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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.


Chelsea Green Weekly for May 5, 2017

Ever wonder what your favorite Chelsea Green authors do between writing groundbreaking–both literally and figuratively–books? Here are the best links and resources for your weekend reading pleasure. Let’s start with The Alzheimer’s Antidote. The Alzheimer’s Antidote Amy Berger has been making the rounds on the health, wellness, and fitness circuit, explaining the theories behind her revolutionary […] Read More

Q&A with Kate Raworth about her radical new book, DOUGHNUT ECONOMICS

Q: First things first: Why did you want to write this book? A: I studied economics at university 25 years ago because I wanted to make a difference in the world and believed that economics – the mother tongue of public policy – would best equip me to do that. Instead, its theories left me […] Read More

Revisiting Naomi Wolf’s Call to Patriots–10 Years Later

Reading Naomi Wolf’s book The End of America: Letter of Warning to a Young Patriot today is an eerie experience. Written in 2007, it detailed the ways in which the Bush administration was beginning to chip away at the freedoms of American citizens. It outlined the ten steps dictators or would-be dictators take when their […] Read More

Chelsea Green: In the Media 2016

Oh, 2016. Where did the time go? Each year, Chelsea Green receives hundreds of mentions (well over 1000 in 2016) in the media both big and small. From interviews, to excerpts, to opinion pieces by authors we’re always working to make sure that the mission and message of each book is spread far and wide. […] Read More

Yes, America We Can Make It … Really

Uncertainty got you down? The political world may seem like it’s crumbling around us, but this we know: We can make it, America. Literally, we can make things. Houses. Gardens. Food. Below we’ve selected some of our classic how-to and DIY books (and some new favorites) to help you sustain your self, family, and community. […] Read More
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