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Obama’s Challenge Author Robert Kuttner on Deficit Hawks and Entitlements

With the budget deficit rising as the economic stimulus takes effect, deficit hawks—both the Republican and “Blue-Dog” Democrat varieties—are rolling out perennial target Social Security again. Robert Kuttner, co-founder of The American Prospect and author of Obama’s Challenge: America’s Economic Crisis and The Power of a Transformative Presidency, looks at the flaws in their argument against one of the most successful federal program in history in this article from the Washington Post.

What’s wrong with the story of entitlements wrecking the economy? Plenty.

For starters, the $56 trillion “unfunded liability” figure relies on creative accounting. Only about $6.36 trillion is the actual public debt, according to the U.S. Treasury. Most of the number Peterson cites is a combination of the 75-year worst-case projections for Social Security, Medicare and Medicaid.

These three programs face very different challenges and remedies. Social Security’s accounts are actually near long-term balance. The Congressional Budget Office puts the 75-year shortfall at only about one-third of 1 percent of projected gross domestic product.

Social Security is financed by taxes on wages — and since the mid-1970s, wage growth has stagnated. If median wages rose with productivity growth, as they did during the first three decades after World War II, Social Security would enjoy a big surplus. Even without a raise for working America, Social Security needs only minor adjustments.

Medicare really does face big deficits. But that’s because Medicare is part of a hugely inefficient, fragmented health insurance system. It makes no sense to “reform” Medicare in isolation.

If we just cap Medicare, needy seniors would get bare-bones care while more affluent people could supplement their insurance out of pocket. The decent cure for Medicare’s cost inflation lies in comprehensive universal health insurance so that the entire system is more efficient and less prone to inflation. You don’t hear many budget hawks supporting that brand of reform.

Read the whole article here.

Image courtesy of guardian.co.uk.


Using Permaculture Principles to Design Resilient Cities

The Permaculture City begins in the garden but takes what we have learned there and applies it to a much broader range of human experience; we’re not just gardening plants but people, neighborhoods, and even cultures.Author Toby Hemenway (Gaia’s Garden) lays out how permaculture design can help towndwellers solve the challenges of meeting our needs […] Read More

Why Title a Book “Parachuting Cats into Borneo”?

Looking for crisp, concise, and targeted advice for success? Change-management experts Axel Klimek and Alan AtKisson offer that, and more, in their new book Parachuting Cats into Borneo.The authors expose the most significant impediments—helping readers recognize their habitual patterns of thinking and perceiving a situation, critique their own beliefs regarding change, and then move beyond these […] Read More

Why Modern Wheat Is Making Us Sick

Why is modern wheat making us sick?  That’s the question posed by author Eli Rogosa in her new book Restoring Heritage Grains.Wheat is the most widely grown crop on our planet, yet industrial breeders have transformed this ancient staff of life into a commodity of yield and profit—witness the increase in gluten intolerance and ‘wheat […] Read More

A Dictionary to Survive the Future

When British economist David Fleming died unexpectedly in 2010, he left behind his great unpublished work, a masterpiece more than thirty years in the making—an intellectually evocative and inspiring dictionary, Lean Logic: A Dictionary for the Future and How to Survive It. In it, Fleming examined the consequences of an economy that destroys the very foundations—ecological, […] Read More

Michael Ableman’s 15-Point Urban Food Manifesto

What if farms and food production were integrated into every aspect of urban living—from special assessments to create new farms and food businesses to teaching people how to grow fruits and vegetables so farmers can focus on staple crops.That’s the crux of Michael Ableman’s Urban Food Manifesto, which has been ten years in the making […] Read More
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