What’s America’s main fiscal policy challenge, particularly in the long run?
Most sensible people will agree that our greatest threat is the rising burden of entitlement spending.
More specifically, demographic changes and ill-designed programs will combine to dramatically expand the size of the public sector over the next few decades.
So it’s really amazing that some politicians, led by the clownish Elizabeth Warren, want to dig the hole deeper.
Here are some excerpts from a recent article in the Washington Examiner.
Elizabeth Warren is pushing Democrats to expand Social Security rather than cut it, a move that could pressure presumed party frontrunner Hillary Clinton to move left. …”What Elizabeth Warren has done on pushing the ball forward on Social Security is another example of why she’s a bold progressive hero,” said T.J. Helmstetter, a representative for the Progressive Change Campaign Committee, an outside group that pushes for progressive causes. …In March, almost all Democratic senators voted for a symbolic budget amendment to express support for expanding Social Security. …The messaging amendment approved by most Senate Democrats also did not specify how benefits were to be expanded.
I discussed this topic in a recent interview.
Though I’m surprised that my head didn’t explode while discussing such a reckless idea.
I closed the interview by expressing a modest bit of optimism.
Surely (at least I hope) politicians won’t dig the hole deeper when we can see right before our eyes the fiscal chaos and economic disarray in Greece, right?!?
I’m surprised demagogues such as Elizabeth Warren haven’t rallied behind a plan to simply add a bunch of zeroes to the IOUs already sitting in the so-called Social Security Trust Fund.
Fortunately, not all politicians think it’s smart to accelerate as you’re driving toward a cliff.
Writing in the Washington Post, Charles Lane explains Governor Christie’s proposal.
New Jersey Gov. Chris Christie…wants to campaign on a sweeping proposal to rein in federal entitlement spending on the elderly. …he urged a phaseout of Social Security benefits for retirees with $80,000 or more in other income and backed a gradual upward adjustment of the retirement ages for Medicare and Social Security, which is also appropriate, given increased life expectancy. …Social Security…remains a non-trivial cause of the government’s long-term fiscal imbalance. Its trust fund, admittedly an accounting fiction of sorts, is on course to run out of cash by the early 2030s. Christie’s plan would provide three-fifths of the resources necessary to guarantee Social Security’s solvency for 75 years
Kudos to Governor Christie for recognizing that you can’t repeal mathematics with politics.
And this modest bit of praise isn’t based on policy. 
I’m not a big fan of means testing, which has some unfortunate economic effects.
And I also think that raising the retirement age is sub-optimal since it forces people to pay longer into an inferior system that already is giving them a very low rate of return.
The right approach is to transition to a system of personal retirement accounts, but at least Christie has an adult proposal based on real-world considerations.
Though, to be fair, many leftists claim we can afford higher benefits and also “fix” the system with a giant tax increase. So they sometimes recognize that math exists, even if they want us to believe that 2 + 2 = 7.
P.S. If Hillary winds up endorsing Warren’s reckless plan, it will give us another data point for our I-can’t-believe-she-said-that collection.
P.P.S. Is Elizabeth Warren more of a faux populist or more of a faux American Indian?
P.P.P.S. You can enjoy some previous Social Security cartoons here, here, and here. And we also have a Social Security joke if you appreciate grim humor.
International Liberty 
[…] In some cases, they want this big increase in marginal tax rates in order to prop up the Social Security system while in other cases they actually want to expand the program. […]
[…] In some cases, they want this big increase in marginal tax rates in order to prop up the Social Security system while in other cases they actually want to expand the program. […]
[…] the votes are counted, but a Boric victory would indicate that Chile’s workers decided to trust the free-lunch promises of a […]
[…] worst news is that Bloomberg has abandoned his semi-rational view and is now urging higher taxes and program expansions. He’s presumably not as bad as some of the other candidates, but that’s damning with […]
[…] of $1 trillion. Especially since the tax-and-spend crowd in Washington is actually arguing that the program should be expanded. I’m not […]
[…] some of our friends on the left think that the answer is to make the program even worse for higher-income taxpayers, even though this […]
[…] previous Republican President and actually expand entitlements (perhaps by borrowing a page from Elizabeth Warren’s playbook and expanding Social Security). If Trump decides to punt (or, gulp, make things worse), that has […]
[…] it’s grossly irresponsible for politicians such as Elizabeth Warren and Hillary Clinton to agitate for higher spending in the […]
[…] But I suspect this kind of detail doesn’t matter to Bernie Sanders, Hillary Clinton, and the rest of the class-warfare crowd. […]
[…] But I suspect this kind of detail doesn’t matter to Bernie Sanders, Hillary Clinton, and the rest of the class-warfare crowd. […]
[…] when I wrote last month about proposals by some Democrats to expand Social Security, I was less than […]
[…] when I wrote last month about proposals by some Democrats to expand Social Security, I was less than […]
I have made this comment before, but it bears repeating:
If FICA payments are eliminated as part of a tax overhaul, the day they stop we have two groups of potential recipients. Those past retirement age are fully vested. Those not yet retired are only partially vested, because they will not be paying FICA for their entire working life.
For those only partially vested, I propose moving their retirement date back by 1/3 of a month, for every month they don’t pay FICA. [Normal work life is 45 years for 15 years of retirement.] After 30 years, Social Security and Medicare will begin at 76.
This gradual increase will allow non-retirees the time to save for the missing benefit periods.
Frankly this is long overdue. When Bismarck first adopted a German form of Social Security, life expectancy was about 40 and initial retirement age was 75, quickly lowered to 65. And we’re currently at 66!!??
Typical of big government types, the thinking must have been “If a little government is good, a whole lot of government will be great”.
Attempts to expand Social Security may be a huge political mistake for the Democrats.
For years they have scared seniors with threats that Republicans will abolish Social Security. However, seniors and close-to-seniors are now more concerned whether or not the money will be there when they need it (surprise, it’s not even there now). Expansion of Social Security makes the threat of a Social Security collapse a the more possible.
They may lose more votes than they gain, especially if illegal immigrants begin receiving payments out of the limited “trust fund”.
[…] WAIT, THERE’S MORE… […]
“Im going to die young. Can I have the money I paid into social security (and even more ironically Medicare, since I’m already sick) before I kick the bucket?”
“No. That money is reserved for the lucky ones that will outlive you by several decades.”
“Not only that, but knowing you will die young, you will still contribute into funds and medical care you can never make use of, so long as you continue working. Other luckier ones, who will outlive you by several decades will use your money and medicine.
Now back to work, because you ain’t got much time left, and your luckier countrymen want a decent retirement that puts them in the world’s top ten percent of income and medical care”.
Why?
Because people to who die young are a minority. Or, to be more exact, people who die young and already know about it are a minority.
In other words the number of electoral years spent “in the know” of a short life expectancy is small. Too small to affect elections.
So we are back to the main principle of a democracy that is sliding into Pitchfork Democracy.
Social programs are twenty percent compassion, eighty percent self interest, and almost a one hundred percent politician gain.
[…] By Dan Mitchell […]
Though shall not steal. I am not a Bible scholar nor do I play one on the internet. That said I know of know exemption for majority vote. We have become a nation of thieves and very few Christians have a problem with that. Heaven help us. Very few conservatives have a problem with that. They just want to reform or “improve” the system.