements than defense. 3:1 ratio and all that.

      There are areas we can cut the DoD. In particular, some of the bases in areas that are no longer strategically important, or where we have multiple bases fulfilling the same role in near proximity. Cut programs the military doesn’t want. Cut waste where we can.

      But the real 800 pound deficit gorilla is entitlements. People need to stop looking at them as entitlements and start looking at them as what they are: The communal future spent to pay for the individual stupidity of the past.

  • chipbennett

    So, allowing for some rounding errors:

    Current Revenues: $2.2T
    Current Expenditures: $3.5T

    Current Entitlement Revenues: $0.9T
    Current Entitlement Expenditures: $2T

    Current Discretionary Revenues: $2.2T – $0.9T = $1.3T
    Current Discretionary Expenditures: $3.5T – $2T = $1.5T

    So, basically: without entitlement programs, we’d have a nearly-balanced budget.

    Things that make you go hmmm…..

    • chipbennett

      I forgot to add that the $200B debt service accounts for the remaining $200B deficit.

      All of this points to one principle: STOP SPENDING!

      This situation absolutely cannot be resolved by raising taxes. There isn’t enough money in the entire accumulated wealth and production capacity of the United States to fund our current rate of expenditures.

  • Green_Lantern

    what this twit thinks. The House holds all the cards in this one. Republican Senators, with the exceptions of DeMint, Rubio, Johnson, Paul, and a couple of others, will all predictably fold like this. They hope to get pats on the head from the Times and the Post and others.

  • drfredc

    We have the entitlement programs we have, as well as many other moral woes imposed by the Federal Government because Federal Politicans and Judges have, as a group, decided to ignore the most basic guidelines for Constitutional rule as defined in the Preamble of the Constitution.

    Promote (not provide) the general welfare. Pandering to special interests, no matter powerful, is generally counter to the “GENERAL WELFARE” of everyone else — IGNORED…

    Yes, Congress has the power to provide the general welfare. However, just as a bulldozer has the power to level your home, except in the most extreme of situations, this would be an unproscribed use of the general welfare clause. — IGNORED

    Preserve liberty for ourselves AND OUR POSTERITY. AKA, generational wealth transfers to support seniors are not a proscribed use of the Federal Government. Nor is balancing today’s budget on the backs of future taxpayers a permitted activity. Nor is passing tax increases on future Congresses (taking away their liberty to deal with their problems) permitted. — ALL IGNORED.

    Then there’s the proposed Balance Budget Amendment. being floated around. Beware of unintended consequences. Something similar hasn’t worked so well in CA, with a 2/3rds requirement to pass unbalanced budgets. In CA, this sort of thing has led to Democrat led politics that has led to the fiscal and moral bankruptcy of that once great state. Fiscally irresponsible Dems can promise the world, and then blame fiscally pragmatic conservatives for not getting what they promised — it’s a prescription for more fiscally irresponsible political behavior, not less

    The Preamble proscribes not taking away future generation’s liberties — In other words, there is simple a balanced budget wording in the Constitution already — IGNORED.

    In order to protect the liberty of future generations, budgeting should be generationally neutral. In other words, each generation should pay it’s own way through the various social marketplaces it utilizes. This allows for deficit spending for any particular generation — however, that generation should be expected to generally pay those debts as it passes. — IGNORED

    In summary, the dead simple way to solve many of our federal government’s woes would be to simply pass a short law that says the Preamble is a fully functional part of the Constitution that provides guidance for how all of the rest of the Constitution is to be interpreted and utilized. Furthermore, these most basic of guiding principles for our government shall not be overlooked or overruled except as clearly defined in amendments to the Constitutions (aka, court rulings don’t overrule the Preamble)…

    Got that? Great, Now I’m going to crawl back under my rock…

  • steve010

    Barry said without a rise in the debt limit, he couldn’t guarantee that social security checks would go out.

    Excuse me. But I’ve been hearing for two months now that SS is not part of the deficit problem. That SS is solvent until 2036 and that nothing has to be done with SS to keep getting check out. When did Barry change his mind on that?

    • http://theminorityreportblog.com Repair_Man_Jack

      Weight of The Poor.

