Given his all but certain entrance in the Republican presidential primary, you’d think that Newt Gingrich would be shifting to the right on economic issues. He’s not. In fact, he recently told a reporter during a press conference that he doesn’t regret expanding Medicare, an entitlement already projected to have trillions in unfunded liabilities over the several decades, by supporting and lobbying for passage of prescription drug benefit - Medicare Part D - in 2003:
At a press conference on Friday, CNSNews.com asked Gingrich, “You were a prominent supporter of the Medicare prescription drug plan that President Bush signed into law in 2003. The Medicare trustees now say that plan is $7.2 trillion in unfunded liabilities over the next 75 years. Do you regret your support for the plan looking back?”
“No,” said Gingrich. “I think that we—I mean, I am for dramatic reform of Medicare. I chaired the Medicare reform task force which saved it in 1996 when the trustees said it was going to go broke, and we passed changes which enabled them to say that we had postponed any problem for well over a decade.
Here is the video with Gingrich’s full comments:
ThinkProgress is taking issue with John McCain, who said in a radio interview that Social Security is a Ponzi scheme that Bernie Madoff would be proud of. They have all sorts of problems with McCain’s comments regarding Social Security, but let me let you read them for yourself:
By calling Social Security a Ponzi scheme, McCain appears to be aligning himself with other radical conservatives who have long sought to gut or privatize the popular public program. Last year, former House Majority Leader and FreedomWorks chairman Dick Armey called Social Security a “pay-as-you-go Ponzi scheme“; a month later, Texas Gov. Rick Perry (R) also compared the program to a Ponzi scheme. And Sen. Ron Johnson (R-WI) campaigned by making the same comparison in his television commercials.
All of these radical conservatives are wrong to make such a comparison between a criminal enterprise and one of America’s most successful social programs. A Ponzi scheme involves fraudulently manipulating investors’ money without being able to pay them back; meanwhile, Social Security is a program that has successfully managed Americans’ money since its inception and has guaranteed them safe retirements.
First, the need to keep in mind that Ponzi schemes only work because some of the people get money back. The money comes from later investors. What happens is that person A invests money. Their returns are actually the investments of person B through Z. In reality, that’s what Social Security is. People today take out far more money than they actually put in, and that’s funded by those still working.
President Obama wants to nationalize wireless internet according to a report in New American in what appears to be another measure argued to be stimulus, but in reality is nothing more than just taking over a sector of American industry. New American doesn’t seem to be much of a fan of the proposal either:
In what amounts to the next initiative undertaken by the Obama Administration towards its ever-expanding program of government expansion and nationalization of various aspects of the lives of the American people (such as the government takeover of health care, intervention in banks, and the nationalization of various automobile companies, such as General Motors), the federal government is now embarking upon a program of government-directed wireless internet (Wi-Fi) delivery.
President Obama outlined his plan for government wireless access and broadband expansion at a press conference on February 10th at Northern Michigan University in Marquette, Michigan. The press conference revealed yet another well-known truth about the proposal, characteristic of any other initiatives which believe that government is capable of expanding access to any commodities: it is rooted in his Quixotic, insolvent, debunked, and expansionist view of government, and in his failure to realize the proper relation of government to the myriad possibilities made possible by the free market, in a more efficient and capable manner. The Wi-Fi expansion proposal not only reflects an unconstitutional view of government spending and scope, but is also a continuation of Franklin Delano Roosevelt-style economics, which failed the country in the height of the Great Depression and continue to contribute towards the national deficit and economic woes.
President Obama recently released his proposed budget, a $3.73 trillion monstrosity that is a monument to his own arrogance and complete inability or refusal to understand the concerns of the American people. After a historic tail-whipping of his party in November, Obama decided to engage in a little rhetorical compromise, and then turned around and doubled down on the disastrous policies that have kept this country in a long recession followed by a jobless recovery.
Simply put, even if we tax the “millionaires and billionaires” at 100% of earnings, it still won’t put much more than a dent in our $14+ trillion national debt. Within a decade we’ll be spending more than $800 billion (conservatively) for interest payments on the debt, and even more if interest rates rise, which they surely will. The fact is that our road to economic recovery lies down the path to drastically reduced spending.
The problem we have as a nation is that Democrats embrace fiscal irresponsibility; a policy of tax, borrow and spend (as if we can keep borrowing to pay for lavish welfare and entitlement programs and the bill will never come due) and Republicans claim the mantle of fiscal responsibility, but engage in a policy of borrow and spend. Yes, cutting tax rates stimulates the economy, but even with increased gross revenues, spending more than you raise still leads to deficits. Republicans are half right, refusing to raise taxes, but drop the ball by not making the case for spending cuts. Republicans, fearing Democrats will demagogue them as heartless to the plight of the poor, back off of spending cuts at the first sign of trouble.
Social Security. The name conjures feelings almost immediately. My mother recently started on Social Security. Now, it such troubled financial times, it’s being looked at as a source of much of our problems. In reality, it’s part of a whole other problem that has little to do with the national budget.
