Thursday, November 19, 2009

Ten years of taxes and spending, six years of benefits

If you want a hint of why the new Senate bill could get a good evaluation from the CBO, consider this.
The Senate bill pushes back implementation of major parts of the reform to 2014 -- a change from 2013 under the Finance Committee bill.

This is bad news for lawmakers who will need to explain to constituents why the elements that have attracted the most attention -- the public plan, the Medicaid expansion and the insurance exchanges -- won't be available for four years.

Some reforms would kick in earlier, Senate aides explained, but the big pieces would still be a ways off.
The pain starts now, but the benefits come later. And that is how they get a good rating for the next decade. And then what happens when we go into the second decade and we have a full 10 years of benefits to pay for? Guess.

33 comments:

LarryD said...

Congress did that with a Health care bill that they passed back in Clinton's day, I believe.

It got repealed.

Freeven said...

I remain opposed to increased government involvement in just about everything. However, if Obamacare, in any form, looks like it's going to be rammed through, I'd like to see it come with a "reverse trigger."

The program relies on sources of funding and congressional actions that the CBO describes as "unlikely." Since the program wouldn't begin to be implemented for four years, I propose that if, by that time, the "unlikely" events and sources of funding have not materialized as promised, the entire program be shut down and pronounced dead on arrival.

This isn't ideal, since we would waste a trillion dollars in the meantime. But at least it would get us off the hook of a permanent commitment for something that doesn't deliver on its promises. On the other hand, if I'm wrong and things look rosy in four years, the program proceeds and nothing is lost.

No reasonable person, Democrat or Republican, should have a problem with this, since the program is only terminated once its known that it can't deliver on its promises. If anyone does have a problem with this trigger, then we'll have established, up front, that not even they buy what they're selling.

ic said...

what happens when we go into the second decade ...

Who cares? They will be lobbyists to lobby for changes to the law.

They are creating future jobs for themselves.

Tacitus Voltaire said...

we have a full 10 years of benefits to pay for?

apparantly, being part of the tea party wing of the modern GOP means being unable to understand what health insurance reform is

or why americans are so overwhelmingly in favor of the most prominent provisions such as the elimination of pre-existing condition or lifetime benefits cap denials, and a 'public option' alternative

i'm not sure if you all have managed to notice how incredibly popular 'socialist' measures such as social security and medicare are with normal americans
.

tfhr said...

TV,

I'm not sure if you've managed to notice how incredibly INSOLVENT measures such as Social Security and Medicare and that normal Americans can only bleed so much in taxes until the aforementioned programs collapse.

Let Obama get Medicare and Social Security off of life support and THEN we can hear his plans for "reform". What his minions in the Congress have isn't reform or a plan; it's a scam.

Tacitus Voltaire said...

tfhr said...
TV,

I'm not sure if you've managed to notice how incredibly INSOLVENT measures such as Social Security and Medicare


yet another case of the eternally predicted bankruptcies that never seem to actually happen

i do, however, hear republican officeholders routinely swear up and down that they are the ones that can be trusted to keep social security and medicare healthy

you know - those programs that republicans call 'socialist' security and that socialist medicare program that ronald reagan warned us against in the early 60s

in another ten years, if there are any republican officeholders left, we can be sure that they will be swearing that they are the ones to be trusted to protect the health insurance reforms you all are fighting right now...

Pat Patterson said...

I can't help noticing that TV did not offer one comment that is remotely germane to the post. What then is a gap between payment and delivery of services mean then? Or more to the point why is this type of info not part of the debate offered by the majority party unless perhaps they have no defense of this possibility or simply don't care to explain themselves?


TV should begin worrying about a loss of seats in 2010 rather than some pie-in-the-sky permanent Democratic majority. In most polls the generic response to whether the citizens are likely to vote Democratic and Republican have the Republicans ahead by 5%.

I would be willing to bet that Dan Rostenkowski and Tom Foley also assumed that their meddling was supported by the citizens and didn't notice otherwise until cleaning out their offices in the Rayburn Building.

tfhr said...

TV,

Why do you trust any politician from any party to run a pyramid scheme like Social Security? Why is this not a matter of common sense for you instead of petty party politics?

People live longer today. Consequently there are fewer workers paying into the system for each Social Security recipient drawing benefits and the ratio is shrinking. I suppose you could blame the longer life expectancy on our horrible health care system but that might burst your other delusional bubble, so pace yourself.

