Sanity Zone 12-16-2012 Moral Hazard
Posted 12-19-2012 at 03:30 PM by xan
Our country is losing its way. We vote ourselves benefits and perks and earmarks while simultaneously foisting the bill on someone else, justifying it by using the theory that the intellectually and philosophically superior society is better off with those provisions. Its insidiousness has led to a culture of moral hazard.
Moral Hazard is the term used to describe behaviors an individual or group takes knowing that the consequences of those behaviors will be "paid" for by someone else. The easiest analogy is driving more recklessly because one has collision insurance. But there are others..
Government sponsored and administered programs like Medicare and Social Security are prime examples of how moral hazard infests our society. After a lifetime of hard work, usually at low wages and at a low standard of living, our citizens receive outrageous payments from the government. Where's the moral hazard? Now that Grandma has $28,000 a year to live on, plus all her preventive and maintenance care paid up, she can live for as long as she wants, as healthy as she wants, and no one can say otherwise. $28,000 is 35% HIGHER than the poverty level, so she's free to pinch our cheeks until her arthritic fingers can no longer grasp. She can give an organ recital at every family gathering, reminding us of how, without the pork of Medicare, her heart and kidneys and knees would have quit long ago. She can watch us wither under the stress of paying for her life of luxury.
And she's living large off the fat of her children. And mine. And yours. If we don't pass laws stopping her, she will live long enough to fulfill the curse of being a problem to her children. We must take back America from this ageist terrorism. Grandma has to suck it up and go at risk like the rest of us. If she didn't work all her life and have enough savings to pay for her drugs, shame on her, not shame on us for not providing it. I'll bet she would have done things differently when she was younger, maybe become an investment banker or congressman. There's a lot of those jobs perpetually unfilled. Maybe she would have scrimped on our parents' schooling or not loaned us money to get started in our first apartment or house. Or maybe she would have just not married PawPaw, that succubus.
We have got to eliminate programs like this, or make them so that no one in their right minds would want to go on them. Like Welfare, or Temporary Assistance For Needy Famillies (TANF) as it is termed by our government overlords. Welfare doles out $112.50 a week to people who could otherwise work, like orphans, or disabled, or single mothers of young children. And best of all, they cap it at 60 months over your lifetime, and they require you to check in and seek work. If you really want to make moral hazard unprofitable, walk into any Welfare office and see how many are laughing versus the ones who are crying. We've had the political will to see those Welfare cheats don't have any incentive to suck off our teats!
We need to ratchet down Medicare and Social Security to TANF levels. We spend over $1.2 Trillion a year on Grandma. Let's take it down to TANF scale, where we spend $18 Billion in total on a few million people. With all those currently in the system, that'd be less than $50 Billion a year! Think of how much smoother our nation would run, how much lower our taxes would be, how responsible Grandma would be if we had the political will. Nothing would really change, except we would be free of the unnecessary burden of being Grandma's chump.
Moral Hazard is the term used to describe behaviors an individual or group takes knowing that the consequences of those behaviors will be "paid" for by someone else. The easiest analogy is driving more recklessly because one has collision insurance. But there are others..
Government sponsored and administered programs like Medicare and Social Security are prime examples of how moral hazard infests our society. After a lifetime of hard work, usually at low wages and at a low standard of living, our citizens receive outrageous payments from the government. Where's the moral hazard? Now that Grandma has $28,000 a year to live on, plus all her preventive and maintenance care paid up, she can live for as long as she wants, as healthy as she wants, and no one can say otherwise. $28,000 is 35% HIGHER than the poverty level, so she's free to pinch our cheeks until her arthritic fingers can no longer grasp. She can give an organ recital at every family gathering, reminding us of how, without the pork of Medicare, her heart and kidneys and knees would have quit long ago. She can watch us wither under the stress of paying for her life of luxury.
