How I Solved the Deficit

The New York Times has an interactive feature today that lets common ordinary folk just like you and me take a whack at solving the deficit issue, giving you two goals to hit: Clearing the projected deficit in 2015 ($418 billion) and in 2030 ($1.3 trillion). Presumably you’ll also hit all the marks in between.

Well, I’m concerned about the deficit, so I thought I would give it a try, and I’m delighted to say that in fact I did manage to curb the deficit quite handily, cutting over $430 billion from the budget in 2015 and over $1.5 trillion from 2030. How did I do it? The link in this paragraph will take you to my actual worksheet, but if you’re lazy I’ll hit the highlights below.

My particular formula combines both cutting the size of government and trimming back some entitlements (yay! I’m conservative!) while also recognizing that taxes aren’t evil and in some cases should be raised for the overall benefit of society (yay! I’m a liberal!). It works out to 58% of the reduction coming from spending cuts and 42% coming from tax increases, which I think is perfectly reasonable.

(Update, 10:43 am: Adding in what I should have noted earlier — in doing this I’m working from the options provided by the interactive feature, which are both limited and elide over annoying little details that are nonetheless relevant. My own real-world choices would be similar to the choices I make here, but with some probably more subtle distinctions and details.)

Domestic Programs and Foreign Aid

In this category I leave pretty much everything untouched except for the number of people employed by the government, choosing to reduce the government workforce by 10% and to eliminate 250,000 contractors. I assume the contractors will be let go at the end of their contracts and the government workers through retirement and typical attrition. This saves $29 billion in 2015 and $32 billion in 2030.

Military

Only two things touched here: I reduce the size of our nuclear arsenal (because I figure 1,000 nuclear warheads is enough to nuke the planet sufficiently) and I draw down our Iraq/Afghanistan troop numbers to 60,000 in 2015. This saves $70 billion in 2015 and $187 billion in 2030.

Health Care

This is where the biggest savings come in. For you conservatives out there, I institute medical malpractice reform, which I know you’ve been itchin’ for. Don’t say I never did nothing for you. I also increase the Medicare eligibility age to 68, although I’ll note that if people really howl about this one I can take it out while still covering the projected deficits for both years. But the huge item here is capping Medicare growth starting in 2013, tying it to GDP growth plus one percent. Now, before everyone begins griping at me about this, I’ll note that in 2030 I’ll be 61, which means I’m putting these reforms on my own tab, and the tab of my own generational cohort. Sorry, Gen X. We’re the ones taking the hit, as usual. But on the other hand we’re saving $45 billion in 2015 and a staggering $631 billion in 2030.

Social Security

You know, if memory serves, when Social Security first started, the life expectancy for the average American was only about a year beyond the retirement age of 65. Now life expectancy is closing in on 80 years, so you can spend 15 years collecting Social Security. This longevity is one reason why I don’t feel entirely bad about deciding to raise the Social Security retirement age to 68 (it was already going up to 67). Once again, it’ll be me and my generation working those extra three years, and I’m fine with that. I also trim down the Social Security benefits for high income folks (more accurately have those benefits determined by a slightly different formula), because you know what? They generally have better retirement set-ups and as a high-income sort of person, I’m fine suggesting to other folks like me that we can probably get along just fine and let the government tend to those who have actual need. This saves $19 billion in 2015 and $125 billion in 2030.

Existing Taxes

The estate tax, gone this particular year (if you’re a billionaire, your heirs want you to die now!!!) will be coming back, although for my part I choose the Lincoln-Kyl formulation of it, which is a 35% tax on estates larger than $5 million, indexed to inflation. So relax, death tax hysterics; you’re almost certain not to get hit. I also boost capital gains and dividends taxes to 20% on high income investors, because 20% is not an onerous tax rate. Likewise I let the Bush tax cuts expire on people making $250,000 or more a year. Don’t wring your hands for the well-off, folks. I assure you we can afford it. I also boost payroll tax on high-income folks so that 90% of incomes are covered (it’s about 80% now). This saves $126 billion in 2015 and $259 billion in 2030.

New Taxes and Reforms

Two things here: One, I implement the Bowles-Simpson plan, which gets rid of a number of tax loopholes but then also generally lowers tax rates overall, which I suspect benefits most people with relatively uncomplicated tax profiles. Two, I institute a bank tax, because you know what? After spending a trillion dollars in the last couple of years to bail them out of their own greed-fueled stupidity, I think it’s fine to use taxes to put something aside for the next time their greed-fueled stupidity gets the best of them. This saves $148 billion in 2015 and $278 billion in 2030.

That’s how I would do it. Your thoughts? How would you do it?

132 thoughts on “How I Solved the Deficit

  1. Medicare: Make any group medical insurance plan primary over Medicare.

    I’m NOT talking about the supplemental plans; only the group sponsored plans. For example, if you are covered by Medicare, still working, and covered by your employer’s medical plan, who is primary? If you have a spouse that is still working and you’re covered by Medicare, who is primary? It just depends. If you have End Stage Renal Disease, it’s a nightmare depending on how long you’ve had the disease.

    I’ve been in the insurance/benefits field for the past 18 years. You have to have a decision tree to figure out if Medicare is primary or secondary if the person is covered by a group sponsored plan in addition to Medicare. Medicaid is always secondary to any group sponsored plan; Medicare should follow suit.

  2. Quick note, fyi: Check the growth in life expectancy for those in the bottom half of the earning population compared to the top.

    You may find that the poor are not living all that much longer and that the increase in life expectancy is MOSTLY from those in the top half, so increasing the retirement age (for wealthier people who sit in front of computers) may just be done on the backs of poorer folk (who don’t live as long and who don’t tend to sit when they work).

    Well done on that.

  3. I added the “millionaire’s tax” to your plan and cut troop levels in Af/Iraq to 30K (I believe the operational distinction on the ground between 60,000 and 30,000 is moot…either level indicates primarily non-combat ops whose purpose is training and force protection). My proportion was 44% Tax and 56% cuts. Medicare caps had to go in (like Willie Sutton, I have to go where the money is), although I believe for that cap to not affect quality of care, you’re going to have to add some regulatory bumpers.

    I put in the Millionaire’s Tax even though I’d solved the deficit problem for one simple reason; if you’re making $1,000,000 per year and you simply cannot tolerate an additional 5.4% tax on your income, I cordially invite you to “Go Galt” and not make that money. Contrary to your fantasies about how the Free World will topple without your precious input I would suggest that your absence…you likely being an investment banker, really high paid attorney, or a CEO of a multi-billion dollar company for which lower level managers actually provide the strategy and implementation to maintain company profits…would be very much a net plus to the economy.

  4. notthatyoucare:

    Meh. Those on the lower end are living well past 68 (on average) from what I can see from the report, and I’m also lowering the benefit for higher-income folks and taxing more of their income for Social Security.

    Not suggesting this is a perfect answer, however.

  5. Off the cuff, I wouldn’t institute “medical malpractice reform”, because it isn’t, actually (and not because I handle med-mal cases, which I don’t). The NYT’s blurb dutifully recites the Chamber of Commerce talking points on the subject, certainly; but “reform” really doesn’t do much except shift the costs of malpractice from medical-malpractice insurers to medical-malpractice victims.

    The clever bit about the “reform”, you see, is that it’s not really intended to reduce those scary verdicts you read about in the newspaper (which usually end up being nowhere near what’s actually paid, but let’s set that aside for the moment). It’s intended to make sure that people hurt by malpractice, no matter how clear-cut the misbehavior and how awful the result, can’t get a lawyer to take their case.

    Plus, there’s the thing about how unnecessary tests are a lot more related to the financial benefit the doctor/clinic/hospital ordering the tests financially benefits from them; but that’s not a narrative “many doctors believe”, even though doctors are the ones who have shown this to be the case.

  6. But the folks who planned Social Security knew that lives were going to be longer and planned for it. The only thing they didn’t anticipate was the baby boom. We need to do some sort of adjustment to accomodate that and let other things be. The problem with raising the retirement age is that companies don’t even want to hire anybody over fifty, how are people who lose a job later in life going to survive? Raising the retirement age would need to take into account that some jobs are harder on a body than others. In terms of retirement, a year working as a laborer should count for more than a year spent as an office worker. There should also be a peg to the unemployment rate for older workers. Companies with a workforce that is younger (statistically significant) than their industry norm should pay a social security surtax. Companies offshoring jobs should have to pay a Social Security surcharge.

    I wouldn’t cut federal workforce now, but would create expectations that it will happen when unemployment drops.

    We should also retrain the army of unemployed low-level bank employees as forensic accountants and sic them on their old bosses.

    As someone born and raised inside the beltway, who remembers the pre-Reagan years when you drove through farmland to get to Dulles airport, I was really disappointed not to see Homeland Security rollback as one of the options. This truly is a huge boondoggle. The military, intelligence, and security budgets need to face the “is this actually keeping real Americans safe or just providing secret little thrills for war nerds” test.

  7. Well, seeing as wife and I are both contractors on a gov’t run research lab, I’d hope that we’re both valuable enough for them to want to hire us on direct.

    And yeah, life expectancy of the lower income folks really hasn’t gone up that much. Maybe make a sliding scale of when you can start collecting SS payments, depending on current income/investments?

  8. So, you found that by implementing the best ideas, regardless of political ideology, you were able to find solutions to problems?

    Don’t let Congress know about this.

    My point is that exercises like this actually make me kind of depressed. I realize that there are ways to fix the country, it’s just that the people we elect aren’t really interested in doing it.

  9. Mike B @10: by “the best ideas”, you realize you mean “ideas as presented in blurb form by the NYT, without a real analysis of the effects other than immediately cutting the budget”. That’s not so much how I would define ‘best’.

    I mean, the Freakonomics folks (back when their agenda was more fact-based) made a convincing argument that one reason for reduced juvenile crime is the reduced number of juveniles due to legalizing abortion. I don’t think that any of us would therefore agree to implementing China’s one-child policy in the US, with forced abortions for people who go over, if the NYT told us that this would save a net of $5 billion in law-enforcement and social service costs.

  10. It is indeed a common talking point that life expectancy was around 65 or less when Social Security was originally passed. However, this is a bullshit statistic because life expectancy was weighed down by infant mortality, and people who die in childhood don’t pay into social security. Even in 1940, more than half the population survived to age 65, and if they lived that long, their average survival past 65 was about 13 years.

    Google failed me, but I did read an article that quoted the guy who did the original math for handling increase in life expectancy for FDR. Things have tracked pretty close to what they expected when Social Security was originally passed, and he was pretty upset so many people were saying otherwise.

  11. Mythago does make the salient point that I balanced the budget with the choices offered via the NYT interactive graphic. The graphic predetermines choices and also quite clearly elides over some difficult choices.

    My own personal choices in the real world would be similar to the choices I made in the interactive graphic, but I suspect there would be more subtlety to them.

  12. I was disappointed to not see single-payer, universal health care as an alternative to the current HCR and/or Medicare/Medicaid reforms.

