The President’s re-election (More Discussion II)

In my post entitled "The President’s re-election (Discussion)" I set forth comments that I received from various subscribers and my responses, including an exchange with Roger Streit of West Orange, N.J. and ended with my rejoinder. But my disputation did not end there, and accordingly, I set forth the further discussion with Roger in my post "The President’s re-election (More Discussion)." While my discussion with Roger has not ended, Albert Nekimken of Vienna, Virginia has joined the fray. I set forth below his comments and in my next post will set forth my rather lengthy response.

Here is what Albert opined with respect to my exchange with Roger:

This exchange is thoughtful - thanks for sharing it, though I'm not sure I can identify accurately exactly where you and Roger diverge. There are too many strands to the argument and chronology for that.

 Suffice to say that I agree with you that the future volatility of interest rates makes our high level of national debt dangerous. However, you may be minimizing the allure to some of inflating our way out of it by devaluing the USD, one way, or another.

 Regarding social security and retirement, we ought to remember that at least 30% of SS recipients have no other source of income. Also, by the mid-60s, many (if not most) people are exhausted and/or unable to continue to work even if anyone was willing to employ them, which is unlikely. If so, raising the retirement age is dangerous. Today, millions of people are struggling to remain employed at all, and therefore able to contribute to the SS fund.

 Based on my reading, the SS fund is NOT a debt of the federal government AND the fund can be rather quickly replenished for the foreseeable future simply by making 90% of all income subject to SS tax withholding contributions, as it was when SS was established; at present, contributions end around incomes of $125,000. This must be changed.

 As for rising life expectancies, where do you find evidence for this myth? American median life expectancy is already lower than that of many OECD countries and insurance companies still estimate that people like me, at age 68, should expect only ten more years of life. If so, that means less than 15 years of retirement on SS benefits--not excessive after a lifetime of work, by my estimate.

 Apart from paying off the Treasury bonds with which Congress irresponsibly stuffed the SS fund over the years, the next greatest federal spending burden is Medicare. Here the Republicans are pushing for a decrease in benefits, which are already inadequate, and ignoring the potential for legislating lower prices from vendors in the healthcare industry, which is currently VERY profitable. As the majority of the population is covered by Medicare, vendors unwilling to accept lower prices (and lower profits) offered by Washington will find ever smaller populations willing and able to pay their higher prices. The alternative approach to lowering healthcare costs, of course, is simply to establish a national health service the provides services directly. There is general agreement that we would see quickly a 30% decrease in useless, duplicative administrative costs even before considering bloated corporate profits.

 When U.S. vendors are unable or unwilling to sell at prices that the national service can afford, procurement should be opened globally. Also, if SS and Medicare payments were made to recipients for payment anywhere in the world where they may reside, you would see an earthquake of price adjustment in the healthcare industry. 

Finally, as you know, defense and intelligence spending must shrink. Alas, there is growing evidence (especially to Washington, DC residents) that the heretofore untouchable spending on intelligence has gone totally out of control. We could likely obtain the same, or better, intell while spending half of what we spend currently--again due to waste, duplication, and sheer incompetence. 

The defense vendor community is resisting spending reductions fiercely, but this is a fight that we must win--even at the cost of raising unemployment temporarily. Employment that is supported entirely by federal spending should be better shifted to time-sensitive, temporary unemployment benefits. 

Must end. Thanks again for resuming your blog and keeping our brains agile.

Comments, questions, or corrections, are welcome and will be responded to and distributed with attribution, unless the writer requests that he/she not be identified.