News Can Cutting Military Spending and Subsidies Solve the US Deficit Crisis?

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Effective deficit reduction requires immediate spending cuts and transparent budgeting. Key proposals include closing foreign military bases, reducing naval forces, and eliminating agricultural subsidies, which are seen as unnecessary expenditures. The discussion emphasizes that entitlement programs like Medicare, Medicaid, and Social Security, which constitute a significant portion of the budget, must also be addressed, though cutting these is viewed as politically sensitive. Some suggest freezing all spending to allow GDP growth to make current levels sustainable, while others advocate for drastic cuts across discretionary budgets. Ultimately, the conversation highlights the complexity of balancing fiscal responsibility with the need to protect vulnerable populations.
  • #91
Please consider the following?

1.) K-12 schools have a break in the summer. The tradition began when children were needed in years gone by to help on the family farm. Now it seems the tradition continues to facilitate family vacations.

2.) Lower income families are typically eligible for food assistance and there are in-school "free lunch" (and/or breakfast) programs in many schools.

IMO - both of those programs are needed. (Although, I would like to see the purchasing addressed - another conversation.)

However, this program does not make sense to me:
http://www.ode.state.oh.us/GD/Templates/Pages/ODE/ODEPrimary.aspx?page=2&TopicRelationID=835

"Just as learning does not end when school let's out, neither does a child's need for good nutrition end. The Summer Food Service Program (SFSP) provides free, nutritious meals and snacks to help children in low-income areas get the nutrition they need to learn, play and grow throughout the summer months when they are out of school.
The SFSP was created to ensure that children in low-income areas can continue to receive nutritious meals during long school vacations when they do not have access to school lunches or breakfasts. But, although millions of children depend on nutritious, free and reduced-price meals and snacks at schools during nine months of the year, just a fraction of that number receive the free meals provided by the SFSP during the summer months."


Why is this necessary? Where is parental responsibility?
 
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  • #92
WhoWee said:
IMO - both of those programs are needed. (Although, I would like to see the purchasing addressed - another conversation.)
Purchasing? Did I miss part of the conversation? :p


WhoWee said:
Why is this necessary? Where is parental responsibility?

IMO this is one of the worst side-effects of any nanny-policy, the waning of responsibilities. And of course is one of the key arguements for free market principles - individuals taking responsibility for themselves are stronger than those that do not take responsibility for themselves. One of my biggest issues with these types of policies is they're band-aids - there is no attempt to actually RESOLVE the impoverishment. We don't need safety nets, we need safety trampolenes.
 
  • #93
mege said:
IMO this is one of the worst side-effects of any nanny-policy, the waning of responsibilities. And of course is one of the key arguements for free market principles - individuals taking responsibility for themselves are stronger than those that do not take responsibility for themselves. One of my biggest issues with these types of policies is they're band-aids - there is no attempt to actually RESOLVE the impoverishment.
That's a key point. It's obvious from the design of the programs advocated by the left, and simple political logic, that resolving the problem is not the goal. Their permanent solution is the perpetuation of the problem, and the perpetuation of their "band-aid" policies.

And like any group of mobsters, it's hopeless to try to sway them with reason and logic. To paraphrase Ben Franklin: Force poops on the back of reason. We will never change the minds of the power hungry.

Of course they have gotten so greedy the last couple of years that their system will likely crash. And they will predictably try to blame those they pillage from instead of their pillaging, just like they do now.
 
  • #94
mege said:
Purchasing? Did I miss part of the conversation? :p

I don't want to divert this thread. In other threads, I've noted the purchasing power the Government would have if they bought generic staples and paid distributors on a cost plus basis - rather than allow consumers to pay retail for processed foods of their choice - again, IMO - poverty is too comfortable.
 
  • #95
Medicaid and Medicare costs are increasing not because the programs are broken and need to be slashed, but because of our out-of-control health-care costs. Health insurance is far too expensive in the US. Other industrialized countries do not pay anywhere what we have to in order to get coverage for their citizens. Institute a true public option, perhaps by allowing younger, healthier workers to opt into Medicare.

