I looked up his actual cuts:
A lot of it is HIGHLY flawed.
“Medicare/Medicaid*: $441 billion (Cato Institute)”
Follow the link…. it has a plan to hand states a block grant based on 2011 expendature and doesn’t adjust for inflation or the number of people Medicare eligable. The plan will save us $400B a year BY 2021.
Well duh!!!!
The people currently Medicare eligable were born at a rate of 2.2 milion(1930) to 2.8 million (1945) per year. Those retiring in the next 10 years were born at a rate of 3.5 million (1946) to 4.1 million (1955).
This is why the Federal budget predicts Medicare spending will increase from $500B to $800B over the next decade.
So, give state the same amount of money, but expect them to cover 70% more people. The other $100B savings comes from not adjusting Medicare or Medicaid for inflation.
AND, that $400B a year savings doesn’t come this year. It comes from future growth in spending as the number of people eligable increases. You can’t subtract that from this year’s deficit and say you have created a surplus.
“Defense cut by 2/3: $475 billion (Federal Budget, pg. 58)”
Best estimates I could find is that 5 million people are employed directly by DoD and contractors. Cutting 2/3rds of that budget would eliminate some 3 million direct jobs and add 3% to the unemployment rate. The echo effects of those job cuts would be much deeper.
I am not saying it is a bad idea. My own “feels right” cuts to DoD would be 50%.
My point is, you can’t make these kinds of cuts without assuming that tax revenues will fall in the recession that is sure to follow.
“Social Security Means Testing: $170 billion (Heritage Foundation)”
Again, this is the estimated savings 10 years from now when there are 70% more people collecting. Actual savings this year would be less than $100B.
My problem with means testing is that it encourages people to not save, to lie, to hide income and assets, etc.
“Eliminate Dept. of Education (includes Pell Grants): $106.9 billion (Cato Institute)”
I do not really care if I pay federal income tax or state. Eliminate the dept of education and dump those costs on the state, doesn’t save me anything.
Social Security*: $85.7 billion (Cato Institute)
1) this is another one of those where the savings is 10 years from now, but he’s assuming we’re saving it this year when he subtracts the amount from this year’s budget.
2) The savings assumes that wages will always go up more slowly than prices. Shift COLA from price to wage based inflation and save $85 billion a year, 10 years from now.
“Eliminate Dept. of Transportation: $84.8 billion (Cato Institute)”
We don’t need no stinking roads, coast guard, airport security…..
Oh, the states will pick up these costs. Again, doesn’t matter to me if my taxes are fed or local. And, there simply won’t be any highways across Wyoming, Montant or the Dakotas where there is not nearly the tax base required to support them. Guess companies looking to ship good from Oregon to Minisota will have to go through….. Hmmm… Not Idaho, Utah, Nevada, Arizona as all of them have more roads than people to pay for them… I guess they are going down through the Panama Canal.
“Eliminate Dept. of Labor*: $78.6 billion (Department of Labor and White House)”
$60B of this savings comes from elimination of unemployment insurance which is currently collecting anout 44B a year but spending more than $105B a year.
The rest is stupid stuff like OSHA and other worker safety enforcement, labor statistics, etc.
Everything else gets smaller and smaller.
No comments:
Post a Comment