Showing posts with label 2- Economics & Public Policy. Show all posts
Showing posts with label 2- Economics & Public Policy. Show all posts

Sunday, November 23, 2025

Trump’s 50-year mortgage makes sense

 Why Trump’s 50-year mortgage makes sense


  • Trump's 50-year mortgage makes a lot of sense based on the numbers

  • It would be a boon to first-time buyers of owner-occupied homes

  • Critics chastised the “50-year mortgage” based on TDS and an intentional focus on bad assumptions (only a critic or an idiot would keep a 50-year mortgage to pay off, if alternatives are available)


The numbers below were worked out by ChatGPT (no expert required)

Using this example, at the outset, a payment difference of ~$150/mo could easily be, for a first-time homebuyer, the difference between being able to buy and not. 

Presuming that the buyer’s age, work experience, economic circumstances improve in a period of two years, the borrower may be financially able to increase the payment with no penalty and be able to go to a mortgage that they could not afford two years prior.

In addition, if mortgage interest rates decline, there is the option to refinance at lower rates, with the benefit of a track record of timely payments.

The more expensive the home, the more advantage there is in the strategy.

The one risk outside this analysis is a decline or collapse of the real estate market. This is a home-buying strategy, not an investment strategy recommendation.


A pipe dream? No, it always was the American Dream (my dream in 1976 with mortgage rates at 9%).


Here’s a clear comparison table showing the three mortgage strategies you've asked about, all based on:

  • Home price: $350,000

  • Down payment: 5% ($17,500)

  • Loan amount: $332,500

  • Interest rate: 6.5%

  • 30-year standard payment: $2,102.56/month

  • 50-year standard payment: $1,949.02/month


📊 Mortgage Strategy Comparison

Strategy

Monthly Payment

Total Paid

Total Interest

Principal Paid After 24 Months

Remaining Balance After 24 Months

Notes

1️⃣ 30-year held to maturity

$2,102.56

$756,921.60

$424,421.60

~$11,875

~$320,625

Most efficient option

2️⃣ 50-year held to maturity

$1,949.02

$1,169,412.00

$836,912.00

~$3,531

~$328,969

More than double the interest

3️⃣ 50-year, then pay 30-year amount after 24 months

$1,949.02 first 24 months, then $2,102.56

$803,698.08

$471,198.08

~$3,531

~$328,969 → paid off on 30-year schedule

Flexible payments, higher interest than Strategy 1


🔍 Key Takeaways

Insight

Impact

🔸 Strategy 2 costs $412,490 MORE in interest versus Strategy 1 (it would be foolish to stick with it for 50 years).


🔸 Strategy 3 (accelerate after 24 months) still costs $46,777 more in interest than starting with a 30-year loan.


🔸 In the first 2 years, the 50-year loan builds $8,344 less equity than the 30-year loan.


👍 Strategy 3 gives payment flexibility early with long-term savings versus Strategy 2.


🚫 Strategy 3 never beats starting with the 30-year mortgage financially, but it beats staying a renter forever.



📈 Visual Snapshot

Interest Paid (Least → Worst)


30-year only          $424K  ✔️ Best

50 → 30 at 24 months  $471K  ❗ +$47K

50-year only          $837K  🚨 +$413K



🧠 Final Recommendations

✔ If possible, start with a 30-year mortgage from day one.
✔ If short-term cash flow is critical, Strategy 3 is a reasonable compromise, but switch as early as possible (don’t wait 2 full years if not necessary).
🚫 Avoid Strategy 2 unless absolutely unavoidable for qualification reasons.



Monday, July 14, 2025

The Coming Tidal Change in US Government Executive Branches Management

Reposted from Brownstone Institute - July 14, 2025 

The Racket Unravels

This past week, the Supreme Court delivered an opinion that could change everything, if not immediately then eventually. It permits the elected president to control the composition of the executive workforce. This involves millions of people in hundreds of agencies who heretofore imagined themselves to be the true and permanent government of the US. 


The administrative state has never been lawful by the words of the US Constitution. There is no fourth branch of government. There is no independent agency that operates on its own, responsive only to the corporations with whom it has a revolving door and working in tandem with the national media. That’s how the system has worked for one hundred years. 


No more. The effects of this decision, and several others dating back only one year, is fundamental to the cause of freedom itself. It won’t be enough to protect the country against more despotic moves such as we have lived through, but it is an excellent start. 


