Monday, August 13, 2012

Benefits are never repealed or reformed

Paul Ryan’s budget honors what Pres. Obama’s commission (Simpson-Bowles) recommended. The president ignored his own commission. They recommended Medicare reform to make it solvent while still providing assisted coverage. As with Ryan’s plan the reform was not to effect present or near users of the program.
Bill Clinton often says when benefit programs are passed, they will never be repealed. He might have added, and will never be reformed. He did not mention cost - that tells a lot about progressive strategy.

Clinton’s idea, is to pass benefit programs without regard to cost other than for political considerations. How to pay for programs is secondary to getting the legislation passed. If Conservatives balk at raising taxes they can be labeled as obstructionist and that means adding to the deficit and debt. Progressives have no down side in the spending game. Their voting base is loyal and constant and all benefit programs pay out more than they take in and so they are actually the redistribution of wealth that progressives see as necessary.
Why necessary? Here we see the difference between the parties.

Democrats are pessimistic, or is it realistic, about the prospects of the middle class in America, hence the need for big government assistance throughout life. They see an America, with a large and growing undereducated population, that has peaked productively and economically.
Republicans are optimistic, or is it naïve, to think the middle class can do better with less government assistance, if only government would get out of the way. Let American free enterprise flourish. Reduce regulations, reduce taxes on small businesses, reform education with less interference, cut government workers at every level, privatize jobs competitively, decentralize power back to the States and local governments.

This election will be self revealing. America's 2012 voters will decide the question. Is America's future outlook so bad as to need more government deficit spending or can it be made to grow with less Gov, less tax, and less regulation.
The commercial areas where the US is most productive today are in endeavors requiring fewer workers for high return, not the areas where low or semi-skilled workers can participate. That means the US will have a surplus of labor and low middle class wages and no end to the wage gap going forward. That has to change.

Our surplus labor is an urgent reason for returning America to re-industrialization. Start by legislatively protecting the astounding oil and gas industry's fracking technology that would employ America's bluecollar millions at good wages while contributing to industrial growth and energy independence lost a half century ago
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This election will test Bill’s premise. Can entitlement spending ever be cut back or reformed?  Simpson-Bowles made a serious effort but were ignored because progressives seem to have no intention of cutting spending ever. They prefer that taxes be raised to whatever level that can be passed by Congress, and any shortfall can be monetized by the Fed or added to the deficit.

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