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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Tiberius - pulling the tail of the left AND right when needed
July 31st, 2012
3:25 pm
iggy, not even close at the Mad Italian, mainly due to the quality of the meat.
Once you’ve had a real Philly cheesesteak, you’ll consider it manna from heaven!
getalife
July 31st, 2012
3:28 pm
The buck stops with the President.
Our President will win in a slow steady job growth economy because that is the best you can do after a collapse.
Americans need a reminder of what w handed our President.
Lord Help Us
July 31st, 2012
3:29 pm
GOP just caved on a spending measure to fund the gov’t until after the Nov elections.
All horn, no drive-shaft…
Numbers-R-US
July 31st, 2012
3:32 pm
I just re-allocated 10 grand in the stock market a few days ago and my next re-allocation will involve a 25 grand chunk that looks like it has run its course and it’s all long-term capital so it qualifies for that cheap capital gains rate. If the politicians want to continue to give me tax-free gains, I’ll just go with the flow. Meanwhile, Obama really needs to end that payroll tax holiday and get a few other tweaks implemented so my social security and medicare retirement are not put at risk. As for you thirty-somethings, you’re on your own but you’re good with that, right. You support Ryan and Cantor and their plans for your futures, right. I thought so.
That Black guy
July 31st, 2012
3:37 pm
Some people are stupid
July 31st, 2012
2:56 pm
Peadawg-
But there is a projected 1.2 trillion dollar deficit for this year, which is under a republican house. Wouldn’t it make more sense to blame congress for spending as opposed to the president. I don’t think he has line item veto powers on a budget, and by not signing, he effectively shuts the government down.
__________________________________________________________________________
Some people, you do realize there was no budget presented to Obama to NOT sign. just continuing resolutions.
Do you blame congress for the increased spending under Bush as well?
Erwin's cat
July 31st, 2012
3:42 pm
As to Obama’s economic policies, economists agree that his stimulus worked.
for China
josef
July 31st, 2012
3:47 pm
Numbers R Us
Didn’t your people tell you never to put a dollar figure on anything for people to see who don’t share a bankbook, blanket, and bathroom with you (accountants, etc. being the exception)? It’s très déclassé.
Finn McCool (The System isn't Broken; It's Fixed)
July 31st, 2012
3:48 pm
Most networks report AND editorialize about the good and the bad in both parties. Fox News avoids reporting anything negative about Republicans and will NEVER editorialize about anything negative involving Republicans.
On the other hand, turn on Rachel Maddow and you will see her berating Democrats quite frequently.
Piedmont South from North Georgia
July 31st, 2012
3:52 pm
Erwin’s cat
July 31st, 2012
3:42 pm
As to Obama’s economic policies, economists agree that his stimulus worked.
for China
___
Ah, there is the rub. Any money put in the economy as a stimulus goes to Asia, because we use it to buy goods made there.
It’s the trade deficit that is killing us.
catlady
July 31st, 2012
3:55 pm
It sure isn’t just poor folks who have a sense of entitlement! Watch the elderly snarl over possible changes in their Medicare! Watch the middle class growl over attempts to take some of their tax deductions!
josef
July 31st, 2012
3:56 pm
FINN
Yep. I’m a big Maddow fan and she’s a big Shepherd Smith fan…she don’t let up on the Dems, and he doesn’t let up on the GOP…
Erwin's cat
July 31st, 2012
4:00 pm
Piedmont – I think on “this week with G Stephanopoulos” a couple weeks ago that 71% of the stimulus went to China…all the green projects etc went to windmills made in China etc etc
yuzeyurbrane
July 31st, 2012
4:01 pm
Explain again how Social Security spending is crowding out investments in infrastructure or anything else. As I understand it, SS has at least a $2.7 trillion surplus and has not contributed one penny to our deficit, or for that matter, our budget, and will continue to have no impact until at least 2033. Even then, it only has an impact if the Congress then votes for the Treasury to pick up the projected 25% cut in benefits from its General Fund and/or if Congress does not enact the small modifications that are needed to keep the program solvent for another 75 years. Kyle, nothing against you Gen-X’rs but don’t pay for the trillions given to the have and have-mores by Bush by stealing it from seniors and the middle class.