The turning point was of course Covid, when the deep state called the shots, invaded our communities and homes and then imposed experimental shots in violation of the Nuremberg Code. This was the turning point. No free people can live this way, not with the reality nor the threat that it could happen again. 


Almost daily, we see some first steps at justice. In 2021, Dr. Kirk Moore of Utah had a bad feeling about these shots and made it possible for people to avoid them. He distributed saline shots and vaccine passports widely. The Department of Justice went after him, incarcerated him for 12 days, and put him on trial. 


The good news came yesterday that the Department of Justice has completely dropped the case, mostly in response to pleas from lawmakers who cared and growing groups of protesters. The man is a hero, and is now free. The trauma, however, lasts and lasts for a lifetime. He is one victim of millions, and there is much more to do. 


Other legal progress is unfolding gradually, with several of our partner organizations prevailing in the long slog. Much more to do. 

Thursday, December 22, 2022

The Age of Amnesia

 Below is a Commentary by Jeffrey Tucker (see bio at the bottom) in The Epoch Times on 12/18/2022

This is THE MOST spot-on assessment of our times that I have read anywhere. I republish it here to have one more place where it may not be forgotten. This is my "resistance at the little game" (see below).

The Age of Amnesia

 
December 15, 2022 Updated: December 18, 2022





Commentary

The main defense of Dr. Anthony Fauci in his legal deposition this month was pretty simple: he forgot. He said that he couldn’t recall nearly 200 times and versions of that many more. He said that he was so busy running his huge agency plus shepherding vaccines that he couldn’t possibly remember this or that email implicating him in a censorship scheme. He gets thousands of emails a day and there’s no reason to think that any, in particular, would grab his attention.

Monday, July 6, 2015

A Simple View of Greece and Grexit

This was originally written for my grandchildren to explain the messy world we live in, It's a terribly simplified view, but why not see what the world thinks.

Who pays for Greece's past follies? To greater or lesser degrees we all will. The farther we are from Greece the smaller the impact. Just as waves that hit us coming from a pebble dropped in a pond. In the US, we are far from the pebble, in Europe the waves will be bigger. To the citizens of Greece they will be monstrous, crushing and their personal pain will be long lasting. But INFLATION is the ultimate solver of tragic imbalances between countries and the world and it will handle this one too. How?

We live in a global financial world that could be finite, but is not. It could be finite if all governments stopped printing currencies. Inflation would be 0 but we'd have difficulties to adjust to trade imbalances and making economic adjustments because "the pie" is getting bigger. We need tiny inflation for slack and room to grow.

Sunday, April 1, 2012

On Health Care Reform Try KISS

With any luck, ObamaCare will be defeated in the courts.  Ten we'll have to hope for the next attempt to bring the US into the ranks of civilized wealthy countries that have a minimum of moral backbone to provide for humans at minimum of care as PETA advocates for animals.  Perhaps then we could try a simple a solution with little or no opportunity for "pork" deals: here is a proposal that requires no monumental or structural change and tests an alternative with a failsafe provision:

  1. Open Medicare basic coverage to anyone above age 50 who wants to participate

  2. Charge for that minimal level of coverage the price that would be charged by the California Public Employees medical plan or the Federal Employees plan or any other similarly sized plan. Those plans have no exclusions for pre-existing conditions and by their size should have a customer base similar to the participants to be added to Medicare in 1. above.  Their price would have to be adjusted to reflect the limited coverage  only for Medicare basic services

  3. Set a sunset law that forces re-approval of the plan in 5 years.  At that time if the plan is successful it can be reapproved and potentially extended to include participants over 40 years of age or even participants regardless of age.  If the plan is not re-approved, participants  no longer elegible will have to find private insurance as they do now.

What is to be gained?  Lots:

  1. Put pressure on private insurers to offer more competitive rates (without exclusions for pre-exsting conditions)

  2. Offer what is essentially a national mutual insurance option for basic medical care where proft making is taken out of the equation.

  3. Move the country toward a single medical payments processing system that can be gradually improved to weed out processing inefficiencies.  Medicare already has the system in place and it is the only such system that all medical services providers are already set up to be paid by. Enhance the system with centralized medical records as most other developed countries have. We could save clinics and hospitals millions in administrative overhead and patients the pain of dealing with records transfers and billing.

