Presidential Candidates Shrink From Budget Issue

[question everything]

The Wall Street Journal

Presidential Candidates Shrink From Budget Issue
Worsening Fiscal Picture Looms, But Hopefuls Prefer Not to Look
By JACKIE CALMES
January 2, 2008; Page R1

WASHINGTON -- One thing unites all the presidential candidates, of both parties: None are honestly facing up to the huge budget challenges that will confront the next White House resident. In fairness, if any of them did, voters probably wouldn't give them the keys. The next president will be inaugurated just as the first of 78 million post-World War II baby boomers begin to retire, and in his or her first term they will be making their claims on Medicare, Medicaid and Social Security. Annual deficits will start climbing, even without any of the new spending that the candidates promise for defense and domestic programs. War costs will continue to pile up. Net interest on the national debt, to creditors in China and elsewhere, already is one of the single-largest spending items, and growing fast.

Meanwhile, revenue will be many billions less than projected. That is because all the candidates have promised to fix or even repeal the alternative minimum tax -- which was intended for rich tax-evaders but not indexed for inflation -- so that the AMT won't hit the increasing millions of middle-class voters due to be ensnared otherwise. Even as Democrats and Republicans on the campaign trail are vaguely promising "change" -- and making it sound easy -- back in Washington the director of the nonpartisan Congressional Budget Office, Peter Orszag, testified on Capitol Hill in mid-December about the nation's long-term budget outlook, and he wasn't optimistic. "Under any plausible scenario, the federal budget is on an unsustainable path -- that is, federal debt will grow much faster than the economy over the long run," he said. And that, he added, means more borrowing from abroad, and less investment and income growth at home.

The main culprit, according to the budget office's latest report, is the projected explosion in costs of health care, exacerbated by the rising claims of aging baby boomers. "Therefore," Mr. Orszag said, "efforts to reduce overall government spending will require potentially painful actions to slow the rise of health-care costs." An economist, Mr. Orszag is a Democrat, but his message echoes that of his Republican predecessor as CBO director, Douglas Holtz-Eakin, who is now the chief economic adviser to presidential candidate and Arizona senator, John McCain. Yet pain isn't something candidates talk about.

(snip)

All the Republicans favor extending the Bush tax cuts, which otherwise would expire in the next president's first term, and rule out any income-tax rises. When quizzed about Social Security's looming instability, all of the Republicans say they support letting workers divert payroll taxes to personal accounts. But that would add to the program's financial woes for decades, requiring additional taxes, benefit reductions or borrowing -- which is why Mr. Bush's own proposal never went anywhere even in a Republican-led Congress. Despite the country's worsening fiscal picture, the Republicans' platforms don't sound all that different from Mr. Bush's back in 2000, when the country was at peace, running a surplus and paying down the debt. Besides echoing his call for overhauling Social Security, they favor more tax cuts, look to market-based remedies for health-care savings and promise deep cuts in other federal spending, without specifics.

But even slashing the overall federal budget -- which ranges from agriculture subsidies and parks to research and weaponry -- wouldn't avert the crisis that Mr. Orszag and others forecast: As CBO data consistently show, the ballooning costs are mostly in Medicare and Medicaid, and to a lesser extent Social Security and interest on the federal debt -- not in the annual appropriations that include much-criticized "earmarks" for lawmakers' special projects... Unlike Republicans, Democrats also aim for universal health care, to cover the 47 million uninsured, and propose new spending and tax incentives for energy and technology innovations, arresting global warming, and for education and college aid. They also promise to restore pay-as-you-go budgeting to the federal government. The biggest offset they offer to "pay" for their proposals is ending Mr. Bush's tax cuts for the richest Americans, typically those making more than $200,000 a year. But what sounds like an all-purpose source of revenue is anything but. Eugene Steuerle, a senior fellow at the nonpartisan and centrist Urban Institute think tank, and a former Reagan Treasury official, says that returning income-tax rates for the wealthy to pre-Bush levels would mean about $50 billion a year. While no small amount, that is less than a third of the fiscal 2007 deficit. It would cover no more than half the revenue cost of overhauling the AMT, and a few months of Medicare's cost increase.

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[Pale Blue Dot]

1. I don't think that any of them are talking about the economy at all.

I think that will prove to be a huge mistake.

[Captain Angry]

2. Economy is too broad a term.

It lets people say it's fine, and they're right. It lets people say it's a mess, and they're right too.

They need to talk about the percentage of the citizens with two jobs that are still not making the equivalent of minimum wage for a year.

They need to talk about the percentage of the take home pay that each American is paying for war, health, etc.

They need to talk about the sectors of the economy that are seeing job creation and growth. And then explain why those sectors are all in the low-end services portion that pay less than enough to live on and be healthy.

Etc.

[fasttense]

3. They are all talking about the economy, only in code.

The reason the reich wing, Murdoch rag, the Wall Street Journal doesn't hear it is because the Robber Baron Murdoch has covered his reports' ears with the threat of firings.

First if you end this stupid war for bush and cheney profits, you have all that money disappearing into corrupt and shoddy contractors for spending. If you do away with these ignorant thieves that the Pentagon has outsourced our military to, then you could put Americans to work and get a savings to boot. All the Democratic candidates have discussed ending the bush/cheney profit wars.

Social Security is not the problem. I say again, SS is not the problem. If the budget were balanced, the thieves in our government wouldn't have to take our taxes for social security and use them to balance the budget. The double tax rate that the baby boomers paid could be used on what it was suppose to be spent on when Raygun doubled the SS taxes - Social Security.

But I'm willing to agree that Medicare and other medical expenses are a problem. That's why we need to ignore the redundant and corrupt health insurance corporations and nationalize all the medical functions. Just think of all the money we could save by not having to pay billionaire CEO's of insurance companies more billions for running the corporation into the ground.

But you are never going to hear any of this from the rags Murdoch runs into the ground. He thinks he's special and he thinks he and his cronies should run our country for us. And he is stupid.