Entitlement and Welfare Spending Catch-all

NathanialG wrote:
MacBrave wrote:

So if enormous government entitlements plus private charity isn't doing the job of getting these individuals out of poverty, what will? More taxpayer money?

Yes. Increasing taxes on the wealthy.

taxe
Two things - we could raise taxes 100 percent on the top earners and it still wouldn't balance the budget or pay off the deficit. I agree with you that taxes need to go up - on everyone who's not distitute. Repeal the Bush tax cut period. We shouldn't have a situation where people not only pay no federal taxes, but even get a refund for more than they paid in.

This is probably something for another thread, but I'm not sure how wealth at the top means it's being stolen from everyone else. The economy is not a zero sum game like medieval times where any gain by the nobility meant losses for the peasantry. Let's talk about increasing the pie instead of embracing class envy.

National Parks, NASA, Food and Water Inspection, Polio vaccination, public libraries, interstate travel, national defense, and that's just off the top of my head.

All good examples, but what about the failed war on drugs, the Trail of Tears, the Tuskegee experiments, Japanese Interment, etc. When the government gets things wrong, it often gets things REALLY wrong,

This is probably something for another thread, but I'm not sure how wealth at the top means it's being stolen from everyone else. The economy is not a zero sum game like medieval times where any gain by the nobility meant losses for the peasantry. Let's talk about increasing the pie instead of embracing class envy.

I don't think you really understand what income inequality really means...

All good examples, but what about the failed war on drugs, the Trail of Tears, the Tuskegee experiments, Japanese Interment, etc. When the government gets things wrong, it often gets things REALLY wrong,

Unless you're going the anarchist route - "all government is bad government" - there's nothing in here that would be changed by changing the size of government. It's to with efficiency, rather than funding or government control or government growing.

And arguing that industry is somehow better at running things than government is not going to get you anywhere, either. Government and businesses use the same structures and techniques in their bureaucracies and operations.

jdzappa wrote:

This is probably something for another thread, but I'm not sure how wealth at the top means it's being stolen from everyone else. The economy is not a zero sum game like medieval times where any gain by the nobility meant losses for the peasantry. Let's talk about increasing the pie instead of embracing class envy.

I think that is exactly what is going on. It isn't "class envy" the current nobility ARE taking more of the pie. That is why the economy is doing so well but things don't seem to be any better.

Here is a crazy thought. How low could we get income taxes if we reformed estate taxes? That is the really despicable part, keeping the rich richer. First 5 million not taxed, and only 40 percent after that?

It has always given me pause that people can say in one mouth that people amass wealth because of hard work, when so many just inherit it. When we began looking at estate reform in the previous century it was from crafting American Aristocracy, and we are right back to it.

Yes, drugs are a huge social and economic and health problem

I'd argue that about 90% of the problems come from the illegality, not the drugs themselves. Addicts will do anything they have to in order to get their fix, so when drugs are expensive and illegal, they'll do highly destructive things to get enough money to buy their next dose. If they were cheap and legal, there'd be very little crime with most intoxicants.

I mean, cigarettes are more addictive than heroin, but we're only just now starting to see any cigarette crime, and that's only because taxes have been jacked up to insane levels.

Obviously, there are health issues involved, but we get those no matter what, legal or illegal.

jdzappa wrote:

This is probably something for another thread, but I'm not sure how wealth at the top means it's being stolen from everyone else. The economy is not a zero sum game like medieval times where any gain by the nobility meant losses for the peasantry. Let's talk about increasing the pie instead of embracing class envy.

From The Economist article I quoted yesterday:

The past couple of decades have seen a huge increase in inequality in America. The Economic Policy Institute, a Washington think-tank, argues that between 1979 and 2000 the real income of households in the lowest fifth (the bottom 20% of earners) grew by 6.4%, while that of households in the top fifth grew by 70%. The family income of the top 1% grew by 184%—and that of the top 0.1% or 0.01% grew even faster. Back in 1979 the average income of the top 1% was 133 times that of the bottom 20%; by 2000 the income of the top 1% had risen to 189 times that of the bottom fifth.

Thirty years ago the average real annual compensation of the top 100 chief executives was $1.3m: 39 times the pay of the average worker. Today it is $37.5m: over 1,000 times the pay of the average worker. In 2001 the top 1% of households earned 20% of all income and held 33.4% of all net worth. Not since pre-Depression days has the top 1% taken such a big whack.

