Barack makes this a good news day..

If it is not an entitlement, then Obama wouldn't be using populist, "We'll tax the rich people more to try to make up some of the shortfall" rhetoric to troll for votes, as he did in the story that started this thread. Either you get out exactly what you paid in, with a reasonable rate of return on your "investment" in social security, or it is intended to redistribute wealth somehow--which it is. That's fine, if it is what people want, but there is nothing wrong with calling it what it is.

It is a pyramid scheme, although a government-sanctioned one, and they remake the rules every time it is about to collapse, so it has government protection that most pyramid schemes don't have. Other types of pyramid schemes have been made illegal in this country. Again, people can decide whether pyramid schemes are shady or wrong. We have outlawed them, though, because they make promises, by definition, that they can't fulfill.

As with any pyramid scheme, it is built on a shaky foundation. People paying in today, can not meet the obligations promised to people a generation ago. It would have fallen apart a long time ago, except for the bandaids that have already been put on it, such as the one Daniel Patrick Moynihan applied. The sucker is bleeding again, and this time, the program is going to fail, unless something even more drastic is done.

What tells me that Obama is exactly the same as every other politician trolling for votes, and not being honest, is that this is a populist ploy, not a prescription that tells people what they don't want to hear. People love hearing, "Hey, we'll tax the rich people for the sake of SS." Anything that taxes someone other than them sounds wonderful. The problem is that what he announced amounts to very little tax revenue. It subjects about $150,000 of 2 to 3 percent of the population to payroll tax. That isn't going to make a dent in the social security shortfall. If he wants to impress me, he'll announce the drastic payroll tax increase across the board, or the drastic reduction in benefits, that is going to be necessary to keep the program from failing. It's a certainty.

While he's at it, he really should explain how he intends to pay for everything he has proposed. If you go up and down the policy ideas he has announced on his website, it amounts to at least a quarter of a trillion dollars worth of spending. Even if he can somehow find a way to stop all funding to Iraq immediately and repeal Bush's tax cuts, which are already set to continue until 2010, he falls at least a hundred billion dollars (and that is a very conservative estimate if you add up what he is talking about) short of paying for everything he is promising people.

 

FirstDown, I think that is about right. The specifics don't matter that much, because whatever they are slinging right now, is not going to be what they can do.

So I just go by the gist of what they are proposing--and don't take it that seriously, because these are unrealistic campaign promises, not the reality of what they can do.

If you are going to look at the revenue side, it helps to also look at the spending side. That didn't do that. You also have to consider their health care ideas, since it is such a significant part of our GDP. And that didn't do that, either.

The way I see it, McCain is talking about reducing tax revenues (less taxes, people love that, don't they?) at the same time he is talking about fiscal responsibility. It's kind of funny, because unless you intend to decrease spending to allow for the decreased taxes, that doesn't seem very fiscally responsible, does it? And McCain, not surprisingly, hasn't talked much about the spending side. If anything, he has made vague promises that seem to amount to more spending, even though he contrasting himself to Obama as the guy who isn't promising to spend like crazy. It's BS.

Obama isn't talking about anything near the same level of decreased tax revenues, although when you sift through his rhetoric, you realize what he has proposed will still decrease tax revenues. He's just done it in a way that will appeal to the large majority--it's populism. Middle income people will pay less in taxes, and the top 1 or 2 percent income brackets will get hit harder. The net effect is that he is still talking about decreased tax revenues overall. At the same time, though, he is making promises that amount to crazy amounts of spending. This is not fiscally responsible either, although his rhetoric regarding fiscal responsibility isn't as full of BS as McCain's. Obama almost seems to announce to me that he plans to spend hundreds of billions of dollars less than we take in.

Obama is trying to get elected by promising everyone candy canes. McCain is trying to get elected by pretending he is the guy willing to make hard choices, except then he subtly goes and promises people candy canes to hedge his bets.

Of course the reality is that neither can do what they are proposing -- without creating huge debt that has far-reaching effects people don't want to think about. If Obama or McCain could each do what they are telling people, they would saddle us with an incredible amount of debt, devalue the dollar at a time it is worth crap already, and put an anchor around our economy.

So the reality will be that they will say what they think can get them elected, and then they will not be able to do anything remotely resembling what they were talking about now. We'll get a mishmash of neutral tax policy that only differs slightly depending on which gets elected. Obama will slightly decrease taxes on middle income people and slightly increase the rates on the highest bracket. He won't be able to do anything too drastic, because of the shortfall in revenues it would create. McCain won't shuffle the deck at all. Each will push through as much increased spending as they can get away with. Obama's ideas will be grander. And he will have to keep coming back to tell people why he couldn't pull it off. McCain will pretend that he was the guy who didn't promise anyone anything. In his case, it's what he doesn't say, not what he does say, that is significant.

 

Demo, An entitlement is simply a guarantee to a benefit. So by any definition of the word, it is an entitlement program.

A lot of people think of entitlements as things that redistribute wealth, though. In the case of SS, it does that in two ways, across generations and within the same generation.

Across generations, this has worked like a typical pyramid scheme. Those who retired in the early years of SS got huge wealth transfers. They paid into the system for a short time and collected much more than they put in, in retirement. Over the years, the "payback" length of time increased--from a few years to get back what you paid in, to a longer period of time as the program crumbled, until now, when the typical worker can not expect to get paid back within the average American life expectancy. Most people are guaranteed now to not get back what you paid in. The redistribution of wealth was that future generations were sold out to subsidize earlier generations.

Within the same generation, SS is also built on a weighted-benefit formula that subsidizes workers with low earnings at the expense of people with higher earnings. The program is designed to redistribute wealth across classes also.

So if you go by the definition of an entitlement, a legal guarantee, or a right, it is obviously that.

If you talking about something that tries to take money from one group of people, for the benefit of another, it is also that.