“The authors examined two categories of federal spending over the past 50 years, representing two of government’s fundamental missions. One was “investments,” which includes maintaining our national infrastructure, keeping our military equipped, helping assure that our work force is educated to a high standard, and underwriting the kind of basic scientific research that is too risky or long-term to attract private money. The report calls this the legacy of President Kennedy’s New Frontier, though the largest infrastructure project in our history, the interstate highway system, was Eisenhower’s baby, a reminder of the days when Republicans still believed in that stuff. The other category was “entitlements,” a catchall word for the safety-net programs that provide a measure of economic stability for the aging and poor: Social Security, Medicare, Medicaid, etc.
You will not be surprised to hear that the red line tracking entitlements goes up while the blue line reflecting investments goes down. What is alarming is the trajectory.
In 1962, we were laying down the foundations of prosperity. About 32 cents of every federal dollar, excluding interest payments, was spent on investments, only 14 percent on entitlements. In the mid-70s the lines crossed. Today we spend less than 15 cents on investment and 46 cents on entitlements. And it gets worse. By 2030, when the last of us boomers have surged onto the Social Security rolls, entitlements will consume 61 cents of every federal dollar, starving our already neglected investment and leaving us, in the words of the study, with “a less-skilled work force, lower rates of job creation, and an infrastructure unfit for a 21st-century economy.”
(…) At least the Republicans have a plan. The Democrats generally recoil from the subject of entitlements. Centrists like those at Third Way and the bipartisan authors of the Simpson-Bowles report endorse a menu of incremental cuts and reforms that would bring down costs without hitting the needy or snatching away the security blanket from those nearing retirement. They include gradually raising the retirement age to compensate for the fact that we now live, on average, 14 years longer than when F.D.R. signed Social Security into law. They include obliging those of us who can really afford it to pay a larger share. They also include technical fixes like aligning the automatic cost-of-living formula with reality.
(…) (And, by the way, we should resist the boomer temptation to take every cent of the reform from the pockets of our kids.)”
What this “concerned” article is leaving out is the following: Social Security benefits average about $15,000 a year, barely enough to make a decent living, if there is no additional retirement plan (these defined-benefit plans are hard to come by thanks to greedy employers, whereas the ubiquitous 401k plans are losing money thanks to Wall Street rigging and gambling), especially considering the increasing cost of medicine. “[A]ligning the automatic cost-of-living formula with reality” is another way of saying “cutting” SS COLAs.
The second thing they are missing out is that whereas wages have stagnated, poverty has also been increasing, stimulating greater expenses for social programs, which goes beyond the old-age, baby boomer argument, which has been exaggerated beyond reason.
Third, the government expenditures completely block out the fact that whereas worker’s contributions through the regressive payroll tax have increased, they have decreased for corporations, and capital owners, i.e. the rich, the only ones whose income has sky-rocketed (the 1% took 93% of all income gains since 2008). Those that can pay taxes, pay less. Those that are squeezed, pay more. No wonder, the shrinking middle class is engaged in tax revolts. (Even though they miss out on the bigger picture with the tax and wealth imbalance.)
Fourth, even though we do find a population bulge among the Baby boomers, to argue that there is a generational battle is absolutely disingenuous, even though fitting with distracting 1% ideology. Students are squeezed by more expensive colleges and deteriorating school quality, and this is why we have to steal Grandma’s bread, right? We are fighting a class war, not a generational war, unless the “centrist” (read moderate right-wing, as opposed to extreme right-wing, to artificially limit the range of admissible debate) argument is made to prevail in the minds of the American people. http://www.nytimes.com/2012/07/30/opinion/keller-the-entitled-generation.html?_r=1&hpw