The pie has gotten bigger, but the rich have eaten everything except a few crumbs in recent decades. This is simply unsustainable (and dangerous) for a democracy.

jdzappa wrote:

All good examples, but what about the failed war on drugs, the Trail of Tears, the Tuskegee experiments, Japanese Interment, etc. When the government gets things wrong, it often gets things REALLY wrong,

War on Drugs: voters asked for it...and, sadly, continue to ask for it.
Trail of Tears: Manifest Destiny coupled with a healthy dose of racism.
Tuskegee experiments: a horrendous failure of ethics by single research program funded by the US Public Health Service.
Japanese Internment: hysteria from Pearl Harbor coupled with a healthy dose of racism.

Three things you say government got really wrong actually had/have tremendous public support. The government isn't a faceless independent entity. It's an extension of the governed--us--and it does what we tell it to do.

jdzappa wrote:
NathanialG wrote:
MacBrave wrote:

So if enormous government entitlements plus private charity isn't doing the job of getting these individuals out of poverty, what will? More taxpayer money?

Yes. Increasing taxes on the wealthy.

Two things - we could raise taxes 100 percent on the top earners and it still wouldn't balance the budget or pay off the deficit. I agree with you that taxes need to go up - on everyone who's not destitute. Repeal the Bush tax cut period. We shouldn't have a situation where people not only pay no federal taxes, but even get a refund for more than they paid in.

I feel like there's an issue with with distinguishing between Federal taxes and Federal income taxes. If you have a job, you're paying FICA taxes which are Federal. If you are a top earner, you probably aren't as wealthy as someone who is a top investor. Rich people don't make their money through earned income. They make their money from dividend income and capital gains. That's how Warren Buffet pays less of a percentage in taxes than his secretary. It's why hedge fund managers pretended they didn't have a salary and instead were quasi-business partners with their clients for tax purposes.

I also don't understand the logic of people not getting a refund for more than they pay in. Unless someone gets out more than they pay in, why are other people paying in more than they get out?

This is probably something for another thread, but I'm not sure how wealth at the top means it's being stolen from everyone else. The economy is not a zero sum game like medieval times where any gain by the nobility meant losses for the peasantry. Let's talk about increasing the pie instead of embracing class envy.

How did wanting to return to the kind of more traditional distribution of wealth in society that we associate with the 'golden years' of the 'American Dream' somehow become class envy? This is not envy. Excuse my rant on semantics here, but envy is when you want what someone else has. This is not about wanting what the rich have. This is about wanting what the middle class used to have. No one is asking for an identical slice of the pie. What people are asking for is a more equitable distribution of the increase in the pie than the ridiculously skewed ratio we have now.

This thread was started as a false dichotomy. Why are we even discussing it?

goman wrote:

This thread was started as a false dichotomy. Why are we even discussing it?

Because it's discussing the fantasy that government is always bad/corrupt/inefficient and doesn't ever provide anything good and we'd all be so much better off if the government just went away and left everything up to private organizations.

That is the core political thoughts of the current crop of Tea Party Republicans and Libertarians. And those thoughts are pretty much always based on misinformation, like charities could do a much better job a providing social services than the government does.

jdzappa wrote:
NathanialG wrote:
MacBrave wrote:

So if enormous government entitlements plus private charity isn't doing the job of getting these individuals out of poverty, what will? More taxpayer money?

Yes. Increasing taxes on the wealthy.

taxe
Two things - we could raise taxes 100 percent on the top earners and it still wouldn't balance the budget or pay off the deficit. I agree with you that taxes need to go up - on everyone who's not distitute. Repeal the Bush tax cut period. We shouldn't have a situation where people not only pay no federal taxes, but even get a refund for more than they paid in.

The government had a surplus this last month. How exactly would raising taxes on the wealthy not balance the budget?

OG_slinger wrote:
goman wrote:

This thread was started as a false dichotomy. Why are we even discussing it?

Because it's discussing the fantasy that government is always bad/corrupt/inefficient and doesn't ever provide anything good and we'd all be so much better off if the government just went away and left everything up to private organizations.