That people have become sadly dependent on this Ponzi scheme doesn't make Social Security a "good" program. It does make many of them dependent on the government and so will this "health insurance reform" scam Reid and Pelosi are trying to sneak through Congress.

Just look how it starts out. We start paying taxes next year for something that won't pay benefits for four more years. Would you buy a car, pay for it starting next year, and not expect to see it for another four years? There is too much slight of hand with budgeting manipulations designed to hide estimates of what this will actually cost and on top of that we already know government entitlement programs always exceed estimates.

Then there is the matter of forcing people to buy into an insurance program. Much of the claim that this "plan" would be "deficit neutral" is predicated on young, healthy Americans participating in a system where they contribute above and beyond their needs to draw benefits. Where have we heard that pyramid scheme before? Furthermore, where in the Constitution does it say that the U.S. Government has the authority to press citizens into participating in a state run insurance program?

Your answer is to keep draining the money from tax payers - that is how we've evaded "eternally predicted bankruptcies", so far. How long do you really think that can be sustained?

Tacitus Voltaire said...

That people have become sadly dependent on this Ponzi scheme doesn't make Social Security a "good" program. It does make many of them dependent on the government and so will this "health insurance reform" scam Reid and Pelosi are trying to sneak through Congress.

that must be why bismark put germany on a guaranteed pension and health insurance program that continues to this day

one of these centuries, no doubt, this foolishness will catch up with the german people

tfhr said...

TV,

People dependent on their governments do have that problem. In Germany there was this little Austrian guy with a tiny mustache that made the trains run on time...all the way to Auschwitz.

No thanks, TV. I'd rather not have people beholden to a government they cannot control.

Pat Patterson said...

And Bismark faced a rather daunting task in keeping German workers, at the time underemployed, in Germany. Germany during those years suffered a net decline in workers capable of doing factory work as they were emigrating to the US in the thousands. And to compound the problem Germany was not letting workers in from the rest of Europe.

Tacitus Voltaire said...

People dependent on their governments do have that problem. In Germany there was this little Austrian guy with a tiny mustache that made the trains run on time...all the way to Auschwitz.

No thanks, TV. I'd rather not have people beholden to a government they cannot control


yeah, sure, every other country in the world having universal pensions and health insurance is bad beacuse hitler. that makes a lot of sense

as far as people vs the government - i don't know why conservatives don't understand that democratic republic theory where we are the government, which we control as best we are able at the ballot box. study up on it, eh?

equitus said...

or why americans are so overwhelmingly in favor of the most prominent provisions such as the elimination of pre-existing condition or lifetime benefits cap denials, and a 'public option' alternative

Sure, if you poll Americans they'll say these things sound great. But if you include in the poll mention of the costs - not just directly via taxes, but also in terms of depressive effects on the economy and innovation - Americans quickly come to their senses.

We're not idiots, TV.

tfhr said...

TV,

Each country in Europe has it's own history of social, economic and political problems stemming from their forms of government and the corresponding services offered to or forced upon their populations.

You picked Germany and you failed. Bad choice on your part, so pick another example of European perfection and we'll go from there. (Hint: Stay away from Russia)

Quick question for you to consider in your quest for a new EuroEden to toss up for evaluation: Which European nation would exist today in it's present form without the support of the United States and what would they look like if not for the the protection and economic assistance we provided for them?

Pat Patterson said...

Malta?

Tacitus Voltaire said...

You picked Germany and you failed

failed to what?
.

tfhr said...

Pat Patterson,

I think Malta would belong to Libya were it not for Britain's influence and their friends in the US Sixth Fleet. Good effort with Malta but don't even think about suggesting Andorra next or I will report you to the Bishop of Urgell.

Tacitus Voltaire said...

my point was that germany has had universal pensions and universal health insurance for over 120 years and has yet to go bankrupt, or even become anything less than the economic powerhouse it has always been, except for a few years after losing some (ahem) wars

your idea that we are propping them up (the marshall plan was a long time ago) are imaginary

also, consider that sweden, the most socialist country in europe, is also known for its robust private sector

or have you been pontificating about socialism and europe without bothering to study their histories and economies?

tfhr said...

TV,

You picked Germany as an example of a nation that did not fail it's dependent populace and you claimed that this goes back to the days of Bismarck. I think it was a poor example on your part for the reasons I stated above and you've still not offered another example to support your claim.

tfhr said...

