Today's WSJ was full of fun, fallacy, and hypocrisy from some of my favorite public figures.
Christina Romer, head of the current administration's Council of Economic Advisers. She says, "Deficits do matter...No one believes that more than the President." (Hmm, I am confident there are people who believe that more than the President.) She also indicated, "...reducing the deficit is a priority for the Obama administration and that a health-care overhaul, which could bring down government spending in the long-term, is part of the solution."
I'm curious how additional spending can reduce deficits. I'm aware of capital investment theory, but that is not what Ms. Romer is talking about. There may be an argument for how improving health care will make everyone happier and healthier, they will all get better jobs and education, and that the costs will eventually decrease because we spawned a better version of man. Or something. Or someone may mention since baby boomers will eventually age and pass away, the younger generation will not replace them at a 1:1 ratio, so of course the costs will decrease. I have not looked into the rationale, but as I like to point out, health care reform is fiction right now and we would do well to look at the track records of similar government programs.
That leads me to the next topic I read about...
Social Security! You remember that glorious program started in the 30's to ease the pain and fear of retiring? Well, surprise of all surprises, this unfunded program won't have enough money to pay seniors their cost-of-living-adjustment next year. (Someone said it was this year, but I honestly don't know which it is as I didn't find an official release on SSA.gov.) In layman's terms, this means that should inflation set in, and prices for goods and services increase, seniors won't get any increase on their benefits. Overall inflation has been negative this year, however the cost of medical goods and services have increased 2%, which seniors use more of.
Wait, what was that about health care reform? It will decrease costs? Oh, is that because it will be run like social security so benefits also decrease? I see, now it all makes sense.
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I'm curious to see what you are thinking...