Jefferson
July 31st, 2012
4:04 pm
Kyle and his generation don’t get it. But they will.
That Black guy
July 31st, 2012
4:08 pm
Bruno
July 31st, 2012
3:24 pm
Gotta run out and cast my “No” vote for T-SPLOST and casino gambling.
Catch you all in a while.
_________________________________________
I voted “NO” this morning, before work.
Numbers-R-US
July 31st, 2012
4:10 pm
Didn’t your people tell you
No.
Now, define rich, upper class, middle class, poor, impoverished, etc., quantitatively without using numbers. Decide who should pay and how much they should pay in taxes, etc. In short, the last thing we need is a lack of numbers in a discussion regarding who needs to pay up. Kyle has even opened the door with his claim that it is the entitlement folks that need to make a bigger sacrifice. Perhaps he should inform them of the cost of their cell phone plan or their dish network plan or their prescription drugs, etc., so they understand just how much more they can do without so the wealthier amongst us can have more tax cuts.
kayaker 71
July 31st, 2012
4:14 pm
Growth still at 1.5%. Unemployment still over 8%, more like 12-13%, if you count everyone, for the last 42 MONTHS!! And you liberals want to give this clown a second term?
Rightwing Troll
July 31st, 2012
4:14 pm
Whew!! What a day… stopped by and voted on the way to work.. stepped out at lunch and voted again… now I’m gonna vote on the way home…
Numbers-R-US
July 31st, 2012
4:16 pm
And you liberals want to give this clown a second term?
Not me. I think Boehner needs to go. Right out the door with the rest of the House Republicans. They have done nothing to create jobs. Nothing. At. All.
Bruno
July 31st, 2012
4:17 pm
Decide who should pay and how much they should pay in taxes, etc. In short, the last thing we need is a lack of numbers in a discussion regarding who needs to pay up. Kyle has even opened the door with his claim that it is the entitlement folks that need to make a bigger sacrifice.
NAU–I’ve already paid somewhere around $200,000 in FICA taxes, and the minimum age to receive Social Security benefits has been raised to 67 for my age group. I’m not sure how much more I’m supposed to sacrifice.
That Black guy
July 31st, 2012
4:20 pm
josef
July 31st, 2012
3:56 pm
FINN
Yep. I’m a big Maddow fan and she’s a big Shepherd Smith fan…she don’t let up on the Dems, and he doesn’t let up on the GOP…
____________________________________________________________________
josef, that can’t be right.
I NEVER watch Fox News, so that’s how I know they NEVER say anything negative about republicans.
Bruno
July 31st, 2012
4:20 pm
I voted “NO” this morning, before work.
TBG–I was surprised to see the Democrat and Republican ballots were substantially different down this way. Other than the T-SPLOST question, all of the other ballot initiatives were completely different. The casino gambling question along with the $100 gift limit appeared only on the Republican ballots. I thought these issues impacted all voters.
JDW
July 31st, 2012
4:21 pm
@kayaker 71 …”Growth still at 1.5%. Unemployment still over 8%, more like 12-13%, if you count everyone, for the last 42 MONTHS!! And you liberals want to give this clown a second term?”
Versus negative GDP growth of 5.9%, job losses of 750,000+ a month, two unfunded wars, torture of prisoners and a melted down financial system…you betcha.
Bruno
July 31st, 2012
4:22 pm
BTW, josef, I followed your lead and figured out why the word s-p-i-c-e doesn’t make it through the auto-censor here.
Either way, you’re still the King of C-u-l-o.
Bruno
July 31st, 2012
4:23 pm
I was also required to show an ID before voting. I thought that requirement was shot down in GA.
Tiberius - pulling the tail of the left AND right when needed
July 31st, 2012
4:23 pm
“Fox News avoids reporting anything negative about Republicans and will NEVER editorialize about anything negative involving Republicans.”
Clearly someone doesn’t actually watch the “news” portion of Fox News.
Numbers-R-US
July 31st, 2012
4:25 pm
I answered no to that stupid question on the Republican ballot about declaring your party 30 days in advance of voting. I answered no to that stupid question about when life begins. I answered yes to cap those gifts for elected ones. Ralston should be ashamed of himself for thinking that his behavior is acceptable. I also answered yes for that casino gambling in order to increase funding for HOPE.