    • rightwingmom52

      why Boehner & all House Republican’s don’t call a press conference and ask Obama that very thing. That would let the elderly know we’re concerned, not going to forget about them, etc. and exposes Obama for what he is. Kills 2 birds so to speak. They really should have somebody reading redstate on a regular basis because we offer so many good ideas about how to frame the narrative. How hard is it to speak to the American people and say we’re going to pass a bill that encompasses cuts, cap and BBA with measures that make sure the debt gets paid, the military gets paid, SS checks go out and whatever else is essential?

      We lose way too many battles in the PR department.

      • Scope

        and actually get shellacked on. When the threat of a government shut-down loomed not long ago, Obama arbitrarily decided that he would not pay the military, knowing that the Republicans honor and respect the sacrifices of our military members, while the Liberals spit on them. The week after that fiasco, when Obama and Moochelle had all those festivities honoring our military members and their families, they made it appear that it was only because of them that their pay would continue. If the government shut-down occured, they would have been blaming the Republicans for not getting paid.

        We desperately need a GOP messaging committee, that can stay one step ahead of the Liberals stories and lies, rather than always playing catch up. Bush was bad to non-existent with his message.

  • dajeeps

    Aren’t they included among the ranks of Democrats who don’t know what the constitution says and think that welfare spending actually increases economic activity? Really the concept of converting otherwise productive capital into consumption and the effect of doing this isn’t that difficult to grasp. But they continue to spew that nonsense regardless of reality. Remeber what Pelosi said about how foodstamps contribute to the economy. It appears rather zombie-ish to me anyway. We are well on our way down the road to serfdom, with reality as a witness.

  • johnt

    & the savages don’t want to give up THEIR advantage. They don’t even rise to the level of barbarism.
    And just who and how does anyone know Patty Murray’s thinking??

  • Pupwood

    I am currently in year 4 of a full conversion from a fairly liberal thinking individual to eventually adopting a totally conservative worldview/mindset. Recent events in my life, this nation and the world are the reason for this conversion. I wished I had done it sooner,,,,much sooner! I still have a few issues to workout (resource conservation/Environment being the last holdout but im sure the truth will prevail once I learn what if really is) but anyway I digress…

    My question is: What is the conservative view of money that people have paid into SS their whole working lives. how is that to be recouped? I understand the program itself is fatally flawed and unsustainalbe but what about the older people already dependant or about to become depandant? I myself am 55 years old and would support the repeal of Social security but I wouldn’t mind getting back some of what I paid in. I could pay off my house and then use the motrgage amount to live on or invest as an example.

    Sorry for the naive question but I have to counter some arguments at work with some of my Lib co-workers at the ‘watercooler”

    Thank You

    • YnotNOW

      The Heritage Foundation has some excellent resources to understand these issues, which are much better than I could ever draft:

      http://www.heritage.org/BudgetChartBook/

      http://www.savingthedream.org/

    • YnotNOW

      The Heritage Foundation has some excellent resources to understand these issues, which are much better than I could ever draft:

      http://www.heritage.org/BudgetChartBook/

      http://www.savingthedream.org/

    • johnt

      gold, courtesy of FDR. Now they confiscate your health care and dollar value thru inflation and deficits. You will probably sneak in under the wire, extended eligibility but available at a discount at earlier age. Save like a squirrel preparing for the Winter otherwise.

    • rightwingmom52

      we are in the same boat, so I understand where you’re coming from having paid into SS for 30+ years myself. My husband and I have prepared for retirement without counting on SS, but not everybody has. Plus we’re very concerned about what might happen to our savings if the country continues down the same path. In any event, speaking only for myself, I’m more than willing to live with a means test and raising the retirement age for the sake of my son’s future and that of our country. We are all going to have to share the pain and make sacrifices in order to eliminate the bulk of entitlements and unsustainable programs like SS. We can’t keep yelling for cuts and then refuse to accept them when they may affect us directly.

      There are some good articles here at redstate as well if you just search “Social Security” in the custom search button on the top right of the page, but here’s a link to a really good one.

      http://www.redstate.com/dhorowitz3/2011/06/16/time-to-opt-out-of-the-social-security-ponzi-scheme/

    • fmaidment

      …that retirement is an individual responsiblity, not a communal one. If you are capable of working now, you’re capable of sacrificing that neat cell phone or that shiny new car or that bigger-than-you-need house in favor of planning for your own retirement.

      That being said, for those people who have paid into social security, they’re going to have to accept the fact that they’re not going to get everything they were promised. Those promises were lies. They believed those lies and, well, caviat emptor.

