The Fiscal Cliff talks

[GG]

You don't get it. First, it's a government fund, they don't operate to make a profit. Second, despite everything politicians say, it's not designed to be solvent in perpetuity, it's designed to get workers to pay more taxes over time than what they get out of it, so that the elite don't have to pay a greater share. From 1983 (when the payroll taxes increased) to now, workers paid more taxes than what was paid out, creating the surplus. NOW, rather than pay on the accumulated IOUs, politicians are telling us that the future liabilities are so great that we need to raise taxes or cut benefits TODAY to make it solvent in the future. The same game that was played from 1983 to 2012. This is the real kick the can down the road issue. Taxes will be raised and benefits cut TODAY so as to generate a "surplus" that will "fund" SS until 2075, but the reality is those resources are needed to pay the IOUs that the government must start making good on TODAY.

 

Re, the first issue. At the same time taxes were cut on the top, Reagan raised taxes on everyone else--payroll taxes. Surely you are familiar with the Greenspan Commission? They raised taxes on SS on the basis that the fund would be insolvent in the 2000s. In reality it was to fund the tax cuts for the rich.

 

And yet the total share of income taxes paid by the top earners has nearly doubled over the last 30 years. How does that square with your theory?

[TPS]

 

 

Stick to the numbers. There you are just wrong. When you start your partisan schit you become wrong and an idiot, eh comrade?

Nice name calling. What part is wrong, and what numbers do you want me to find for you, again?

[TPS]

 

 

 

 

And yet the total share of income taxes paid by the top earners has nearly doubled over the last 30 years. How does that square with your theory?

What theory? It's a fact. Taxes were cut on the rich and SS taxes were raised.

You will have to be more specific on your data. What do you mean by top earners? 1%? 10% 20%?

Simple answer will be rising inequality. less income at the bottom and more at the top.

Edited January 4, 2013 by TPS

[birdog1960]

I agree, but how do you sell that? I'll tell you how, you don't.

you sell it by selling it. you define ordinary care and require out of pocket payment for extraordinary care. it's the american way. but you'll hear plenty of bitching about who makes those definitions. eventually, however, it has to happen.

[Magox]

you sell it by selling it. you define ordinary care and require out of pocket payment for extraordinary care. it's the american way. but you'll hear plenty of bitching about who makes those definitions. eventually, however, it has to happen.

 

People on both sides of the aisle vociferously defend seniors. No way in hell are politicians going to tell seniors that they shouldn't get any more or for that matter less care towards the end of their lives.

[3rdnlng]

Nice name calling. What part is wrong, and what numbers do you want me to find for you, again?

 

What I meant was that you should stick to the numbers and keep the blatantly partisan schit out of an economic discussion. See your post below:

 

 

You don't get it. First, it's a government fund, they don't operate to make a profit. Second, despite everything politicians say, it's not designed to be solvent in perpetuity, it's designed to get workers to pay more taxes over time than what they get out of it, so that the elite don't have to pay a greater share. From 1983 (when the payroll taxes increased) to now, workers paid more taxes than what was paid out, creating the surplus. NOW, rather than pay on the accumulated IOUs, politicians are telling us that the future liabilities are so great that we need to raise taxes or cut benefits TODAY to make it solvent in the future. The same game that was played from 1983 to 2012. This is the real kick the can down the road issue. Taxes will be raised and benefits cut TODAY so as to generate a "surplus" that will "fund" SS until 2075, but the reality is those resources are needed to pay the IOUs that the government must start making good on TODAY.

 

 

Are we bringing in more payroll taxes than we are paying out, TODAY?

[birdog1960]

People on both sides of the aisle vociferously defend seniors. No way in hell are politicians going to tell seniors that they shouldn't get any more or for that matter less care towards the end of their lives.

People on both sides of the aisle vociferously defend seniors. No way in hell are politicians going to tell seniors that they shouldn't get any more or for that matter less care towards the end of their lives.

i'm not so sure. it's going to come to a real battle of the generations. younger folks are already realizing that their gonna get less than they paid for when it comes their time to retire. older folks are mostly getting more than they paid into. i think americans, in general, think you should get what you pay for with a safety net for the helpless (provided that doesn't take too much away from "me" or anybody like me). we are rapidly approaching that tipping point. that's where all the blowback on obamacare comes from. the ironic thing is, that's the first step towards some limits (especially the expert panel, defining appropriate care).

[Magox]

I hear ya, but I don't see it happening.

[John Adams]

I agree, but how do you sell that? I'll tell you how, you don't.

 

We can/t afford it. So you set a limit for how much care you can get past a certain age. Seriously, we need to get better at letting people die with dignity. I don't see a pretty way out of it but we spend way too much time and money fighting death, especially at the end of life. If you're 85 and on your second bout of cancer in 3 years, it's time, not for a surgical intervention, but to allow yourself/loved one to pass.

