NYT’s Keller gets it half-right on need to reform entitlements
In a column addressed to his fellow baby boomers (sorry, this Gen-Xer peeked anyway!) New York Times columnist Bill Keller says one way for his generation to shed its reputation of entitlement and selfishness is, well, to be less selfish about entitlements.
He refers to a study by the Democratic think tank Third Way that examines the tremendous growth of, as Keller puts it, the federal government’s “safety-net programs that provide a measure of economic stability for the aging and poor: Social Security, Medicare, Medicaid, etc.” The growth of this spending, he and Third Way argue, is crowding out federal spending for “‘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 answer, he suggests, is for liberals to embrace reforms of the entitlement programs. I agree with his conclusion, but there’s an important misperception to correct along the way.
Here’s how Keller summarizes Third Way’s findings:
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.”
Sounds pretty bleak for “investments,” huh?
But what these figures obscure is that spending on Third Way’s “investments” category — adjusted for inflation and population growth — has in fact increased significantly during the past 50 years.
How can that be?
Start with the fact that, in 1962, federal spending (see Table 8.4) minus net interest payments equaled 17.6 percent of gross domestic product, or GDP. In 2012, it’s expected to hit 22.9 percent of GDP. So federal spending as a share of the economy is higher today by almost one-third.
Then move on to the fact that GDP, adjusted for inflation, is nearly 4.5 times larger today: Annualized, it stood at $13.56 trillion in the second quarter of 2012 (the most recent data available) compared to $3.06 trillion in the same three months of 1962.
Finally, consider that our population has grown by only about 70 percent during the past half century: from 186.5 million to 314.4 million (note: the Census Bureau has not yet released its estimate for July 1, 2012, so I took the figure for a year earlier and applied the same growth rate the Census Bureau applied for 2010 to 2011; my number ought to be pretty close to the eventual Census estimate, or at least close enough for today’s exercise).
Run the numbers, including Third Way’s calculations of “investments” and “entitlements” as percentages of the federal budget, and here’s what you get:
Inflation-adjusted, per capita federal spending
So, while it’s true that entitlement spending has grown massively since JFK’s presidency — by more than 1,000 percent on a real per capita basis — it’s also true that real per capita spending on that group of “investments” has grown by 60 percent. Not too shabby. Viewed similarly, spending on everything else (besides net interest payments) has also soared by almost 150 percent.
To reiterate: I agree with Keller and Third Way that entitlement reform is desperately needed. And I join them in urging boomers, particularly those of the liberal persuasion, to be open to such changes. Where I part company with them is in the reason this needs to happen.
It’s not to spend more money elsewhere in the federal budget, but to free the economy from the burden of all excessive federal spending.
– By Kyle Wingfield
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Thomas Heyward Jr.
July 31st, 2012
10:05 am
Finn McCool (The System isn’t Broken; It’s Fixed)
July 31st, 2012
9:51 am
My husband, being a boomer, declared that promises should be kept.
This is what the cons want to end.
When you enter a financial agreement with an employer – public or private – you agree to terms. If the employer promises to pay you so much a year AND contribute to your retirement, then they are making a contractual promise. If you, as a worker, keep up your end of the agreement and come to work, why shouldn’t the employer keep up their end?
You tell a soldier that if he/she puts his life on the line for so many years, you will provide them with certain benefits, then those benefits need to be honored. It’s called “supporting the troops.”
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.
Financial “agreement”?
.
You forgot that when the USGov is involved…………..there is a gun in the room.
.
dummy.
Jose
July 31st, 2012
10:06 am
NOT BLIND
YOU DIDN’T BUILD THAT
SOMEBODY ELSE BUILT THAT
Normal Free...Pro Human Rights Thug...And liking it!
July 31st, 2012
10:06 am
Not Blind
July 31st, 2012
10:02 am
Well said.
Thanks
July 31st, 2012
10:07 am
Erwin’s Cat: Tell all the other cats
Erwin's cat
July 31st, 2012
10:08 am
why shouldn’t the employer keep up their end?
because the contract says that “this” agreement can be canceled at any time by either party
Keep Up the Good Fight!