That is the core political thoughts of the current crop of Tea Party Republicans and Libertarians. And those thoughts are pretty much always based on misinformation, like charities could do a much better job a providing social services than the government does.

Yeah, I'm getting the picture from this thread that there is pretty much nothing a private enterprise can do better than a comparable federal government program.

MacBrave wrote:
OG_slinger wrote:
goman wrote:

This thread was started as a false dichotomy. Why are we even discussing it?

Because it's discussing the fantasy that government is always bad/corrupt/inefficient and doesn't ever provide anything good and we'd all be so much better off if the government just went away and left everything up to private organizations.

That is the core political thoughts of the current crop of Tea Party Republicans and Libertarians. And those thoughts are pretty much always based on misinformation, like charities could do a much better job a providing social services than the government does.

Yeah, I'm getting the picture from this thread that there is pretty much nothing a private enterprise can do better than a comparable federal government program.

I don't think anyone feels that way. It is just that when it comes to taking care of people, at least theoretically, that is what the government is for.

NathanialG wrote:
MacBrave wrote:

Yeah, I'm getting the picture from this thread that there is pretty much nothing a private enterprise can do better than a comparable federal government program.

I don't think anyone feels that way. It is just that when it comes to taking care of people, at least theoretically, that is what the government is for.

I thought this thread existed as a response to the often cited idea that the government is highly inefficient and private companies could take care of people much better. It's not saying government > private industry, just that it's also not the other way around.

I'd argue that about 90% of the problems come from the illegality, not the drugs themselves. Addicts will do anything they have to in order to get their fix, so when drugs are expensive and illegal, they'll do highly destructive things to get enough money to buy their next dose. If they were cheap and legal, there'd be very little crime with most intoxicants.

I disagree with you on the percentage, since the addictions and effects on behavior and health are often life-destroying for the user and others. But yeah, legalization would eliminate much of the crime involved. It would create other serious problems, but one step at a time.

I mean, cigarettes are more addictive than heroin, but we're only just now starting to see any cigarette crime, and that's only because taxes have been jacked up to insane levels.

Nah, large-scale cigarette smuggling has been around for my lifetime, anyway. It's a form of arbitrage and undercutting price by smuggling to avoid taxes. It's not jacking up taxes that enabled that, it's taxing them *at all*, and differently in different states and countries. It's just more profitable today, but the term "cigarette boat" predates the War on Drugs for a reason, you know?

And the health problems of tobacco alone are fiendishly expensive to society. And in poor families, cigarettes can eat up 10% or more of the family budget... These are issues we'd see get worse with legalization of harder drugs, and we'd need systems to prepare to deal with that in amounts that are beyond what we see now (and have serious trouble dealing with, as a society).

Yeah, I'm getting the picture from this thread that there is pretty much nothing a private enterprise can do better than a comparable federal government program.

Both can be well-run, both can be poorly run, but the important thing is that both use the same tools and techniques to get work done. The addition of the profit motive does not automatically make private industry better in every field; even Adam Smith noted that in some areas, the profit motive is counter-productive. And yet it's invoked as if it's *always* better, and somehow will magically fix every problem in government and industry...

Just ask HP employees how quickly a well-run company can get into difficult straits.

SixteenBlue wrote:

I thought this thread existed as a response to the often cited idea that the government is highly inefficient and private companies could take care of people much better. It's not saying government > private industry, just that it's also not the other way around.

The War on Poverty, like the other government Wars, is highly inefficient - and ineffective. In a new paper last month, Michael Tanner of the Cato Institute details just how bad the current system really is.

On January 8, 1964, President Lyndon B. Johnson delivered a State of the Union address to Congress in which he declared an "unconditional war on poverty in America." At the time, the poverty rate in America was around 19 percent and falling rapidly. This year, it is reported that the poverty rate is expected to be roughly 15.1 percent and climbing. Between then and now, the federal government spent roughly $12 trillion fighting poverty, and state and local governments added another $3 trillion. Yet the poverty rate never fell below 10.5 percent and is now at the highest level in nearly a decade. Clearly, we have been doing something wrong.
Robear wrote:

Both can be well-run, both can be poorly run, but the important thing is that both use the same tools and techniques to get work done. The addition of the profit motive does not automatically make private industry better in every field; even Adam Smith noted that in some areas, the profit motive is counter-productive. And yet it's invoked as if it's *always* better, and somehow will magically fix every problem in government and industry...

