I just read today’s editorial in the New York Times regarding the national (growing) deficit. It was standard fare, the root cause is the Bush tax cuts that provided inadequate revenue, Obama inherited the recession and thus had to add to the deficit substantially (but not enough and we need more) and health care reform has done its part to reduce the deficit. The editorial correctly pointed out that Medicare, Medicaid and Social Security account for about 40% of the budget and thus a substantial part of the problem.
I have a friend who has a money problem too, it’s his wife who spends and spends and charges and charges to the point where he simply can’t pay his bills. He even took a second job to increase his revenue and his wife just spent that too. I wonder, is the proboem that he doesn’t have sufficient revenue or that he can’t control his family budget?
Historically what has Congress done with more revenue…it spends it and it commits to long term obligations. Why is the estate tax still in effect when it was supposed to be temporary to help fund WWI? Why is Social Security in the hole it is in when in the beginning it was supposed to become self-sustaining with worker contributions?
Why haven’t the billions and billions already spent on economic stimulus stimulated much…perhaps because Americans are worried about what’s coming next. How much more will they have to pay in taxes, how much more will their health care cost them? What will be the state of the Country they leave for their children?
Health care reform is another example. To the extent it lowered federal spending at all it shifted additional costs to Americans and private business which as one might suspect leaves less for the private sector to spend which is needed to keep the economy humming. If Congress was so concerned about the deficit and the shortfall in revenue why “improve” Medicare when it is not affordable? Sure, adding new benefits, closing the donut hole are all great for the people changes help, but so is a two week vacation on Maui…if one could afford it. What nonsense!
By the way, health care reform is not going to lower the deficit in any way shape or form, it is a big shell game and any serious attempt to truly impact federal spending on health care is going to be very painful.
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