Social Security’s Looming Fiscal Nightmare

August 10, 2014

Just a reminder of another fiscal bomb set to go off.

International Liberty

With all the controversy over the failed and costly Obamacare program, it’s understandable that other entitlements aren’t getting much attention.

But that doesn’t mean there aren’t serious problems with Medicaid, Medicare, and Social Security.

Indeed, the annual Social Security Trustees Report was released a few days ago and the updated numbers for the government-run retirement program are rather sobering.

Thanks in part to sloppy journalism, many people only vaguely realize that Social Security is actuarially unsound.

In reality, the level of projected red ink is shocking. If you look at the report’s annual projections and then adjust them for inflation (so we get an idea of the size of the problem based on the value of today’s dollars), we can put together a very depressing chart.

How depressing is this chart? Well, cumulative deficits over the next 75 years will total an astounding $40 trillion. And keep…

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Attention! The US Economy closes for business in 2027! Please make your final selections…

March 28, 2012

In this latest installment of Firewall, Bill Whittle highlights an amazing exchange between Rep. Paul Ryan (R-WI) and the tax-cheating nitwit who runs our Treasury Department, Timothy Geithner. In it, Ryan points out that spiraling debt means the US economy according to the administration’s own numbers will cease to operate around 2027. Geithner agrees — and then admits there is no plan to deal with the problem:

Scary, isn’t it? And infuriating; the administration knows full-well that its policies will lead to a Greece-like fiscal meltdown, and yet they act as unconcerned as the grasshopper in the face of approaching winter.

Except in this case, the Democratic grasshoppers are endangering all our futures, not just their own.

As Whittle points out (and expounds on at greater length in this video. Do watch.), the problem is entitlement spending. We have enough revenue to pay for all the functions of government from the military to the post office, but the burgeoning costs of entitlements are forcing us to spend more and more and borrow more and more. At this time, we borrow just over forty cents of every dollar the federal government spends. That money has to be paid back with interest, and that interest will go up as our credit gets further downgraded. (Which, on the current path, is almost inevitable.) And that’s just what we’re borrowing now; as time goes on and entitlement spending increases thanks to an aging population and the costs of ObamaCare, there will be a need to borrow even greater amounts as a percentage of total spending, until one day our creditors wake up and realize we’ll never be able to meet our payments, and so stop lending us any more.

At which point the entitlement system collapses, our economy shuts down, and we come to the end of that downward spiral only to find ourselves not in a paradise of Unicorns and lollipops, but on the burning streets of Athens.

Forget 2012. Think 2027.

Now, if I were a cynic, I’d say that’s the plan in the back of the progressives’ minds: “reforms” that only seem to solve the problem, but actually set up greater crises that will eventually have the public demanding “progressive” solutions — greater government intervention and direction of the economy, with higher taxes to pay for it all. It’s Marxist philosopher Andre Gorz‘s concept of “non-reformist reforms.”

But… nah. I couldn’t be that much of a cynic, could I?

Yes. I. can.

It doesn’t have to be this way, though. While Whittle is, by his own description, running around with his hair on fire screaming warnings (and justly so), we have choices. Republicans have proposed three alternative budgets in recent weeks, any one of which will solve our entitlement crisis, restrain spending (the root of the problem), and emphasize pro-growth policies that will allow us to eventually balance the budget, pay off our debts, and prosper.

But, let’s be honest. That will only happen if We The People do what it takes this November to make it happen: defeat Barack Obama, take the Senate, and hold the House. The Democrats must be crushed. (1)

Otherwise 2012 may be the final bell before 2027.

RELATED: If you want to see “non-reformist reformism” in action, have a look at Steven Den Beste’s essay on Obama’s preferred outcome in the ObamaCare case now before the Supreme Court.

Footnote:
(1) In a peaceful, electoral manner, of course. Just in case some Lefty was about to start hyperventilating about “violent rhetoric.” They’re so excitable.

(Crossposted at Sister Toldjah)


Entitlement spending as vote-buying heroin

January 27, 2012

Liberals decry all the corporate money in politics, while conservatives worry that President Obama plans to spend a billion dollars to fund his reelection campaign.

Bill Whittle calls that “chump change.”

In another of his Firewall videos, Bill examines what he calls “The Vote Pump:” the money the federal government can use to make sure you vote the way the statists want. It’s eye-opening, to say the least.

Interesting, isn’t it? We currently take in more than enough revenue to fund the actual government (setting aside for the moment how many of those are legitimate functions), but what’s killing us is the nearly 60% of all federal spending that goes toward entitlements.

And it’s a percentage that, under current conditions, is only going to go up as the population ages.

Bill calls this a vote pump — money in, votes out. I think of it more as a form of economic heroin: give people “free money” and make them dependent, afraid to give it up. And, no matter how much they realize intellectually that the system is unsustainable and bad for the nation, that fear will lead most to vote to keep in power those who promise to keep the smack coming — the statists, whether Democrat or Republican.

It’s as de Tocqueville once wrote:

The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money. (1)

So when conservatives mock Gingrich for proposing a lunar base (“Too expensive!!”) or lefties decry all the money for the military (“Think of the children!!”), just take another look at Whittle’s chart and remind yourself of what the real problem is.

And then look at Greece to see where it will lead.

Footnote:
(1) Arguably misattributed.

(Crossposted at Sister Toldjah)