July 31st, 2012
10:08 am
Well Erwin, the so-called 47% who paid 0 federal income taxes are also generally in compliance with law…. so I guess the rant is meaningless.
And it still remains to be seen if all of Mitt’s deductions and tax avoidance schemes were legal and/or appropriate. He was on the board of Marriott (audit committee chair also) when Mariott claimed false shelters.
Normal Free...Pro Human Rights Thug...And liking it!
July 31st, 2012
10:09 am
Jose, like other “Conservatives” who have nothing else always resort to statements taken out of context to make their point…not realizing the only point they make is they got nuthin’..
Finn McCool (The System isn't Broken; It's Fixed)
July 31st, 2012
10:10 am
to free the economy from the burden of all excessive federal spending.
Yeah, grandma, that healthcare you’re enjoying? That’s excessive federal spending.
Erwin's cat
July 31st, 2012
10:11 am
Keep – the IRS might disagree…I’m pretty sure they’ve seen Mitts returns.
and I am certain that when Mitt was on the Marriott board, he wasn’t doing their taxes
Numbers-R-US
July 31st, 2012
10:12 am
Kyle,
I do belive it is the Democrats that are willing to compromise and implement a mix of tax hikes and cuts in order to address the debt and deficit. If only Republicans were willing to do the same. We might actually make some progress. I don’t see it happening though.
But we do have those defaults to fall back on. I like defaults. They give everyone a chance to participate.
@@
July 31st, 2012
10:12 am
What’s going on with Bloomberg? Has he lost his mind? Latch on to Bloomberg’s nanny?
schnirt
Mayor Bloomberg Declares War On Baby Formula
Program Is Not An Absolute, But You’ll Be Lectured If You Choose Not To Comply
But we can’t ask a woman to view her baby on ultrasound prior to abortion?
I’m outta here. Not lookin’ to read what Bookman’s libs have to offer. I know all I wanna know about them and their “opinions”.
Finn McCool (The System isn't Broken; It's Fixed)
July 31st, 2012
10:12 am
because the contract says that “this” agreement can be canceled at any time by either party
Twenty years after you’ve left the employer and they pull that crap. And you’re ok with this? That’s how you want to be treated? Or just everybody else?
Finn McCool (The System isn't Broken; It's Fixed)
July 31st, 2012
10:14 am
It doesn’t matter what’s in Mitt’s tax returns. The guy is a bumbling fool and it’s all on display this week. HE can’t get out of his own way.
Erwin's cat
July 31st, 2012
10:14 am
Twenty years after you’ve left the employer and they pull that crap. And you’re ok with this? That’s how you want to be treated? Or just everybody else?
Just you
Jose
July 31st, 2012
10:15 am
NOT BLIND
i hate boomers that think they are smarter than other generations or worked harder than other generations
you didn’t build that
you had a lot of help
Erwin's cat
July 31st, 2012
10:16 am
The guy is a bumbling fool and it’s all on display this week. HE can’t get out of his own way.
yeah any idiot can accumulate $243M
Thomas Heyward Jr.
July 31st, 2012
10:17 am
Finn McCool (The System isn’t Broken; It’s Fixed)
July 31st, 2012
10:12 am
because the contract says that “this” agreement can be canceled at any time by either party
Twenty years after you’ve left the employer and they pull that crap. And you’re ok with this? That’s how you want to be treated? Or just everybody else?
————————————————————————————————————————-
.
There was never an agreement on my part.(ss,medicaire,medicade.etc….)
It was extortion.
Why should anyone be surprised that criminals renege.
.
You must be a Romney/Obama surpporter.
Keep Up the Good Fight!
July 31st, 2012
10:18 am
Erwin, you can speculate all you want and avoid the responsibility of directors, especially on the audit committee but as George Romeny says…. what’s Mitt hiding?
And no, the IRS does not audit all returns.
MC
July 31st, 2012
10:19 am
If Republicans have their way in 20 years we’ll be the mirror image of Mexico. A giant oligarchy.
Thomas Heyward Jr.
July 31st, 2012
10:20 am
“If Social Security has been such a success, then it no longer needs the government’s monopoly on violence to ensure participation…Sadly, we see otherwise”.