[BillsFanM.D.]

We can/t afford it. So you set a limit for how much care you can get past a certain age. Seriously, we need to get better at letting people die with dignity. I don't see a pretty way out of it but we spend way too much time and money fighting death, especially at the end of life. If you're 85 and on your second bout of cancer in 3 years, it's time, not for a surgical intervention, but to allow yourself/loved one to pass.

 

I'm a huge fan of hospice. Let folks die with dignity and comfort. We spend too many resources trying to keep folks 'alive' for an additional two weeks.... far too often. This isn't a 'death panel' issue....this is just allowing a natural process to occur with a modicum of dignity.

[GG]

What theory? It's a fact. Taxes were cut on the rich and SS taxes were raised.

You will have to be more specific on your data. What do you mean by top earners? 1%? 10% 20%?

Simple answer will be rising inequality. less income at the bottom and more at the top.

 

Pick any of those 1%, 5%, 10%. Their share of income tax payments went up. So how does that compute with your theory that Reagan's tax cuts benefited the rich at the expense of the poor? Rising inequality isn't the topic. You said that the tax cuts for the rich were funded by everyone else. Please provide the data.

 

And I'll tack on that we need to get better at letting people die. The vast majority of healthcare costs are spent in the last 2 years of someone's life. What the !@#$ sense is that?

 

I know this is an oft repeated factoid, but it's not true.

 

The vast majority of healthcare costs of a dying person are spent in the last year of that person's life. But, that does not represent the vast majority of overall healthcare costs.

[John Adams]

I know this is an oft repeated factoid, but it's not true.

 

The vast majority of healthcare costs of a dying person are spent in the last year of that person's life. But, that does not represent the vast majority of overall healthcare costs.

 

Perhaps misstated by me. Still, "One out of every four Medicare dollars, more than $125 billion, is spent on services for the 5% of beneficiaries in their last year of life. Yet even with Medicare or private insurance, you're likely to face a big bill: A recent Mount Sinai School of Medicine study found that out-of-pocket expenses for Medicare recipients during the five years before their death averaged about $39,000 for individuals, $51,000 for couples, and up to $66,000 for people with long-term illnesses like Alzheimer's." http://money.cnn.com/2012/12/11/pf/end-of-life-care-duplicate-2.moneymag/index.html

 

""We end up spending about a third of our overall health care resources in the last year of life," Bergman said. "It represents a huge avenue for improvement." http://www.reuters.com/article/2010/10/14/us-care-costs-idUSTRE69C3KY20101014

 

Pretty staggering waste of money right there. We are spending gazillions on people who are about to die. As some said above, we need to get a lot better as hospice and letting people die with dignity, and not shot through with tubes.

 

[dayman]

Just 1% of Americans accounted for 22% of health care costs in 2009, according to a federal report released Wednesday.

 

http://usatoday30.usatoday.com/news/washington/story/2012-01-11/health-care-costs-11/52505562/1

 

 

Bring out the firing squad

[3rdnlng]

Wow, the vast amount of health insurance expenditures are going to the aged and ill? I betcha that nearly all auto insurance premiums go to pay for accidents too. If only we could manipulate things so that the healthy people and safe drivers get the benefits of INSURANCE.

[birdog1960]

despite the right's protestations, obamacare has begun to address this. i encourage wellness visits for all my medicare patients. included in the requirements to be reimbursed under the aca for this visit is a discussion on advance directives. if i get even a few patients to document their wishes for do not resuscitate status, i've likely saved many medicare dollars and much suffering. but the repubs demonized this requirement (http://www.oregonlive.com/opinion/index.ssf/2010/12/end_of_life_care_resuscitated.html )as a part of the death panel. i wish they'd put their mouths where there money is. at least the dems are taking baby steps in this regard.

Edited January 5, 2013 by birdog1960

[TPS]

 

 

Pick any of those 1%, 5%, 10%. Their share of income tax payments went up. So how does that compute with your theory that Reagan's tax cuts benefited the rich at the expense of the poor? Rising inequality isn't the topic. You said that the tax cuts for the rich were funded by everyone else. Please provide the data.

First, I didn't say that they were (completely) funded by everyone else, I said that they raised taxes on workers (and cut benefits for retirees) at the same time they cut taxes on the rich. Between Reagan's increased defense spending and his tax cuts, the SS changes helped reduce his deficits somewhat toward the end of the 1980s (for example in 1988 the off-budget surplus was 0.7% and the primary deficit 3.8%, so the total deficit was 3.1%). That is the off-budget surplus has helped offset primary deficits ever since. Also, the 1980s SS changes included everything they are talking about now: tax increases, benefit cuts, and raising the eligibility age.