  4. The insured that want to never fill out another insurance application wil have that option.

  5. The insured that want additional coverage can buy it from private Medicare Supplemental insurance suppliers already in the market

  6. The insured that want only private options will be free to shop as they please and change from plan to plan as they do today.

  7. The indigent can be covered through a system already equipped for  that purpose.  What they pay or what credit they receive for it can be handled the same way as now is done for indigent Medicare recipients.

  8. Employers can be taken completely out of the business of shopping for insurance for third parties (their employees).  They would however cotinue to process payroll deductions just as they do for taxes (the system for all this is already in place).  Citizens should also be able to handle their own payments as they do for other matters in their lives.

  9. The level of minimum services would be finally managed not by sticking ERs with unpaying patients, but based on nationally debated and set budgets and voters preferences as voted at the ballot box. If, as a nation, we want to offer little beyond "stopping the bleeding" or "preventing epidemics" we surely can.  If we want to provide more we can, but it would all be determined by an open debate and allocated budgets.

It may be too much to hope for. The wage controls instituted in WWII, as an unintended consequence  gave our nation the only employer managed health care system in the world.  It was an accident, not a reasoned policy.  Quality regardless of cost became part of the system and now we find we cannot afford it indefinitely.  Any variation that is based on the same unreasoned premises will only continue to benefit the vested interests that have perfected milking the current system.

Tuesday, October 11, 2011

School Bullying - There IS an EASY fix

School bullying has becoming a near obsession to the point of Anderson Cooper making a national campaign against it and CNN reporting endlessly on it along with other media. There is reason for it if children lose their lives to it.

However, to a person raised outside the US it is surprising that for all the research on victims and aggressors, mea culpas by talking heads and school administrators the dynamics and the solution are so difficult to understand.  I can already hear the chorus of dissent and dismissal for lack of complicated paradigms and formal research papers.

Nonetheless there is a simple remedy that could be tested at minimal or no cost with virtually no lead time.  It is probably too simple to be credible to many, but let's look at it just in case.

Premises

Most would agree that bullying, in its many manifestations, reflects a fight for social dominance and status within a group and may be acted out by individuals or groups.  I will leave it to researchers of primates to explain why humans have such a need. I accept that we do to varying degrees and give various displays of it.

The first notable thing to a newcomer to this land (40 years ago) that enters a US middle school or high school is the strong social dynamics of popularity. In American schools popularity is the all absorbing priority of students except for those contrarians that on purpose reject it and create alternative counter cultural groups with varying degrees of alienation.  Popularity can be built by many means from the jersey of an athlete-jock to the pom-poms of a cheerleader to the wallet of a big spender and by the kid that has easy access to the family's medicine  or bar cabinet.  Looks and clothes and the right vehicle (including the one a parent drives them to school in) are key components to the social climb.

So, just as for everything in society, there are the haves and the have-nots.  As in any group from social and sport clubs, to greek houses, to trade unions to military elites, exclusion and limitation of membership is the means to increase the value of the membership and its benefits for those accepted: thus hazing rituals, separate and exclusive gatherings, country club fees, special handshakes, etc.

In schools the same group dynamics evolve and are fed by differences in economic means, athletic skill, gift for jokesterism, access to drugs and transportation.  Group membership is further amplified and managed by social media tools, cell phones, etc.  as tools of inclusion, exclusion and social attack.

The Fix

To that same newcomer that went to school abroad in a country where students attend from 8am to 1pm, then go home, never eat lunch at school, and study on their own in he afternoons, the fix is obvious.  School group dynamics are driven not only, but heavily by the ability of kids to group (read include exclude others) at lunch time.  In the cafeteria and in the school yard the whole population can see who belongs where and with whom building the necessary envy, desire for membership, superiority by exclusion. Just as for primates violence, psychological or physical,  enforce the group membership and relative dominance.

So an easy fix is to test in schools is to break up or weaken the cycle of group creation and control by  inclusion/exclusion: Require students to sit at assigned (randomly drawn and periodically rotated) seats at every opportunity in classes in cafeterias,  auditoriums, etc.

Forced one on one contact is not as desirable as voluntary contact, but it would teach tolerance for societal rules (for sure and also need) and eventually tolerance for people that one would have not chosen to come in contact with.  Initially such school requirement would be most unpopular, but discovering that people outside a chosen group are not dorks or geeks or dumb or poor or useless would eventually prevail.