What does this even mean?

Currently, the Department of Health decides how much to reimburse providers for procedures performed under Medicare. These rates are already significantly below the going market rate - so much so, that the system suffers from provider flight. Your argument is that these costs are still too high. If so, the Medicare advisory board already has the authority to negotiate lower reimbursement rates - why don't they?

Because, of course, reimbursement rates aren't "too high"; in fact, they're too low, from the markets perspective. Other industrial countries pay less because they use non-price determinants of supply; specifically, they make do with less access (first-come first-serve rationing rather than price-rationing) and fewer procedures (the most expensive treatments are priced out of the market and totally unavailable outside the United States). This is less of an option here because the government must compete with private consumers for access to providers - something illegal in places like England and Canada (though I think Canada is flirting with privatization).

So, you've got two options:

Nationalization, so that the government becomes a monopsonist (the sole consumer of the good). It can dictate lower prices to providers (they won't be able to simply turn away the government pool and service a private pool). Many providers will be priced out of the market, reducing the supply and resulting in lengthy wait times for access (or eliminating access altogether, if reimbursement rates won't cover operating costs at even the most efficient firms for the most exotic procedures). This is the British model.

Privatization. Reduce the benefits provided by the Medicare program, and encourage customers to supplement with private coverage, or pay out of pocket. So, for example, Medicare might provide catastrophic coverage, with routine, long-term, maintenance and prescription coverage obtained privately or on a for-cash basis. This is the Ryan model.

In neither case is the existing model sustainable, let alone expandable. Note also, before pushing for the former, that the vast majority of healthcare innovation occures in the United States. Routine access to new procedures becomes commonplace in foreign markets only years after procedure introduction here, when costs have fallen to workable levels, given the lower international reimbursement schedules. It is possible that healthcare innovation would mostly stop if the incentive to innovate - a rich and willing to pay American market - were eliminated.
 
  • #96
On the issue of servicing the national debt, I think it was mentioned earlier that we are at a double-digit percentage of the budget being used to pay for servicing the debt. However, this is incorrect, the percentage of the federal budget used to service the debt is still in single digits, however, we are at a double-digit percentage of the federal revenues being used to service the debt. Right now, it's about 13% of the federal revenues, which is a red flag. If it gets up to 18% or over, that is a major red flag that can cause a downgrade to the bonds.

On the issue of the entities that buy U.S. debt being willing to buy it at very low rates right now, what happens if the interest rate has to increase? With a moderately-size level of national debt, this isn't a problem, but with a massive level of national debt, this can create a huge problem, because at that point, even an uptick in the interest rate of one percentage point could mean a massive increase in the amount of money it takes to service the debt. In other words, we could go from 13% of the federal revenues to 18% or higher being used to service the debt really quickly. Japan for example has a national debt that is 230% of their GDP. They have a AA bond rating. Their national debt is so high that if they were to increase their interest rate by one percentage point, it would wipe out whole sections of the Japanese government. Probably one way in which Japan is able to get around this is that they hold 90% of their debt.

On making Social Security more solvent by raising the cap on income taxed, the argument against this is that it would turn SS into a de-facto welfare program. SS is (or was) "supposed" to be a program in which you get paid out what you paid in. So you cap how much income is taxed, because otherwise the guy making $500,000 a year would end up getting massive payouts from SS while the person who made $30,000 a year wouldget much smaller payouts, which would lead to a lot of populist screaming. If you make the higher-earners pay into SS but only get a tiny amount paid out, if anything at all even, it is now a welfare program. One thing that could be done for SS is to raise the retirement age a bit more.