And she's living large off the fat of her children. And mine. And yours. If we don't pass laws stopping her, she will live long enough to fulfill the curse of being a problem to her children. We must take back America from this ageist terrorism. Grandma has to suck it up and go at risk like the rest of us. If she didn't work all her life and have enough savings to pay for her drugs, shame on her, not shame on us for not providing it. I'll bet she would have done things differently when she was younger, maybe become an investment banker or congressman. There's a lot of those jobs perpetually unfilled. Maybe she would have scrimped on our parents' schooling or not loaned us money to get started in our first apartment or house. Or maybe she would have just not married PawPaw, that succubus.
We have got to eliminate programs like this, or make them so that no one in their right minds would want to go on them. Like Welfare, or Temporary Assistance For Needy Famillies (TANF) as it is termed by our government overlords. Welfare doles out $112.50 a week to people who could otherwise work, like orphans, or disabled, or single mothers of young children. And best of all, they cap it at 60 months over your lifetime, and they require you to check in and seek work. If you really want to make moral hazard unprofitable, walk into any Welfare office and see how many are laughing versus the ones who are crying. We've had the political will to see those Welfare cheats don't have any incentive to suck off our teats!
We need to ratchet down Medicare and Social Security to TANF levels. We spend over $1.2 Trillion a year on Grandma. Let's take it down to TANF scale, where we spend $18 Billion in total on a few million people. With all those currently in the system, that'd be less than $50 Billion a year! Think of how much smoother our nation would run, how much lower our taxes would be, how responsible Grandma would be if we had the political will. Nothing would really change, except we would be free of the unnecessary burden of being Grandma's chump.
Total Comments 10
Comments
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Never have I heard someone so openly advocate for the killing of grandmothers and I presume, grandfathers everywhere.
You do realize that people who "depend" on Social Security, are people who have had exactly the low wage jobs of which you speak? It is the "reason" they need SS, because a whole life of striving, at the hardest, most thankless jobs, they've ended up not able to save anything. Prices go up, wages go down.
Add to that, Republicans exported the best jobs, the union jobs, that people once aspired to, so the rich could make even more money. Along with that went the taxes of 30 million great, American jobs, the aspirations of the simple American Dream, to work a job, to rise up within the organization to make more. Yes, to actually be able to save.
I'm all for creating jobs for those who can't work. But expecting people to work, when there is an unofficial unemployment rate of close to 20 percent, pretending there are jobs there for everyone, but it's just that vagabond bum won't work them, well, that's just fiction.
We're all interconnected--when you crap on people, it gets flung here and there, you get crap on you, others, your family, your friends, the people you care about (assuming you do) get crap on them. Like it or not, these programs were put in place not as some flight of fancy. They were created to fix a problem, sadly, a problem Republicans mostly, and a few idiot corporate blue-dog democrats have once again put in place.Posted 12-21-2012 at 12:27 PM by mike27
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It's been said you can judge a society by the way it treats it's elderly and it's infirmed. Your blog seems to indicate we're failing as a society.
There's a few fundamental flaws with your logic.
The last generation to draw more in Social Security benefits then they paid in was the Greatest Generation, or those born roughly between 1901-1924.
Social Security payments are based on the amount they've contributed to the fund during their lifetime. Someone retiring today, after contributing up to $500k in FICA/SocSec/Medicare taxes and rating approx. $2250/mo is not going to appreciate receiving $112.50/wk under your plan. What you're advocating is almost income distribution, except you don't indicate where all those extra funds will be going to.
Social Security is a self-funding program and solvent through 2038. With projected increases in employment and people paying into the fund, it will continue to be solvent after that. Projected strains on SocSec by the anticipated influx of Baby Boomers retiring will be offset by Generation X, Y, Z 'ers whose numbers are equal to or more than the Baby Boomer generation.
Medicare is a bit of a mess, but it could be fixed by simply forcing our elected officials & govt. employees to participate in the plan. It would be fixed immediately. Taking $500 billion from Medicare to fund Obamacare doesn't help either. Neither does raiding the SocSec fund since the '60s. Grandma's not your problem, Xan, your elected officials are.
Back in August, as a self-proclaimed 'independent thinker', you blogged the cost of Medicare was a 'rounding error' and 'insignificant'. You decried the use of the nation's 'most desperately needy' as a bargaining chip in the budget debates, and now you're an advocate for killing Grandma. What made you change your mind & feel SocSec/Medicare are the root of America's moral hazard?
