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Monday, February 25, 2013

What if the sequester is exactly what the country needs? Will it make us realize we must pay for what we want?

Could Washington have backed or stumbled and bumbled into a national wake-up call?

The fact is that most Democrats, Republicans and independents love the programs that are most at fault for our increasing long-term debt - our entitlements and screwy tax system. But not many in any of those groups want to take less in benefits or pay more to secure their fiscal future.

Recipients of Medicare and Social Security don't want those programs touched, the poor and their advocates don't want welfare benefits touched, and the rich don't want to loose their prime position with special tax rates that help them at the expense of everyone else.

That can't continue. 

What if the sequester is exactly what the country needs?

From the piece:

In short: just because the sequester is a manufactured crisis doesn’t mean it can’t have the same effect as a non-manufactured crisis in waking up the body politic to the “have cake/eat it too” mentality that dominates not just Washington but the public at large.

Pew Research Center poll conducted earlier this month makes clear the country’s “both/and” nature and why it is so hard for politicians to thread that needle.

While there is widespread support for trimming federal spending, when it comes to the specifics of what should be cut, clarity disappears.

 

Issac J. Bailey - More than the poor are on public dole

The Sun News, Thursday, March 1, 2012
A Different Perspective
A couple of weeks ago, I asked a few questions on my blog that have not yet been fully answered, particularly by those who took issue with the questions themselves.

Who is more dependent upon government assistance, I asked, a poor, single-mom on welfare or a well-off retiree on Medicare ?

The middle-class woman who owns a $500,000 house and receives a huge tax break because of mortgage interest deductions, or a poor child who gets free lunches and food stamps?

Billion-dollar corporations who receive tens of billions of dollars every year in the form of special tax breaks, subsidies and other perks, or their employees, whose private health insurance plans are made affordable because of federal funding and support?

Or maybe the most reliant are the mothers who, with the help of federal funding, are able to avoid more than 1 million abortions and miscarriages every year?

The ongoing debate about public assistance has been lopped sided for far too long. Many of the people who complain about welfare recipients receiving a couple hundred dollars a month, in addition to food stamps, are also reliant upon the government. It’s just that they either don’t notice or ignore that inconvenient fact.

A recently-released study out of Cornell University showed that 44 percent of Social Security recipients, 43 percent of those receiving unemployment benefits, and 40 percent of those on Medicare claim to have not used a government program.

Another study, out of Indiana University, showed that in 2010, residents in the 10 most conservative states received 21.2 percent of their income in government transfers, compared to 17.1 percent in the 10 most liberal states – even though the loudest complaints about government dependence are most passionately made in red states.

Many of the complainers commit to mental gymnastics to deny the obvious, that many more people who are willing to acknowledge the truth rely upon the government. South Carolina receives more in federal funding than the money it sends to Washington. And the Grand Strand has grown so strong for such a long time because of relocating retirees who rely upon Social Security and Medicare – maybe the two most popular and untouchable programs ever created.

According to economists Eugene Steurle and Stephanie Rennane of the Urban Institute, the average, two-earner couple who made $89,000 a year would have been paid roughly $614,000 in Social Security taxes during their careers and can expect back only $550,000 in benefits, meaning they more than paid for what they are receiving.

But most retirees claim Social Security and Medicare , and combining the two tells a much different story. That same couple paid $114,000 in Medicare payroll taxes during their careers by the time they retired in 2011. But they will likely receive $355,000 in medical services in return, about three times as much as they put in.

In other words, they are receiving something for nothing from the government, which when it comes to a welfare mom – who pays a variety of taxes to help support welfare and other government programs – such a scenario is derided as a handout.

Somehow a monthly $220 welfare-to-work check will make a single-mom lazy and dependent, but much more generous benefits via Social Security and Medicare won’t do the same for retirees?

Unemployment benefits should be frowned upon because of their potential to create dependency – even though recipients paid into that system the same way Social Security and Medicare recipients paid into those?

The conceit is that it is easier to accuse some of being dependent on the government while absolving others who are also reliant because of the way we define and allocate funds. We call the major subsidy we provide to people who own homes worth up to $1 million tax credits and mortgage deductions and the like, while calling what the poor receive welfare.

We call the help more than 90 percent of Americans who receive health insurance through private employers necessary subsidies to large corporations but call the health care program for the poor Medicaid.

There’s been a lot of talk over the past year about reigning in government spending and entitlement programs. But that will be impossible to do as long as we refuse to own up to the full truth.

Popular programs should not be shielded and poor people should not be made scapegoats for the benefits the majority of us rely upon. 

 

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