Ron Paul
ragnar danneskjold
July 31st, 2012
10:22 am
A half step is an improvement worth applauding. This is the 100th birthday of the one who said, in economics, “Anyone easily converted is not worth converting.”
Kyle Wingfield
July 31st, 2012
10:23 am
Normal Free @ 9:15: The rule here is not to cut and paste entire articles from elsewhere. Please repost an excerpt of the article with a link to the rest of the piece. Thanks.
Jose
July 31st, 2012
10:24 am
it FUNNY
liberals CRY when you take OBAMA out of CONTEXT but they POUNCE on ROMNEY and take him out of CONTEXT all the time
IRONIC-MORONIC-HYPOCRITICAL
Numbers-R-US
July 31st, 2012
10:24 am
I see that Kyle has also taken note of the fact that changes in both the numerator and denominator affect a ratio. I think he took note of that, didn’t he.
iggy
July 31st, 2012
10:27 am
“single moms having to take food out of their hungry kids mouths to pay taxes so the the 50% can deduct their way to 0%”
Single moms shouldve thought about that before climbing in the back seat. But it doesnt matter. Poverty breeds poverty, jail time and both parties give them just enough to keep them miserable and, for the most part, out of the voting booth.
Tiberius - pulling the tail of the left AND right when needed
July 31st, 2012
10:29 am
“There were these things called “actuaries” around way back when FDR and his team first formulated SS. They were well aware of what was happening with life expectancy and built a system to accommodate it.”
Major fallacy, stands.
Back when SS began, there were 33 people paying into the system for every 1 person getting benefits.
Today, it is 2 for every 1, and dropping. By 2030, there will be more people receiving SS benefits than paying into them.
So if you think that’s how they designed their system back in the 1930’s . . .
Numbers-R-US
July 31st, 2012
10:29 am
@@,
Pardon me for stating this in such a graphic fashion but if I read your post correctly, you are stating that you like to be free to take a dump but you do not want to be forced to hear anyone reply about it’s presence or who left it or who should clean it up, etc. Is my assessment correct?
Jose
July 31st, 2012
10:31 am
T-SPLOST SUPPORTER LOGIC
leaders and politicians were so inept and incompetent that they did not plan or implement transportation projects to alleviate traffic in the past 10 years
SO!!!!!!!!!!
lets give these inept and incompetents MORE TAX MONEY and HOPE they CHANGE and will do what they DID NOT do in the first place
INSANITY
iggy
July 31st, 2012
10:32 am
“take a dump but you do not want to be forced to hear anyone reply about it’s presence or who left it or who should clean it up, etc. Is my assessment correct?”
LOL PPP U
I demand to see Cheesy Grits Birth Certificate- Long Form Please
July 31st, 2012
10:41 am
We have plenty of money for Laser Hovertanks that we will never use but try to give a poor kid a decent lunch and everybody goes ape.
Our priorities stink.
Finn McCool (The System isn't Broken; It's Fixed)
July 31st, 2012
10:42 am
So, you “no-tsplost” voters are voting no because you don’t trust the leaders and politicians who will in charge of spending the money.
These are primarily Republicans, correct? So you trusted them enough to vote for them and put them in such a position of responsibility but you don’t trust them enough to do their jobs?
Really? Is it any wonder GA is last in most every category? Too many Republican voters in GA.
kayaker 71
July 31st, 2012
10:42 am
“Facist ethics begin…… with the acknowledgement that it is not the individual who confers a meaning on society, but it is, instead, the existence of the human society which determines the human character of the individual. According to Facism, a true great spiritual life cannot take place unless the state has risen to a position of pre-eminance in the world of man. The curtailment of liberty this becomes justified at once and the need of raising the state to it’s rightful position”
Nikita Krushchev, February 25, 1956, 20th Congress of the Communist Party.
I demand to see Cheesy Grits Birth Certificate- Long Form Please
July 31st, 2012
10:45 am
Today, it is 2 for every 1, and dropping. By 2030, there will be more people receiving SS benefits than paying into them.
This is a myth. SS is not going bankrupt.