Social Security was originally designed to be a trust fund system where money went in and, when you retired, you got your money back out. It would have worked, especially in those days, because a lot of people paid in via taxation, but died before they reached retirement age. This would created a bit of a cushion for those who actually drew out more than they paid in.
However, over time that trust fund looked mighty tempting to the folks in DC. Money got tight, and like a parent raiding their kid’s piggy bank in the dark of night, they took money from it to pay for other pet projects. This depleted the trust fund and its cushion so severely that it became a Ponzi scheme. We today pay into the system so that other can draw it out. The understanding is that we will get our money back from future generations.
However, more and more of us are coming to believe that Social Security won’t be there when we reach retirement age.
The left goes nuts whenever anyone mentions privatizing social security, despite evidence that it would actually benefit retirees far more than the current system ever has. Some studies suggest that we could be a nation of millionaires, while fears percolate that the stock market would wipe out retirees income in short order.
Over at the Wall Street Journal, Peter Suderman explains how ObamaCare is hitting states hard by expanding access to Medicaid:
At roughly 21% of total state spending, Medicaid is already the single largest item in state budgets, according to the National Association of State Budget Officers. Between 2008 and 2009 (the latest year for which figures are available), annual spending growth on the program nearly doubled, growing to 9% from 4.9%.
Medicaid currently covers 53 million people at an overall cost of $373.9 billion (states are responsible for about half). But starting in 2014, ObamaCare rules will add about 20 million more, according to Richard Foster, the program’s chief actuary.
Yet state budgets are already being squeezed. Washington state, facing a $5.7 billion budget hole, has ordered the Medicaid program to cut its budget by 6.3%. The state cannot reduce eligibility to enroll without jeopardizing federal funding altogether. Its only option is to eliminate “optional benefits” (not federally required) such as dental services and speech therapy—one of the options suggested in Ms. Sebelius’s letter. That sounds good, but it’s not enough. “Even if we eliminate every single optional benefit, we still don’t get there,” Doug Porter, the state’s Medicaid director, told Governing magazine.
To consider what the expansion of Medicaid under ObamaCare might do to the states, take a look at Massachusetts and Tennessee. In 2006, Massachusetts overhauled its entire health-care system, including a significant expansion of Medicaid. This expansion is costing the state far more than expected. Gov. Deval Patrick approved a record-setting $9.6 billion to cover its share of Medicaid costs last July. It wasn’t enough. He’s already gone back to the legislature twice, adding almost $600 million in additional funds.
Discussion of spending cuts is increasingly becoming a topic of discussion in the United States Senate, the most recent proposal coming from Sen. Claire McCaskill (D-MO) and Sen. Bob Corker (R-TN), both up for re-election in 2012, would cap spending at 20.6% - the 40-year historical level:
Two senators, one Republican the other a Democrat, teamed up to introduce a bill aimed at cutting trillions of dollars from the federal budget over the next decade.
Sen. Claire McCaskill, D-Mo., said Tuesday that her sponsorship of the bill “could cost me my Senate seat,” which is up for grabs next year, but that the effort would be worth it.
“It’s a price I’m willing to pay for my country and, more importantly, it’s a price I’m willing to pay for my grandchildren,” she said.
McCaskill introduced the legislation alongside Sen. Bob Corker, R-Tenn., a staunch supporter of reducing the nation’s $1.3 trillion deficit.
The bill would put in place a 10-year plan to slash both discretionary and entitlement spending (which includes Social Security and Medicare), from the current level of 24.7 percent of Gross Domestic Product to 20.6 percent.
Yesterday, the Republican Study Committee, a group of conservative Republicans, fired the first shots in the budget battle with the Obama Administration by proposing $2.5 trillion in spending cuts over the next 10 years (you can view the release below, or here):
A group of conservative House Republicans laid out a plan to drastically cut federal spending over the next ten years, targeting everything from Amtrak to Fannie Mae and Freddie Mac to subsidies for mohair producers.
All told, it adds up to $2.5 trillion in cuts, whacking 55 different agencies and programs, including public housing, benefits for federal employees, funding for the arts and humanities and international aid.
Many of the proposed cuts represent longtime conservative targets, like the National Endowment for the Arts and the Corporation for Public Broadcasting. They also would gut a wide range of energy and environmental programs — like weatherization and beach erosion funds — and have proposed clamping down on federal employee unions.
But the long list of spending cuts is notably silent on the two biggest federal budget drivers — entitlements and defense spending.
The proposed cuts were laid out Thursday by the Republican Study Committee, a caucus of House conservatives, and while it has not won the endorsement of GOP leaders, this package represents the most specific list of cuts so far from the new Republican majority.
The heart of the measure is a substitution of fiscal 2008 spending levels for nonsecurity and nonveterans programs when the current continuing resolution expires on March 4, followed by a subsequent reduction of domestic spending to 2006 levels.
Below is a collection of several links that we didn’t get around to writing about, but still wanted to post for readers to examine. The stories typically range from news about prominent figures in the liberty movement, national politics, the nanny state, foreign policy and free markets.