Tax Cuts, Bush’s Spending and the Social Safety Net

May 22, 2011 Leave a comment

There are two points here.  If you just let the Bush tax cuts expire the country’s capacity to pay its debt will be stable for ten years.  Also, the other key to debt has been spending on wars and the Bush Medicare Part B prescription benefit.  Otherwise, the remaining balance of spending as a cause of debt is trivial.  In other words, cutting employment programs, education spending and other social safety nets pays for the tax cuts of the wealth.  This is not a good political or economic system, nor is it sustainable over time, and may threaten our democracy eventually.

We focus here on debt held by the public, which reflects funds that the federal government borrows in credit markets to finance deficits and other cash needs.  That’s the proper measure on which to focus because it’s what really affects the economy.  We compare it to GDP because stabilizing the debt-to-GDP ratio is a key test of fiscal sustainability.

…simply letting the Bush tax cuts expire on schedule (or paying for any portions that policymakers decide to extend) would stabilize the debt-to-GDP ratio for the next decade.   While we’d have to do much more to keep the debt stable over the longer run, that would be a huge accomplishment.

via Economist’s View: Bush Tax Cuts, Wars Major Drivers of Projected Government Debt.

Filed under Economy, National

BBC News – Louis Theroux goes to the Miami mega-jail

May 21, 2011 Leave a comment

Imagine a jail where dangerous inmates awaiting trial live 24 to a room and fight each other under a violent gladiatorial code. This is life inside Miami’s mega-jail, writes Louis Theroux.

via BBC News – Louis Theroux goes to the Miami mega-jail.

Filed under Miami-Dade County

Junot Diaz On What Disasters Reveal | On Point with Tom Ashbrook

May 20, 2011 Leave a comment

There is a wonderful audio interview at this site.  Well recommended for use in South Florida–we have our “natural” and political disasters, too.

The Dominican-American writer Junot Diaz got everybody’s attention, and a Pulitzer Prize, with his fierce, funny, tragic first novel “The Brief and Wondrous Life of Oscar Wao.” Now, in a big new essay, Diaz has moved on to bigger themes — like apocalypse and the fate of the human race.

Junot Diaz looks at our recent headlines of earthquakes, tsunamis, meltdown fears, and floods and sees revelation. Not of the hand of God, exactly. But of human realities running amok.

via Junot Diaz On What Disasters Reveal | On Point with Tom Ashbrook.

Filed under Environment

Geithner’s Sad Facts for the US

May 18, 2011 Leave a comment

It is hard to imagine the urgency of the governor and the House of Representatives to cut benefits for the poor.  Apparently, more poor is not a big concern for the most rich.  Better the poor than pay more taxes.

Here are five facts that Treasury Secretary Timothy Geithner offered in a speech in New York Tuesday as  “context for the [fiscal] choices we must make now to preserve room for important investments in our future.”

• In the U.S. today , 40% of children born each year are covered by Medicaid.  If you are born today in hard-pressed communities in many American cities, like St. Louis or Baltimore, you are more likely to die before your first birthday than if you were born in Sri Lanka or Belarus.

• In education, we’re losing ground…. In Los Angeles, only about half the kids graduate from high school.

• Over the next 25 years, the number of Americans eligible for Medicare and Social Security will nearly double, while the number of working age Americans will only increase by about 10%, putting substantial new burdens on working Americans.

• We spend $700 billion a year on national security… about two-thirds of what we spent as a share of our economy during the Cold War.

• The effective income tax rate for the wealthiest Americans—those earning more than $250,000 a year—is at its lowest level in 50 years. And the effective rate for the very rich—those earning over $10 million per year— has declined much further and is now around 21%.

via Geithner Offers Fiscal Facts – Real Time Economics – WSJ.

Filed under Economy, National

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