This is a strawman argument. The argument is not that the profit motive is *always* better, but that it leads to better aggregate outcomes because government lacks incentives to be efficient, stay on budget, actually produce results, and do what their customers want. Government programs are developed based on political needs, not economic needs. Incentive-wise, it's actually counter-productive for government anti-poverty programs to be successful, because that would mean the end of the program, and of the political benefits. This leads to a situation that incentivizes appearing to be doing something about poverty, while not actually doing anything ... or indeed, doing things that are actually economically detrimental.

Thus the argument is actually that government is the worst way to try and help the poor, so it would be better to leave the resources in the private sector and have the society work that way to produce better outcomes - and get more people out of poverty. It's not a magic bullet, but at least it's not actively bad.

Thus the argument is actually that government is the worst way to try and help the poor, so it would be better to leave the resources in the private sector and have the society work that way to produce better outcomes - and get more people out of poverty. It's not a magic bullet, but at least it's not actively bad.

I'd like to add that I believe we on the frontier of amazing things when it comes to charity. Charities like the Gates foundation are doing incredible things with microloans in developing countries. Considering the difficulty of getting traditional loans to start a business in depressed areas, this is one way to get money to people who need it. Likewise, Google Crisis raises tens of millions of dollars during catastrophes. Why can't we use that type of social networking to raise money for ongoing problems? If Kickstarter can raise several hundred dollars to make 90s style turnbased strategy games, can't we use that same method to boost charitable giving?

Or we can go ahead and continue with a system that condones and even encourages people like the Octomom or Angel Adams - mother of 16 kids who still thinks the government owes her more money:

http://www2.tbo.com/news/news/2012/m...

Aetius wrote:

The War on Poverty, like the other government Wars, is highly inefficient - and ineffective. In a new paper last month, Michael Tanner of the Cato Institute details just how bad the current system really is.

On January 8, 1964, President Lyndon B. Johnson delivered a State of the Union address to Congress in which he declared an "unconditional war on poverty in America." At the time, the poverty rate in America was around 19 percent and falling rapidly. This year, it is reported that the poverty rate is expected to be roughly 15.1 percent and climbing. Between then and now, the federal government spent roughly $12 trillion fighting poverty, and state and local governments added another $3 trillion. Yet the poverty rate never fell below 10.5 percent and is now at the highest level in nearly a decade. Clearly, we have been doing something wrong.

Yeah, it's totes legit to compare America of 1964, when our economy was growing at 5.6%, with America of 2011, when our economy was barely limping out the worst recession since the Great Depression and say "see, it doesn't work!!"

Aetius wrote:

This is a strawman argument. The argument is not that the profit motive is *always* better, but that it leads to better aggregate outcomes because government lacks incentives to be efficient, stay on budget, actually produce results, and do what their customers want. Government programs are developed based on political needs, not economic needs. Incentive-wise, it's actually counter-productive for government anti-poverty programs to be successful, because that would mean the end of the program, and of the political benefits. This leads to a situation that incentivizes appearing to be doing something about poverty, while not actually doing anything ... or indeed, doing things that are actually economically detrimental.

Thus the argument is actually that government is the worst way to try and help the poor, so it would be better to leave the resources in the private sector and have the society work that way to produce better outcomes - and get more people out of poverty. It's not a magic bullet, but at least it's not actively bad.

Please, explain how the profit motive is going to feed families who don't have enough money to buy food? Or put a roof over their heads when they can't afford what the market is charging for rent?

The only folks using the profit motive and targeting the poor are, to put it nicely, f*cking scumbags: payday loan operations, rent-to-own operations, etc.

I don't want want to make it a requirement for my government to stay on budget when it comes to these programs. It's moronic to even ask for it. Why? Because when the economy tanks, the need for the programs increases dramatically and the allocation of funds would always lag actual need. How would you like to depend on food stamps only to be told, "sorry, we're over budget, come back next fiscal year and we might have something for you."

Why not take a step back and ask a more fundamental question about poverty and the profit motive: why is it good to blindly follow an economic system that, pre-government intervention, had 20%+ of the population wallowing in poverty? That's a massive failure rate for an economic system.

