President Obama’s Medicare Malady: Jobs, Debt, Inflation…

MaxedOutMama writes of his disconnect from reality:

The inescapable reality is that Social Security and Medicare will rise far faster than employment taxes. These are pay as you go programs – every dollar not covered by employment taxes is a dollar that must be borrowed by Treasury THAT year.

Therefore neither anything the Democrats are suggesting will help, nor is the GOP currently addressing the underlying problem.

We are going to raise taxes. We cannot raise corporate taxes, therefore we are going to raise taxes on individuals. (The reason we cannot raise corporate taxes or capital gains taxes is that doing so will cut investment and jobs – we need those jobs to employ the working age population.)

Because individual incomes are rather limited, we should address current tax-exempt revenue (not capital gains) streams such as bonds and retirement funds. It should be obvious that wealthier retirees will have to pay more relatively; we cannot expect a much smaller relative working population to cover the costs for a much higher relative retired population. In 2010 the retirees are 21.6% of the working age population. In 2020 the retirees are 28% of the working age population.

IMO the GOP will regain some power, but does not currently have the confidence of the general population sufficient to broker a new broad compromise. Either the Democrats will develop into that party (after the current leadership fails utterly and falls in an internal insurrection) or a new party will emerge.

We can greatly ease the demographic transition by following high growth policies that will generate more jobs, but that is not sufficient to cover these costs.

Like the good Mama, I, too believe that Obama and the Left have killed progressivism for a generation.

Added: Just remember, if people had jobs, they could afford to buy health care.

Also, rich people run out of money, too, or, they stop earning purposefully.

Posted in Barack Obama