Entitlement Hysterics

Jon Chait has a brilliant piece on "entitlement hysteria", noting that despite the pundits' obsession with Social Security, the entitlement problem is really a Medicare problem which, in turn, is really a health care problem:

Since you can't solve the entitlement problem without solving the health care problem, one might think that the entitlement hysterics would have gradually moved on to becoming health care hysterics. (There's also the fact that Social Security is solvent until 2041, but over 40 million Americans lack health insurance right now.) Yet this is another puzzling thing about entitlement hysteria: the sheer persistence of the obsession. It's true we have some large federal programs that are going to have to be shored up. But why do they consider this to be a matter of such unique urgency? Put aside the war in Iraq, for which plenty of people (including me) lack any confident solution. In addition to the health care crisis, there's global warming. There are numerous loosely secured nuclear sites throughout the world, any one of which could some day provide the raw material for a terrorist attack of unprecedented scale. There are numerous diseases threatening the lives of millions of Africans whose deaths could be prevented at relatively modest expense.

These other calamities have one thing in common: The consequences of inaction are permanent. Carbon released into the atmosphere can never be recovered. Africans who die from aids can't be brought back to life. And fissile material captured by terrorists can't very easily be taken back.

Meanwhile, of course, health care is precisely the issue that the candidates are offering plans on. But acknowledging that the current debate is, in fact, presenting important choices on issues of vital importance would put political journalists in an awkward position. Rather than posturing, you'd need to respond to that reality by trying to inform yourself about the issues at hand and the meanings of the rival camps' proposals to deal with them. Instead, it's more comforting to complain that nobody has the courage necessary to talk about cutting Social Security benefits.

Comments

"Carbon released into the atmosphere can never be recovered."

not true, luckily, and a curious error in an otherwise spot-on paragraph.

on the other hand, there is no time to lose in pulling the excess co2 back out of the air.

Posted by kid bitzer | October 23, 2007 2:47 PM

You left icky gay sex off your litany of issues clouding our national discussion. Ewwwww!!! Who in the hell is worried about the disappearing ice caps when there's rampant buggery in our midst!?!? Jayzus!!

Posted by steve duncan | October 23, 2007 2:53 PM

No it is simpler than that. Alf Landon ran for President on an anti-Social Security platform in 1936 and certain factions of the Republican Party have never given up their hatred for the system, not because it was going to fail (although many sincerely believed it would) but precisely because it was working. The likelyhood of the Republican Party retaining control of the WH and regaining control of both houses of Congress now reaching near zero (lightning not going to strike three times) the Privatizers are now fully cognizant that it is Now or Never on Social Security, they won't get action in the next Congress and given a Democratic President in the next two Congresses and after that it will be too late. It was really too late by 1999 when Dean Baker and Mark Weisbrot published Social Security: the Phony Crisis and the numbers haven't gotten any better since they wrote:

The roof analogy is illuminating, but we can make it more accurate. Imagine that it’s not going to rain for more than 30 years. And the rain, when it does arrive (and it might not), will be pretty light. And imagine that the average household will have a lot more income for roof repair by the time the rain approaches.
Now add this: most of the people who say they want to fix the roof actually want to knock holes in it.
This is the situation facing Social Security, and it is well known to those who have looked at the numbers. The program will take in enough revenue to keep all of its promises for over 30 years, without any changes at all. Thirty years is a long time—it’s hard to think of any other program that can claim to be secure for that long. Furthermore, the forecast of a shortfall in 2034 is based on the economy limping along at less than a 1.7 percent annual rate of growth—about half the rate of the previous three decades. If the economy were to grow at 1998’s rate, for example, the system would never run short of money.

True dat. And it includes the prominant privatizers. They know the numbers, none better. They want to kill Social Security anyway. 2012 will be too late, absent a hellish recession Social Security solvency is almost assured. Even now 'Crisis' is defined as a check only 20% better in real terms than the check retirees get today rather than the 60% of the current schedule (a point made by Prof. Barkley Rosser of JMU). I don't expect that they really think they can jerk victory out of the jaws of defeat here, then again certain Cato affiliated economists have quite literally devoted their entire careers to this, you can't expect them to give up now. Think that Pentagon Lt. Col who has devoted his entire career to development of a particular weapons system. Not only is cancellation of the program bitter, it is a career ender. Where really is the market for ex-privatizing economists?

A seventy-two year dream of killing the New Deal is dying here, the whirring sound you hear is Alf and Ayn spinning in their grave. Social Security is fine and for certain people that is a tragedy. This last minute coordinated effort is just that. Last minute. The clock is winding down on this one.

Posted by Bruce Webb | October 23, 2007 2:55 PM

Meanwhile, of course, health care is precisely the issue that the candidates are offering plans on.

Plans that involve an additional $100 billion a year in government spending. Exactly how is this a solution to the entitlement problem?

Posted by Mixner | October 23, 2007 2:56 PM

Plans that involve an additional $100 billion a year in government spending. Exactly how is this a solution to the entitlement problem?

