Why No One Running For President Represents Change
All three of our erstwhile candidates running for president have tried to adopt the mantle of change but when you get down to it, it's really hard to see how they are anything other than the same old hacks we see time and again with new names.
Cynical? Well, yes, but also fairly realistic.
All three candidates have called for cutting taxes and Barack and Hillary are vying to see who can offer the most promises on a universal health care system.
There's only one fly in the ointment. The federal government is beyond broke. Oh, it went broke a while back. Now the feds are doing nothing but piling up IOUs and the problem is getting worse, not better.
Bush just posted a budget and predicts the fiscal year 2008 deficit will be $410 billion and the fiscal year 2009 deficit will plunge to $407 billion. Because the fiscal year ends in September, we will be stuck with the Bush budget in 2009. As for 2010 through 2012, he projects a complete fantasy the budget will come into balance. But, of course,in 2005, he was promising a balanced budget by 2009, so we already know he's a liar.
Let's take a deep breath here. According to Bush himself, in the last two years while he is office, he will add nearly $1 trillion to the national debt. This is after adding several trillion more to the debt in his previous six budgets. Like it or not, that debt has got to be repaid. As the trillions add up, the debt service we're all obligated to pay for adds up. Think of it as the mortgage from hell. So even as Bush gets ready to get the hell out of Dodge, he's making it harder for the next guy to do anything but pay the interest.
But is a $407 deficit in 2009 even remotely realistic? Nope, for starters that budget does not include the costs of the Iraq War which is running about $200 billion a year. Under arcane Washington rules, the Iraq War is funding is known as "emergency spending" which no one could have foreseen.
Then there is the small matter of the alternative minimum tax.
The AMT saves a lot of middle class Americans from seeing their taxes jump higher than the Empire State building. But while every politician agrees we need to keep the program in place, it too, like the Iraq War, ain't being included in the budget documents. So tack on another $65 billion in 2009 to cover that known problem.
Despite this dire fiscal outlook, all three candidates are slapping the American people silly with their happy talk of how they are going to do this and that once they get into the Oval Office. If we had better options, the candidates would be telling us we have a serious problem and it's going to take a while to dig ourselves out of the hole we're in. And the digging part is going to take some sacrifices. Taxes will need to go up and spending, even on everyone's favorite programs, will need to go down.
Why? Because starting in 2012, the fiscal poop is really going to hit the fan. That's the year when the first of the baby boomers retires at age 62. (Terrie corrected me in pointing out that 2012 is the year the first baby boomers can retire at full social security benefits. The can take partial benefits now. See comments below) Social Security will not have the funds to pay for the retirement of the baby boom generation unless taxes are raised. The program may be running a surplus now, but if you have questions about where that surplus is, please refer back to the discussion of deficits. It has been spent.
In some recent posts, I have written some fairly dyspeptic comments about specific politicians and the election in general. But it's hard to take the optimistic viewpoint here. Either Barack, Hillary and John are delusional and don't know about the fiscal problems we face, or they are just trying to BS their way through like candidates have always done.
Either way, this election is a dog's breakfast and there is nary a leader in sight.
Alex Keto
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Reader Comments (10)
Hi Alex,
Tiny correction. The first of the Boomers (I was born in the first year, 1946) reach full Social Security retirement age (66) in 2012. We reach early (age 62) benefits this year. I will begin collecting in September. The good news is that most of my friends born in '46 have elected to either keep working or postpone receiving benefits.
I agree with you that the deficit is not something that we as a nation can take lightly, especially since so much of our capitalization is now foreign owned.
I am HOPING for a balanced budget, which would be a nice CHANGE.
Terrie
Terrie,
Thanks for the correction. My math skills are weak which is why I try to write.
Everyone's so hip on this election, but I actually don't care much about it. After a couple of years of floundering amid the mess Bush left, whoever is elected now won't make it back for another four.
They all seem like more of the same to me.
You know I just turned 35 making me eligible for the office. is it too late to run? Alex will you be my campaign manager?
Sure Travis, let's just use the Kinky Friedman campaign strategy although I forgot what it was. But at least he sold his book
Can I be first lady? I've been a professional decorator and I'm reeeal social. No reason we HAVE to be married.
Travis, Sexscenes
This is perfect. You two have to run for president and first lady. Your first job, of course, will be coming up with a campaign name like "straight talk express" but geared to you two. Obvious thoughts point to "Sex one day at a time at Starbucks" or "One more word and no Sex at Starbucks"
But I'll leave it up to you two
Travis, Sexscenes, you can do it! It's not too late. Ralph Nader just declared his intention this morning. Alex, if you are the campaign manager, can I be a campaign volunteer, only I don't like envelopes, so you will have to buy self seal. Oh! Oh! Oh! I forgot. It's 2008, everything is on-line. Let's get this party rolling! Terrie
Okay, maybe I'll hate myself for opening this can of worms, and let me preface it by saying I agree that all the candidates have more in common with each other than with me, and that all upcoming deficits, especially Medicare, are urgent and serious.
That said, the AMT is not a tax break for the middle class, despite the misleading name. Govt's love to name things so we can't tell what the heck it really is or does. Anyway, the Wikipedia summary is fairly good on this http://en.wikipedia.org/wiki/Alternative_minimum_tax , but the upshot is that 1960's congressmen were upset, as they so often are, that there was a group of rich households (155 actually) that were avoiding paying taxes under the code of the time. Gov't not earners always deserve the money, no matter how inefficiently they waste it! In order to capture these few, the AMT calculation was invented so that, no matter what perfectly legal deductions or exemptions these people of a certain income level used, they would pay the GREATER of the two tax calculations. Calculate via normal methods, calculate via AMT, pay the greater amount. This was the brilliant notion.
At the time it was enacted, the income level was believed to be set at such a high level by the congressbeasts that "normal" people would never have to pay the odious AMT. Well, they forgot to index the amount to inflation (oopsy) and now lots of people who would hardly be considered the idle rich have to pay this higher number, and aren't allowed to take the full advantage of their home/education deductions, etc. That means married filers with a total income of $75,000 and a mortgage and 4 kids in school can have to pay the AMT's higher number, especially difficult if they already live in a high-cost geography. Are these the filthy rich, tax-dodging fiends that so offended Congress in 1969? I think not, but unfortunately, every year inflation causes more people to be caught in the AMT net, and as the tax coffers subsequently swell, it gets harder to get Congress to detach from the teat, no matter that this "tax the rich" measure will soon affect 20% of filers. Also, the costs of having to prepare two sets of taxes to figure out which one you owe is burdensome, and many people don't know until the IRS tells them, by such time they've got trouble.
In order to squeeze 155 households almost 40 years ago, millions now pay more than they should, and it's so tough to get the congressional pork-lovers to discipline themselves from sending easy money back to their districts for piles of things that have nothing to do with the big issues. Teapot museums in the midwest and golf awareness programs for Florida. Typically offensive gov't short-sightedness and graft.
That's why I'm voting the Erwin/Keto ticket!
Clare2e
you are absolutely right about the AMT. I tried to short hand it as a tax break for the middle class because if they get caught up in it, their taxes rise. But it wasn't a good short hand phrase.
I'll shift over to saying that more people are in danger of being sucked up by the AMT.