    My worksheet ended up 56% taxes and 44% cuts. My biggest cut was the cap on Medicare, but that would be superseded if single-payer, universal health care were enacted.

  13. I know it’s a check-the-box thing with no choice either way, but the medical malpractice reform one bothers me. People paint it as protecting doctors and only hurting lawyers, but while it does hurt lawyers (and full-disclosure, I am one), it also hurts patients and protects insurance companies a lot more than it protects doctors. Caps mean less potential recovery, meaning that real injuries will go uncompensated because it won’t be worth any lawyers’ time to pursue. There’s reform that’s worthwhile (for example, a panel like the EEOC to help weed out bad claims and pursue good ones), but the cap-limit bandied about isn’t one of them. I’d rather go without any reform than that “fix”.

  14. Mike B.@ 10 – If it were just the people we elect who weren’t interested in fixing the country, that wouldn’t be so bad: we could vote them out. Let’s admit that it’s we the voters who aren’t interested, because putting fixes in place would make our lives less comfortable in the short term. Like most large problems, this one has more than one cause, but we’re the biggest.

  15. I really don’t want to bog the thread down debating medical malpractice (I do, but our host will Mallet me into next week, and then I’d have to sue him, and Ohio is a crappy venue for that sort of thing and…meh, not worth it), but there are a host of remedies available to cut the 2% of the medical budget that’s related to malpractice other than “make sure the medical malpractice insurers don’t ever have to pay out claims”. Which, bluntly, is the interest that bankrolls “tort reform” of all stripes.

    John @13: and some of those choices are not a whole lot more complicated than they make it out to be – the estate tax doesn’t really have a serious downside – but it’s frustrating when this is taken more as an intellectual exercise/starting point and more as “Well gosh, if we just did that thing we’d fix the deficit, why cannot those madmen in Congress do this?!

  16. Bob @16 and mythago @17: I chose to ignore the “eliminate earmarks” option because that’s never going to happen. Congresscritters bringing home the pork is as American as apple pie – asking them to stop earmarking would be like asking them to stop breathing…

  17. Personally, I’d balance the budget with universal health care, a 50% reduction in military spending, sharply progressive individual and corporate taxes, and fines for corporate misdeeds defined in percentages of gross income. But Mythago’s right: there are reasons for existing outcomes that this sort of exercise doesn’t illuminate at all and often obscures.

  18. Bob@#16 – I would wholeheartedly agree with you. I like in Oklahoma where we recently voted to outlaw Sharia law. Because when you think of the encroachment of Sharia law, Oklahoma is the front line.

    We’re basically duking it out with Mississippi for worst state in education, health care, etc. and THIS is what people are actually worried about.

    Mythago@#11 – Please enjoy your game of “gotcha” by yourself.

  19. Personally, I’d have eliminated farm subsidies, cut earmarks, dropped more weapons programs, withdrew more troops, cut the size of the Navy, enacted a carbon tax, and gone with Clinton era on a number of tax increases. That would give us a nice surplus out in 2015, which we could use to spur actual growth.

  20. I went for a one-time 5% cut in the pay of federal workers. We have a similar situation here in the UK with regards Public Sector vs Private Sector wages. I did this instead of cutting jobs, knowing how much it sucks to be out of work and how that particularily affects young workers.

    I reduced the Nuclear Arsenal to 1000+ warheads. I’d of liked to have cut it even further, but there wasn’t a button.

    I wanted to reduce the US military presence in Europe, but wouldn’t dare reduce it in Asia. After much pondering my mistrust of geopolitical rivals China won out I decided to keep the lot. Taiwan will surely be relieved.

    I kept all the US military shinies intact. Primarily because I suspect surrending technological capability at this critical juncture would be false savings at best and disastrous at worst. I hold this especially true of Air force and Naval capabilities.

    I reduced the presence of American soldiers in Iraq and Afganistan to 30,000 by 2013. I regard the Afghan war as an expensive and largely counter-productive waste of time, money, effort and lives. I realise that such a quick withdrawal might to tantamount to a retreat, but 86 Billion soon and 169 Billion Dollars later is a very convincing argument.

    I capped Medicare growth to GDP plus 1 percent because i’ve never been a big fan of government programs that balloon, unchecked, while the taxpayer foots the bill.

    I raised the Social Security retirement age to 70 as I believe that such a safety net should be primarily aimed at those who are Too Damned Old to work, rather than those who are merely old and fed up. Considering the rise in life expectancies over the last half-century I think it’s only realistic that people should be expected to work for longer too.

    I also voted to reduce Social Security benefits for those with high incomes. Because I mean… really?!

    I adopted the Lincoln-Kyl Proposal, because while being taxed 35% of your inhereted estate sucks, you didn’t earn it yourself and the blow is cushioned by the $5 million that is tax free. I find it hard to sympathise with anyone that maintains that they NEED significantly more.

    I allowed the expiration of Bush’s tax cuts for those earning above $250,000 and plumped for the Millionaire’s surtax.

    I went for a Carbon tax because I believe it provides incentive to develop cleaner techonology… and because I think those unlovely monolithic fossil fuel companies can afford it.

    The end result? I eliminated the deficit, but just barely.

  21. Just to see how the math worked out, I tried first with spending cuts only – no taxes – and not touching military spending. Can’t be done. Selecting all of the domestic, Social Security and health care cuts covered the long-term gap but only covered about 2/3 of the short-term gap.

    For what I’d actually do, I started off raising the Medicare and Social Security eligibility ages to 70, but when I was through with everything else, the numbers worked out for Social Security and Medicare eligibility at 68, so I gave the 68- to 70-year-olds a reprieve, but we’re still taking all the other cost-cutting measures for both programs except the medical malpractice reform. I reduced the nuclear arsenal (anything beyond what it takes to turn the whole planet into a molten slag heap is superfluous) and trimming down the fleet, future weapons plans and overall size of the military. This would require re-framing the purpose of the military more narrowly to defending our vital interests (not all interests, just the vital ones) rather than going after every bad guy on the planet ourselves, but I think that’s reasonable. I went with the lower levels of troops, on the “time to fish or cut bait” with the war principle.

    I left all domestic programs intact. A few of them, I think could go, but realistically, there is no chance of cuts to farm subsidies or earmarks actually going through. I left the contractors and workforce alone since one person’s bloated bureaucracy is another person’s job.

    The only tax measures I enacted were the Bowles-Simpson plan and expiration of tax cuts above $250K a year. End result is the deficit is closed, 79% cuts, 21% taxes.

  22. Yep, we have medical tort reform here in Michigan, and because of it my disabled mother is unable to sue for an egregious medical error made by a hospital in 2005. Non-economic (punitive) damages are capped at $250,000. A lawyer’s portion of that settlement would not cover the costs of the case. Only cases that have huge economic damages can receive justice (babies, small children, younger wager earners).

    Each of the options on the NYT site includes a set of assumptions which, like medical malpractice reform, are debateable. The point of the exercise is to bring home the painful sacrifices and tradeoffs that our government must make in order to balance the books, and that I think it does quite well.

  23. By the way, anyone in favor of raising minimum age for Social Security and such really should look at trends in unemployment and reemployment for people over 50. It’s bad and getting worse – someone over 50 who loses a job stands a good chance now of never working in their field again, or indeed working at all at anything above generic retail mininums. If you want them to spend 10, or 15, or 20 years stuck without real work, you need to have something in mind for them to do other than starve, and if you want them to work – as they would like to! – you need to offer some idea of what might reverse this well-established, pretty much universal trend in business.

  24. Mine ended up 72% taxes 28% spending cuts. Guess I’m a liberal. :) I cut government contractors but not employees, hit every military cut they had other than cutting soldiers’ pay/benefits, left social security and medicare alone other than cutting social security benefits to high income earners, returned most taxes to Clinton-era levels (cause they seemed to work pretty well then), and added a carbon tax, bank tax, and millionaire’s tax. And yeah, a single-payer Medicare-for-all health plan would save way more money than all the other health care options they have there.

    When looking at life expectancy changes, remember to factor in infant mortality, which is much lower now than it was 75 years ago thanks to advances in medicine. When you have fewer people dieing at age 0, it has a huge impact on the average. A person who survived to age 60 in 1935 and a 60-year-old in 2010 have much more similar life expectancies, there are just a lot more people surviving to 60 these days.

  25. elides? Huh? Google to the resue. This is why reading is good.
    Your soloutions seem reasonable. Too bad people aren’t particularly reasonable.

  26. FungiFromYuggoth @12:
    I often see that life expectancies were much lower in 1935, and and agree that it is a deceptive argument. Life expectancy at 65 is what is relevant, not life expectancy at birth. While life expectancy at age 65 has gone up, it has not gone up nearly 15 years. For men it has gone up about 3 years.
    I’ve included stats below:
    http://www.ssa.gov/history/lifeexpect.html
    The above chart starts at 1940 and ends 1990 (as opposed to 1935-2010), but it illustrates the concept.
    Example:
    Life expectancy at birth for Men in 1940 – 60.8 (http://www.infoplease.com/ipa/A0005148.html)
    Life expectancy at age 65 for men in 1940 – 12.7yrs = 72.7
    Life expectancy at birth for Men in 1940 – 71.8
    Life expectancy at age 65 for men in 1940 – 15.3yrs = 75.3
    So about a 10 year difference in life expectancy at birth, but only about a 3 year difference in life expectancy once age 65 is reached.

    If you are interested, the CBO did a study on bringing social security into balance. Summary below:
    http://www.cbo.gov/ftpdocs/115xx/doc11580/11580_Summary.pdf
    One of the options (removing the taxable maximum), would cover all SS shortfalls by itself. Raising the age to 68 would cover only roughly 1/6th of the shortfall.

    The good thing about SS shortfalls though, as opposed to Medicare shortfalls, is projected growth plateaus so it only has to be fixed once.

  27. It’s interesting to see in black and white what I already knew – earmarks are ethically shakey, but irrelevant when talking about the deficit. Ditto foreign aid. I slashed earmarks anyway, because I’m like that. Medicare, however. Damn.

    The rest of it was pretty balanced, although I was more 60/40 tax increases. I added a carbon tax, raised SS to 70, and brought the estate tax back to the hell of the Clinton years when the economy was in the toilet and everyone suffered oh, so much.

    The point that poor people tend not to live as long and thus will collect less social security under this scheme is true, but it overlooks the fact that the poor benefit from social security more than the wealthy do (they get a larger percentage of their earning years income as SS and also need it more). I’m going to wave my arms and claim that it all evens out.

  28. Be careful, John… You’ve just solved the budget issues in a concrete manner easily readable (and probably palatable to or even likable) by the average American. AND you have a daily readership of 40k people, which probably equates to 200k+ actual semi-regular readers.

    That’s a lot of people.

    I think I’m already hearing the sounds of hundreds of inkjets and tweets all bearing the message: “SCALZI 2012″. ;)

  29. I read an interesting way to phrase estate taxes: Given the choice between being taxed more while alive, or being taxed more when dead, what would you choose?

    The dead tend to be less likely to object to estate taxes, and they need the money less.