Piedmont South from North Georgia
July 31st, 2012
4:26 pm
Bruno
July 31st, 2012
4:20 pm
____
Those items were on the Democrat ballot in DeKalb. I voted early – last Thursday, but I hope I can remember that far back. Could be a false memory. Lot of those are going around.
Piedmont South from North Georgia
July 31st, 2012
4:28 pm
Bruno
July 31st, 2012
4:23 pm
_____
Think you just had one of those false memories I just mentioned. Memories are tricky things..
JDW
July 31st, 2012
4:28 pm
@Bruno…”The casino gambling question along with the $100 gift limit appeared only on the Republican ballots. I thought these issues impacted all voters.”
Those are just polling questions by each party…the Dems asked voters if the state should be able to override local school boards when it comes to the creation of charter schools; if Georgia should adopt an income tax credit for home energy costs; and if the state should reduce sales taxes for Made In Georgia products to spur economic growth.
Bruno
July 31st, 2012
4:31 pm
Versus negative GDP growth of 5.9%, job losses of 750,000+ a month
For how many months?? In case you missed it, the economy did well under Bush for the first 7 + years.
two unfunded wars
Last I checked, both the Iraq and Afghani invasions were paid for.
torture of prisoners
Though I don’t support mistreatment of prisoners in any way, waterboarding someone is a little bit different from what happens to prisoners in many other countries. In case you were unaware, both Clinton and Obama utilized “Extraordinary Rendition”, by which prisoners are farmed out to places like Egypt which are only too happy to do our dirty work for us.
and a melted down financial system…you betcha.
Care to explain how that is Bush’s fault alone. Seems to me he had a lot of cohorts, including Bill Clinton, who signed all of the financial market deregulations bills which started the ball rolling.
But don’t let any of the facts get in the way of your partisan rants…….
Numbers-R-US
July 31st, 2012
4:31 pm
I’ve already paid somewhere around $200,000 in FICA taxes, and the minimum age to receive Social Security benefits has been raised to 67 for my age group. I’m not sure how much more I’m supposed to sacrifice.
If you are under 55, you are being asked to sacrifice some unknown amount by accepting a cut from a fixed block grant with a declining value when you retire. Now, per this post, if you are already retired or near retirement, you are apparently being asked to sacrifice some portion of what you thought you were going to get in order to provide for more tax cuts for the job creators.
Jefferson
July 31st, 2012
4:32 pm
How much ? As long as you work you pay. Get over it.
Piedmont South from North Georgia
July 31st, 2012
4:33 pm
Those items were on the Democrat ballot in DeKalb. I voted early – last Thursday, but I hope I can remember that far back. Could be a false memory. Lot of those are going around.
_______
Just checked with my wife. Those items were not on the democrat side.
I did vote for limitations on gifts to lobbyists. I must have got that confused with the other gifts.
I thought there was something about gambling on the dems side.
don’t understant the point of non=binding votes anyway.
Numbers-R-US
July 31st, 2012
4:34 pm
Last I checked, both the Iraq and Afghani invasions were paid for.
Where’d you check, in the IOU pile.
Piedmont South from North Georgia
July 31st, 2012
4:34 pm
two unfunded wars
Last I checked, both the Iraq and Afghani invasions were paid for.
______
Paid for with money borrowed from China. Don’t think that counts as being paid for. The debts are still outstanding.
Bruno
July 31st, 2012
4:34 pm
Piedmont–I just returned from the voting precinct about 5 mins ago. My memory ain’t what it used to be, but it’s not that bad.
I answered no to that stupid question on the Republican ballot about declaring your party 30 days in advance of voting. I answered no to that stupid question about when life begins. I answered yes to cap those gifts for elected ones. Ralston should be ashamed of himself for thinking that his behavior is acceptable. I also answered yes for that casino gambling in order to increase funding for HOPE.
We voted the same except for the casino gambling question.
Jose
July 31st, 2012
4:35 pm
OBAMA IS REALLY UNPATRIOTIC
http://www.youtube.com/watch?v=1kuTG19Cu_Q
Numbers-R-US
July 31st, 2012
4:36 pm
don’t understant the point of non=binding votes anyway.