Similarly, school uniforms have for ages demonstrated their ability to unify a student body by minimizing  aesthetic and economic differences.

This whole idea is probably anathema to a population and culture that for the last 50 to 100 years has been schooled in the American way of school cafeterias and schoolyards.  But there is reason for optimism: school uniforms have started making a come back in many public schools, with great results, for similar reasons a despite the best efforts of vested interests intent in commercializing our children into ever changing fashion objects (sidebar: Anderson Cooper and CNN  might research how many countries that score above the US in middle and high school achievement require uniforms in their schools - care to bet?).

This is only a small step that probably would take some years to have serious impact on the culture, but rivers change course according to one small grain of sand being displaced one way or another. This is one grain that would require very little to test.

Marco Messina

10/11/11

Monday, February 7, 2011

A National Disgrace

I just confronted yet another instance of how the US is losing the war for innovation, green technologies, sustainability and energy independence to countries like India and China despite the fact that the inventions put in play are American Inventions.   See Smart Planet - China to develop a greener nuclear reactor

How can that happen?  The usual suspects could be fingered: disrespect for science and engineering, focus on easy answers, industrial vested interests, etc.  I propose that perhaps the worst is "Failure To Communicate" and this is the most blatant example I ever found.

Background

During the Manhattan Project a process to use nuclear materials (nuclear cycle was identified that could generate nuclear power but was not good enough for the explosive reaction needded for nuclear bombs.  Given the objective of the Manhattan Project, it was naturally sidelined.

During the 1950's and 1960's the "less efficient" process was revived, as an option for peaceful power generation. in what became known as the Thorium Nuclear Reactor. It was demonstrated capable to avoid all the most negative aspects of a high pressure nuclear reactor (e.g. meltdown, explosion, highly 1000-years radioactive waste, etc.), but gained little attention.

From the 1970's until today nuclear power developed evermore the popularity of "the turd in the punchbowl" for a variety of legitimate and other reasons.

Today it appears that the media and the voters would prefer confronting an ice age with candles than considering nuclear power generation in the US.  But what if there were an option that avoids many or all of the risks, costs less, produces more and was already tested sixty years ago?

Well,  for that option to go anywhere we'd have to publicize it so that voters would come to understand it, develop confidence in it, accept it and allow construction of this  "new" variety of nuclear plant.

The national tragedy

As it happens, that option appears to exist in the Thorium Nuclear Reactor (TNR)

  • The TNR was designed and tested in the US in the 1960's

  • Our TNR technology is now being test deployed by India and China

  • In the future, when it becomes fully commercial, we will buy it from India and China just as we buy oil from Canada and OPEC today

How can it happen?

Smart Planet reports these facts (hats off to them for reporting at all)

BUT


at the bottom of their report there is also a video surely intended to help the reader better understand the process and the inherent opportunity.

The combination of the report and that video is the disgrace I am talking about.  It is the clearest example of scientists' and science reporters' inability to effectively communicate and make a good case even when all facts appear to be in their favor:

  • The video is 16 minutes long.  Challenge yourself to listen to the end.  It will become a blur, but you'll get key relevant pieces any way.

  • Is the audio in the video speeded up to suit the internet attention span?  Hard to tell.  If it is, shame on the editor, if it is the speakers's natural pace, shame on them.

  • Did all the presenters speak at the same time?  I doubt it.  Shame on the editor.

  • The message is clearly educational about the advantages of the TNR, but you would not know it. The positive technical  details are buried in an alphabet soup and cacophony that hides it all.

  • The speakers in the video, one guesses, are knowledgeable presenters at professional conferences, but sound like drug advertisements disclaiming potential side effects.

  • Comments such as  "no one knows anything about TNR any more because all the original scientists are dieing" would dissuade any politician from going to bat for this technology.

In 1993 Michael Crichton took the media to task (speech at the National PressClub) warning that superficiality and lack of quality in reporting would eventually have disastrous consequences for the media, which undoubtedly it is having.

I suggest that by framing important issues poorly, sloppy, if well intentioned, reporting can have more disastrous consequences than no reporting at all.  We all depend on the media to make informed decisions, to support or obstruct national policies.  On a subject as urgent as the one above, and not particularly popular with the populace, the damage may well exceed the benefit.