  30. Kevin O. McLaughlin:

    Krissy, however, has already employed the spousal veto on any political ambitions of mine beyond SFWA President. So it’s the shortest presidential run in history, I’m afraid.

  31. I was surprised at how easy it was. I suppose I might be missing some negative consequences of some of my choices, but it seems to me that our nation’s spending problem is not intractable in the least. It’s just that our lawmakers have no intention of taking it seriously.

    I eliminated farm subsidies and earmarks, cut pay by 5%, eliminated 250k contractors, reduced the nuclear arsenal, reduced the number of troops in Iraq and Afghanistan to 60,000, enacted medical malpractice reform, increased the medicare eligibility age to 68, capped medicare growth, raised the retirement age to 68, did the Lincoln-Kyl estate tax plan, did President Obama’s investment tax plan, let the Bush tax cuts expire (all of them), and added the millionaire’s tax. Done!

    Re: medical malpractice reform, I read several medical blogs, and I don’t think caps are going to solve the problem. A lot of the problem is frivolous lawsuits filed by people who think that if they have a bad medical outcome, somebody must be to blame (and they should get millions of dollars in compensation). Here’s an example of one such horror story:

    http://erstories.net/archives/138

    The case was ultimately thrown out of court, but it did plenty of damage. I don’t know how it can be done, but somehow the system needs to prevent cases with no merit from entering the system. Another problem is that insurance companies and hospitals will quickly settle smaller, frivolous suits because it is cheaper than fighting them. This just encourages more frivolous suits.

  32. This exercise is good in only one way – getting people to think about the budget directly. Unfortunately, it frames the entire debate within the options being presented by the commission and VSPs and does not introduce other options that have been discussed but conveniently ignored such as single payer health care, a return to pre-Regan tax rates, etc. Whether politically possible or not, in an exercise such as this, one should consider every feasible option and not just the options the current people in power would accept. As pointed out previously, plenty of people would probably choose other options if given the opportunity.

  33. Bruce @ 27

    Just off the top of my head: (disclaimer: over 50 here)

    Would raising the retirement age make a more mature (aka older) employee more valuable as the employer doesn’t have to think about the employee aging out so soon after hiring?

    It seems rather odd, in this society where it seems the majority of management remain in a company for less than 10 years, that an older employee is seen as less valuable. It’s sad that I’m wrong according to someone’s HR protocols.

  34. Define then next years polical decisions through a web game, to get the best of what men could make up, that is scifi. Do you think it could work ?

  35. So, Mr. Scalzi, you *do* endorse the Bowles-Simpson plan! I must confess I’m not at all taken aback.

    notthatyoucare @ 4: Methinks I spy a Krugman acolyte, perhaps?

  36. My solution was 40% tax, 60% cuts – but also came out with a $179B surplus in 2015 and $230B in 2030. Why? Because I want to see the national debt reduced. Depending on who you believe, interest expense is 6 to 9% of federal expenditures, varying significantly as the interest rate varies (see Wikipedia for some interesting numbers.) Reduce the national debt, and interest expense drops. Every penny drop in the interest expense is either another penny available for spending or available for tax decrease. Like all interest expenses, the sooner you get out from under it, the bigger the savings.

  37. Steve @ 43 -While I’m all for debt reduction, I’d rather do that when unemployment is at a reasonable rate. It’s not yet, so why not spend that surplus on jobs programs, or tax incentives for employers to hire more people? Having employment at rational levels would increase the tax base, and thus give the government income, rather than outflow for UI or other social services that the unemployed rely on.

  38. The problem with capping Medicare at GDP growth + 1% is that the pace of new Medicare recipients entering the system will be much faster than an extra 1% per year thanks to the Baby Boomers. Also, as technology gets better, it gets more expensive to take care of those patients (who will then also, presumably, live longer and cost even more).

    This inflation + 1% thing sounds a lot like the current SGR (Sustainable Growth Rate) formula, which calls for reimbursements to health care providers to go down by about 25% in January. Medicare already reimburses at a rate less than the cost of providing care to patients: at my medical school’s hospital, Medicare reimburses something like 80% of the cost of providing care to Medicare patients. If the 25% cut happens, many practices will go out of business or many providers will have to stop seeing Medicare recipients (probably both). Capping at inflation + 1% will mean that the reimbursements per patient will also have to go down, which will have the same net effect: Medicare might exist but Medicare recipients will have difficulty finding medical providers to see them (even more so than they do now). There is a reason that Congress keeps passing temporary fixes for the SGR and it’s definitely not because politicians like doctors, nurses or hospitals; rather, the fixes keep getting passed because politicians are afraid of seniors who are incapable of accessing medical care.

    So, overall, I like your plan. I just think that some things (like Medicare at GDP growth + 1%) are unworkable. I do like the medical malpractice thing, though.

  39. Being a member of the over-fifty-can’t-find-work group (I’m 61 and forced out of work due to a takeover) I can tell you without a doubt that we have created a very depressing situation for all those boomers caught in that particular limbo. While trying to figure out what can be done, I’ve come up with a solution that seems plausible (maybe even profitable for ALL) but probably impossible to implement.

    Many of these “retirees” have a tremendous amount of valuable experience and knowledge in their particular fields and are still ready and willing to work… an awesome resource if it can somehow be “tapped”. What if they could form “work groups” who could do cut-rate “jobs” for others in need (low income or elderly individuals and families who can’t afford conventional services)? As an example, one “group” might consist of retired trades people (plumbers, carpenter, electricians, masons, etc) who would do repairs for those who qualify for the reduced-rate category. Maybe some kind of sliding scale based on income… these groups could operate out of a pool of workers and would be sent out in units comprised of those with the skills and experience to complete the task at hand. This same formula could be used for almost anything: accountants, painters, technicians, doctors, nurses, … hell, even old “writers” could produce some nifty ads and pamphlets… LOL

    I see this as a national network (hopefully, someone other than the government would be involved in establishing and administering it!) and run as not-for-profit organisation with everyone drawing a fair pay for their efforts. It may even be possible for IT to carry its own group medical insurance!!

    Of course, I haven’t worked out all the details but it seems doable to me and it’s a win-win-win for ALL involved (which is probably the best argument for why it will never be implemented). I’m seriously thinking about doing this exact thing (in a more limited fashion) right here in the Atlanta area to see if it’s possible and to create a template for future consideration. Whatcha think??

  40. I’d go with one simple change for medical malpractice: all punitive damages go to fund Medicare. Getting rid of the jackpot lure would shut down most of the “operators are standing by” law offices but wouldn’t prevent anyone with a serious grievance from bankrupting a truly reckless provider.

  41. WRT malpractice reform, the theory is, once we see those reforms (a) Insurance companies will lower rates because they’re kind enough to pass the savings on to the doctors and (b) hospitals will start charging less.

    Do the Republicans who propose this idea have any way to compel that outcome? No. This is just like when they told CA that deregulating the gas and electric market would save the consumer money because of competition. Instead, the companies colluded to jack prices, and even created fake blackouts to hype energy trading prices.

    What will happen is that insurance companies will pocket most, if not all of the savings, pass on a slim amount to hospitals, who will pocket that themselves, because they’ll be getting less in medicare reimbursement and need to make up the difference because we expect them to operate at a profit.

    When are we going to learn that deregulation and tort reform is just a gimme to Republican donors, and always (so far as I can tell) results in the consumer getting jacked? It’d be nice to stop frivolous lawsuits, but this isn’t even intended to do that. It’s a gift to the insurance industry.

  42. “I was surprised at how easy it was. I suppose I might be missing some negative consequences of some of my choices, but it seems to me that our nation’s spending problem is not intractable in the least. It’s just that our lawmakers have no intention of taking it seriously.”

    Sigh. And that’s why I dislike these cute little calculators. It lets people move around numbers with little to no thought, see things line up and the lesson taught isn’t “Hey, this stuff is complex… I’ve had to make choices that affect real people in negative ways sometimes” but “Oh look, I played on a website and solved the deficit!! It’s easy and if I can do it over coffee on a Sunday morning, the politicians are just idiots!”

    Sidestepped are issues like “Do we want or need to entirely eliminate annual deficits? Or are they OK at some percentage of the budget/economy?” and “What IS the likely effect on various constituencies of raising the SS age?” and “If we limit medical malpractice awards, who does that actually help and hurt?”

    If these calculators were complex enough to even come close to mirroring the real world and people were confronted with more than the surface effects of their choices they might be interesting. AS it is, I think they end up doing more harm than good.

  43. My solution came out ~55% taxes and 45% cuts, with nice surpluses. Which made me realize there was no option for increasing spending on anything. For example, I’d like to use some of my surplus to raise the amounts spent on military personnel and their families, both during their service (pay, housing, support for dependents) and after (especially medical care).

  44. Never got to 2030 without hitting any unacceptable compromises, but I got 2015 through taxes alone.

    Yup, I’m a liberal. A bleeding-heart pinko liberal who usually makes around $20K a year and thinks the people who have most of the money should pay most of the taxes.

  45. It just doesn’t give any options for punitive taxes against the baby boomers who got us all into this mess. Raise retirement age now (on social security retirement right now, time to get out of Florida and back into the workforce) to 80 for 15-20 years then let it drop back down. That would help.

  46. @53… Oh whine some more please. Guess what – when you’re 60 the 20 year olds will complain about your mistakes too – and your generation WILL make mistakes, we all do.

    We had an annual surplus in 2000, at the end of Clinton’s terms (you remember Clinton? A boomer.) I doubt spending a trillion on 2 wars helped – but from what I can tell support for that crossed generational lines as did support for Bush’s tax cuts. Spending a trillion without funding it from taxes and insisting on keeping the tax cuts has a VERY big effect on things.

    That’s the other issue with this calculator – it doesn’t even reveal its most basic assumptions like average annual GDP growth. Most of the small $20b or so choices that they list will be swamped by assumptions about things like GDP growth and, in reality, actual events will play havoc with any prediction made. Look at what’s happened since 1994, just before the dot com boom and the last time we had a Republican electoral victory in the middle of a Democratic presidency – the internet. The dotcom boom and bust. 9/11. Two major wars. Large tax cuts. A minor recession, a boomlet coming out of that and a huge recession. None of that could have been predicted in ’94 so to pretend we can accurately model the next 20 years to the single digit billions is, well, lying.

  47. MikeB @21: huh?

    Alpha Lyra @38: which, again, is the entire problem with this exercise. It seems so easy because it’s presented as such, not because it is in the real world. The answer to “but it’s so easy, why don’t our lawmakers see that?” is not that they’re sinister and/or blind; it’s that it isn’t that easy in real life. You’re not only missing the negative consequences of your choices, which, to be fair, are not exactly set out honestly in the NYT exercise. If we started sending everybody for termination at age 50 that’d sure save on Social Security and Medicare, but nobody really wants that – even though just looking at the soundbite it might be a “net savings”.

    And again, while I don’t want to divert this into a discussion about medical malpractice, your post is regurgitating a lot of myths. The idea that med-mal insurers quickly settle frivolous cases to get rid of them–let’s just say I was extremely glad I didn’t have a mouthful of coffee when I read that.