On the issue of a minimum wage, you raise the minimum wage too high, and you'll hike up the unemployment rate. I have actually wondered how the unemployment rate currently would respond if both the national and all state-level minimum wages were suspended for a couple of years. One of the first things the Democrats did under Nancy Pelosi upon taking control of the Congress in 2006 was to vote in an increase in the minimum wage. A healthy economy could maybe withstand that (although we had around 5% unemployment under Bush, at the limit for being considered full employment), but with it having been increased and then with the real-estate industry crashing, and then the financial crisis in 2008, I'd imagine the higher minimum wage is probably keeping unemployment higher than what it otherwise might be as the economy is very sensitive.

As for cutting spending, on the issue of waste and corruption, a problem with much of that is you just can't cut it, because it's like the marbling in a steak (marbling is the fat webbed throughout the meat). If there are big pieces of fat on the ends of the steak, you can take a knife and just cut them off, but it's pretty impossible to cut out the fat webbed throughout the meat, and that is how a lot of the corruption that occurs in the government is.
 
  • #97
turbo-1 said:
IMO, the only way to effectively cut our deficit is to cut spending ASAP and to keep all future spending on-budget and transparent.

We can get rid of a lot of spending with a few moves. First, close at least 600 foreign military bases. They are not necessary to the security of our country. Foreign bases are a drain on our treasury and a direct monetary transfer to the countries that host those bases. Bring home the military personnel, administrators, and their families. We will all be better off.

Next, drop a couple of carrier groups. Our Navy does not need to be able to project aggression all over the world. No other country has this force.

Next, drop the support for ethanol, and all other price-supports for agricultural programs that steer so many millions of dollars to ADM, Monsanto, etc, while making basic foods more expensive for US citizens.

This is not an inclusive list. I hope others can chime in.

The GOP fantasy that we must attack deficits by cutting Medicare, Medicaid, and Social Security, is just that. A fantasy that cannot work while keeping our most vulnerable citizens covered by at least a minimum social net.

To re-address the OP - I'm in favor of a phased-in percentage reduction across the board starting now with a goal of paying down the national debt over 40 years - perhaps to a 90 day working capital limit. If the budget cut is 20% or 30% - let the administrators of the specific departments sort out the details.

IMO - when Government has a lean budget - waste will become quite obvious and any cuts in service favored over cuts in staff (Government size) will also be obvious.
 
  • #98
mege said:
The http://www.cnn.com/2011/US/06/02/georgia.immigration.farm.workers/index.html?iref=allsearch" there are several states in the mid-$8 range. The article must be mistaken, but that's where I got my number.

Is that before taxes or after taxes? I specifically mentioned "taking home" $7.80 an hour.

Current binary employment issues aside, my point is that actual take-home isn't the issue for those that are working full time. Working 50 hours at a mill or farm isn't out of the ordinary - unskilled labor for road construction, county crews, etc, generally pay much higher (esspecially for unionized employees). The problem is really WHAT jobs people are doing. It's easy to be willing to work at WalMart or Target, and you're getting paid accordingly - lots of people love retail jobs because of the extreme flexability and possible discouts/perks. It's also a job that can be done by someone with on the job training, making these jobs also good for young folks in college or just starting out. The retail environment is sketchy for the employer - you cannot give all of their staff full time hours. I was a supervisor at a big box store for about 2 years - out of 25 employees in my department during christmas, I had 3 that were full time. 6-8 each day during the week and everyone on Saturday and Sunday. In the non-holiday times that scaled down to a total of 8 with 2 full time. 3 per day during the week, and again, everyone on the weekends. How can I employ more people - the business couldn't handle it? Mandating that a company has x% full-time employees is lunacy and will spell doom for the retail industry - or prices will neccessarilly go up accordingly.

Ah, I see what you mean now. See, explanations are good. They help me understand things.

One could argue that the issues that General Motors faced in the past decade were because of their generous hiring practices. As a rule through the 60s and 70s, GM didn't hire temporary workers, it didn't hire part time workers - it didn't need to. It could afford the inefficiencies with the excuse that they had a huge available talent pool (ever heard the phrase 'Generous Motors'?). As their market share shrunk through the 80s and into the 90s they had to start cutting chaff and become more lean and mobile. They voluntarilly chose to be a respite, of sorts, for the community and had very loose hiring standards and practices - but that ended up biting them in the rear. Now, except for some highly specialized engineering positions, they're not hiring for permanent positions and they've started contracting more temps than ever. They got bit by the excess on their employee's behalf.



