In my last blog entry I promised to bring forth a measure of objectivity to the right-wing scare tactic of each household in America being hugely indebted to the federal government.
Tuesday, June 7 of this year, the nation’s newspaper, USA Today, featured a front-page piece of fiscal panic journalism that warned a naïve and uninformed readership that the U.S. government was sinking under a mountain of $61.6 trillion in ‘unfunded obligations’ and that your household owed $534,000 as your share of those obligations.
The Spartanburg Herald Journal, never missing an opportunity to frighten it’s readership at the expense of the democrats, quickly published a follow-up piece by the Colorado Springs Gazette that regurgitated the USA Today politicized modern-day Revere ride, “the unfunded obligations are coming, the unfunded obligations are coming”. The write-up was featured on the June 10 editorial page. Considering the Gazette editorial page has generally featured such far right luminaries as Michelle Malkin, George Will, John Stossel, Thomas Sowell and the head of a Texas Free-Market Research Institute, Ronald L. Trowbridge, the article was a natural for the SHJ.
This little dance is not new to USA Today. They ran essentially the same type of scare tactic in May of ’07. The numbers then were $59 trillion and $516,348 per household. Needless to say every right-wing think tank on the planet has embraced (and mostly likely initiated) the issue.
The unfunded obligations, also referred to as liabilities, have been a right-wing ‘sky is falling’ ploy for years. YouTube appears to figure heavily in pushing some of these myths. A comely former CATO Institute Intern, Kelly McDonough, narrates a 4:19 minute piece on the debt and obligations under the auspices of the Center for Freedom and Prosperity, founded by a CATO board member. She clearly is reading everything she says from a prompter, but for pure eye candy will probably attract male viewers who otherwise would completely ignore the subject. Other young, female right-wing narrators make fashion choices that border on soft porn. Republicans learned long ago to recruit a stable of beauty pageant runners-up to do their political bidding.
A couple of other similar YouTube propaganda pieces go back a few years as well. An older one claims 50 Trillion in unfounded obligations with the ever-popular household number pegged at $400,000.
Here are the lastest unfunded obligation figures quoted by USA Today…
- Medicare: $24.8 trillion
- Social Security: $21.4 trillion
- Federal debt: $9.4 trillion
- Military retirement/disability benefits: $3.6 trillion
- Federal employee retirement benefits: $2 trillion
We’re told the huge Medicare number represents expenditures ‘over the lifetime’ of current recipients and workers. What exactly is ‘over the lifetime’? Men live an average of just over 75 years, so, actuarially they get Medicare for about 10 of those years. That’s not much of a ‘lifetime’ of benefits. The actual expenditure for Medicare and Medicaid combined in FY 2010 was $793 billion. For Social Security, $701 billion; the year before the number was $686 billion ($807 billion was taken in for a surplus of $121 billion) . But you’re led to believe that for Medicare alone, we owe $24.8 trillion any day now.
Let me home in on social security. It’s your safety net for decades of labor. You tithe 6.2% of your pay for the privilege of having enough money for your golden years. Your employer kicks in 6.2% as well. Eventually, the total will have to increase by a modest percentile of 1 – 2 percent. With that one caveat, we’ll be fine for at least 75 years. As is, there is no problem for roughly 25 years doing absolutely nothing. It also wouldn’t be a bad idea to have the truly rich wage earner kick in past the current limit of $106,800.
Medicare and Medicaid will remain solvent and then some with a few logical and practical adjustments. Though doubtful, there may have to be a marginal increase in the 1.45% contribution both you and your employer give to the program. I doubt that increase would be necessary if we pursued the following strategies…let’s begin by negotiating prescription drug prices just like the VA, the DOD and other industrialized countries. These other smarter countries also place ceilings on how much the pharmaceuticals can rip us off. Controlling prices at a reasonable and still profitable level is an imperative. Deregulation is a huge factor in our current ethical imbalance. Huge corporations will get away with whatever they can. And you’ve seen unconscionable increases in prices and premiums across the board.
Fraud is another ever-present consideration. President Obama appears to be sincere in going after the crooked docs, dentists and hospitals that are squeezing the system for billions in undeserved reimbursements.
The real questions to be asked; if we’re in such a horrific fiscal crisis mode, why on earth would any elected official vote to cut already benign taxes for the top 2%? Why wouldn’t we go after the hundreds of billions of tax dollars tucked away in off-shore havens ranging from Andorra to Western Samoa with 37 asset-hiding destinations in between? It might surprise you that under certain circumstances, Canada and Great Britain are included in the list.
And why do we allow ourselves to continue to be blackmailed by industrial giants that supposedly honor us by not taking all their manufacturing overseas to countries with workers who are paid pennies an hour? Why should it take a billion bucks to persuade Boeing to locate in this state? And, given all the tax and infrastructure breaks all the states give the Fortune 500 crowd, why have we effectively stopped collecting any federal tax from them? Corporations used to account for a high percentage of taxes collected by the feds, now it’s miniscule. Ergo, we lose trillions in revenue over time.
A study quoted in the consummate corporate apologist publication, the Wall Street Journal, revealed that 12 huge corporations with profits of $171 billion received $62.4 billion in federal tax subsidies and ended up paying ZERO federal taxes for the three-year period of 2008, 2009 and 2010 (Boeing was prominent among them).
It’s not a new phenomenon. Between the years of 1996-2000, 61% of U.S. Corporations paid no federal income taxes. In 2008, the number was 55%. And while the U.S. may have the second highest statutory tax rate among industrialized countries, it’s effective or real rate (the taxes actually paid) ranks right down there with the lowest.
The same holds true for wealthy individual tax-dodgers who fleece us out of many additional billions of tax dollars and flee to the same tax-havens as their corporate brethren.
An easy and obvious revenue producing solution is to start collecting the unpaid taxes from these aforementioned corporations and rich folks.
There are your real “Unfunded Obligations”
No comments:
Post a Comment