  48. Worry about deficit reduction later. Right now, re-institute the WPA. Our unemployed neighbors get paid work, we all get out bridges repaired. Everybody wins.

  49. MuDPhuDStudent@45, you talked me out of capping Medicare, so I did the exercise again. More painful this time, but instead of capping Medicare, I added some more taxes–the carbon tax, the bank tax, and the slightly more aggressive estate tax (Obama’s rather than Lincoln-Kyl). I also chose a few more of the social security cuts. I had no trouble getting the budget balanced for 2015, it was 2030 that was difficult. That required changes to entitlements, not just spending cuts.

    Rickg@50, don’t worry, nobody will ever elect me to national office. But I think these calculators are a good thing. The people who benefit from the U.S.’s broken budget, who are amassing huge personal fortunes while the country careens towards bankruptcy, have a vested interest in convincing us this problem cannot be solved. They want us to throw up our hands in despair and go argue about abortion rights or illegal immigration instead.

    Yes, these budget cuts have consequences. But doing nothing has consequences too.

    When I got divorced, I lost my husband’s income, which meant I had to cut my household budget in half. IN HALF. If I can do that (and I did; I’m carrying no consumer debt), our lawmakers can balance the budget. Maybe not today, because a recession is a bad time for cuts, but over a period of years, absolutely. I refuse to believe this problem cannot be solved.

  50. mythago@55, where’s your evidence that insurers and hospitals don’t settle frivolous cases? Here is an example of a hospital settling a frivolous case to make it go away. The case obviously has no merit at all, but I’m assuming they chose to settle for $10k because the legal costs involved in fighting would have been higher.

    http://erstories.net/archives/126

  51. Alpha Lyra @55, you made an assertion and haven’t backed it up, yet you’re asking me to prove a negative? The link you’ve provided is from somebody who was a medical resident at a hospital who admits that he is guessing as to why that hospital settled some cases and fought others; even assuming his description of the facts is 100% accurate, we don’t know why the hospital – NOT its insurer, as the anecdote makes clear – decided not to pursue the case. (The comment that the guy’s lawyer got 2/3 is also hilarious; this is the equivalent of “stop whining about your medical school loans, doctors are all freaking rich”.)

    I’d refer you to Dr. Atul Gawande’s writings – as a practicing physician he has a lot of interesting things to say about why medical mistakes happen, what can be done about them, and how financial incentives distort medicine; the University of Michigan medical system’s practice of admitting mistakes proactively and compensating injured patients, which along with safety programs has slashed the number and defense costs of malpractice claims against it; and if you can stand to listen to somebody who actually has been on the ‘other side’ of these cases for over 20 years, he has a guest post at KevinMD as well as discussions on his own blog about the myth of frivolous lawsuits and how to put malpractice attorneys out of business.

  52. Cassie: You’d think that businesses would see advantages in skilled people with often relevant experience who need work. But they don’t now, and I don’t see how the idea that these people have 18 or 20 more years to go rather than 10 or 15 is going to change any of that.

  53. The military cut options are rather timid. The US could cut $550 billion per year from the military budget, and still have the largest military in the world. Why look at anything else before that?

  54. “When I got divorced, I lost my husband’s income, which meant I had to cut my household budget in half. IN HALF. If I can do that (and I did; I’m carrying no consumer debt), our lawmakers can balance the budget. Maybe not today, because a recession is a bad time for cuts, but over a period of years, absolutely. I refuse to believe this problem cannot be solved.”

    Sigh. (sorry, I’m in a sighing mood). Your household is not analogous to a national budget. First off, you dont’ have multiple interests. Even if you had kids and had custody *your word was final*. All you had to do was reduce drastically a few things and you were done. I’m not saying it was easy, but it is simple. Can’t afford the $2000 mortgage? Rent for $1000/month. You don’t have two car payments, you have one. You choose not to eat out as much. Etc… The choices are clear and there are relatively few options.

    National budgeting is nothing like that.

    As far as whether it can be done… it was. Again, we were running surpluses in 2000. Some of that was the result of government policies, but some of it was also a booming economy. However, the Bush years saw us spend $1 trillion on 2 wars and a population who, though they said they supported those wars, refused to accept tax increases to pay for them.

    These calculators lead people to check a few boxes, see the figures line up and assume it’s easy – it’s not. We need a populace that appreciates the tradeoffs and complexities inherent in doing something like balancing the budget and this tool takes is in the opposite direction. It lets you do things like toss a million people out of work because “hey, the figures line up” and ignore the political complications with a proposal that moves the Medicare and SS ages up.

    What we do NOT NEED at this point is to make things simpler. There’s too much simple thinking in American politics right now. Adding more does not help anything.

  55. I thought this was an interesting exercise but in many ways the choices, in my opinion, fall short.

    Starting with the military, as Michael Kirkland notes, we have by far the largest military budget in the world. We spend more on our military than nearly all other nations combined. Our budget for 2010 is almost $700 billion dollars. The next closest? China with $99 billion.

    To correct Michael slightly, we don’t have the largest military (We’re second to China in active military personnel and we fall to eighth if you include reservists and para-military organizations.) and I’m not sure that cutting $550 billion is feasible, but I certainly agree that there could likely be more substantial cuts than what are presented here.

    I’d like to see the Bush tax cuts expire and the estate tax to be reinstated. For one, even though my wife and I do earn in the range where we would see our taxes increase for some of our income, I’m certain that we can afford it and we both feel it’s necessary for it to happen for the budget to get back on track. As for the estate tax; well, I think that it needs to be re-worked so that lower income families that have many assets related to running a family business (such as family (not corporate) farms.) are not taxed. I think that the Forbes and Waltons of the world can afford to give up a few of their billions that aren’t left to charity or their spouse to help fund some critical government programs.

    I’d also like to see overall tax rates decline for middle and lower income families, but be countered with a national sales tax that would only impact luxury goods. Things like food, shelter, medical care and other necessities shouldn’t be taxed but items like televisions, cars, clothes that cost above a certain dollar amount and other non-essentials should be eligible.

    Ultimately, the real problem is that no one in politics wants to do something unpopular, like cutting spending for the military or social security. So instead they attack the small programs that barely cut the surface. What’s one of the first things that seems to get mentioned, things like education, National Endowment for the Arts, the National Science Foundation. These things are a drop in the bucket compared to Military spending and Medicare/Medicaid and Social Security.

  56. Obviously a national budget is more complicated than a household budget, but that’s why they have hundreds of people to work on the problem, not just one. They can solve it. But they won’t. Because too many of our congresscritters are beholden to special interests who have a vested interest in seeing government money spent in ways that benefit them personally. Furthermore, real fiscal responsibility (not just talk) appears to be political suicide with voters.

    I’m for any educational tool, however simplistic, that sends the message to the voters that this problem can and should be solved. Doing nothing has consequences. What about the Federal Reserve’s latest move to essentially print $600 billion by buying back bonds? That was a decision made by a small number of people that could potentially have very negative consequences. These are the kinds of decisions that are being made in the absence of effective action from Congress.

  57. What Bruce said at #27. Also, I can’t be so cavalier about raising the retirement age to 68. This change will hit blue collar workers harder than anyone else. If you do manual labor for decades, you are going to find that you just wear out faster than the average cosseted middle class person (like me.)

  58. I also did mine with mostly tax increases.

    Here’s my breakdown:

    Cuts:

    Cut foreign aid in half (I actually would have eliminated it altogether); eliminate earmarks and farm subsidies; reduce federal workforce 10%; eliminate 250,000 contractors. I checked every single box offered to reduce military spending (sorry guys, the Cold War’s over, we don’t need all that crap). I too wish they would’ve offered something about Homeland Security; I would’ve cut that by at least 75%, starting with eliminating the TSA altogether. Reduced troop levels to the max offered.

    I didn’t touch Social Security or Medicare in any way, shape or form, except for reducing benefits to those with high incomes. I gleefully raised taxes on the rich to the max allowed, instituted bank and carbon taxes, raised estate taxes, raised payroll taxes, let the Bush tax cuts expire on the rich, and instituted a millionaire’s tax.

    End total: 66% tax increases, 34% tax cuts; almost all increases falling on the rich. Social Security and Medicare untouched. Major military spending cuts. I don’t feel the least bit guilty about coming down on the rich, because of the simple fact that they can afford it; I can’t.

    But then again, I’m not in any sort of public office.

  59. Here’s mine: 89% spending cuts, 11% new taxes (specifically, closing tax loopholes, the tax code doesn’t need to be any more complex than it is.)

    I see a lot of these simulators floating around, and it’s very easy (for me, at least) to balance the budget. The question is not ‘can we balance the budget?” We can, and we should. It is a question of “do we have the will to balance our budget?” Particularly when it involves hitting three of the most organized and self-protective lobbies in DC – government employees, defense contractors, and the AARP…

    @61 rickg: Yes, in fact, national budgeting is like that. You can’t run a household on a continuing deficit. You can’t run a business on a continuing deficit, either, nor a corporation, nor a charity, nor a town, nor a county, nor a city, nor a state, nor a nation. (Even nations like the U.S. which enjoy reserve currency status and seignorage are not immune. Their collapses just tend to be a bit more rapid – and catastrophic – when they do happen) Some problems are technical. Some problems are because of human nature. And some problems are because we simply refuse to solve them. Well, the national deficit is one of these last problems. It exists because we, the people, refuse to solve it. Problems based in a lack of will seem complicated, but they are really very simple. You just have to knuckle down and solve them.

    But the deficit cannot continue forever. One way or another, it will be solved. Whether we do it through spending cuts (the most economically beneficial solution), tax increases (much less beneficial) or the hyperinflation of the U.S. dollar (always a possibility), is up to us.

  60. Personally, I’d love to see aliens come in and wipe out all those crooked bastards in Washington and start over… maybe a genetically engineered virus that would only infect all those who pretend to be looking out for our best interests… better yet, how about the “Pinocchio Virus”which makes their nose grow each time they lied… most of them wouldn’t be able to get into their limos after the first day!! Gee, that’s a great visual…..;-))

  61. Taxing religion would do it in a minute. It’s a pity that any politician who even suggested it would never be re-elected, which is much more important to all politicians than balancing the budget or fixing the deficit.

    It would be much better if we lived in a Democracy and I was the Democ.

  62. I didn’t bother with the calculator because it is bogus, but I did read the Social Security options. From what I know, they are complete and utter BS as far as savings. Social Security is not a budget item and does not affect the deficit. By law Social Security can not pay out more than it takes in or has in its trust fund. Any change at all is deficit neutral, though it will be felt by recipients. The reason that Social Security is included in deficit talks is because there are people who want to cut Social Security for ideological reasons, not to lower the deficit.

    And if the argument is that the trust fund has been loaned out to cover budget items, that is a problem with the budget, not Social Security. If the Fedeal Government can’t repay its debt to Social Security, then raise taxes to cover it, don’t cut Social Security to cover up the error.