TV,

The Marshall Plan and our overwhelmingly disproportionate commitment to NATO compared to western European nations allowed those same countries to rebuild. Without that investment Europe would have never recovered in a way that yielded the present form.

Further, our protective umbrella allowed western Europeans to engage in social spending that they would never have been able to manage without our support. Today, we see France, Germany, the UK, and other European nations struggling to support their bloated social systems under the weight of an aging populace and massive foreign immigration.

Interesting that you brought up Sweden. Though it managed to side step WWII by supplying Germany with raw materials while maintaining a neutral status, Sweden did receive hundreds of millions of dollars under the Marshall Plan. In case you didn't realize it, the Marshall Plan was as much about rebuilding war torn western Europe as it was about protecting it from Soviet aggression.

That brings us to Sweden's "neutrality" during the Cold War. You may not have heard much on the subject but Sweden was NOT neutral. Sweden's security through much of the Cold War depended on agreements with the West and an expectation that the United States would help Sweden deter the Soviets. This was kept secret from the Swedish population and did not become publicly known until the 1990's. From extending Swedish airfields to accommodate American aircraft to positioning Polaris ICBM equipped nuclear submarines in Swedish waters, the notion that Sweden did not benefit from the American umbrella and did not actively seek that protection is hollow. http://www.foi.se/FOI/templates/Page____3726.aspx

also see: http://www.foi.se/FOI/templates/Page____4065.aspx

There is still much to be admired about Sweden's accomplishments, I'll grant you that. However when you compare Sweden with the United States, you should consider that it's total population is something on the order of 10 million. Sweden's second largest city does not rise to the level of one million even if you include the entire metropolitan area.

That said, you should not be surprised to learn that your interest in universal pensions might not enthuse Swedes. "Sweden is now one of the world's leaders in the global shift to private pensions. The Swedish pension program faced financial problems similar to the troubles plaguing the U.S. Social Security system, and the Swedes decided that partial privatization was the best solution." http://www.heritage.org/Research/SocialSecurity/bg1381.cfm

I encourage you to read the article linked above as well as some doing some research on the Marshall Plan and Cold War defense agreements. Then you can come back to me with "have you been pontificating about socialism and europe without bothering to study their histories and economies?"

As it stands, that would seem to be a question you should ask yourself, TV.

Pat Patterson said...

So the Weimar Republic doesn't count? Plus those pensions and "universal" coverage only applied to German citizens, no Poles, French, Romani or anyone not wearing lederhosen need apply.

tfhr said...

TV,

The Marshall Plan and our overwhelmingly disproportionate commitment to NATO compared to western European nations allowed those same countries to rebuild. Without that investment Europe would have never recovered in a way that yielded the present form.

Further, our protective umbrella allowed western Europeans to engage in social spending that they would never have been able to manage without our support. Today, we see France, Germany, the UK, and other European nations struggling to support their bloated social systems under the weight of an aging populace and massive foreign immigration.

Interesting that you brought up Sweden. Though it managed to side step WWII by supplying Germany with raw materials while maintaining a neutral status, Sweden did receive hundreds of millions of dollars under the Marshall Plan. In case you didn't realize it, the Marshall Plan was as much about rebuilding war torn western Europe as it was about protecting it from Soviet aggression.

That brings us to Sweden's "neutrality" during the Cold War. You may not have heard much on the subject but Sweden was NOT neutral. Sweden's security through much of the Cold War depended on agreements with the West and an expectation that the United States would help Sweden deter the Soviets. This was kept secret from the Swedish population and did not become publicly known until the 1990's. From extending Swedish airfields to accommodate American aircraft to positioning Polaris ICBM equipped nuclear submarines in Swedish waters, the notion that Sweden did not benefit from the American umbrella and did not actively seek that protection is hollow. http://www.foi.se/FOI/templates/Page____3726.aspx

also see: http://www.foi.se/FOI/templates/Page____4065.aspx

There is still much to be admired about Sweden's accomplishments, I'll grant you that. However when you compare Sweden with the United States, you should consider that it's total population is something on the order of 10 million. Sweden's second largest city does not rise to the level of one million even if you include the entire metropolitan area.

That said, you should not be surprised to learn that your interest in universal pensions might not enthuse the Swedes. "Sweden is now one of the world's leaders in the global shift to private pensions. The Swedish pension program faced financial problems similar to the troubles plaguing the U.S. Social Security system, and the Swedes decided that partial privatization was the best solution." http://www.heritage.org/Research/SocialSecurity/bg1381.cfm

I encourage you to read the article linked above as well as some doing some research on the Marshall Plan and Cold War defense agreements. Then you can come back to me with "have you been pontificating about socialism and europe without bothering to study their histories and economies?"