 

Going forward, payroll taxes have become a larger share of the government's total revenues, especially after the Bush tax cuts (in fact, before the temp cut in SS taxes in 2010, payroll taxes were almost = income taxes in 2008 and 09). But during Reagan's term, income taxes as a share of gdp fell by about 0.8% and payroll taxes increased by about 0.5% (I say about, because it depends what years you use and I used a conservative average that excludes the recession years). Since about 1980 to 2007, payroll taxes as a share of total government revenues have increased by 5-6% and personal tax revenues have declined by about 2% (again, I take a rough average).

 

So you want an explanation. Inequality does matter as I showed you in our discussion about cap gains revenues. You can't talk about income tax shares without looking at both income shares and tax rates. The huge shift in income to the top 20% (with 50% of income) means they are paying more INCOME taxes and the bottom 80% less because their share of income has decreased (as we all know from rush and romney, the bottom 47% don't pay income taxes).

So how do I reconcile? The top 20% have more than half the income and personal income taxes have declined as a source of total government revenues. The government does not look at revenues as separate lock boxes; it's all one pot. In 2009, personal tax revenues were $915 bil and payroll tax revenues were $890 bil. out of the total $2.1 trillion in revenues.

 

So, again, the facts (not theory) are that the off-budget surplus generated by payroll taxes offsets the primary budget deficit. We need to stop pretending that the two are separate and then we can have some real discussions about how much to allocate to various sources (defense, non-def discretionary, SS and Medicare) and how to generate the revenues to meet the estimated needs over time. For example, if we say we want government no greater than 20% of gdp, how much to allocate to each, then how to finance. The debates would be much more transparent.

Time for a beer and lunch at your favorite place.

Cheers.

 

 

 

What I meant was that you should stick to the numbers and keep the blatantly partisan schit out of an economic discussion. See your post below:

 

 

You don't get it. First, it's a government fund, they don't operate to make a profit. Second, despite everything politicians say, it's not designed to be solvent in perpetuity, it's designed to get workers to pay more taxes over time than what they get out of it, so that the elite don't have to pay a greater share. From 1983 (when the payroll taxes increased) to now, workers paid more taxes than what was paid out, creating the surplus. NOW, rather than pay on the accumulated IOUs, politicians are telling us that the future liabilities are so great that we need to raise taxes or cut benefits TODAY to make it solvent in the future. The same game that was played from 1983 to 2012. This is the real kick the can down the road issue. Taxes will be raised and benefits cut TODAY so as to generate a "surplus" that will "fund" SS until 2075, but the reality is those resources are needed to pay the IOUs that the government must start making good on TODAY.

 

 

Are we bringing in more payroll taxes than we are paying out, TODAY?

With all due respect, everything is partisan. There is no completely fair system; society as a whole decides what's fair. The current budget debates are all about who will pay a greater amount--the top 1% or everyone else? Everyone will contribute, but who will bear the most pain is the issue.

Regarding SS funds, the temp cut in taxes and the recession have pushed revenues below expenditures. The end of the temp cut should put it close to breakeven.

 

 

 

Perhaps misstated by me. Still, "One out of every four Medicare dollars, more than $125 billion, is spent on services for the 5% of beneficiaries in their last year of life. Yet even with Medicare or private insurance, you're likely to face a big bill: A recent Mount Sinai School of Medicine study found that out-of-pocket expenses for Medicare recipients during the five years before their death averaged about $39,000 for individuals, $51,000 for couples, and up to $66,000 for people with long-term illnesses like Alzheimer's." http://money.cnn.com/2012/12/11/pf/end-of-life-care-duplicate-2.moneymag/index.html

 

""We end up spending about a third of our overall health care resources in the last year of life," Bergman said. "It represents a huge avenue for improvement." http://www.reuters.com/article/2010/10/14/us-care-costs-idUSTRE69C3KY20101014

 

Pretty staggering waste of money right there. We are spending gazillions on people who are about to die. As some said above, we need to get a lot better as hospice and letting people die with dignity, and not shot through with tubes.

Want to throw my 2 cents in here because I totally agree, which doesn't seem to happen too often here!

My dad spent the last year of his life on hospice surrounded by his loved ones. Hospitals and nursing homes suck (for the most part)!

I told my wife that when I get to the point where I can't take care of myself, take me back to Hawaii and strap me to a surfboard then have someone tow me into a 20 foot wave. Kowabunga!

[Adam]

I will add this. My father suffered from multiple forms of dementia, multiple myeloma and numerous other things. Towards the end, when we declined treatments, which would be worse than the illness, we were besieged by friends and family that went off on us- they said we were doing the wrong thing. Sometimes letting the end cme, is the best treatment possible.