When that happens an opportunity the voters and for the nation to stay in the lead is wasted.  India and China move ahead and we are left to wonder why.  As Crichton said, there are no easy answers, but surely bad information or badly framed information will lead us to lousy outcomes.

And that is a national tragedy.

Thursday, May 20, 2010

Columbus all over again

Food for thought

When Columbus landed in North America it took months for his closes back-home associates to learn about it.  Europe's literati took years to hear about it and nearly a century passed before the proof that the earth was not flat sunk into people's consciousness.  Some wits would say that even today some people are only marginally aware of it (Austria and Australia are still indistinguishable to same).

Well we are at that point again. Today's announcement is as momentous if not more so.  The information will travel faster, but, still, real consciousness of its significance will lag, luddites will deny it (e.g. the moon landing was a video scam), some (ostriches) will ignore it, some will be horrified by it (and try to put the gene back in the bottle), all will be directly or indirectly affected.

The impact will be not only in the practical consequences (medicine, industrial, etc.), which have been in the making for years, but mostly, in the psyche of homo sapiens.  I do not know when it happened (lags still exist even in the information age), nor how long it will take to sink in, but today's announcement is "Columbus all over again".  Write down the date; it will matter when you'll say "I remeber when..." to your grandchildren, to whom the whole affair will have become as common place as TV remotes and cell phones.

Today homo sapiens made life, not a human, not without some minor procedural shortcuts, not "new" life only a duplicate, but synthetic self duplicating DNA based life just the same. The world and we as a species will not remain the same.

http://www.nytimes.com/2010/05/21/science/21cell.html

May 20, 2010

The genome pioneer J. Craig Venter has taken another step in his quest to create synthetic life, by synthesizing an entire bacterial genome and using it to take over a cell.

Dr. Venter calls the result a “synthetic cell” and is presenting the research as a landmark achievement that will open the way to creating useful microbes from scratch to make products like vaccines and biofuels. At a press conference Thursday, Dr. Venter described the converted cell as “the first self-replicating species we’ve had on the planet whose parent is a computer.”

“This is a philosophical advance as much as a technical advance,” he said, suggesting that the “synthetic cell” raised new questions about the nature of life

Other scientists agree that he has achieved a technical feat in synthesizing the largest piece of DNA so far — a million units in length — and in making it accurate enough to substitute for the cell’s own DNA.

But some regard this approach as unpromising because it will take years to design new organisms, and meanwhile progress toward making biofuels is already being achieved with conventional genetic engineering approaches in which existing organisms are modified a few genes at a time.

Dr. Venter’s aim is to achieve total control over a bacterium’s genome, first by synthesizing its DNA in a laboratory and then by designing a new genome stripped of many natural functions and equipped with new genes that govern production of useful chemicals.

“It’s very powerful to be able to reconstruct and own every letter in a genome because that means you can put in different genes,” said Gerald Joyce, a biologist at the Scripps Research Institute in La Jolla, Calif.

In response to the scientific report, President Obama asked the White House bioethics commission on Thursday to complete a study of the issues raised by synthetic biology within six months and report back to him on its findings. He said the new development raised “genuine concerns,” though he did not specify them further.

Dr. Venter took a first step toward this goal three years ago, showing that the natural DNA from one bacterium could be inserted into another and that it would take over the host cell’s operation. Last year, his team synthesized a piece of DNA with 1,080,000 bases, the chemical units of which DNA is composed.

In a final step, a team led by Daniel G. Gibson, Hamilton O. Smith and Dr. Venter report in Thursday’s issue of the journal Science that the synthetic DNA takes over a bacterial cell just as the natural DNA did, making the cell generate the proteins specified by the new DNA’s genetic information in preference to those of its own genome.

The team ordered pieces of DNA 1,000 units in length from Blue Heron, a company that specializes in synthesizing DNA, and developed a technique for assembling the shorter lengths into a complete genome. The cost of the project was $40 million, most of it paid for by Synthetic Genomics, a company Dr. Venter founded.

But the bacterium used by the Venter group is unsuitable for biofuel production, and Dr. Venter said he would move to different organisms. Synthetic Genomics has a contract from Exxon to generate biofuels from algae. Exxon is prepared to spend up to $600 million if all its milestones are met. Dr. Venter said he would try to build “an entire algae genome so we can vary the 50 to 60 different parameters for algae growth to make superproductive organisms.”