Aetius wrote:
SixteenBlue wrote:

I thought this thread existed as a response to the often cited idea that the government is highly inefficient and private companies could take care of people much better. It's not saying government > private industry, just that it's also not the other way around.

The War on Poverty, like the other government Wars, is highly inefficient - and ineffective. In a new paper last month,

Already been brought up, I think; the War on Poverty wasn't the only thing going on in 1964:
http://www.gamerswithjobs.com/node/1...

This is a strawman argument. The argument is not that the profit motive is *always* better, but that it leads to better aggregate outcomes because government lacks incentives to be efficient, stay on budget, actually produce results, and do what their customers want. Government programs are developed based on political needs, not economic needs. Incentive-wise, it's actually counter-productive for government anti-poverty programs to be successful, because that would mean the end of the program, and of the political benefits. This leads to a situation that incentivizes appearing to be doing something about poverty, while not actually doing anything ... or indeed, doing things that are actually economically detrimental.

Thus the argument is actually that government is the worst way to try and help the poor, so it would be better to leave the resources in the private sector and have the society work that way to produce better outcomes - and get more people out of poverty. It's not a magic bullet, but at least it's not actively bad.

Where's the "profit motive" for the private sector in getting people out of poverty? Who is the customer here? This doesn't make any sense.

jdzappa wrote:

Or we can go ahead and continue with a system that condones and even encourages people like the Octomom or Angel Adams - mother of 16 kids who still thinks the government owes her more money:
http://www2.tbo.com/news/news/2012/m...

How many people are there like Octomom or Angel Adams? We saw before how looking at the very sources you brought to the table meant that we were only talking about one-third of this group even being under discussion for your ideas on people being lazy. Why should we now be convinced by two cases like this?

And note that the Great Society programs caused the government to massively overprint dollars, way more than it had gold to support, directly leading to our default on our international obligations, the terrible economic distress of the 1970s, and the subsequent erosion of wealth in the country as the now-entirely-fictional (instead of partially fictional) wealth token system took over.

Malor wrote:

And note that the Great Society programs caused the government to massively overprint dollars, way more than it had gold to support, directly leading to our default on our international obligations, the terrible economic distress of the 1970s, and the subsequent erosion of wealth in the country as the now-entirely-fictional (instead of partially fictional) wealth token system took over.

Wealth tokens have always been fictional. It is a man made system.

goman wrote:
Malor wrote:

And note that the Great Society programs caused the government to massively overprint dollars, way more than it had gold to support, directly leading to our default on our international obligations, the terrible economic distress of the 1970s, and the subsequent erosion of wealth in the country as the now-entirely-fictional (instead of partially fictional) wealth token system took over.

Wealth tokens have always been fictional. It is a man made system.

:-P

We need to get back to a solid monetary system based on shiny shells and beads!

CheezePavilion wrote:

Where's the "profit motive" for the private sector in getting people out of poverty?

Don't wealthier individuals generally purchase more goods and services than individuals living in poverty?

MacBrave wrote:
CheezePavilion wrote:

Where's the "profit motive" for the private sector in getting people out of poverty?

Don't wealthier individuals generally purchase more goods and services than individuals living in poverty?

Sure, but if the private sector just keeps that money they don't have to lose a percentage of it in the cost of running a business. Simply put, they make more money by keeping it than they do by using that money to get people out of poverty.

Aetius wrote:

Government programs are developed based on political needs, not economic needs. Incentive-wise, it's actually counter-productive for government anti-poverty programs to be successful, because that would mean the end of the program, and of the political benefits.

Agreed. A small example which sticks in my mind is when I was in college co-oping for the department of defense at a military installation, working in their I.T. department. One day in early September he came to me and said "Do you want to work some overtime on the weekends between now and Oct. 1st?" I answered that my current project and workload really didn't seem to justify me working overtime. His response was "That's Ok, work it anyway. I need to use up this budgeted overtime by end of the fiscal year or I won't get it next year." I just don't see this kind of scenario playing out in any kind of well run private enterprise.

MacBrave wrote:
Aetius wrote:

Government programs are developed based on political needs, not economic needs. Incentive-wise, it's actually counter-productive for government anti-poverty programs to be successful, because that would mean the end of the program, and of the political benefits.