  63. MasterThief @68: you seem to have skipped over rickg’s point entirely, which was that households have far fewer ‘stakeholders’ than governments do. If I want to change how my household spends money, I probably ought to run it by Mr. Mythago, but my kids and pets don’t get a vote, and I don’t have to get buy-in from hundreds of others of people to do what I want with my money. This is why the “if I can cut spending and balance my checkbook, why can’t Congress?” argument does not work.

    Also, of course, there’s the fact that there are a lot of things a government has to budget that a household doesn’t (at least in the US). I don’t have to pay the police bill and the ‘keeping the Taliban from invading California’ bill and the ‘keeping your water purified’ bill; those are collectively paid for through taxes, and I receive those benefits whether or not I, personally, pay them.

    Regarding the tax code, it’s a bit like watching a hoarder complain that she can’t find anything when she needs it; it’s that complicated because we (particularly those of us who are corporations) don’t wish to give up out deductions and our loopholes and our ability to shift cost bases around or to run profits through different countries until they’re taxwashed (I’m looking at you, Google).

  64. Lol, number games are always fun, but they are kind of removed from real world economics (which is really about choice and consequence), because they don’t really take in cause and effect very well, or what actually happens in the real world (Congressional Budget Office). Nor do I understand how some of these changes that effect the budget are going to be good for the economy (aka you and me).

    “Cut pay of civilian federal workers by 5 percent
    “During the Great Recession, most private-sector employees have seen their wages frozen, and some have even watched wages decline,”[...] “In contrast, federal workers have seen their wages increase.” This option would be a one-time 5 percent cut in federal civilian workers’ pay; the chairmen called for a three-year freeze on pay, which would have a similar effect”.

    IMO, this one does not go far enough, since 2000 the federal employees have seen their salaries and benefits rise 3% annually, while the private sector saw an increase of only .8%, meaning that federal pay and benefits on average was growing at 375% faster than private sector. Everything be equal (meaning salaries) it would still take the private sector, (at the outside, since I am not using exponents) about 15 years at .8% growth, to catch up to the public sector pay and benefits after the 5% cut!

    “Reduce noncombat military compensation and overhead
    Would change health-care plan for veterans who had not been wounded in battle. […} More veterans would receive health insurance from employer. [...] The military would also reduce the length and frequency of combat tours. [...] longer than a year, [...] without spending at least two years at home.

    A proposed savings of $23 and $51 Billion. Now I am not sure why (other than money) anyone would want to create a 2 tier health care plan for those serving in a combat zone but that is just me. Nor does this idea really make sense, economically, if you require longer mandatory down times, the military will need to maintain a larger standing force to maintain combat operation, which is going to negate any kind of proposed savings.

    “Use an alternate measure for inflation
    Some economists believe that the Consumer Price Index overstates inflation, [...]This option would use a different, lower inflation measure both for Social Security and in the tax code [...] Supporters say the lower measure is more accurate. Opponents say it is less accurate [...]“.

    This one is kind of funny for multiple reasons, the consumer price index is already manipulated by US government, for instance they no longer include the price of fuel and food, when measuring inflation. Which is kind of amazing if you actually think about it, what two goods are you least able to minimize your consumption of when it comes your cost of living? Fuel and food!

    Although this one is not one of on the NYT, it was one of the proposals done by the President’s Debt Commission; a 15 cent tax increase on fuel. Fuel is already tax 18 cents by the federal government, this would be an 83% increase of the federal tax on fuel, this does not include local city and state taxes of fuel. This might be good for government but not for you and me.

  65. Such a solution would sadly require that the members of Congress, and the occupant of the Whitehouse (whoever he/she may be at the time) put aside partisan politics and do what is best for the country rather than what is best (maybe) for their next campaign or political party.

    Granted that this is grossly oversimplified, it still serves as an example that solutions are possible if elected officials had the cojones to effect them. It makes me sad to realize that the nation will probably have to suffer an economic crisis worse than the one that we are currently trying to struggle out of in order for much of this to actually happen. (I say worse because we appear to be out of the very worst of the current one, and this stuff didn’t magically come to pass, so I’m guessing that bad wasn’t quite bad enough.)

  66. I think that actually assuming that the Bowles-Simpson plan would work for taxation is naive. While the idea of reducing loopholes so that people are paying an honest amount of tax and then reducing the rate so that the average amount paid is fairly similar is solid and valid it ignores some deep problems. The first is that there is no way to limit reintroduction of those tax loopholes because (1) the US governement has used selective tax breaks as its primary means of social engineering (2) each individual loophole has a interested party pushing for it but rarely any opposition (3) individual loopholes are negligable in terms of cost to the government but only in aggregate cause problems. So effectively we would have dropped 4% off the top rate for taxation in exchange for a short-term removal of loopholes which in the longterm means that the top tax rate has dropped but without actually impacting the presence of tax loopholes.

  67. John, you are so naive.

    Limiting medical malpractice claims? Are you f-ing crazy?

    That will only hurt the patients, benefit the insurance companies and increase unemployment. I don’t say that just because I’m a lawyer. BTW, John Edwards would have been a much better choice for President.

    Cut the government payroll?

    Hello? Federal employees only make about $20K more than the average worker now. I mean, come on, we pay our congressmen $174,000 per year for job performance that less than 20% of us approve of, and you want to cut the federal payroll. Is that really the message you want to send?

    And what about the troops? You want to get them out of Afghanistan. You want to just cut and run after only eight or ten years. Sure. Let’s just abandon our clearly defined goal of gaining one useless yard of ground at a time by risking the life and limbs of our children so that sooner or later the various pre-industrial tribes will realize how much better democracy is than the way they’ve been doing shit for the last 1500 years.

    This isn’t like Vietnam where no one wanted us there, nothing we did was going to change their thinking, and they could jump back over the border to Pakistan, I mean Cambodia, to regroup in safety. This time we have a clear military objective that is totally unaffected by political pressure back home.

    Grow up John.

  68. @68 mythago: Not all “stakeholders” are equal. The American people do not decide what taxes are raised and how the money is spent. Congress does that. We elect them to make precisely those tough choices. If we’re not satisfied, we can vote them out, but elections don’t happen every day. Governance happens every day. (The only place where the people do get a say in how the money is spent is California, and look how that is turning out.) It’s the same thing in any large organization. The board of directors proposes, upper management imposes, and the workforce disposes.

    And I’m skeptical that much of this spending on earmarks, defense spending, transfer payments to rich seniors, or YAGA (Yet Another Government Agency) has any justification outside of “I’ll fund your hobby horse if you’ll fund mine.” There are votes to be had by any candidate who delivers on a promise to shrink our bloated government.

  69. I agree generally with pretty much everyone. Especially the work/pay reduction at the federal level for all those self-interested jackals willing to feast on the rest of us starving blue collar lot.

    All those government workers just getting into government for the money. Those people suck. Why couldn’t they stay in the private sector like the rest of us and get a law degree, get rich defending the common man in medical malpractice, and THEN get into government? But, you know, public office, which pays more, but is still respectable. And then publicly humiliate his dying wife. That’s American.

    But, really John, why the cuss did you cut the space spending? I move for SFWA impeachment.

  70. Other Bill @81: What it actually said is this: “Would also reduce the number of Minuteman missiles and funding for nuclear research and development, missile development and space-based missile defense.

    The sort of “space spending” that was banned by the ABM treaty (that W decided to renege on) – kill it…

  71. MasterThief @78: it’s not all that long between elections for one’s Representative, and one would think that “whoever I vote for is going to be speaking for me for two to six years” would make people more careful about who they elect – but let’s set that aside for now. The American People do not go back and crouch in their little boxes waiting to be let out next election. They don’t pull the lever, but they’re also perfectly capable of explaining to their elected representatives what will happen to them next election if they don’t vote on $issue as the voter is inclined; and of course the American People can donate money, individually or collectively, and work as a group for or against particular elected officials.

    (When people we disagree with do this, we call them “special interests”.)

    So, again, if I want to change the way my household spends money, I don’t need to pass a bill to do it, or vote on my next-door neighbor’s earmark in order to get permission to drop my Netflix subscription. If my kids are mad that we’re cutting down on the game budget, I’m sure I’ll hear about it, but they can’t really fire me as Mom. If I’m an elected official, it’s a little trickier to get spending cut, and if I tell my constituents “Sorry, I’m not getting us any pork, we’re working on the deficit,” what do you think the odds are that they will reward my fiscal prudence with a landslide re-election?

    I don’t follow the comment about California.

  72. Mythago @ #83,

    California voters have the ability to bring specific things to the ballot, called ballot initiatives, that do not require a representative to propose them. Its a form of direct elections, this both helps and hurts voters because it is a way to get your voice heard but it is also very confusing, but even with this system California is out of money, they own something like 500 Billion to the public worker pensions in the near future, and they don’t have the money nor are they even close.

    If you want to control behavior especially bad behavior you have to tie consequences and accountability to those behaviors. For example, balancing your home budget, if you don’t do this and you run up huge debts that you are unable to afford, you lose you can lose your home, care, savings, or other things of consequence even possibly jail time, in the case of knowingly writing bad checks. Unfortunately in government when it comes to accountability their isn’t any and it is the tax payer that is left holding the bag, even thou they have no direct ability to control the budget. So if we want to prevent poor budget decisions from being made we have to attach direct consequence to those actions.

    My suggestion is we tie the legislatures salaries to deficit spending and for every year there is a budget deficit the salaries of the legislatures is permanently reduced by 10% and if the deficits spending continues the salaries of public employees is reduced by 1%. This ensures that it is in the legislatures monetary interest to manage the budge well, and if they don’t they are not going to be very popular with anyone and won’t be in office for very long.

  73. As disinformation, the New York Times interactive budget cutting app ranks right up there with Soviet economic reports.

    Missing? Any kind of option to, oh, say, cut America’s insane 1.3 trillion-dollar-a-year military budget by, for example, 85%, back to a more rational level, like 300 billion a year.

    Also missing: any option for an excess profits tax of the kind Eisenhower instituted back in 1956 on greedy corporations (that commie Eisenhower! A Marxist fifth columnist!) or eliminate the 15% capital gains tax rate and tax all income over a million dollars per year at 90%, the way Eisenhower did.

    Along the way, this beautiful exercise in disinformation indulges in some wonderful Newspeak. Let’s take a quick look at the Newspeak-Budget-Cut-to-plain-English translation:

    “Cutting farm subsidies”: equivalent to raising food prices on the poor, who can least afford it. Also raises gasoline prices ‘cause it jacks up the price of ethanol. So all commodities shipped by truck will get more expensive.

    “Cutting earmarks”: our decaying infrastructure decays further.

    “Cut aid to states by 5 percent”: throw sick people out on the street to die and toss poor people out to starve, since this translates directly into cuts in medicaid and state food stamps and welfare.

    “Enact medicare malpractice reforms”: the most heinous lie of all, since it isn’t malpractice reform, it just means that people mutilated or killed by drunk or drug-addicted doctors won’t be able to sue.