As it stands, that would seem to be a question you should ask yourself, TV.

Tacitus Voltaire said...

most accounts of the widespread reforms toward a more market-responsive economy in many western european nations during the 80s note two things

1. where sweden ended up would still be radically more democratic socialist than most other countries, although paradoxically it has always had some tax and regulatory policies that are more friendly toward business than the u.s. (!!!)

2. after having made these adjustments in their public/private balance in the 80s, countries (including the u.s.) stopped this movement, rediscovering two things that should be obvious to any thinking person: a. there are trade-offs no matter what solution you try, and privatisations resulted in trading the problems of privatisation for the problems of socialisation, as well as trading the benefits. please note, it is merely lazy thinking to expect your pet solution to yield perfect results. and b. all human initiatives are subject to the law of unintended consequences - in this case meaning that just because a government expects something good to happen when it revises a policy, that doesn't always happen.

as for the marshall plan, aside from the fact that it was implemented 50 years ago, i am not well briefed on it. i will point out to you that it was, literally, one of the largest social welfare efforts ever undertaken, and we can all be proud as americans at how we used the result of our hard work to feed and clothe the victims of fascist agression, and jump-start their economies

why you think helping hard working people in our own country who are hard up against it, in the same way, is evil, is utterly beyond me

tfhr said...

TV,

Check the date-time-group on that article I provided for you regarding Sweden's embrace of private pensions. You are responding with an apparent reference to something two decades removed and I'm telling you that today Sweden, along with some other European countries are trying to undo the damage socialism has wrought.

Your characterization of the Marshall Plan as a "social-welfare program" tells me that you still have not taken the opportunity to learn about it. I recommend that you read The Marshall Plan by Michael J. Hogan, 1987. I'm not an expert on the Marshall Plan but Hogan certainly is and I can add that from sitting in his classes for several semesters that the breadth of his knowledge extends well beyond that aspect of history.

You only need to do some cursory reading to understand that the Marshall Plan was a good deal more than feeding and clothing refugees, as you seem to have concluded. Along with accepting the foreign aid component of the plan to repair, replace and modernize infrastructure, industry and agriculture, European participants also had to agree to remove trade barriers. This was helpful on the Continent but also established a path for trade with the US. Needless to say, breaking down trade barriers and integrating European economies was particularly upsetting for the Soviets. In other words, the Marshall Plan was not only good for Europe, it was good for the US because it created markets by stimulating two-way trade while solidifying the economic recovery brought about by the war time economy and enhanced our national security.

The social-welfare component of Europe's war recovery was provided largely by the UN and other relief agencies when it came to providing for the millions of people displaced by the war though I know you can find some administrative support provided by agencies and organizations created by the Marshall Plan if you look.

Most importantly, remember the context of the Marshall Plan. Europe was largely an ash heap and a void when it came to transportation infrastructure. The United States was really the only country of note to emerge from the war with its infrastructure intact and a treasury that had not be completely depleted. Back then we had the money to rebuild Europe. We did not claim ownership or operating rights for our investment. Contrast that with the TARP's wild and reckless spending during a severe recession characterized by high unemployment and a weakened dollar. The Marshall Plan was really a self-help program. TARP, along with other bailouts has broken dangerous new ground with the US Government's new found ownership of several large corporations and financial institutions.

To get back to the root of our discussion: If you want to compare Europe and the United States, I just ask that you move forward in context which should preclude your use of Germany or Sweden as examples of socialism's success.

tfhr said...

TV,

Almost forgot to compliment you for this:

"b. all human initiatives are subject to the law of unintended consequences - in this case meaning that just because a government expects something good to happen when it revises a policy, that doesn't always happen."

That is so true. It happens to be one of the most important reasons why I don't trust the government to run health care effectively or efficiently when it also appears that they miscalculated on the costs of the TARP and cannot agree on the costs or even who will be covered by Obamacare.

We need only look at all of the other failed entitlement programs to see what will become of this latest effort to replace the free market with a government mismanaged program.

Pat Patterson said...

I would go even further in placing Germany's so-called progressive thinking in the context of a fear of a Communard type rising among the lower classes of Germany who were angry over Prussian domination and were fleeing the country by the thousands. Bismarck simply did what any smart politician did, then and now, he co-opted the left, and kept them from seizing the factories and setting up autonomous retirement systems outside the control of the the Empire and the Hohenzollern family.

