There are those in our country who point to Obama and his administration and claim that he is dooming us to the same desperate state Greece now must rectify. The pundits on the right are claiming, as they always do, that one step towards the left will indelibly lead us to full socialism. That's a shame.
There are many countries which are more socialistic in their approaches to governing than we are and which are doing no worse than we, indeed better! This list is long.
Yet the right is correct about some things regarding Greece. Balance and common sense in government programs must exist. The right is correct when it says that entitlements are dangerous because they can cause a decrease in self-reliance. The Greeks have been unwise. The have fostered entitlements to an exaggerated point. Retirement payments for some (maybe most) at 100% of quitting year salary! The State of Utah pays 60% of quitting year salary for its employees, but guess what? That is going to change. Newly hired workers for the State of Utah can now look forward to only a 45% plan of quitting year salary. My social security benefits will comprise only about 35-40% of what I will be making at retirement at 66 years old. If I want to live at the same rate of income (100% of what I was making while working), it is up to me to make up the difference before or during retirement. I have been diligently doing so.
Health care presents similar problems. Indeed, I can plan for most everything, even some awful level inflation, but the wild card that threatens even the most financially prudent (who is not in the privileged classes - who can buy their way out of medical disaster) is that of health care.
The goal of social security and health care should be to provide safety nets that ensure bare and reasonable minimum standards of living for all. Greece is a bad example of how this works, Canada, Denmark and many others are good examples of what is possible. Our country must address our problems of accessibility and affordability to health care all the while maintaining the safety net of social security in all its forms. Yet we must not follow the example of the foolish Greeks.
3 comments:
Adding entitlements like health care will be was a bad step in Greece's direction. The Dallas Federal Reserve calculates that the Federal Government has $117 trillion in long-term obligations (current debt + Medicare + Medicaid + Social Security) and that doesn't even include health care (revenue neutral? who believes that propaganda?). Our current GDP is about $14 trillion, so raising taxes will not cover these obligations. We will have no choice but to cut entitlement spending or implement a VAT tax. Once entitlements are enacted, it is nearly impossible to retract them (e.g., Greece). Hence the unwise enactment of health care at this time. A VAT tax would result in a gusher of revenue for the government, but we all know that politicians will not pay down the debt nor set up a trust fund for entitlements. They will simply spend more and more and more.
We are already far down the slippery slope and gaining speed. The question is: How far off the deep end are we going to fly?
Entitlements cannot not be the only federal spending that runs this discussion. I admitted freely in my post the importance of wisdom in entitlements. But as we have discussed before, there are many other areas in which we can cut, and cut deeply. Foreign aid, military spending, government grants for fostering entrepreneur ship, and many others.
Health care improvement is a huge step, no doubt. However, it is not, of course, the only culprit, but it does seem to get nearly exclusive attention in this debate.
George Will is for a VAT tax only if income tax is repealed entirely. Even then, he echos your concern that politicians will spend: the party does not matter.
Why the government still has foreign aid when our country is in the red? I will never comprehend some of the politicians. Doug is right when he says that it could be cut deeply. I even say that it should.
M
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