In fact after the baby boomers die off ( which for some is already happening ) It will be even more solvent.
Erwin's cat
July 31st, 2012
10:46 am
So, you “no-tsplost” voters are voting no because you don’t trust the leaders and politicians who will in charge of spending the money.
I voted NO because there is nothing in there that will reduce traffic congestion
Finn McCool (The System isn't Broken; It's Fixed)
July 31st, 2012
10:47 am
It’s okay for multi-millionaires and corporate lobbies to bankroll the most negative ads in a presidential election year—ads that are thrust upon millions of people whether we want to hear them or not—but the individuals or interests who are paying for those messages need to be protected from criticism or angry responses?
http://www.alternet.org/gops-three-biggest-fears-2012?page=0%2C2
Finn McCool (The System isn't Broken; It's Fixed)
July 31st, 2012
10:48 am
nothing in there that will reduce traffic congestion
hyperbole at its finest.
I demand to see Cheesy Grits Birth Certificate- Long Form Please
July 31st, 2012
10:49 am
Number of questions taken by Cheesy Grits during his entire overseas trip …..
3
stands for decibels
July 31st, 2012
10:50 am
Today, it is 2 for every 1, and dropping. By 2030, there will be more people receiving SS benefits than paying into them.
Did you really think my response to this would be “Oh golly, I’ve never heard THAT argument before”?
Do you think you’re dealing with some Boortz listener, here? Do you think I don’t know that the whole reason we began for the first time, in the 1980s, ever actually taking out a significantly higher chunk of income for a trust fund, was to account for that future?
Please read this before you try to answer back with another canned bit from the thieves’ playbook.
Jose
July 31st, 2012
10:50 am
ERWIN
you are wrong
the ATLANTA BELTLINE and MARTA CAPITAL PROJECTS will reduce traffic in Marietta, Forsyth CO., Rockdale CO. and Gwinnet CO….
you just are not smart enough to understand how this works
its too complicated for simpletons like us
Tiberius - pulling the tail of the left AND right when needed
July 31st, 2012
10:51 am
“This is a myth.”
Sorry, but these are the SSA figures from just 8 years ago.
No myth. FACT, Cheesy Grits.
stands for decibels
July 31st, 2012
10:52 am
Number of questions taken by Cheesy Grits during his entire overseas trip
“Hey, that’s three more than **I took from reporters during my 2008 Veep campaign!”
–Sarah Palin
Erwin's cat
July 31st, 2012
10:53 am
Okay Finn…please point out exactly which of the proposed TSPLOST projects will reduce traffic congestion…
sometimes hyperbole imitates life
Jose
July 31st, 2012
10:53 am
FINN is the type of HYPOCRIT that CRIES the 1% are getting unfair tax treatment on the backs of 50% that pay no taxes………… yet supports a tax increase (T-SPLOST) that favors the rich ATLANTA, FULTON and DEKALB over all the other poorer counties and cities in the region……….
md
July 31st, 2012
10:54 am
“I’m not sure this guy’s column is worth discussion anyhow, he thinks Boomers demonstrated the “spirit of sacrifice” in the Viet Nam war.”
Well, he has a point. The “choice” back then was to get drafted to go to the slaughterhouse or flee to Canada. The majority allowed themselves to be drafted vs flee. Of course 70% went voluntarily.
Then, compare the casualties vs today’s conflicts…..60k didn’t come home (alive).
St Simons - he-ne-ha
July 31st, 2012
10:58 am
Remove the 106k cap on SS – there, fixed for 75 yrs
Medicare for All – there, fixed
4 tiered tax table, 0, 15, 28, 39.5, no loopholes – there, fixed
Reduce corp tax to 20, raise capital gains tax to 41
you better have your seatbelts on, this thing will take off like a Saturn V
so easy. so obvious.
this is so easy to fix, it makes me believe you don’t really
want to fix it, so you can say ‘gubmint doesn’t werk’
Tiberius - pulling the tail of the left AND right when needed
July 31st, 2012
10:59 am
Wow, stands. A liberal think-tank writing about how wonderful SS is.