On his yacht trips round the world, Dr. Venter has analyzed the DNA of the many microbes in seawater and now has a library of about 40 million genes, mostly from algae. These genes will be a resource to make captive algae produce useful chemicals, he said.

Some other scientists said that aside from assembling a large piece of DNA, Dr. Venter has not broken new ground. “To my mind Craig has somewhat overplayed the importance of this,” said David Baltimore, a geneticist at Caltech. He described the result as “a technical tour de force,” a matter of scale rather than a scientific breakthrough.

“He has not created life, only mimicked it,” Dr. Baltimore said.

Dr. Venter’s approach “is not necessarily on the path” to produce useful microorganisms, said George Church, a genome researcher at Harvard Medical School. Leroy Hood, of the Institute for Systems Biology in Seattle, described Dr. Venter’s report as “glitzy” but said lower-level genes and networks had to be understood first before it would be worth trying to design whole organisms from scratch.

In 2002 Eckard Wimmer, of the State University of New York at Stony Brook, synthesized the genome of the polio virus. The genome constructed a live polio virus that infected and killed mice. Dr. Venter’s work on the bacterium is similar in principle, except that the polio virus genome is only 7,500 units in length, and the bacteria’s genome is more than 100 times longer.

Friends of the Earth, an environmental group, denounced the synthetic genome as “dangerous new technology,” saying that “Mr. Venter should stop all further research until sufficient regulations are in place.”

The genome Dr. Venter synthesized is copied from a natural bacterium that infects goats. He said that before copying the DNA, he excised 14 genes likely to be pathogenic, so the new bacterium, even if it escaped, would be unlikely to cause goats harm.

Dr. Venter’s assertion that he has created a “synthetic cell” has alarmed people who think that means he has created a new life form or an artificial cell. “Of course that’s not right — its ancestor is a biological life form,” said Dr. Joyce of Scripps.

Dr. Venter copied the DNA from one species of bacteria and inserted it into another. The second bacteria made all the proteins and organelles in the so-called “synthetic cell,” by following the specifications implicit in the structure of the inserted DNA.

“My worry is that some people are going to draw the conclusion that they have created a new life form,” said Jim Collins, a bioengineer atBoston University. “What they have created is an organism with a synthesized natural genome. But it doesn’t represent the creation of life from scratch or the creation of a new life form,” he said.

Wednesday, March 31, 2010

Health Care - We, the people, are getting shafted



Now, let me get this straight......
we're trying to pass a health care plan
written by a committee whose chairman says he doesn't understand it,
passed by a Congress that hasn't read it but exempts themselves from it,
to be signed by a president that also is exempt from it and hasn't read it and who smokes,
with funding administered by a treasury chief who didn't pay his taxes,
all to be overseen by a surgeon general who is obese,
and financed by a country that's broke.

See any problems with it?

Friday, March 26, 2010

Trying Hope ... Again

Frankly I feel completely cheated by the audacity of hope for change.  I just saw the political process prostituted to the point of openly buying votes for a bill with "part of the pay off being exemption from being covered by the bill".  Yes, reread it: even in most corrupted nations like Nigeria they do not have the gall of doing something like that.  Yes, that's change all right. I was one of the dumb asses audaciously hoping and I resent being had.

So, it is time again to hope for change. Now I hope for Paul Ryan to bring us some national leadership along with his straight talk and real, if unpleasant choices.   I long for the intellectual honesty (or just plain honesty) of a person willing to propose a medicine sure to be unpleasant at times but well reasoned, to fix several fundamental weaknesses of our economy and political system.  Bravo, Mr. Ryan.

As a public service here is a reprint of the article by Congressman Ryan published in Newsweek Feb 19, 2010

Newsweek

Red Alert


As Obama’s national-debt panel prepares for deliberations, one congressman proposes how to get back in the black.  