Many on the left simply ignore that socialist and communist theoreticians argued against government run programs as that meant the government controlled their lives. They expected, not quite the Scientific Socialism, that it was inevitable that these institutions would exist independent of the government and that co-operating simply delayed the workers emancipation.

Tacitus Voltaire said...

face it, we gave europe a very large amount of money to help them get back on their feet. apparently you think this was good for europeans but not good for americans

nearly all of the provisions in the health insurance reform bills before congress, that you guys refuse to find out about, are oriented to private industry, and most countries mandate universal health insurance coverage through a complicated mixture of public and private funding. your refusal to learn about this and your resulting conclusion that socialist measures consist of the state taking over everything explain why you think the article about swedish pension funds would be surprising to me

again, take a few minutes to google what is in the health insurance reform bills, and then get back to me, ok?
.

Tacitus Voltaire said...

now, tfhr, read again carefully the article you linked about "sweden's embrace of private pensions", as you concieve of it:

Partial privatization. Workers must put 18.5 percent of their income aside for retirement, but they are now able to invest 2.5 percentage points of that amount in an individual account. Beginning later this year, workers will be able to choose the pension fund that best suits their investment preferences.

Individual accounts. The remaining amount, 16 percentage points, is a tax that funds the pay-as-you-go government program. The Riksdag also altered this portion of the system dramatically. Instead of providing a pre-determined retirement benefit based on number of years in the workforce and earnings history, the new system provides benefits based on the amount of taxes paid during the worker's career. By creating a system of notional accounts (no money is actually deposited) and linking retirement benefits to lifetime income, the parliament has set the stage for further privatization.

Safety net to protect the poor. As in other nations that have shifted to personal retirement accounts, a safety net will exist under the new Swedish pension system. The government will continue to guarantee a minimum pension funded by general tax revenues.


"but they are now able to invest 2.5 percentage points of that amount in an individual account"?

um...

Tacitus Voltaire said...

Bismarck simply did what any smart politician did, then and now, he co-opted the left

exactly. now, think of the implications of what you just admitted...
.

tfhr said...

TV,

You have to read the entire article or you miss salient facts such as Swedes being able to invest up to 7%, not just the 2.5% in the Premium Pension you cited.

Here's the money quote:

"The combination of these occupational plans and the privatized portion of the government system means workers will be able to save 4.5 percent–7.0 percent of their income in personal accounts for retirement. This level of mandatory individual retirement savings is significant by world standards".

http://www.heritage.org/Research/SocialSecurity/bg1381.cfm

You're getting very lazy these days, TV. Your sloth has allowed you to incorretly conclude that "apparently you think [the Marshall Plan] was good for europeans but not good for americans"

Here is what I said in the fourth paragraph from the bottom of my 2145 post:

"In other words, the Marshall Plan was not only good for Europe, it was good for the US because it created markets by stimulating two-way trade while solidifying the economic recovery brought about by the war time economy and enhanced our national security."

I'm seeing a pattern here, TV: You don't read. Maybe this is why you have no idea what is in the Obamacare bills. I say that not for snark but that I hold out hope that you might not be the cynical sort of person that puts government ahead of citizens. Maybe if you actually understood what was at stake...I wonder if you even read this far.

Tacitus Voltaire said...

I'm seeing a pattern here, TV: You don't read

what i meant was was that the kind of help that we provided in the marshall plan seems to be supported by persons of your political persuasion, but yet it seems that you do not support the same sort of help for people living in this country. i hope that is clearer

yes, that is very nice that swedes will be able to invest up to 7% of their retirement accounts. presumably they will now invest it as they please in the stock market, like we do with up to (what is it now?) 20% of our income. perhaps you have a 401k, too. did you notice what happened to the 401k of most americans last year? did you notice that social security benefits were not affected by it? if not, please do
.

Pat Patterson said...

But since we are not faced with a declining population and some very hostile neighbors directly on our borders that are armed to the teeth then the comparison is moot. The left in the US has always been an outlier from the founding of the Republic and except for a few years at the beginning of the Depression they have never been a real threat to the public. We simply don't need to co-opt the left because they are simply toothless and too willing to work within the system they claim to hate.

tfhr said...

TV,

The "money" in Social Security is an IOU written by the government to the government. Unfunded liability!