Finally, and I generally avoid any ad hominem discussions - but if you're only working 20 hours/week, that's your own fault. There may not be jobs you want to do out there to make minimum wage or better with full time hours, but they are out there. I've always had a job where I was getting 40+ hours. For the first time, come this spring, in almost 10 years I will not have a full time job (by my own choosing, to focus on school). I've jumped between jobs as I've moved around, but a month or two of unemployement aside - I've worked 40-60hrs/week for a decade. Most have been indoor desk or retail jobs, but some of the best paying jobs I've had were labor (I did road construction for 3 summers between my first stint at college). Most of that time was spent living in the Detroit area... so arguebly an area that has been worse for longer as far as employement has concerned. Point being - jobs are there, it just may not be precicely what you want to do.

I'm just going to ignore this part; I don't want to get into a flame war right now. Allow me just to mention that it's a trifle difficult to work 40+ hours a week and still manage to get 15-18 hours of class and 45-54 hours of studying in, per week. And still have time to sleep.

And before you say anything, yes it took me this long to get back to you.
 
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  • #99
Char. Limit said:
I'm just going to ignore this part; I don't want to get into a flame war right now. Allow me just to mention that it's a trifle difficult to work 40+ hours a week and still manage to get 15-18 hours of class and 45-54 hours of studying in, per week. And still have time to sleep.

And before you say anything, yes it took me this long to get back to you.

Then you have extra circumstances that prevent you from working 40+hrs/week. That's a different situation than jobs being available for someone looking for a career to live off of.

I moved a year ago and it took me 3-4 job interviews and offers before I found one compatable with going back to school. I eventually did find something compatable (I work nights doing server-watching which gives me a lot of homework time!). I was close to giving up my search for a fulltime job and accepting part time somewhere for the flexability, but I consider myself lucky.
 
  • #100
mege said:
Then you have extra circumstances that prevent you from working 40+hrs/week. That's a different situation than jobs being available for someone looking for a career to live off of.

I moved a year ago and it took me 3-4 job interviews and offers before I found one compatable with going back to school. I eventually did find something compatable (I work nights doing server-watching which gives me a lot of homework time!). I was close to giving up my search for a fulltime job and accepting part time somewhere for the flexability, but I consider myself lucky.

Hmm, that actually sounds pretty interesting (and useful). Nice catch!
 
  • #101
turbo-1 said:
IMO, the only way to effectively cut our deficit is to cut spending ASAP and to keep all future spending on-budget and transparent.

We can get rid of a lot of spending with a few moves. First, close at least 600 foreign military bases. They are not necessary to the security of our country. Foreign bases are a drain on our treasury and a direct monetary transfer to the countries that host those bases. Bring home the military personnel, administrators, and their families. We will all be better off.

Next, drop a couple of carrier groups. Our Navy does not need to be able to project aggression all over the world. No other country has this force.

Next, drop the support for ethanol, and all other price-supports for agricultural programs that steer so many millions of dollars to ADM, Monsanto, etc, while making basic foods more expensive for US citizens.

This is not an inclusive list. I hope others can chime in.

The GOP fantasy that we must attack deficits by cutting Medicare, Medicaid, and Social Security, is just that. A fantasy that cannot work while keeping our most vulnerable citizens covered by at least a minimum social net.

http://www.ssa.gov/pressoffice/pr/trustee10-pr.htm"
 
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  • #102
SixNein said:
http://www.ssa.gov/pressoffice/pr/trustee10-pr.htm"

Isn't the "surplus" used to pay other expenses?
 
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  • #103
WhoWee said:
Isn't the "surplus" used to pay other expenses?

The surplus goes into a trust fund.
 