    “Increase Medicare eligibility to 68″ and “increase Medicare eligibility to 70″: this will just force sick old people to go to the ER, further clogging our already overburdened health care system and bankrupting old people. It’s sick and evil. Medicare eligibility age should be decreased, not increased. The human body starts to break down after age 60. Studies prove that people retire as soon as they’re able, regardless of Medicare elgibility, so this is wasteful, punitive, and stupid.

    “Cap Medicare growth starting in 2013″: sadistic and evil way of saying “throw sick people out on the street to crawl away and die after 2013.” The title of this “cut” is a grotesque lie, since it doesn’t cut the growth of medical costs—it cuts the growth in medicare expenditures, by hurling sick people into the streets to suffer, scream, and die.

    “Raise the social security retirement age to 68″ or 70: once again, stupid and a gigantic money waster. 30% of all people work in physically demanding jobs. They can’t physically work at age 70. It’s insane to try to demand that people do WalMart stocking with heavy boxes at age 70. They’ll injure themselves, it will cost a fortune, this is stupid and evil. Obviously the fool who dreamed up this scam deluded himself into fantasizing that everyone out there has a cushy job as a pundit sitting in a comfy chair tapping bullshit justifications for war and Wall Street theft into a computer all day. No, most people have to work for a living.

    “Tighten eligibility for disability”: let more mentally ill homeless people roam the streets, wander into traffic, and get run over by trucks. Because we have too few of ‘em right now.

    “Use an alternate measure of inflation”: yes, measure inflation in the number of pixie dust particles per magic pony. Assholes. The current measure of inflation is already a scam, since it excludes the two most important components of the average person’s expenses: fuel and food.

    “National sales tax”: raise prices on everything for poor people. The rich, of course, will buy their luxury goods overseas and never pay it.

    “Bank tax”: increase bank fees for the bottom 90% of Americans. Say hello to the $500 overdraft fee.

  74. Oh, I saw that it was the militarization of space type of spending. I still argue for SFWA impeachment. This still strikes me as worthy of SFWA impeachment.

    I mean, what’s a huge part of SF without space based militarization? And don’t go arguing any of that Hey writers are people who come home from the job to live their own lives nonsense. Or any of that That’s Soo pre-millennium sf stuff.

    Also, I should clarify that I’m teasing.

  75. Scalzi @13

    I balanced the budget with the choices offered via the NYT interactive graphic. The graphic predetermines choices and also quite clearly elides over some difficult choices.

    Well another modeling choce can be found at the The National Economic Rescue Initiative.

    In an attempt at crowd-sourcing a solution the originators of this site

    Working alone or with others, develop ideas for cutting federal spending. Submit your recommendations to our Solution Design Center where we will display them to other users and find the best path to send them to those in government.

    Join an Interest Group or Working Committee: Become part of one or more teams who are focused on specific issues — like those facing the next or current generation or workers, the likelihood of rising homelessness — where you can share your knowledge and brainstorm ideas with others.

    Now I don’t know if they can actually present the results of endeavor to our legislators in a way that will have credibility, but what the hell, they might and everyone who takes a little time can be part of the solution.

    And what does it hurt to pretend that this will be an input to a solution?

    But if we are going to crowd-source a solution, it important that the participants are “autonomous, decentralized and cognitively diverse” as I’ve pointed out before.

  76. I dunno, capping Medicare spending at GDP +1% seems an awful lot like that mathematical proof that includes “Then a miracle occurs” as step 2.

    Unless you do something about actual medical inflation (currently running ~20%), all your cap does is push people onto Medicaid when they (and “they” includes you) go broke trying to pay for health care on their own.

    Seems like that’s one of those “little” details that a NYT simulator elides.

  77. Alpha Lyra:

    The case was ultimately thrown out of court, but it did plenty of damage. I don’t know how it can be done, but somehow the system needs to prevent cases with no merit from entering the system.

    It’s impossible to “prevent cases with no merit from entering the system” without also preventing cases with merit from entering the system, because one of the proper functions of the system is to decide which cases have sufficient merit to be heard. That’s inherently part of the system. There may (or may not) be ways of streamlining that part process without blocking valid complaints, but it makes zero sense to try to figure out how to skip that step.

    Many years ago, I dumbly parroted the infamous and supposedly-outrageous McDonald’s Coffee case to someone who politely but firmly pointed me at the actual facts of the case, which showed that McDonald’s had been overdue in getting their asses handed to them. (And, after endless appeals, they got off relatively lightly.) Since then, nearly every time I looked deeper into a much-repeated example of a supposedly ridiculous lawsuit that made it as far as a judgment, it turns out to only have been ridiculous based on the version of the story told by the defense lawyers. Which was often promulgated by people who’ve only read or heard variations of that story passed along by interests who benefit from discouraging lawsuits.

  78. Paul @84: the initiative system isn’t unique to California; California’s initiative system has been around for some time; the idea that ‘the economy is in the tank because you let voters directly vote’ therefore not only makes no sense, but contradicts the earlier assertion that representative democracy is a problem. If there are no consequences to a deficit, it’s because we, the voters, choose not to impose any.

    Tying salaries to the deficit is a very bad idea. It gives legislators an incentive to cut the deficit at any cost – even if it’s a very bad idea to do so. Think of corporations where the CEOs pass measures that jack up short-term profits (and thus, their own stock) that will cripple the company in the long term, because the have a perverse incentive to do so.

  79. Billy Quiets:

    Federal employees only make about $20K more than the average worker now.

    Only if you use an ever-popular apples-to-oranges comparison. If you compare salaries for comparable jobs, then there isn’t nearly that much of a difference.

    I used to work for a state government. I know government workers. And we all understand that when people start using the “cutting fat” phrase, we know that what almost always happens is that any fat cutting that happens is incidental and minimal, during the process of getting to the bone marrow.

    If you want to cut waste, then bloody find and cut actual waste, don’t just scream for cuts in funding and think that’s magically the same thing. It’s not.

    Plus, keep in mind that if you don’t change the oil in your car, it’ll save you money … temporarily.

  80. You asked at the end how we did it, and I admit that I did it the “Dirty F’ing Hippie” way by raising taxes for the most part – about three to one taxes over cost cutting.

    That said, I was impressed with how much good could be had by raising taxes “all the way” back to where they were under Clinton. Not even going to the extortionate rates under those liberal socialists Nixon and Eisenhower. :)

  81. Jas:

    If Eisenhower came back today, not only would he not be able to run as a Repub, he probably wouldn’t get very far as a Dem.

    Hell, he was the guy who warned us about the “Military-Industrial Complex” and said that “[e]very gun that is made, every warship launched, every rocket fired, signifies in the final sense a theft from those who hunger and are not fed, those who are cold and are not clothed.”

    Definitely a cheese-eating surrender monkey.

  82. Bearpaw:

    Cry me a river. Personally, I think we should reduce the size of our bloated government by far more than John’s 10%.

    Government doesn’t produce anything but more government. How many agencies, departments, and regulatory committees do you think we need?

    And boy are they doing a great job! Love that Fannie Mae and Freddie Mac. And dude, how about the postal service? Awesome.

  83. Bearpaw@90, the problem is that the process of determining whether or not a case has merit requires truckloads of money in legal fees. Thus hospitals and insurers are motivated to settle even suits with no merit, because it’s cheaper for them. It’s like shipping companies deciding to pay the Somali pirates’ ransom fees rather than try to defend themselves from the pirates, because it’s cheaper. But it encourages more and more pirates, plus it’s just plain infurating to anyone with a sense of justice.

    Do you recall how in the 1980’s, many vaccine manufacturers went out of business because they’d been slammed with too many lawsuits over kids being injured by vaccines? Congress passed the National Childhood Vaccine Act. It established a vaccine court where people who’d been injured by vaccines could seek compensation for medical and legal expenses, lost future earnings, and up to $250k for pain & suffering. But all vaccine claims had to go through this specialized court, and it was paid for by a tax of 75 cents per vaccine. This saved the vaccine industry.

    I think we need a similar system for medical malpractice. I also think such a system should focus not just on financial compensation for people who were harmed by truly negligent doctors, but on removing those negligent doctors from practice.

  84. GAH! I find I’m making excuses just like a politician at this point: “Well, THIS plan leaves a shortfall of 30 gigabucks in 2015 but HUGE SURPLUSES in 2030!”

    ’cause those promised huge surpluses 2 decades off ALWAYS happen.

  85. Alpha Lyra @96: you keep repeating this ‘insurers settle because it’s cheaper’ thing as if it’s true. It’s not. The only thing you’ve offered in support of this is a third-hand anecdote from a medical resident that one hospital, apparently in opposition to its insurer, decided to pay a silly malpractice claim for some reason; from this you extrapolate to the conclusion that doctors need their own special, private justice system. I understand that the idea that malpractice suits are all strong-arm attempts aimed at innocent doctors is an article of faith in the medical profession, but articles of faith are not going to fix the deficit.

    And no, I don’t remember lots of vaccine manufacturers going out of business in the 1980s over lawsuits.Do you? It would be astonishing if such a thing actually happened, given that large pharmaceutical companies get sued all the time in regular old courts over the drugs they manufacture – and yet, Merck and Pfizer continue to exist. It’s almost as if you’re wrong, and the real reason for establishing ‘vaccine courts’ was to make sure companies continued to manufacture vaccines – which, as I’m sure you know, are not really all that profitable for the manufacturers. The government wanted to make sure we still had vaccines and that people would still immunize their kids. Are you concerned that if the government doesn’t rush in to protect crummy hospitals, nobody will be able to get a Pap smear?

    To try and keep this somewhat relevant to the topic, this is a perfect illustration of one of the reasons why we can’t simply snap our fingers and have a working budget. Even when you set aside irrationality, personal bias and perhaps even self-interested agendas, we are not all working with perfect information, and “cuts deficit, yes/no” can’t be the only criteria we use to weigh whether the government should tax or spend money on something.

  86. rickg for the win!! Decisions get a lot more complex when you actually have to consider the consequences.

    For example, what do you think cutting 10% of the federal work force will do during a very shallow recovery from a very bad recession? Answer: increase unemployment and decrease wages. Is this good? IMO, it isn’t.

    Also, as others mentioned, you would need a magic wand to cap the medicare growth rate to gdp growth. The two things are not related. You might as well cap the medicare growth rate to the Red Sox Payroll. Neither, GDP or the Sox payroll actually take into consideration how many selfish old people choose not to die each year.

  87. @95 Billy Quiets: Actually, the US Postal Service is pretty awesome, and considering what it does, pretty inexpensive as well. It’s still competitive with private services like FedEx and UPS, bu I don’t have to pay $14.00 to have a letter delivered to my brother in Ohio – $0.42 will get it delivered right to his door. Oh, and when he lived in Alaska? It still only cost me a single stamp cost. While there may be a few individuals who wear the post uniform that probably need to be removed, by and large, as an organization, the USPS is pretty damn efficient.

    I don’t actually have a lot of patience with people that generalize that all government is bad, because not unlike the whole “No Government Run Med Insurance/Don’t touch my Medicare/Tricare!” When you get down to the specifics, the government is in the Service industry for its citizens as opposed to the manufacturing of goods.