Agreed. A small example which sticks in my mind is when I was in college co-oping for the department of defense at a military installation, working in their I.T. department. One day in early September he came to me and said "Do you want to work some overtime on the weekends between now and Oct. 1st?" I answered that my current project and workload really didn't seem to justify me working overtime. His response was "That's Ok, work it anyway. I need to use up this budgeted overtime by end of the fiscal year or I won't get it next year." I just don't see this kind of scenario playing out in any kind of well run private enterprise.

http://en.wikipedia.org/wiki/The_Sur...

Obviously that's a comedy show but it happens all the time. Departments in large companies always fight over budgets and these things happen frequently.

MacBrave wrote:

Agreed. A small example which sticks in my mind is when I was in college co-oping for the department of defense at a military installation, working in their I.T. department. One day in early September he came to me and said "Do you want to work some overtime on the weekends between now and Oct. 1st?" I answered that my current project and workload really didn't seem to justify me working overtime. His response was "That's Ok, work it anyway. I need to use up this budgeted overtime by end of the fiscal year or I won't get it next year." I just don't see this kind of scenario playing out in any kind of well run private enterprise.

What, exactly, does your story have to do with the government providing social services or benefits?

The vast majority of social services are means tested and capped. You won't find the government saying, "hey, we have extra money in the food stamp program so everyone gets extra!" Benefits are defined and you get what you get based on your income, number of dependents, etc.

When the number of people receiving a benefit increases it's not because the government's just handing out cash. It's because they've met the requirements of the program, which typically means things aren't going too well those people at the moment.

OG_slinger wrote:
MacBrave wrote:

Agreed. A small example which sticks in my mind is when I was in college co-oping for the department of defense at a military installation, working in their I.T. department. One day in early September he came to me and said "Do you want to work some overtime on the weekends between now and Oct. 1st?" I answered that my current project and workload really didn't seem to justify me working overtime. His response was "That's Ok, work it anyway. I need to use up this budgeted overtime by end of the fiscal year or I won't get it next year." I just don't see this kind of scenario playing out in any kind of well run private enterprise.

What, exactly, does your story have to do with the government providing social services or benefits?

The vast majority of social services are means tested and capped. You won't find the government saying, "hey, we have extra money in the food stamp program so everyone gets extra!" Benefits are defined and you get what you get based on your income, number of dependents, etc.

When the number of people receiving a benefit increases it's not because the government's just handing out cash. It's because they've met the requirements of the program, which typically means things aren't going too well those people at the moment.

He's saying the government is inefficient and wastes money and the well run private sector wouldn't do that.

MacBrave wrote:
CheezePavilion wrote:

Where's the "profit motive" for the private sector in getting people out of poverty?

Don't wealthier individuals generally purchase more goods and services than individuals living in poverty?

It's a 'tragedy of the commons' problem though: the private sector is made up of many different businesses that compete to a greater or lesser extent. Any money an individual business spends will come 100% out of their own pockets. The return on that investment, however, will only be the increase those newly wealthy individuals spend on the products of that single business, not their total elevated spending because just about all of that elevated spending will go to their competitors.

SixteenBlue wrote:

He's saying the government is inefficient and wastes money and the well run private sector wouldn't do that.

Oh, I understood the point he was trying to make. Again, his little story had nothing to do with the discussion at hand and was simply the warmed over conservative talking point of government bad, capitalism good.

No one has explained how the vaunted market is going to do a better job providing social services than the government.

Contrary to what Aetius was saying, having for-profit companies run social programs would virtually guarantee that the programs got bigger and bigger every year because that's how those companies would make more money. That or they'd follow the lead of insurance agencies and disqualify practically everyone so they could keep the difference. Either way, the social good of taking care of our fellow citizens while being mindful of the budget isn't going to happen with for profit companies leading the way.

I mean just look at what outsourcing functions GIs used to do has cost the DoD (and taxpayers). By every measure the quality of service has declined and the cost has skyrocketed. Those contractors have absolutely no incentive to do anything but spend more since that boosts the profit they get.

I don't want a company like Halliburton squeezing taxpayers for billions and billions of profits to do something Uncle Sam does just fine today, nor do I want the inefficiency of having hundreds or thousands of tiny companies replicate what's done today by a single agency.