      That doesn’t mean we leave people to twist. Honestly, my personal preference would be to let them suffer for trusting politicians to tell the truth, but I know that’s politically not feasible. But we have to cut back on unsustainable promises. Social Security was never intended as anything more than a supplement, not your full retirement. If your plan is to retire solely on Social Security, plan on living in a tent. Or with your kids.

      The good news is, if you’re 55, you still have some time. You can start paying off your debts, you can put money into 401(k)s and IRAs, and no one says you have to retire at 62/65/67/whever your Social Security retirement age is. Sure, it won’t be the most comfortable retirement if you’re not already invested, but it’s better than doing without.

      But what to do about what you’ve already paid in? Well, some of it you can kiss goodbye. Heck, you’ve already sacrificed the future value of the payments you made back-when, so you’ve already taken one on the chin. The financial rate of return on Social Security retirement insurance sucks compared to, say, the S&P500 rate of return.

      So let’s guarantee some portion of what you’ve paid in. Let’s say that your employer contribution still gets paid into the system, no matter what. Now, say you’re over 40 and have been paying in for at least 15 years. Maybe 50% of your payments can be guaranteed? We’d have to do a lot more math than I want to bother with right now. We then take that money and let you invest it as you wish, whether that’s keeping it in Social Security, putting into the Stock Market, municipal bonds or plain-old savings, but it has to go into retirement, not your pocket. If you’re over, I don’t know, 60? You can stay in social security as is, but you’ll have to take a sizable cut in promised benefits. And if you’re under 40, we don’t guarantee much of anything, but you’ve got about 25 years to plan for your own retirement using your individual contribution, plus anything else you want to throw at it.

      That’s an idea I’ve been running through my head for quite awhile. We have to step back from Social Security as it exists today. We have to force people to take responsibility for themselves and stop being dependent upon government. We have to remind people that “non-discretionary” refers to the idea that Congress doesn’t have to approve it every year and does not indicate that it’s “mandatory” spending.

  • http://theminorityreportblog.com Repair_Man_Jack

    My question is: What is the conservative view of money that people have paid into SS their whole working lives. how is that to be recouped?

    The painful answer is that it may very well not be. The SS program can be partially (I think about 80%) salvaged if we put a means test on it and raised the mandatory retirement age. Rich people and HENRYs would be stuck with a bum deal. More people would die prior to pay-off date under the proposed age adjustment. I can’t think of any nice way to fix this problem, but this at least distributes pain to those who can actually withstand it.

    I understand the program itself is fatally flawed and unsustainalbe but what about the older people already dependant or about to become depandant?

    As a society, we will simply have to get back tot he traditional view where children give back the gift in a sense by looking after or at least financially providing for aging parents. Our current system will financially collapse if we attempt to honor everything that was mistakenly promised.

    • lineholder

      from the moment the words came out of Obama’s mouth, my brothers and I have already put our heads together and come up with a plan that will make sure my aging father has the things he needs. We had to be “persuasive”, meaning that we had to tell him not to act like stubborn mule about this one. But after all he’s done for us over the years, it is honor and privilege to have this opportunity. It truly is! Usually he’s far too independent to even consider our helping him with anything.

      But another event has happened today as well. The church that my father attends has already been on the phone, contacting their senior citizens, finding out who might be totally dependent on SS and who isn’t, who has other options and who doesn’t, etc. And the church is coming up with some plans of their own to step into the gap in what ways they can, if it comes right down to. Talk about efficient, RMJ!

      I was wondering if any other churches are making plans on this point. It won’t help everyone, but it definitely will make a difference.

    • Pupwood

      Great answers from all!..my take away on this issue from the answers given is that retirement income is a personal/family responsibilty and NOT a governmental one. Once again, the consevative view “Personal Responsibility” takes center stage and one of the main reasons for my conversion.

      I personally have some diversification in my retirement plans as others seem to have also and I certainly do not count SS in any large measure. I am willing to make sacrifices in order to preserve a future for my kids. But I can see for society as a whole, once a person starts to suckle the government teat it is going to be hard to get them off it.

  • rockymtn1776

    Our elected officials discovered long ago that entitlemt programs buy votes. There are even willing to pass an amnesty bill, let illegals and dead prople vote, rampant voters fraud (Harry Reid) and this is just the tip of the corrupt iceberg ! Many of our politicians have sold their soul and their country for money, power and votes.

    Those who are wards of the state deserve no voice in affairs of the state !

  • Old_Crow

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