Friday, February 19, 2010

The Trouble with Specifics

The Tea Party movement is coming up with a Contract from America for this fall. It's a grab bag of conservative favorites, from ending runaway spending to tax reform and transparency. What it doesn't do is address the only two things that matter. They are Social Security and Medicare.

Actually, Social Security is not that big of a problem. But Medicare is. Say what you will about ObamaCare, but it had a plan to curb Medicare spending: Rationing with death panels. Never mind if it was a stupid plan. Never mind whether it would have worked. It was at least a plan.

Of course the big impact of Medicare is still a decade or so away. That's when baby-boomers like me will be seriously hitting the last-six-months-of-life syndrome and chewing up health care like you wouldn't believe. Meanwhile there are plenty of things that can be done to curb the cost of government. But every one will hit a powerful special interest. Here, just for giggles, is the current state of the game on government spending. It's from, of course.

United States Federal State and Local Government Spending Fiscal Year 2010 Amounts in $ billion Pensions: $987.4 Health Care: $1,081.6 Education: $1,041.8 Defense: $896.2 Welfare: $750.1 Protection: $350.0 Transportation: $269.3 General Government: $133.1 Other Spending: $581.7 Interest: $309.2 Balance: $104.4 Total Spending: $6,504.7

It can't be emphasized enough that the big dollars are all in the big four: Pensions (i.e., Social Security and government employee pensions), Health Care (i.e., Medicare and Medicaid), Education (the Blob), and Defense. Welfare is up by 50 percent, on account of the recession, but that will probably subside.

The big problem is that the government is paying for pensions that people ought to save on their own, and it is paying for health care for seniors that they ought to be paying on their own.

Not all people. But most of us. There's a role for government in helping people who have failed to provide for themselves, although families, churches, unions, and fraternal associations would probably do a better job. But the big problem is that government has promised gigantic benefits that it can never deliver. Politicians made those promises in order to win elections.

When the government runs out of money, it won't be the politicians that will suffer. It won't be the educated liberals that will suffer. It won't be the professional classes and the businessmen. It will only be the lower layers of the middle class. It will be the poor and the near poor. They will suffer. They will have to go without the health care that can make the last years a little more comfortable.

Yet it was the poor and the near poor that the modern welfare state was supposed to help.

It's a bit late to say this now, but government is just the wrong agent to provide any of these services. If you want insurance against risks, buy insurance. If you want to stop working, do some saving. If you want the comforts of health care, get a job.

But that's what we must work for. A government that only does the things that absolutely require force. Defense. Policing. Law. But humans have always been freeloaders, and they always will.

Meanwhile, let's watch the political system dance around the 800 pound gorillas in the room: Social Security and Medicare.

1 comment:

  1. I'm with you. Putting Congress in charge of pensions and insurance plans is like hiring a fox to watch the hen house. Social Security and Medicare should have been private institutions from day one. Of course, no private institution could have ever provided these things, so the programs were doomed to failure before they even started.

    If we hold firm on spending and taxes, then Social Security and Medicare, must, of necessity, go away.

    I know it's hard for the American public to understand that these are two mutually exclusive things. We can only take solace in the fact that there is no way that either of these programs can continue.