StanCollender'sCapitalGainsandGames Washington, Wall Street and Everything in Between



New Bowles-Simpson Plan Is Just More BS

20 Feb 2013
Posted by Stan Collender

A quick post about the new Bowles-Simpson plan that was announced yesterday because that's all it deserves: It's a total nonstarter.

(If you haven't heard about it, here's Jeanne Sahadi's story from CNMoney.)

Bowles and Simpson didn't have enough support to get their original plan through their own commission in 2010, so why do they or anyone else think their new plan is relevant now that the commission has been disbanded? Bowles and Simpson have no standing and no influence.

The new plan should be seen for what it really is: A desperate plea for attention by two men who have hurt rather than helped their reputations by releasing it. It's the federal budget equivalent of Brett Favre continuing to play for other teams long after he should have just retired.

In the past I've said (here, for example) that the Bowles-Simpson Commission should be called the BS commission. This latest ploy by Bowles and Simpson makes it clear I was right the first time.

Easy, lad. There are right

Easy, lad. There are right ways and wrong ways to say "I was right". Even when you're right.


Bowles-Simpson was BS in 2010

Bowles-Simpson was BS in 2010 and it is BS now. Why not be blunt and tell the truth? Afraid of the truth?


Substance of BS commission report

Here's a question purely to better understand exactly what happened with the B-S commission. Was the report useless because of it's substance or the fact that it didn't get enough votes to be formerly recommended? I ask because, although it will be a hard pill to swallow, isn't cuts in the defense budget needed to reign in the yearly budget deficits?


Re: Substance of BS commission report

The BS commission called for a combination of things, including making the Bush tax cuts permanent & cuts to "entitlements," including Social Security. Yet tax cuts are not consonant with reducing the deficit & debt (unless you buy into the GOP's bogus notion that tax cuts pay for themselves with higher GDP growth, which has never been supported by the evidence). And Social Security has nothing to do with the deficit/debt, so why on earth was it included in the package? The BS commission package always looked to me more like a political deal (and one tilted in favor of the GOP) than a budgetary/economic one.


Two things. Exactly why

Two things. Exactly why doesn't social security have anything to do with debt/deficit? It's a budget line item just like anything else correct? Also, I agree the report favored the GOP way of thinking which is why I'm confused that GOP members voted against. I'm guessing because of the deep defense cuts which it called which isn't in line with GOP idealogy.


SS

Social Security has its own tax and its own Trust Fund that is independent of the rest of the budget. Social Security is an INSURANCE program. Young workers pay into the program and retirees and disabled get insurance payments.

SS and the SSTF are used to hide the accounting, but the impact is clear if you compare On Budget with Off Budget numbers. SS is completely solvent for a generation. Improvement in the economy, changes in immigration, &c may make the worst case predictions not come true with no changes. It is silly to make changes now for a problem that may not even occur decades into the future.

Almost the entire budget problem is due to a bloated health care system that costs too much for what it delivers. The short term deficits are a non issue. Borrowing at interest rates lower than inflation is not a problem. (Wish I could do that.) The only problem that makes a big difference is future health care spending.

BS did NOT focus on fixing health care spending. BS FAILED to correctly identify the problem so they tried to solve the wrong problem.


Now that the Bowles-Simpson

Now that the Bowles-Simpson "commission" is just them, we can say it's a purified BS plan.


What deficit "crisis"?

The United States has a jobs and unemployment crisis, not a deficit crisis. Bowles-Simpson, like its authors, manages the impressive feat of being both misguided and irrelevant.


In other news

I'm glad to see a number of stories come out questioning why, if Bowles-Simpson is purely a deficit reduction plan, it contains significant tax rate reductions across the board. The answer, of course, is that much of B-S is ideology masquerading as non-partisan deficit reduction.




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