17 February 2011

Budget Seriousness

L'Hote | freddie | actual seriousness

Here's what you won't find at the Daily Dish, or at the Corner, or in any of the other places showily demanding seriousness: the actual, human, negative consequences of harsh entitlement cutbacks. I mean, from reading online today, you'd be hard pressed to know why we have Social Security and Medicare at all. I'll tell you why: because our winner-take-all economic system leaves defenseless, impoverished people in its wake. We have Social Security because the sight of so many elderly people left literally homeless and starving , too old and weak to work, was unseemly to an earlier generation that was willing to take less for themselves to provide for others. We have Medicare because it is an obscenity for a country responsible for the atom bomb and the moon landing and the Hoover Dam to allow suffer and die from lack of health care access due to the vagaries of birth and chance. That's why those programs exist.
Everybody please stop going back to the same "but we put a man on the moon!" well. It's lazy, and it's a bit dishonest. It's a justification for anything. It's non-falsifiable. Look: This is the country which built the most powerful weapon the world has ever known. So how can we not provide a rifle to every household in the land. Even Switzerland manages to do that!

Let's try another one: We built the Hoover damn for god's sake! If our society can do that, then everyone should get free water and electricity.

These seem like non-sequiturs, but they make at least as much sense as "We put a man on the moon therefor we need to pay for every old person's drugs."  Achieving a difficult thing does not obligate you to do everything that people think is easier than that thing.

Imagine if you actually lived our life that way. I could afford to take that vacation, so obviously I can afford to eat at that new restaurant. And I got a new computer, so how could I not also be able to provide a new watch? I ran a marathon last year, so of course I should walk up to my office on the twelfth floor everyday.  Individually any one of those things makes sense, but you can't keep using the same justifications for every new activity.
Cutting them will lead to human misery and death. It will. Cutting Social Security will mean the difference between subsistence and a pitiful existence for untold thousands of senior citizens. Cutting Medicare will mean some people won't get the health care they need when they need it and will suffer the physical pain and indignity that comes with that. That's just the way it is. Yet I keep reading all of these very serious people today failing to mention this reality at all. It's as if we have entitlement programs for no reason.
I'm looking around today and I see a lot of retirees who are a lot wealthier than I am. Remind me again why I'm transferring money to them. Surely not to avoid their imminent suffering. If that's what you're worried about then where's the means testing? Don't rhetorically prop up this entire edifice on the backs of the few people who need it. It's either a (shitty) retirement program, in which case everyone gets some, or it's a welfare system, in which case only the needy should get it. It can't the latter when it's time to make justifications, but the former when it's time to pass out checks.

And Really? Misery? Death? Federal spending on Social Security and Medicare is up 76% and 132% since 2000, respectively. (The CPI is up 26%, and there are 13% more people over 65.) Do you remember hordes of old people keeling over in the streets in 2000? I don't. I remember it as being a pretty fine time to be alive, for young and old alike.

But why bother rolling the clocks back that far? Wasn't all our stimulus spending supposed to be "timely, targeted and temporary?" That's what I remember our Fearless Leaders promising at the time. So let's just revert back to 2007's budget. Obama's proposed outlay for next year is a TRILLION dollars higher than 2007's. That's 37% higher. I don't recall a lot of misery and death in 2007.
Phony, showy seriousness is built on complaints, vague talk about thrift and national virtue, and a studied, preach-to-the-choir attitude where well paid journos and pundits see who can outdo each other in advocating measures that will be painful to others but painless for them. Actual seriousness means wrestling with the very serious and real costs of the harsh measures you're advocating. You don't get to show your courage in being ruthlessly pragmatic if you aren't willing to show who you are being ruthless against. The first step is showing the victims. Perhaps if Sullivan gets the deficit-reducing budget he wants, the Dish can start a "Homeless Grandmother of the Day" feature. Democracy needs that sort of thing; it's far, far too easy for people to operate in generalizations that preserve the illusion of painlessness.

Some people will lose jobs. Some people will not get their rents. Some people will not get to consume more than they produce. This will be painful for them. But this is reality. We can not all endeavor to live at each other's expense to the degree we have become accustomed in the last decade. There is your reality.
We do not have the money to pay for all of these things. Freddie does not seem to be disputing that. He is only distracting us. The degree of suffering that cutting spending will have, by itself, is immaterial. If there would be no suffering, we would have to cut spending. If there was immense human suffering... we would still have to cut spending.

And the further we delay, the more suffering there will be when the bill finally gets settled. Seriously, would you rather inflict a little pain now, when we have a bit of control over it, or wait for the bond markets to inflict a lot of pain later whenever they finally get antsy?

Cutting spending is not optional. It's not something we do if it's painless, but don't do if it's painful. It must be done. Let's not ignore the pain, but let's not use it as an excuse for avoiding making the difficult decisions either.

(Via McArdle)

PS I agree with Freddie that we should drastically reduce military spending and especially foreign deployments. But shuttering those over seas bases is not something done overnight. It's best to ease into it, like all spending cuts. Better to start now -- with the Pentagon's budget and everyone else's -- than to wait for the fiscal plane to fly into the mountain and then slash everything all at once.


  1. I'm looking around today and I see a lot of retirees who are a lot wealthier than I am.

    You begin by talking about non-falsifiability, and then this is the level of evidence that you are going to hold yourself to? You realize that there are millions of seniors who live below the poverty level, right?

  2. Yes, there are millions below the poverty line. Which Is why I never said they should be cut off.

    There are many seniors who are millionaires. As a group, those 65+ have higher median net worth than any other age cohort. According to CNN Money (and I wish I could find a better source, but I'm not going to put in the legwork now) their median wealth in 2009 was $232,000.

  3. PS The Federal Reserve's 2007 (most recent) "Survey of Consumer Finances" puts median net worth of all American households at $120,300. For those with retired heads the median was $543,100. I don't like household aggregated data much, but it's what I've got.

    Many old people are poor. Many are not. The existence of poor old people does not require us to transfer resources to all old people.