By Paul Ryan | NEWSWEEK
Published Feb 19, 2010

From the magazine issue dated Mar 1, 2010

Imagine your family’s finances if you spent and borrowed like Washington: you’d owe $60 in credit-card loans for every $100 of income. Every month you’d pay back a little but borrow even more. In 10 years, you’d owe $87 for every $100 you made. At some point you’d hand off the debt to your kids. If they worked until 2035, they’d owe more than $180 for every $100 they earned. In 2050, your grandkids would owe more than $320. By 2080 they’d owe seven times their earnings. Of course, lenders would cut them off well before then, and your family would be ruined. But this is the path your government is on right now.

Today, our country faces a fiscal meltdown - and Washington’s continued cowardice is a big part of the problem. The social-insurance strategies of the 20th century - Medicare, Medicaid, and Social Security - are driving our federal government and economy to collapse. It’s long been obvious that we’re ill prepared for the retirement of the baby boomers. Now, the recession and Washington’s recent spending spree have accelerated the day of reckoning.

Consider just one program: Medicare. Today, this program is short $38 trillion of what it promises to provide your parents, you, and your kids. In five years, the hole will grow to $52 trillion. Your family’s share: $458,000. Medicaid will add trillions more in state and federal debt.

Social Security’s surplus is already gone, and its debt is mounting. Without shoring up its finances, the government will be forced to cut benefits nearly 25 percent or raisepayroll taxes more than 30 percent.

Both Republicans and Democrats share the blame for failing to be candid about the difficult choices we face and for continuing to make promises that cannot be kept. Some apparently have no sense of shame about shaking a tin cup at China and Japan.

I’ve put forward a specific solution to meet this challenge, a plan the nonpartisan Congressional Budget Office says can achieve its goals of paying off government debt in the long run - while securing the social safety net and making possible future economic growth. I call it “A Roadmap for America’s Future.” If followed, this is what will happen:

HEALTH CARE

You, not your government or your boss, should own your health plan. The Roadmap replaces a tax break that benefits only those with job-based health insurance with tax credits that benefit every American. It addresses the key drivers of rising health-care costs, securing universal access to quality, affordable health coverage.

MEDICARE

Everyone 55 and over will remain in the current program. For those now under 55, the Roadmap turns Medicare into a health-care program like the one enjoyed by members of Congress. Future seniors will receive a voucher and will be able to choose from a list of Medicare-certified insurance plans that best suit their needs. Thegovernment subsidy will provide additional support for those with lower incomes and higher health costs.

SOCIAL SECURITY

Everyone 55 and older will remain in the existing program with no change. My plan offers those now under 55 a choice: continue to take part in traditional Social Security or join a retirement system like Congress’s own plan. Future seniors will be able to invest more than a third of their payroll taxes in savings accounts they will own. These accounts will be guaranteed and managed by the federal government - not by a private investment firm. For both Social Security and Medicare, eligibility ages will gradually increase.

PRO-GROWTH TAX REFORM

To get the economy going again, the Roadmap offers the option of a simple, low-rate, two-tier personal income tax, eliminating loopholes and the double taxation of savings and investment. Corporate income taxes will be replaced by a simple 8.5 percent business consumption tax.

For specifics on these and other reforms, go to americanroadmap.org.

Critics say that any attempt to cut entitlements is tantamount to political suicide. Nonsense. Most Americans see such reforms as common sense. It makes sense to gradually increase the eligibility ages for Social Security and Medicare - Americans are living decades longer than when these programs were first enacted. It also makes sense to tie benefits to income so that those with fewer resources receive more support. Arguing in favor of “means testing” Medicare premiums, House Majority Leader Steny Hoyer, the respected Maryland Democrat, put it well late last year: “We have to buck up our courage and say that if we try to take care of everybody, we won’t be able to take care of those who need us most.”

One frequent charge against these reforms is, however, correct: the Roadmap does shift power to individuals at the expense of government control. It rejects the merits and sustainability of a cradle-to-grave welfare state, which drains individuals of their self-reliance. The plan unapologetically applies our nation’s founding principles - individual liberty, limited government, and free enterprise - to the challenges of today. And the Roadmap does this in a way that honors our historic commitment to strengthening the social safety net for those who need it most.

I welcome the debate on how to tackle our fiscal crisis - and the larger debate on the proper role of government. But I’d encourage those taking aim at the Roadmap to arm yourselves with a specific alternative. My dad used to say, “Son, you are either part of the solution or part of the problem.” (That was usually when I was being part of the problem.) Now we must make the same demand of politicians in Washington: Don’t patronize the American people as if they were children - deferring difficult decisions and promising fiscal fantasies. Tell the American people the truth and offer them a choice, and they will do what’s right.