They most likely will be used to help generate those lists of talking points that have the greatest probability of stirring up the desired responses when needed from the respective constituencies.
JDW
July 31st, 2012
4:40 pm
So this is our alternative…send Mittens out for 3 days and he insults Great Britain and the Palestinians plus makes it real clear to his own press corp where they stand. Boy stand by for the “positive” news stories to roll out…and people wonder why Obama will win.
http://www.politico.com/news/stories/0712/79200.html?hp=t1
That Black guy
July 31st, 2012
4:41 pm
Bruno
July 31st, 2012
4:20 pm
I voted “NO” this morning, before work.
TBG–I was surprised to see the Democrat and Republican ballots were substantially different down this way. Other than the T-SPLOST question, all of the other ballot initiatives were completely different. The casino gambling question along with the $100 gift limit appeared only on the Republican ballots. I thought these issues impacted all voters.
_________________________________________________________________
Same thing in College Park where I live. Also, I took the nonpartsain ballot and the only thing on it was the T-SPLOST and a few local elections. Not even the casino question.
Numbers-R-US
July 31st, 2012
4:41 pm
Seems to me he had a lot of cohorts, including Bill Clinton, who signed all of the financial market deregulations bills which started the ball rolling.
Phil Gramm’s name seems to come to mind with regards to one of those pieces of deregulation. Something to do with derivatives or something like that slipped into a funding bill under cover of midnight without even the knowledge of his own party members, or so the story goes.
Hillbilly D
July 31st, 2012
4:41 pm
Numbers-R-US @ 4:36
They give the pols an idea of where the people will allow their pockets to be picked and where they won’t.
Bruno
July 31st, 2012
4:43 pm
If you are under 55, you are being asked to sacrifice some unknown amount by accepting a cut from a fixed block grant with a declining value when you retire. Now, per this post, if you are already retired or near retirement, you are apparently being asked to sacrifice some portion of what you thought you were going to get in order to provide for more tax cuts for the job creators.
I’m under 55. And, technically speaking, SSI is a separate entity from the broader federal government, with its own independent source of funding (FICA taxes). As such, any mythical “tax cuts for the job creators” don’t impact it. Just in case you forgot, the Bush tax cuts helped everyone, with those at the bottom more impacted proportionally. Furthermore, the temporary reduction on payroll taxes was a Democratic brainchild, one which also disproportionately helps those at the bottom tiers.
How much ? As long as you work you pay. Get over it.
I’ve never objected to paying my fair share. I’m just asking for a reasonable return when I hit retirement age.
Erwin's cat
July 31st, 2012
4:43 pm
I got a non-partisan card and it just had judges and TSPLOST…nothing else
Bruno
July 31st, 2012
4:45 pm
Phil Gramm’s name seems to come to mind with regards to one of those pieces of deregulation. Something to do with derivatives or something like that slipped into a funding bill under cover of midnight without even the knowledge of his own party members, or so the story goes.
Any reason you’re having difficulty acknowledging that Clinton signed the bill?? Don’t tell me you’ve fallen prey to Bush Derangement Syndrome…….
Hillbilly D
July 31st, 2012
4:46 pm
Intentionally stepping on toes, rather than simply writing what I think and letting the chips fall where they may, is not on my to-do list.
I admire you for that. It’s getting to be a rarity in the news/entertainment business.
Jose
July 31st, 2012
4:47 pm
liberals sure are giving us SHOVEL READY excuses for Obama’s economy
http://www.youtube.com/watch?v=skAOLejB4BA
Tiberius - pulling the tail of the left AND right when needed
July 31st, 2012
4:47 pm
First the left claims that Romney doesn’t take a stand.
Then, when he does, they complain that he took a stand.
This is the essence of the liberal mindset.
Hillbilly D
July 31st, 2012
4:50 pm
I got a non-partisan card and it just had judges and TSPLOST…nothing else
I think it’s that way most places. I know where I live, I don’t really have a choice of which party primary I vote in, if I want to take part in elections for local offices. Except for about one election cycle, it’s been that way my whole life. Went from having to vote in the Democratic primary to having to vote in the Republican primary. From where I sit, nothing has really changed on the state and local level in the last 40 years, except the party labels.