There's no solution because there is no problem. We'll fund it indefinitely with "supplementals--" just like the Iraq war. Odd how you should suddenly show a concern for fiscal prudence.

Posted by James Gary | October 23, 2007 3:02 PM

There's no solution because there is no problem.

Medicare is projected to go bankrupt in about a decade. That's not a problem?

Posted by Mixner | October 23, 2007 3:09 PM

BTW Chait's piece isn't particularly 'brilliant', he hasn't shown he understands the dynamic at all. In 1999 SS Trust Fund Depletion was scheduled for 2034, in 2004 it was scheduled for 2042, in 2006 for 2040, in 2007 for 2041. Similarly the Medicare Part A Trust Fund (HI) was scheduled for depletion in last year's report for 2018, in this years report it is scheduled for 2019. In 1992 it was set for 1999. Thus Chait's 2042 is 'wrong' and his 2019 Medicare date misses the fact that it was 2018 last year.

Real reporting on this topic would explore why the dates move at all, and why they have trended outwards and at rates at more than a year per year on average. Social Security and Medicare reporting generally uses static language (i.e. 'will') to describe what the data shows are dynamic dates and numbers. There is a Pulitzer in the future of the first reporting team that explains the trend shown in this table EPI: Changes in Trustees Projections over Time (Matt, you can mention me in a footnote)

Posted by Bruce Webb | October 23, 2007 3:16 PM

have the new owners removed the subscription-firewall from The New Racists, or is this a special deal for Chait articles?

I hope the former, because bug-fuck crazy bigot Marty definitely needs a bigger audience for his minions.

re: the explosion in Medicare costs. simple solution, all Medicare services will henceforth be offered only in Iraq. need a kidney transplant? No problemo, Ramadi General Hospital is ready, willing, and able to handle all of your Medicare-related procedures.

Posted by mrs. ibrahim al-jafaari | October 23, 2007 3:19 PM

"Medicare is projected to go bankrupt in about a decade. That's not a problem?"

Mixner, define 'bankrupt'. It is not like the payroll tax is going to vanish. Medicare Part A like Social Security is funded by premiums paid by current workers, it has been running a surplus, one that was predicted to falter and exhaust the Trust Fund by 1999 back in 1992 and now is projected to allow the Trust Fund to last to 2019, a year better than last year. Will there be an initial gap of about .75% of payroll in 2019? Well under Intermediate Cost assumptions sure. Is that a 'problem'? Only if you don't own a calculater.

Social Security and Medicare cannot go 'bankrupt' as long as there is a payroll tax. Certainly there can be gaps between income and cost that either will or not be made up by new taxes or benefit cuts. but some people need to do some homework here.

Posted by Bruce Webb | October 23, 2007 3:32 PM

Mixner points out the gaping hole in the "Reality-Based Community"'s talking points on entitlements. If anyone brings up Social Security, the liberal response is, essentially, "Why are you worrying about that? Medicare is a much bigger problem." If anyone proposes discussing the fiscal train wreck that Medicare is steaming towards, the liberal response is (as Matt demonstrates), "That's why we need to reform health care".

When Mixner follows up with the obvious question any numerate observer would ask, i.e., how do you solve the looming fiscal crises of Medicare by adding an additional entitlement, that will increase total entitlement costs, the response is either silence, irrelevancies, or snark.

The real reason for these responses, of course, is that Dems don't want to engage in an honest assessment of the fiscal state of our current entitlements, because they know this would only demonstrate how irresponsible it is to propose new ones before figuring out how to pay for our current ones.

Posted by Juan | October 23, 2007 3:39 PM

Plans that involve an additional $100 billion a year in government spending.

With 300 million Americans, that's $333.33 apiece. I pay more than that a year for no-ault automobile insurance medical expense coverage, and I have to get hurt in an auto accident to use it. $100 billion for universal health insurance, which would eliminate the need medical expense coverage under my auto insurance, sounds like a great deal to me . . .

Posted by rea | October 23, 2007 3:52 PM

Bruce Webb,

Mixner, define 'bankrupt'.

Medicare will enter a state in which spending exceeds income. This isn't a temporary or one-time deficit, but a structural problem that will get worse and worse every year. The Medicare trustees say the sooner we address this looming fiscal catastrophe, the better. They also say that it may be even worse than their projections, because of their wildly optimistic assumption about physician fee reductions. And yet you propose tens or hundreds of billions of dollars a year in additional federal health care spending, without even proposing a way to pay for our existing spending. It's grossly irresponsible.

Posted by Mixner | October 23, 2007 4:13 PM

There is a very good (and by good, I mean bad)reason for the social security "crisis".

Social security has been funded by payroll taxes, paid mostly by middle class people. The trust fund pulled in more than it paid out, and supplemented the general fund. This allowed income taxes, paid primarily by wealthier people, to be lower than they would be otherwise. This is why, previously, Social Security opponents have been all "sound and fury, signifying nothing".

