Is there anybody left that doesn't see what a hack this guy is? More info on Krugman's hypocrisy at ZeroHedge.
So, now that you see Krugman talking about the massive future problems of Social Security way back when; and, now that we have experienced the Great Recession which has completely derailed the US GDP and tax collections for years already, and most likely for many more years to come, and; now that many economists are in agreement that the old GDP (and thus tax collection) estimates were wildly over optimistic and have recently been adjusted for the new projections, and; now that the Great Recession has caused millions to apply for Social Security early instead of waiting for full retirement age, thus swelling the rolls years before prior projections, and; now that the very latest projections from the govt economists that take into account the huge changes in tax collections, GDP projections, swelling rolls, the inability of the current government to raise payroll taxes for fear of precipitating a Great Depression, etc.; do you now take back your snide bs in the other thread about me being an expert? Keep in mind - government economists project that Medicare/Medicaid are fiscal train wrecks signifcantly more expensive than Social Security.
Wasn't meant to sound snide. Was trying to be funny. And no, I still don't recognize you as an expert, sorry. Sure, social security has future funding problems, but they aren't insolvable, nor is it an immediate crisis. The sky is not falling. We can either raise taxes (or increase the percentage of current taxes we spend on SS) to pay for it, or we can cut benefits. It might be painful, but it is not a complex problem. The solutions are completely obvious. That is certainly true. Medicare is a much bigger issue than SS. barfo
Krugman is an expert. Dozens of government economists are the experts. Duh. See, that is what prompted my over-the-top rant about AARP. This SS problem was a moderately easy fix. In the 1990's. Economy was booming. That is the time to raise taxes. Baby Boomers were years away from retirement. That is the time to adjust the COLA computation formulas so the SS checks of the future rise at smaller rates each year. That is the time to bump up the retirement age - when the pig in the python has extra years to save to make up the difference of smaller benefit checks. But no. AARP led the charge to demonize and destroy the political career of every national pol who dared to even launch a serious, adult conversation. Now. The "easy" fixes you talk about are much harder. Can't raise taxes now. Would crush the economy. In fact, your boy Obama, wants to LOWER SSI taxes. Oops. We are going in the wrong fucking direction to "fix" Social Security. Sure, we can raise the retirement age and adjust the yearly increase formulas and means test, etc. But, no one has ever proposed - and will not - that the main brunt of any of these changes will apply to those already retired or even near retirement. Now that the Boomers are aleady collecting, the savings will be disproportionately less - as it will apply to fewer retirees than if we had made these changes years ago. Which means even higher taxes / deeper benefit cuts required to make the numbers work. Bad news for the youngins. More politically painful too. Thus, we come back to Krugman's rant that it was a "Ponzi" scheme. When he actually meant that it was a massive intergenerational transfer of wealth.
No doubt about that. Too bad we did the opposite. Getting the economy back on its feet is a higher priority than fixing SSI (especially since the former will help fix the latter). Maybe we'll get lucky and the boomers will all die earlier than expected. Oh, wait, I'm a boomer. barfo
Unfortunately, the "never let a good crisis go to waste" "bad economy" has become an excuse to transfer assets from the trust fund to the Chinese. First they looted the fund and left IOUs, now they're giving those IOUs to the Chinese. It already was so broken that you couldn't raise taxes on EVERYONE high enough to make it work. I don't see how it's going to survive into the 2nd half of the century.
That might be the most ridiculous thing you've ever posted, and it has some pretty stiff competition. Let's get real here. As the graph below shows, the unfunded portion of SSI amounts to 1.5% of GDP. And you are claiming there is no possible way to pay for something that amounts to 1.5% of GDP? Yes, it's a problem. But it's not an insolvable problem. Instead of spending 4.5% of GDP on it, we need to spend 6% of GDP on it. Or cut benefits, or some mixture of both. barfo
It's 1.5% of GDP today, but it's growing fast. It's liabilities are at lest 3x GDP. When the boomers are fully retired in 15 years and the IOUs in the trust fund are all cashed in, the massive deficits will be far greater than 1.5% of GDP. The baby boomers are 40% of the population who will be paid and no longer paying in. Your 1.5% is wrong, too. SS is about 1/15 of GDP. It's more than we spend on anything else. More than defense and interest combined.
I'll add that Medicare expenses will be 6% of GDP at the same time OASDI will be. Combined that's 12%+ of GDP. Both programs are already running a deficit with current tax collections. To cover an increase of expenses from 1.5% of GDP to roughly 15% of GDP would require a 10x increase in the taxes that pay for those benefits.
You need to go back and read my post a little more carefully, and maybe look at the graph I helpfully provided. barfo
Gah. More DennyMath. It's not an increase from 1.5% to 15% of GDP. For SS, it is an increase from 4.5% to 6.0%. barfo
Yes. And what do you get? You get about 12%. And we already are paying most of that. There is a gap that needs to be made up, but it's not some impossible chasm. This graph that you just posted shows why there is no need to run around like chickens. The sky is not falling. barfo
But it will be increasing as the economy improves. Besides, 15% > 12%, and we don't hit 12% until 2045 or so, so obviously we can afford to continue these program as-is if that is our number one priority. Maybe it's not, so maybe we will end up cutting benefits. Or maybe we will raise taxes. Or maybe we'll do both. But the sky won't fall. It's not an impossible problem like you were claiming (and that was when we were discussing just SSI, before you changed the subject to all entitlement programs). barfo
Historically, Social Security was never even 1/2 the budget, let alone 80% of it. What gets cut to pay for these programs? Factor in the payments on the debt, barfo. You think we're going to be able to pay near 0% interest rate for long? (I don't). It's currently 6% of the $3.5T budget. We won't have a military at all. There won't be money for education. There won't be money for roads, bridges, to pay for the courts, foreign aid, medical research, a space program, etc. http://www.ssa.gov/oact/trsum/index.html Social Security and Medicare are administered by Social Security (the bureaucracy).