  • #104
SixNein said:
The surplus goes into a trust fund.

http://www.ssa.gov/oact/progdata/fundFAQ.html

"Why do some people describe the "special issue" securities held by the trust funds as worthless IOUs? What is SSA's reaction to this criticism?

As stated above, money flowing into the trust funds is invested in U. S. Government securities. Because the government spends this borrowed cash, some people see the trust fund assets as an accumulation of securities that the government will be unable to make good on in the future. Without legislation to restore long-range solvency of the trust funds, redemption of long-term securities prior to maturity would be necessary.
Far from being "worthless IOUs," the investments held by the trust funds are backed by the full faith and credit of the U. S. Government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government.

Many options are being considered to restore long-range trust fund solvency. These options are being considered now, over 20 years in advance of the year the funds are likely to be exhausted. It is thus likely that legislation will be enacted to restore long-term solvency, making it unlikely that the trust funds' securities will need to be redeemed on a large scale prior to maturity."
 
  • #105
SixNein said:
http://www.ssa.gov/pressoffice/pr/trustee10-pr.htm"
The reason that Medicare and Medicaid costs are rising is because we have a broken health-insurance system. It costs more than many people can afford, and uninsured people fall back on ER visits, etc, when timely preventative care could have averted those visits. That drives up medical costs for all.

The lack of affordable universal coverage in the US is very costly to all the insured people because their costs are driven up by the uninsured. European countries and Canada do a lot better at covering their citizens with a lot less money than the US spends.
 
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  • #106
turbo-1 said:
The reason that Medicare and Medicaid costs are rising is because we have a broken health-insurance system. It costs more than many people can afford, and uninsured people fall back on ER visits, etc, when timely preventative care could have averted those visits. That drives up medical costs for all.

The lack of affordable universal coverage in the US is very costly to all the insured people because their costs are driven up by the uninsured. European countries and Canada do a lot better at covering their citizens with a lot less money than the US spends.

How many millions of people have been added (and will be added) to Medicaid - because they are unemployed or under-employed? Let's also not forget the expansion of the SS disability program (50+ new eligible conditions - bi-polar as an example). I've posted links to both of these extensively in other threads - just label IMO.
 
  • #107
WhoWee said:
"Why do some people describe the "special issue" securities held by the trust funds as worthless IOUs? What is SSA's reaction to this criticism?

As stated above, money flowing into the trust funds is invested in U. S. Government securities. Because the government spends this borrowed cash, some people see the trust fund assets as an accumulation of securities that the government will be unable to make good on in the future. Without legislation to restore long-range solvency of the trust funds, redemption of long-term securities prior to maturity would be necessary.
Far from being "worthless IOUs," the investments held by the trust funds are backed by the full faith and credit of the U. S. Government. The government has always repaid Social Security, with interest. The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the Federal government.
While that's true, the "safety" of all U.S. debt notes assumes that our grandchildren will choose to pay debts they didn't incur. Could happen, but I wouldn't count on it.
 
  • #108
Al68 said:
While that's true, the "safety" of all U.S. debt notes assumes that our grandchildren will choose to pay a debt they didn't incur. Could happen, but I wouldn't count on it.

When the Chinese raise our borrowing rate - we'll see how secure the trust fund investments are - won't we?
 
  • #109
Try Smart Shopping
By Ed Rendell

Pennsylvania now spends $2 billion less to run state government than it did eight years ago. This didn't happen by accident; it's a direct result of the smart management measures we put into place.

Pennsylvania had more than 2,000 contracts for buying office supplies when I took office in January 2003. Some agencies paid full retail price. We immediately began applying good business practices to every aspect of state purchasing. We saved $14 million a year by putting office supplies out to bid and selecting the lowest-priced single supplier. Applying that same model to computer purchases saved taxpayers another $19 million a year. We allow local governments and school districts to piggyback on these contracts. These are just two examples of the procurement redesign that is saving taxpayers nearly $30 million a year.