Soon though, the SS trust fund is going to need to be repaid. That money will come from higher income taxes. That tax burden will likely fall upon the rich. The rich figure they have less than ten years to kill Social Security before their less knowledgeable (and less wealthy) political allies make a quick and easy connection between the continued existance of Social Security and their own best interest.

Posted by Njorl | October 23, 2007 4:16 PM

Mixner. Yep. And they were saying the same things back in 1992. They were wrong. Let me quote you something from the 2007 Report of the Trustees of Medicare. From page three.

Under the intermediate assumptions the HI trust fund is projected to be exhausted in 2019, 1 year later than in last year's report, due to slightly higher projected payroll tax income and slightly lower projected benefits than previously estimated

Which translated means 'Our models were wrong again, for like the fifteenth time in fifteen years'

You say

This isn't a temporary or one-time deficit, but a structural problem that will get worse and worse every year.

I say back that up with some data big boy. Because the track record of the Trustees on this one doesn't suggest we should be simply giving them a pass.

On balance both Social Security and Medicare Part A have been pushing Trust Fund depletion back more than a year per year for more than a decade. Maybe the improvement won't continue, but it seems like the burden of proof is on you. I have been encountering this same line of bluster and bullshit for years, yet the subsequent Reports never seem to back them up. Care to make a bet on the 2008 Report? Its due on or after March 31, 2008. I read it every year, do you?

And yet you propose tens or hundreds of billions of dollars a year in additional federal health care spending, without even proposing a way to pay for our existing spending. It's grossly irresponsible.

Exactly where did you get that from? True enough I support SHIPS, but not only did I not mention that on this thread we are talking $7 billion a year and not 'tens' or 'hundreds' of billions. Are you always this lazy with your argumentation or are you just tired?

Posted by Bruce Webb | October 23, 2007 5:06 PM

Obviously there are many things we can do to limit rapidly rising healthcare costs.

Medicare can pretty easily be made solvent with a few small fixes. In this case, running around shouting that the sky is falling is not credible.

Posted by bob | October 23, 2007 5:13 PM

"Medicare can pretty easily be made solvent with a few small fixes."

Don't keep us in suspense: what are the "small fixes" you propose? Please quantify how your proposed fixes will solve the fiscal problems of Medicare, and let us know if similar fixes will work for Medicaid as well.

Posted by Juan | October 23, 2007 5:25 PM

Bruce Webb,

Mixner. Yep. And they were saying the same things back in 1992. They were wrong.

No, they were not "wrong." The data changes each year, so it's not surprising the projection changes also. The most recent projection is that Medicare will go bankrupt in little more than a decade.

I say back that up with some data big boy.

Read the Trustees' report, bubba.

Exactly where did you get that from?

The health care plans of the three major Democratic candidates. Am I to understand that you oppose all of them? If so, good.

Posted by Mixner | October 23, 2007 5:39 PM

And yet if you were to take Social Security away from these fat cats, they'd freak out just like all those greedy poor people.

Posted by Ron | October 23, 2007 5:45 PM

There is no "entitlement hysteria." There is only demagoguery.

Posted by Bengt Larsson | October 23, 2007 5:47 PM

Re: how do you solve the looming fiscal crises of Medicare by adding an additional entitlement, that will increase total entitlement costs, the response is either silence, irrelevancies, or snark.

Because Mixner's premise is fundamentally wrong. No one would be "adding" an expense that does not already exist! Medicare is part and parcel of the overall healthcare system and its dysfunctions are the dysfunctions of the whole. You have to solve the problem of the whole to fix Medicare. Trying to fix Meducare without fixing healthcare overall is like fighting a fire on near side of the county line and ignoring the blaze on the far side of it because it's not your turf.

Re: how do you solve the looming fiscal crises of Medicare by adding an additional entitlement, that will increase total entitlement costs, the response is either silence, irrelevancies, or snark.

Sorry, Juan, but your morality is really screwed here. It is morally imperative to provide everyone with access to healthcare. That's my rock bottom premise and I'm sorry it isn't yours. The country is abundantly rich enough to do this- can you deny it?-- so therefore we must. Obviously we need to find a good way to do it, and that's a debate we do indeed need to have and everyone is welcome. But suggesting that we should just chuck some people overboard so the well-heeled and well-connected can continue to live like God on a holiday, well, sorry-- that's disgusting.

Re: Medicare will enter a state in which spending exceeds income.

Hmm. Sounds like the entire government is bankrupt, and quite often has been since Washington crossed the Delaware.

Re: Medicare will enter a state in which spending exceeds income.

How many times do I have to make this point: THAT'S NOT NEW SPENDING!!! The money is already being spent for crying out loud! Why can't you get that through your head? IT'S NOT NEW SPENDING!!!

Posted by JonF | October 23, 2007 7:55 PM

Mizner the future doesn't change once current year numbers come in. If you read the Reports iin sequence it is clear that future numbers were being manipulated.

Posted by Bruce Webb | October 23, 2007 8:26 PM