Never would have guessed you’d pull THAT card out of your butt . . .
btw, never believe anyone who thinks the SS trust fund actually exists. It’s GONE! Long gone. Spent by the very same liberals (and some Republicans) who cling so desperately to the notion that our deficit spending will magically come under control.
RC--apoi
July 31st, 2012
11:00 am
Well, it won’t hurt the geezers to do without a few meals a week. Most are too fat anyway. And they don’t need all those trips to the Dr. Let them go buy a little linament and some Vicks salve and they’ll get by OK. And most of them can’t hardly wait till they hit 65 so they can retire. I say they need to work till they’re 80 at least.
I say let’s go back to the way things use to be—say, around 1840. Back then, we never had all these guvmint leeches and people had the decency to die when they got too old to be useful. And Those People knew who was in charge. They never up and charged into a White man’s restaurant and demanded to be served or acted like they were just as good as the rest of us.
You know, I’m getting to like the way Wingfield thinks. Maybe I’ll just pull up stakes over at Bookman’s and move over here. Wingfield’s a redneck’s redneck. He knows what I’m thinking before I even get the thought in my head. Heck, by the time we get guvmint drowned in a bathtub, it won’t even be the size of a small mouse.
Vote No on this guvmint ripoff called TSPLOST and vote for all Tea Party Republicans today. Be a good Christian and elect people that will make all these lazy bums go out and find a job. And have a good Tuesday everybody.
Molly Brown is going down
July 31st, 2012
11:00 am
Thomas Sowell: It’s true. The rich are getting poorer A CBO report shows that the top one percent lost 36% of its income between 2007 and 2009.
“Perhaps the biggest lie of this election year, and the one likely to be repeated the most often, is that the income of “the rich” is going up, while other people’s incomes are going down. If you listen to Barack Obama, you are bound to hear this lie repeatedly.”
“But the government’s own Congressional Budget Office has just published a report whose statistics flatly contradict this claim. The CBO report shows that, while the average household income fell 12 percent between 2007 and 2009, the average for the lower four-fifths fell by 5 percent or less, while the average income for households in the top fifth fell 18 percent. For households in the “top one percent” that seems to fascinate so many people, income fell by 36 percent in those same years.”
“Ironically, those who make the most noise about income disparities or poverty contribute greatly to policies that promote both. The welfare state enables millions of people to meet their needs with little or no income-earning work on their part.”
“Most of the economic resources used by people in the bottom 20 percent come from sources other than their own incomes. There are veritable armies of middle-class people who make their livings transferring resources, in a variety of ways, from those who created those resources to those who live off them.”
“These transferers are in both government and private social welfare institutions. They have every incentive to promote dependency, from which they benefit both professionally and psychically, and to imagine that they are creating social benefits.”
“For different reasons, both politicians and the media have incentives to spread misconceptions with statistics. So long as we keep buying it, they will keep selling it.”
Tiberius - pulling the tail of the left AND right when needed
July 31st, 2012
11:03 am
Typical liberal solution, St Simons.
More revenue, but no cuts in spending (which is our actual problem, btw).
Rafe Hollister, suffering through Oblamer's ineptocracy
July 31st, 2012
11:04 am
We desperately need entitlement reform, and yes I am a baby boomer. It is unfair to our kids. The libs want to support Obama in his” tax raises on the rich solve everything” economic program, but anyone with a lick of sense knows that is counter intuitive to long term growth. We have to grown the economy first, then reduce the size of government, and use the money collected more wisely.
I have never understood why we feel that Soc Sec is so untouchable. Times change, we do not have the problems we had in the 30-40’s of old people starving and being left out of our society. Yes, many older people need assistance, but the majority hold most of the wealth in our country. We should continue to help those, who did not save enough or did not make enough to save, but the “fun money” should be stopped to those who do not need it. FICA should then be reduced substantially.
It is ridiculous for recent college graduates, loaded with debt, living in a flea trap apartment, unable to find a decent job, working minimum wage, having money confiscated from their paycheck thru FICA, so the money can be given to some blue haired widow driving a new Cadillac and living in a paid off home. The same coupon collecting blue hair that asks for a senior discount at every place she shops.