Today, the skyrocketing cost of providing health care is squeezing taxpayers. Here, we've applied more cutting-edge strategies. To give our state workers greater responsibility for their own care, I imposed the first-ever employee contribution toward premiums. We also require employees to fully engage in a wellness program or face 50% higher monthly premiums.

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Our wellness plan specifically focuses on reducing the costs of treating chronic illness, and it actively pushes employees to stay healthy. This approach enables us to keep the state's cost increases to less than 7% a year, well below that of most other states in the recent past. This is a true "win-win" for our employees and our taxpayers.

To save even more money without cutting services to taxpayers, we've asked the state legislature to place all 500 of our school districts into one combined health-insurance plan. Districts would enjoy new leverage in the insurance marketplace, leading to improved benefits and cost reductions of up to 30%.

Each of our cost-saving measures has faced some opposition from legislative leaders of both parties. Fortunately, taxpayers stood with us—they understand that common sense, innovation and political will are what it takes to make government work for them.

Mr. Rendell, a Democrat, is the governor of Pennsylvania.

Pension Reform Is Key
By Arnold Schwarzenegger

For years now, I have been trying to get lawmakers to reform public employee pensions in order to benefit private-sector job growth. The problem is stark: Over the last decade in California, spending on state employees' compensation rose nearly three times faster than state revenues. This has squeezed resources for programs, such as higher education and job training, that benefit private-sector workers.

This year, for the first time ever, our state was forced to spend more on retirement costs ($6.5 billion) than on higher education. This prevented us from, among other things, investing in more transportation and other infrastructure projects that are needed to accommodate the world's fastest-growing and most innovative companies.

Last week we finally got some good news: The state legislature agreed to pass my pension reforms as part of a hard-fought budget deal. These reforms cut spending in significant ways:

• Current employees will now be required to contribute more toward their pensions, saving nearly $800 million this year alone.

• For new employees, we will create a two-tier system that rolls pension levels back to pre-1999 levels. This will reduce pension costs by $100 billion over time.

• We ended the ugly practice of pension "spiking," where employees manipulated their compensation in their final year at work in order to boost their lifetime retirement benefits.

• We brought transparency to the system by exposing the deceptive pension fund accounting practices that were hiding hundreds of billions in pension debt from the taxpayers.

These reforms are creating a pension system that is fair to both state workers and to the private-sector workers who pay their salaries and benefits. It will free up more money for investing in critical programs like higher education and infrastructure, and help reduce tax burdens on the private sector.

It saddens me to see Democrats and some Republicans who seem intent on raising business taxes and reducing infrastructure investment in order to protect spending on public-employee compensation and retirement benefits. We believe that, on the contrary, private-sector job growth will be enhanced if public-sector retirement benefits are brought under control. All it takes is some lawmakers who are willing to stand up to the special interests and do what's right.

Mr. Schwarzenegger, a Republican, is the governor of California.

Invest During Bad Times
By Deval Patrick

Even before we began to feel the effects of the global economic collapse, we chose investments and reforms that we believed would build a stronger, better Commonwealth for a generation. We stuck with that strategy through the recession—and it's working.

Massachusetts increased its investment in education—because education is our calling card around the world—and sustained it because second graders don't get to sit out the second grade until the recession is over. We invested in innovation industries (like biotech, IT, clean and alternative energy, and related manufacturing) because our highly educated work force is uniquely suited to such enterprises. And we invested in health care, because we see health as a public good, and because we believe that people should have health security, especially in tough times.

We paid for these investments with government reforms and deep cuts in other spending. We cut $4.3 billion from a variety of programs and agencies, reduced employee head count by 3,000, negotiated wage and benefit concessions from state employee unions, and increased state employee health-care contributions. We also capped pensions and ended loopholes that some employees used to boost their retirement benefits, such as by claiming an entire year of service for working one day in a calendar year.