    In doing the NYT calc above (and blancing the budget with surplus \o/), I relied heavily on raising revenues,cutting back on military expenditures, increased troop drawdowns and did raise the retirement age to 68. But I did little to cut jobs in the government because as pointed out several times a) the unintended consequence of cutting govt job and contractors is higher unemployment b) and by and large government workers may have amazing benefits but their salaries aren’t actually out of alignment much with the private sector and the vast majority of govt. workers are in salary ranges that fall squarely in the middle of the middle class. I don’t have a problem at all with people who work 40 hours plus, 50 weeks out of a year making a decent wage, even if my taxes are paying for it. (67% by Rev increase, 37% Spending cuts, but I had a surplus both in 2015 and in 2030)

    What I do mind is paying highly inflated prices on goods and services that pay people 10 times as much for doing half the work your average Government worker does, and in no way holds them accountable for when they screw it up. Yes, Wall street, I’m looking at you. Yes, my personal bank, I’m looking at you.

  88. Doing it isn’t that hard–I admit I took a classist approach to the exercise–and “punished” the rich while reducing our military (which would create its own additional unemployment, at least for a while).

    2015 I have almost $400 billion sloshing around that can be reallocated -enough to take a line on deficit reduction and increase social spending. Of course by 2030 we may have to look at investing insane amounts of money to create levee’s around New York, Boston, San Diego, etc, but what the heck.

    Of course the chances of increasing taxes right now are zero.

  89. Mythago:

    “Even when you set aside irrationality, personal bias and perhaps even self-interested agendas, we are not all working with perfect information, and “cuts deficit, yes/no” can’t be the only criteria we use to weigh whether the government should tax or spend money on something.”

    Am I correct in interpreting this sentence to mean that you exclude yourself from issues of personal bias and irrationality and consider your information to be perfect?

    The ‘we are not all’ portion leads me to read it this way.

  90. Maygra,

    “What I do mind is paying highly inflated prices on goods and services that pay people ten times as much for doing half the work your average government worker does.”

    So you must be really pissed that the taxpayers had to pony up $8.5 billion last year when the US Postal Service DOUBLED its losses from 2009. $3.5 billion to $8.5 billion in one year. In losses.

    Maybe if the average government worker did only one quarter of the work that the lazy assholes who pay their salaries do, the government would have only lost $4 billion on the postal service.

    “It’s still competitive with the private services like Fedex and UPS.” Really? Then why do they exist? One thing is for sure, they wouldn’t be around for long if they lost $8 billion a year. Subsidizing failure isn’t “competitive”, it’s just stupid.

  91. Reduce the number of nukes? Preposterous! More nukes make you safer by maintaining a credible deterrent. Let me explain. You can’t just push a button and a thousand nukes go off on your designated targets. You have to get them there. Lets assume ten warheads per missile so we have 100 missiles. Of those 100 missiles only ten percent receive the order to launch due to a pre-emptive enemy attack (We will assume we would never launch first) 90 left. Of those 90, ten percent acutally leave the silo. 81 left. Of those 81 ten percent suffer from some midphase error. 73 left. Of those 73, ten percent are intercepted midphase. 66 left. Of those 66, ten percent suffer from bus seperation problems. 59 left. Of those 59, ten percent are interecepted during reentry 53 left. Of those 53, ten percent miss the target and so on and so forth until you only have one nuke that finally detonates and destroys its designated target. Its called net assessment. We need tens of thousands of weapons just to have the ability to destroy Luxembourg never mind a country as large as China or Russia. I’m a bit sarcastic but the math required to properly destroy all life on Earth is real.

  92. @Billy Quiets: I actually know somebody who ran the numbers for DHL on taking over a national postal service. The reason they are profitable is because they don’t have to offer the same level of service as the post office.

    Now, if you want to remove rural services all together and make the cost of postage prohibitive for all but businesses then have at it.

    They’re largely profitable because they do all the profitable things that national postal services don’t do.

    In fact, come to think of it. It often amazes me how “profitable” private companies are when all the unprofitable business they would otherwise have to do is handled as a public service.

    As a friend of mine says: there is a reason why Dilbert is set in the private sector.

  93. #105 by Daveon:

    They’re largely profitable because they do all the profitable things that national postal services don’t do.

    In fact, come to think of it. It often amazes me how “profitable” private companies are when all the unprofitable business they would otherwise have to do is handled as a public service.

    Sure, and let’s not forget that the profits of many “successful” corporations depend on corporate welfare and/or externalizing costs. The entire oil industry, for example. Sure, sure, a good libertarian would say that corporate welfare isn’t any more acceptable than the other kind. But somehow when “the fat” gets cut, it’s only the little guy who bleeds.

  94. @103 Billy Quiets

    So you must be really pissed that the taxpayers had to pony up $8.5 billion last year when the US Postal Service DOUBLED its losses from 2009. $3.5 billion to $8.5 billion in one year. In losses.

    Actually, no. that’s a bail out I can actually get 100% behind, because I use the post office every day. I use the FDA required food labels on my food every day. I use the US highway system to get to work every day (Yes, US — I travel 17 miles of interstate highway twice every work day to get to work.) there are a lot of services and tangible benefits the government provides for me every day — and that’s without me receiving any other tangible asset from the gov, like a student loan, or housing assistance.

    Given that business and banks have receive $1.1 Trillion dollars in assistance over the last couple of years from keeping the financial markets from collapsing, or the housing sector from tanking any more than it has, I’m pretty okay with 8.5 billion given to the postal service. At least we can be fairly certain they won’t take their bailout money and pay their top executives millions in stock options. Or invest in offshoring jobs.

  95. Scalzi @ 37
    “Krissy, however, has already employed the spousal veto on any political ambitions of mine beyond SFWA President. So it’s the shortest presidential run in history, I’m afraid.”

    Could you at least come up with some sort of bacterial culture that could rule the world in your stead? Perhaps a yogurt of some form?

  96. Billy Quiets @54:

    Your assertions contradict the documented facts.

    According to the study published here
    http://www.irle.berkeley.edu/cwed/wp/2010-03.pdf

    “State and local government workers earn less than comparable workers in the private sector, a new study by two economics professors finds, even when pension and other benefits are included.
    “The study, commissioned by two public employee-connected research groups, contradicts comparisons in the “popular press” that show government work pays more than the private sector.
    “The media compares average pay and benefits, the study released last week said, which misses the point that the average public-sector worker and the average private-sector worker have different education levels and different job duties.
    “Compensation specialists have repeatedly shown that the average state and local government worker has “more education, more tenure and more responsibilities,” said the study by Keith Bender and John Heywood of the University of Wisconsin-Milwaukee.
    “Nearly half of state and local government workers, 48 percent, have completed college, said the study of workers nationwide. Only a little more than a fifth of private-sector workers, 23 percent, have a degree.
    “Many of the most common state and local government jobs require higher education: teachers, social workers, nurses and university professors. In Michigan, more than half of the state jobs require that applicants have at least a bachelor’s degree.
    “`Thus, the fact that public sector workers receive greater average compensation than private sector workers should be no more surprising than the fact that those with more skills and education earn more,’ said the study.”

    This latest study reaches the same conclusion as many previous studies, all of which show that government workers make less than private sector workers.

    “While public employees make about 7 percent less than their counterparts in private industry, the study found there is virtually no difference between the two sectors once you consider that state and local governments contribute nearly 6 percent more to benefits such as health insurance and retirement funds. But public employees also receive ‘considerably’ less supplemental pay and vacation time, the study found.”
    Source: “Public workers highly paid? Not exactly,” San Francisco Chronicle, Marisa Lagos, 19 October 2010.
    http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/10/18/MNUJ1FUAOH.DTL#ixzz131Cub5xj

    As far as your sneer at the U.S. Postal Service goes, you seem unaware of the following facts:

    The USPS handles 40% of the world’s mail

    In fiscal year 2007, the USPS sorted and delivered 213 billion pieces of mail using 785,000 employees.

    Postage in America is cheaper than in any other advanced nation. The first class stamp that costs 43 cents in America costs 75 cents in Japan, 49 cents in Germany, and 71 cents in Britain.

    Overall postage rates—as measured by both the Producer Price Index and the Consumer Price Index—have increased less than consumer prices in general since the creation of the USPS in 1971. The stability in postage rates was achieved even as direct and indirect taxpayer subsidies have been eliminated—driving the real cost of mailing letters down 23 percent.

    The price of a stamp (41 cents, up 412 percent since 1971) has increased much less than many other ordinary products and services. For example: a movie ticket ($9, up 432 percent since 1971); natural gas to heat your home ($11.40 per 1,000 cubic feet, up 844 percent since 1971); a copy of Time or Newsweek ($3.95, up 690 percent since 1971).

    Since December 1997, when the BLS started collecting the data, the delivery services component of the Consumer Price Index has increased 59.2% while the postage component of the CPI increased by just 19.2%.

    Postal total factor productivity (TFP, which is output per combined unit of labor, capital and material input) has increased by 19 percent since 1972, averaging 0.5 percent per year. Recent BLS research on similar private sector industries—the transportation, utilities and communications (TUC) industries and service sector in general—found significantly lower annual TFP growth rates than those observed for the USPS.

    Source: USPS performance and productivity
    http://www.nalc.org/postal/perform/productivity.html

    Before you open your mouth, Billy Quiets, you might want to check the facts and make yourself familiar with the numbers to make sure your claims don’t flagrantly contradict observed reality.

    By comparison, let’s consider the United States military, which has managed to spend 1.35 trillion dollars per year to lose two wars simultaneously to barefoot kids who are armed with bolt-action rifles. Clearly the American military is the most inefficient and incompetent of all government programs, and thus is number one with a bullet when it comes to cutting wasteful government spending. We would expect this, since the U.S. military is run by incompetent cowards and manned by rapists and gang members:

    See “1 in 3 females raped in the military, and apparently the Pentagon doesn’t think it’s a problem”
    http://mydd.com/users/itsneverover/posts/1-in-3-females-raped-in-the-military-and-apparrently-the-pentagon-doesnt-think-its-a-problem

    Also see “The army’s other crisis: why the best and brightest young officers are leaving”
    http://www.washingtonmonthly.com/features/2007/0712.tilghman.html

    Also see “U.S. is recruiting misfits for the army: racists, felons, gang members”
    http://articles.sfgate.com/2006-10-01/opinion/17315471_1_recruits-criminal-records-military

    So how much of the annual military budget should we cut, Billy Quiets? Since we want tocut useless wasteful government spending, clearly military spending is the number one target–so how much should we cut? Should we cut 500 bilion a year? 700 billion a year? 900 billion a year?

  97. Rather than raise the age at which people can get Social Security or Medicare, I think that we should increase the wage base taxed. There’s no reason why SS deductions should top out at earnings of $106,000, other than to make SS a higher tax on those of lower incomes.

  98. Thanks for posting this John. I’m so totally a Liberal. I didn’t quite cover the 2030 shortfall, but what I did cover was 67% savings from tax increases and 33% from spending cuts. Part of that is from wanting to be more subtle and nuanced about the cuts in spending.