Ryan of Wisconsin is the ranking member of the House Budget Committee.

Find this article at: http://www.newsweek.com/id/233915

Saturday, February 6, 2010

Yes we can - No you can't

What a difference a year makes.  I've gone from hope to total disillusionment and it appears I am not alone. This rapid change of mood raises the question: "Are we just a bunch of ungrateful, uninformed, wishy washy and hyper-reactive dingbats? ", or perhaps we are displaying a new trait politicians ought to learn to consider in the age of the internet?

Let's look at two recent instances where voters suddenly revolted against the "great leader" they had trusted.

First we have  George W. and his Rasputin, Dick Chaney.  Here is a quick review of the relevant events:

  1. 9/11 creates an abnormally uncritical citizenry catalyzed by patriotism, and fear,  

  2. the Bush, Chaney, Woolfowitz, etc. gang figure they don't need to disclose their private agenda of redesigning the Middle East. In pursuit of it, fabricate tales of weapons of mass destruction to start a war

  3. the US goes to war on two fronts with a majority of support justified by fabricated information and fears 

  4. with war in progress the great leader gets re-elected 

  5. eventually analysts, former generals, etc. unveil the lies used to tee up the strategy and the internet distributes them to all able to read

  6. after 4 years of burning billions by the month, the economy goes into a tailspin 

  7. the voters, suddenly recognize they were lied to and paying a huge price for it and give victory to an untested newcomer that promises "change", the only thing that all want regardless of political orientation - CHANGE

  8. and change we get with the highest expectations.  Probably an non-republican could have been elected.  I for one admit being so offended by the lies and so smitten by the prospect of change that I abandoned my past "Reagan conservativism" and the fact that the alternative to "yes we can" was an Alaskan-diva whose key qualifications included "mayor of a town of 6000" did not help.

Now let's look at why, suddenly, "yes we can" does not resonate any more with the hopeful change-minded electorate.  Consider this to figure why and how a "tea party" would start:

  1. with the economy in collapse "Mr. hope" bails out the banks.  Perhaps needed to avert further trouble, but why not a single bureaucrat or banker lost his job in the process?  The problem is not that some bankers make millions, is that some are paid millions with our money - "Mr. hope" wonders why the fuss? Duh. 

  2. GM, whose brilliant management consistently lost (stock) value to its shareholders for 45 years straight, must be saved from bankruptcy, its executives must be paid (or exit with) millions of our subsidy money - such great talent must be retained, no? 

  3. Meanwhile small business owners fail by the thousands and banks who are given billions to lend, with no conditions to actually do so, continue to lend nothing. 

  4. "Mr. Change" campaigned on a promise to "change" medical services to control rising costs, rein in insurers' practices of coverage exclusions, increase insurance competition with a government plan  and insurance sales across state lines. 

  5. After near a year of debate and horse trading the grand proposal offers:

    1. no expansion of Medicare as an alternate  to private insurers,

    2. no cross states insurance sales to increase competition, 

    3. any limits on pre-existing conditions will take years to be enacted

    4. senators from too many states to count have been "bought" with cash subsidies, exclusion from participation in the plan they vote for, etc.

    5. unions have been cut similar deals

  6. where does the tax paying citizen figure in this barrel of pork? So much for CHANGE and the audacity of hope.

  7. disillusionment sets in but we are saved at the last minute by sheer luck in Massachusetts

  8. Again the voters have revolted against arrogance, stupidity, lies and having their common sense insulted

The two scenarios above show that one party is no more decent than the other.

The Supreme Court meanwhile asserts that corporations are "citizens" with the right to free speech and are free, if not to a vote at the polls, to at least to vote their pocket book.  The latter of course is worse to the democracy as it entails influence without responsibility or accountability.  The citizenry's common sense could only be insulted more if the wise Justices permitted corporations "as individuals" to marry and have children - now that is a new legal frontier.

Faced with pork and lies and insult to common sense, is it any surprise that a sentiment develops among the sheep that perhaps, just perhaps, "we deserve some respect?  We, the living, ought to stand up and say 'I count and you work for me' ".

Some fantasize nonsense like "going Galt", the more realistic develop a Tea Party frame of mind, perhaps it is finally time for a new party.