At the same time, we consolidated more than 20 transportation, business development and other state agencies. Civilian flaggers instead of police details were assigned to construction projects. We cut the business tax rate to 8.75% from 9.5%. We closed tax loopholes that favored multinationals over small businesses, which make up 85% of the businesses in our state. We increased our sales tax to 6.25% from 5%, but food and most clothing remain untaxed. A large rainy day fund and federal stimulus funds have also helped. Through this blended approach, we delivered four responsible, balanced budgets—on time—leading all the independent rating agencies to reaffirm our strong bond rating.

We're getting results. Massachusetts's rate of job growth is the highest in the nation, having added nearly 65,000 jobs so far since December. The state economy is growing at 6.4%, twice the annual rate. CNBC rates us the fifth best place in the U.S. for business.

Mr. Patrick, a Democrat, is the governor of Massachusetts.

Ever-Higher Budgets Can't Be the Norm
By Bob McDonnell

When I took office in January, we faced two massive budget shortfalls. The first was $1.8 billion in the fiscal year 2010 budget. To get this under control we cut spending and provided a financial reward for state workers to generate savings and not spend their entire agency budgets by the end of the fiscal year. Six months later we announced a $403 million surplus.

The second shortfall was $4.2 billion in the current biennial budget. Again, we cut a wide variety of programs (including in education and health), reducing state spending to 2006 levels. As a result we closed that shortfall without a tax increase—indeed we threatened a veto if the legislature passed the previous governor's proposed $2 billion tax increase. The legislature rejected the tax unanimously.

Virginia's state budget grew by 73.4% from 2000 to 2009, much faster than the rate of growth in population plus inflation. This is unsustainable and unacceptable, and the budget cannot be seriously restrained without addressing its two primary drivers: personnel and programs.

As a result, we supported a significant overhaul of Virginia's pension system. All state employees hired after July 1 of this year will now, for the first time in a generation, contribute to their own pensions. With pension-system reform, we will save an estimated $3 billion over the next 10 years. Actuaries estimate that in the long run, our reforms will reduce the total cost of Virginia's pension system by 10%.

Our second major reform was an immediate, statewide hiring freeze. We obtained enhanced authority from the legislature for the governor to order a freeze that covers all noncritical areas of state government, not just a select few agencies. This strict freeze, together with reductions in full-time positions, will save over $20 million a year.

Looking forward, we've also created a commission on government reform that is evaluating over a thousand ideas to save tax dollars, by doing everything from cutting and consolidating boards and agencies to creating a one-stop shop where businesses can access every license, permit and registration they need to operate. For too long, state governments have operated on the assumption that ever-higher budgets are the norm. We intend to redo the way government operates.

Mr. McDonnell, a Republican, is the governor of Virginia.
 
  • #110
WhoWee said:
When the Chinese raise our borrowing rate - we'll see how secure the trust fund investments are - won't we?
Yep. Many people seem to think that a government can continue to exist indefinitely while overspending like ours currently does. And that a constantly devaluing fiat currency can last indefinitely. We know from history that neither is true.
 
  • #111
Al68 said:
Yep. Many people seem to think that a government can continue to exist indefinitely while overspending like ours currently does. And that a constantly devaluing fiat currency can last indefinitely. We know from history that neither is true.

I received four (4) emails today from lenders urging me to borrow money before July 1 - when their rates will increase.
 
  • #112
turbo-1 said:
The reason that Medicare and Medicaid costs are rising is because we have a broken health-insurance system. It costs more than many people can afford, and uninsured people fall back on ER visits, etc, when timely preventative care could have averted those visits. That drives up medical costs for all.

The lack of affordable universal coverage in the US is very costly to all the insured people because their costs are driven up by the uninsured. European countries and Canada do a lot better at covering their citizens with a lot less money than the US spends.

Maybe medicare/medicaid is the problem with the health care system in the US. Instead of being safety nets for the unfortunate and the elderly - they've become ways of life for many. I forget whom said it - but medicare wasn't supposed to get this big, ever. It was supposed to be stop-gap coverage, and temporary at best for necessary services.