    I definitely believe you can’t spend more than you bring in, but I’m itchy about just randomly reducing the workforce 10%. I think in reality someone needs to go over government with a fine tooth comb and get rid of the inneficiencies. Which will cost money for new computer systems etc. But will allow for more streamlining of the workforce in the long run.

  99. Mythago:

    So, the commentary intended was akin, if one allows that every human has internal biases and agendas, it is still difficult for one to solve complex problems, in a group environment, where imperfect information is also a commonly shared challenge?

  100. Other Bill @113: Again, no. The fact that you keep raising biases and agendas in relation to a comment that explicitly states it is setting aside problems like biases and agendas makes me wonder if you’re just bored and picking a fight, or what.

  101. It’s not bored picking a fight. I was just trying to figure if you very eloquently called people who disagree with you inherently wrong because they don’t know about that which they speak, or if you were stating a general truth about group problen solving.

    I’m pretty sure you said “It’s really hard to have a conversation where people don’t know what they’re talking about.”

    You strike me as a I put my words where I mean them to be type. And you don’t seem interested in clarifying through a follow up. So, consider the issue dropped.

  102. I’d also like to add, for emphasis, that I’m really (picture italics because I don’t know HTML) not trying to pick a fight. I really (italics again) just didn’t understand the point of that sentence and I’m trying to establish how to incorporate that into my following of the discussion.

  103. I was just trying to figure if you very eloquently called people who disagree with you inherently wrong because they don’t know about that which they speak

    Nope – hence the we, as I include myself in the group of people who should not necessarily be first in line to sit up all night with the calculators.

  104. mcl @ 110,

    I’m pretty sure that saying that “the U.S. military is run by incompetent cowards and manned by rapists and gang members” is about the most classless and low thing I have ever read on a respectable message board.

    In fact, the longer I think about it, the worse I think it is.

    I could dispute all of your figures “commissioned by two public-employee connected research groups” but I wouldn’t waste my time arguing with an anonymous assbag who has such obvious disdain for the people who have fought and died to give him the right to spout such bullshit.

  105. And now that Billy’s had an opportunity to reply, I’ll step in and remind everyone that it’s best to stick knives into arguments and not into each other.

  106. Mythago –

    Understood. That distinction may well have been clear to everyone but me. I hope you can see, given the huge rift between the two possible interpretations *I* saw, the question was to clarify for my benefit.

  107. Here’s a Billy-Quiets-to-plain-English translation:

    “I could dispute all of your figures “commissioned by two public-employee connected research groups” but I wouldn’t waste my time arguing with an anonymous assbag who has such obvious disdain for the people who have fought and died to give him the right to spout such bullshit.”

    TRANSLATION: “I have no fact and no logic and no credible arguments to support my baseless claim that public employees are paid too much and that the U.S. army is a splendid institution despite Abu Ghraib and the fact that 1/3 of women in the military get raped…so instead I’m going to call names and hurl vacuous ad hominem insults.”

    Congratulations, Billy. You’re ready to run for congress as a Tea Party candidate. A bright political future awaits you.

    Meanwhile, out here in the real world, the fact remains that the U.S. army proves chronically unable to win wars while pissing away well over a trillion dollars a year. If we want to cut waste and inefficiency from the U.S. government budget, cutting our useless impotent incompetent military should be job one.

  108. Yes, let’s move on. Here’s a portrait of America’s economy in six graphs:

    http://2.bp.blogspot.com/_djgssszshgM/TEAb1QvKL3I/AAAAAAAABKY/15t1T9wg508/s1600/median+weeks+of+unemployed.png

    http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389×6198648

    http://www.mymoneyblog.com/images/1007/tuition.gif

    http://graphics8.nytimes.com/images/2009/07/09/business/econgraphic3.jpg

    http://4.bp.blogspot.com/_Whzugz3HHQ4/TGqcknjlBOI/AAAAAAAAADU/kQQiImMq6IM/s1600/GR2010010101478.jpg

    http://economistsview.typepad.com/economistsview/2010/07/-anomalous-capacity-shrinkage.html

    The biggest area of waste in the U.S. GDP? Our medical expenditures, which far outpace those of any other developed nation — with far worse results.

    Until each of the issues raised by these charts gets addressed, playing “balance the budget” by rearranging fiscal deck chairs on our budgetary Titanic remains an exercise in futility.

  109. Two points:

    i, All those people justifying cutting wages to Federal workers on the grounds that their wages have been rising faster than the private sector over the last couple of years of Depression will, of course, also be calling for government wages to be raised based on the decades before those years in which public sector wage gains lagged the private sector, right?

    ii, The NYT is being dishonest in includign Social Security in the exercise – it’s funded seperately, it’s not in any real danger, and can be solvent for the forseeable future with a couple of simple tweaks. The only way it can affect the real budget is if you implicitly assume the US will default on the obligations to the fund – which are held as Treasury Bonds. And if the US is going to default on Treasury Bonds, suddenly you have a whole lot more problems to deal with.

  110. Up to half of the $700B/year we spend on Medicare/Medicaid (including state contributions) goes to fraud, waste, and unneeded procedures. If we eliminate it, we basically balance the budget, problem solved.

  111. Bill K #127: Do you have any credible evidence to support your claim that “up to half of the $700B/year we spend on Medicare/Mediaid…goes to fraud, waste, and uneeded procedures”?

    That claim contradicts congressional testimony by CBO analysts that puts waste and fraud in Medicare and Medicaid at less than 4% as well as senate testimony by the chief financial officer of the HHS department, who backed up her testimony with detailed financial records of medicare and medicaid expenditures.

    “In November 2008, HHS reported a Medicare FFS paid claims error rate of 3.6 percent. This exceeded our 2008 goal of 3.8 percent, and was a decrease from the 3.9 percent reported in 2007, and lower than the 4.4 percent rate reported in 2006. The FFS error rate has declined significantly from the 10.1 percent reported in 2004 to the 3.6 percent reported in 2008.”

    Source: Statement by Deborah Taylor, Acting Director and Chief Financial Officer,
    “Eliminating Waste and Fraud in Medicare and Medicaid” before the Senate Homeland Security and Governmental Affairs Committee Subcom. on Federal Financial Management, Government Information, Federal Services & International Security of the United States Senate, Wednesday, April 22, 2009.

    http://www.hhs.gov/asl/testify/2009/04/t20090422a.html

    That’s a waste or fraud rate of 3.8%, less than 4%. Out of 700 billion dollars, that comes to less than 28 billion dollars — wildly less than the 350 billion dollar waste and fraud number you pulled out of nowhere with no supporting citations.

    Unless you have some credible hard evidence to back your claim that medicaid and medicare currently waste 350 billion dollars a year, this sounds like yet another repetition of the Reaganoid fairy tale of welfare queens driving around in Cadillacs or strapping black bucks buying T-bone steaks with food stamps.

  112. I did mine by pretty much overhauling the military, going to Obama’s proposed tax rates, not really touching medicare or medicaid accept for the cap to GDP and by instituting a new taxes(everything but the sales tax, sales taxes are like inflation, they hurt the poor more than the rich).

    This all being said I would like to point out everyone might as well check off the farm subsidies box. That ones not really up for debate. The US recently got in a lot of trouble with the WTO over it’s farm subsidies for Cotton. You see American Cotton farmers have the prices for their goods regulated by US government, the government basically goes in and sees what a profitable competitive price for cotton farmers is and they tell farmers that if they ever have to sell under that price to meet the demand that the government tells them that they have their back. Having there back means that the US treasury writes them a check in the form of a subsidy for whenever they have to sell under their set price. The problems with this “insurance” policy(subsidy) as the government calls it is that it breaks WTO laws which we actually were the architects in creating. We have basically promised Brasil(country who sued United States over this and won 3 times so far) that if we don’t change this in the farm bill which is up for vote in congress soon, that we basically just give them $147 million a year to drop their suit. Brasil has since agreed to the terms, but other US industries with more powerful lobbyist than cotton industry are not lobbying to end all farm subsidies. You see when a country wins a WTO suit it gets to tax imports to it’s country from the country who did the offending. Brasil has been able to tax the American music industry, luxury car manufactures and clothing manufactures who export goods from US to Brasil since around 2008. These industries are really pissed off at these subsidies and are now lobbying hard to get them taken away.

    Long story short, farm subsidies are pretty much dead in the water, which means the United States probably will drop off considerable from being worlds number 1 exporter of things like corn, cotton, etc. This isn’t exactly a bad thing for the market because it means less US tax payers money is going to distorting the market, which in the long run is promoting certain domestic industries over others. We could have a need for something else in America but we would never know because we’ve been funneling money to US farmers for so long.

  113. ohh god, I need to drink some coffee before I make comments. Sheesh,

    “I did mine by pretty much overhauling the military, going to Obama’s proposed tax rates, not really touching medicare or medicaid except for the cap to GDP and by instituting a new taxes(everything but the sales tax, sales taxes are like inflation, they hurt the poor more than the rich).”

  114. Fraud and errors are part of it. A small part, but estimated at up to $60B a year. (http://en.wikipedia.org/wiki/Medicare_fraud) Medicare is a subsidy for organized crime in Florida. Whoever designed an insurance program based on trust should be hauled out behind the barn and shot.

    A bigger problem is unnecessary procedures. Medicare works by setting a schedule of reimbursements for hospitals, but these schedules are wildly inaccurate. Hospitals will lose money on certain procedures, and make money on other procedures. Analysis of procedures ordered has shown a very strong correlation to extra procedures ordered and their profitability.

    So if a hospital loses 500 bucks on a hip replacement, and makes 1000 bucks on an MRI, guess what? Odds are every hip replacement is going to get an MRI tacked onto it, whether it is necessary or not. It doesn’t harm the patient, but it screws over the taxpayer, who has now just paid out 1500 dollars instead of 500.

    The entire notion that the government can accurately and fairly fix prices for *anything* is so appallingly stupid that you’d think it’d have been discredited and abandoned 70 years ago.

    Even the NY Times estimates that needless procedures make up about 10-30% of the Medicare budget. (http://www.nytimes.com/2010/03/30/health/30use.html)

    If you want to look at numbers, the NHS and VA system insure people at around $2,000 to $4,000 per person, including third party subsidies. Medicare and Medicaid costs over $10,000 per person per year, when you include Medicare Advantage payments and so forth. Not a perfect comparison, because Medicare insures the elderly and Medicaid the poor, but enough to show you what sort of efficiency improvements should be possible.

  115. You said “taxes!” I HATE YOU I HATE YOU I HATE YOU! If you think the government needs your hard earned money then you are more than welcome to just write it a check Mr. Scalzi!
    I’ll just keep all my money thank you very much! After all, I’m a self made man!
    I got a public education, was treated in a hospital for free when i had an accident and didn’t have insurance, I only utilized my Pell grant for my education at a public university, had to live off of food stamps for a mere 6 mos, and noone ever once helped me! Why should I now pay taxes for anyone else!?

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