 

I don't expect everyone to nderstand that, but after watching the end come, I don't ever want anyone to go through that because of me. Personally, I don't want to hang around past having a quality life, anyways

[John Adams]

Wow, the vast amount of health insurance expenditures are going to the aged and ill? I betcha that nearly all auto insurance premiums go to pay for accidents too. If only we could manipulate things so that the healthy people and safe drivers get the benefits of INSURANCE.

 

Not the point but you miss the point often.

 

We spend a boatload of money prolonging lives that are over instead of helping people die with dignity. This isn't a debate over giving an older person their hormone replacement drug or blood pressure meds.

Edited January 6, 2013 by John Adams

[3rdnlng]

Not the point but you miss the point often.

 

We spend a boatload of money prolonging lives that are over instead of helping people die with dignity. This isn't a debate over giving an older person their hormone replacement drug or blood pressure meds.

 

Can't resist a caustic remark, eh? To follow your logic, maybe we shouldn't have spent so much money on AIDS patients back a few years ago when we knew it was just a death sentence anyway.

[GG]

First, I didn't say that they were (completely) funded by everyone else, I said that they raised taxes on workers (and cut benefits for retirees) at the same time they cut taxes on the rich. Between Reagan's increased defense spending and his tax cuts, the SS changes helped reduce his deficits somewhat toward the end of the 1980s (for example in 1988 the off-budget surplus was 0.7% and the primary deficit 3.8%, so the total deficit was 3.1%). That is the off-budget surplus has helped offset primary deficits ever since. Also, the 1980s SS changes included everything they are talking about now: tax increases, benefit cuts, and raising the eligibility age.

 

Going forward, payroll taxes have become a larger share of the government's total revenues, especially after the Bush tax cuts (in fact, before the temp cut in SS taxes in 2010, payroll taxes were almost = income taxes in 2008 and 09). But during Reagan's term, income taxes as a share of gdp fell by about 0.8% and payroll taxes increased by about 0.5% (I say about, because it depends what years you use and I used a conservative average that excludes the recession years). Since about 1980 to 2007, payroll taxes as a share of total government revenues have increased by 5-6% and personal tax revenues have declined by about 2% (again, I take a rough average).

 

So you want an explanation. Inequality does matter as I showed you in our discussion about cap gains revenues. You can't talk about income tax shares without looking at both income shares and tax rates. The huge shift in income to the top 20% (with 50% of income) means they are paying more INCOME taxes and the bottom 80% less because their share of income has decreased (as we all know from rush and romney, the bottom 47% don't pay income taxes).

So how do I reconcile? The top 20% have more than half the income and personal income taxes have declined as a source of total government revenues. The government does not look at revenues as separate lock boxes; it's all one pot. In 2009, personal tax revenues were $915 bil and payroll tax revenues were $890 bil. out of the total $2.1 trillion in revenues.

 

So, again, the facts (not theory) are that the off-budget surplus generated by payroll taxes offsets the primary budget deficit. We need to stop pretending that the two are separate and then we can have some real discussions about how much to allocate to various sources (defense, non-def discretionary, SS and Medicare) and how to generate the revenues to meet the estimated needs over time. For example, if we say we want government no greater than 20% of gdp, how much to allocate to each, then how to finance. The debates would be much more transparent.

Time for a beer and lunch at your favorite place.

Cheers.

 

What did the wise old man once say about statistics and lies?

 

Yes, let's talk about facts. If your theory were true, then not only would payroll taxes rise more than income taxes over the periods, but the proportion of payroll tax vs income tax relative to total revenues would also rise. Yet, that isn't the case.

 

Interesting that you bring in 1980 as the starting year, because it obviously plays into your statistics. Why didn't you use 1960 as the baseline, when payroll taxes were a much smaller component of the revenue take? They have grown substantially since Great Society's implementation, but that's the point. If you want to provide a social safety net, you want to have as many people on the hook paying into the system.

 

But to your point that Reagan/Moynihan's grand bargain sacrificed the working class for tax cuts to the rich, nothing can be further from the truth. Individual income tax contributions stayed at a consistent mid 40% level of total federal revenue, while payroll tax contribution rose from low 30% to mid 30%. I'll admit that's a big jump, but most of the difference came from lower corporate tax remittances. But, wait, there's more. Over 1/2 of payroll taxes are paid by employers and the self employed. So, the majority of that rise in payroll taxes wasn't on the back of the working class, but came out of the employer's wallet, who are probably in the high income tax brackets.

 

So this recession reinforces the stupid direction that the country and its tax policies are headed in. By making the tax code even more progressive, you stifle growth avenues, while your revenues are based on a diminishing number of people who have the ability to defer income and lower their tax bills.

 

Yeay, progress.