The dictitorial nature of medicare/aid skew the otherwise market system that is in place and force medical facilities to potentially charge more for a service to 'non standardized' patients. This increase can be from a) the dictated price being higher than necessary (so why charge less to someone) or b) the dictated price being lower than expected (causing the facility to recoup costs from non-medicare/aid patients). Either way, unless the medicare/aid price for service is perfectly aligned with the market expectation it will force the non-entlitled individuals costs up. With the expansion of federal medical subsidies like medicare/aid in the 90s (it's not really insurance...) there were several reports which went into more detail on these points. If I have time tonite I'll dig them up.

Even discounting the scenario above, if medicare/aid is well managed enough - how does that explain the secondary market for medicare coverage? There's companies out there making money on buying medicare coverage from someone and still providing them 'even more' services. That indicates a fundamental flaw in the system to me.
 
  • #113
mege said:
Maybe medicare/medicaid is the problem with the health care system in the US. Instead of being safety nets for the unfortunate and the elderly - they've become ways of life for many. I forget whom said it - but medicare wasn't supposed to get this big, ever. It was supposed to be stop-gap coverage, and temporary at best for necessary services.

The dictitorial nature of medicare/aid skew the otherwise market system that is in place and force medical facilities to potentially charge more for a service to 'non standardized' patients. This increase can be from a) the dictated price being higher than necessary (so why charge less to someone) or b) the dictated price being lower than expected (causing the facility to recoup costs from non-medicare/aid patients). Either way, unless the medicare/aid price for service is perfectly aligned with the market expectation it will force the non-entlitled individuals costs up. With the expansion of federal medical subsidies like medicare/aid in the 90s (it's not really insurance...) there were several reports which went into more detail on these points. If I have time tonite I'll dig them up.

Even discounting the scenario above, if medicare/aid is well managed enough - how does that explain the secondary market for medicare coverage? There's companies out there making money on buying medicare coverage from someone and still providing them 'even more' services. That indicates a fundamental flaw in the system to me.

The Government has controlled healthcare and health insurance for many years - through regulation and price control.
http://www.google.com/search?source...gc.r_pw.&fp=bd71108a3b251f45&biw=1186&bih=847

To expand a bit - Medicaid has become a de-facto universal health care plan - due to expand again - isn't it?
http://old.news.yahoo.com/s/dailyca...opelosiunclearonobamacaresmedicaidglitchcosts

"As details about the new-found Obamacare glitch, that allows for more than 3 million middle-class Americans to qualify Medicaid surface, the Obama administration and key members of Congress are mum on several points.
Was it intentional? According to the Associated Press, it was a negative result of a “well-meaning effort.” Obama administration officials and senior congressional Democrats, including House Minority Leader Nancy Pelosi haven’t answered this question, and Pelosi’s office hasn’t responded to requests from The Daily Caller seeking comment.
“What I want to know is: did the CBO know about this? Did they include this spending in their original score of the law?” said Michael Cannon, health policy expert at the Cato Institute, in an email. “Or would this spending add even more to the cost of the law?”"
 
Last edited by a moderator:
  • #114
I would keep social security off-budget where all pols used to promise it was. I would pay the social security trust fund its 2500 billion dollars using printed money and allow them to invest it in something real like the world stock markets.

That leaves everything else at 45% borrowed. I would cut everything 45% except I would cut 100% of ag subsidies, 100% of oil subsidies, 100% of foreign aid. I would consider repudiating the debt.
 
  • #115
turbo-1 said:
The reason that Medicare and Medicaid costs are rising is because we have a broken health-insurance system. It costs more than many people can afford, and uninsured people fall back on ER visits, etc, when timely preventative care could have averted those visits. That drives up medical costs for all.

The lack of affordable universal coverage in the US is very costly to all the insured people because their costs are driven up by the uninsured. European countries and Canada do a lot better at covering their citizens with a lot less money than the US spends.

While I agree that uninsured people are a problem, the necessary reforms are not politically possible.
 

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