IDK if you're serious or just looking for knee-jerk reactions, but I think you need to rethink it a little bit. JMO.Posted 12-21-2012 at 06:44 PM by SloMotion
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I read this blog last night and was so angry, I didn't know where to begin. This is by far the sickest post I have seen on this site. And frankly, it's one of the worst I've seen anywhere. Xan, people like you are what is wrong with America. This kind of incoherent psychobabble is what our so called "leaders" are trying to force on us. The only difference between you and them, is that they aren't quite so blunt in their terminology. But this mindless, disgusting rant you have put on display illuminates just how ruthless this kind of proposed system truly is.
Does your mother know you would rather she just die, than to be able to enjoy the fruits of her life long labor? If Grandma hadn't married your grandpa, you mother would never have existed, which means you wouldn't have either. I bet you never considered that...
And keeping on the grandma subject that you brought up, why does she not deserve social security just because she didn't work enough to save up? Could it be, perhaps, that she was too busy staying home raising some ungrateful shmuck?... Maybe someone like you?
I agree with SloMotion's sentiments above. This blog is a complete 180 of your previous posts about what you perceive to be the problem. So you're not even consistent. As for the other reply above, I don't know how anyone can believe this is a republican problem. Republicans have almost no say anymore. Democrats have control of almost everything. and of the problems we already face, they are proposing more of the same, and even worse. No such thing as a blue dog democrat. A blue dog is used to describe the more moderate, or liberal so called "republicans". I'm a conservative, myself. I'm tired of people refusing to take responsibility for the insane things they vote for. There have been some of these aforementioned blue dog republicans who have contributed to the problem, and you can blame them all day, that's fine. But don't pretend that liberals are somehow innocent when they are campaigning for this kind of crap Xan is talking about, everyday.Posted 12-21-2012 at 11:11 PM by burningmetal
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Well let me start with a few facts. We've collected 2.7 Trillion MORE than we've paid out to SS recipients at this point. We've been loaning that money to the rich, in the form of tax cuts. What we need is to find ways to pay that money back, that the rich, and wars have taken from it, to the SS fund.
Simple fixes are to raise the income cap. Most of us have the full 12.4 percent taken out, half from our checks, half from our employer. Economists consider that part of our compensation, so essentially we're paying that out of our checks. For all the money we make, up to the current cap, they take that out. It is at about $108,000 now. Above that, they stop taking it out. So simply kicking the cap to the curb, or raising it steadily so higher income folks will pay as much as the lower roughly 80% of us pay makes it solvent out past 2080, and beyond.
Democrats aren't "in charge of almost everything." Republicans, due to some heavy gerrymandering, and though Democrats had a million more votes for House (of representative) seats, Republicans kept the House. If Republicans refuse to do anything majorities of 70-80 percent of us want to do, then Democrats are powerless. Add to that, the Senate has to have currently 60 votes, to choose to vote on anything. That is called "cloture." It basically means all debate is shut down, and voting can occur up and down. Republicans filibustered roughly 380 bills. This is a massively historically high figure. Usually roughly 25 bills are per 2 year period. Sadly, Republicans in order to make Obama look bad, have refused to do anything, almost anything at all. We never had 60 Senators even in the first two years, with 57, then 58 after Franken was sworn in late because of the close vote in MN.Posted 12-22-2012 at 02:21 AM by mike27
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As far as raising the retirement age, at 57 sometimes I already feel like I'm 80. People with physical labor jobs are not likely to even make it to 65, much less 67. It's a stupid idea, unless you are working in congress, or an easy money job talking on the phone all day, and shuffling papers. Add to that, a lot of folks already get fired just after they are 50. It's just a fact--and I've seen it happen anecdotally.
And whether you want to believe all of this or not, Republicans have done this, they've nearly destroyed America. We might as well send in the orders for crowns and scepters, and thrones, as we're nearly a Dynasty, with Kings and Queens, princes and princesses, Lords and Ladies. I think some misunderstand just how much a few have, just so a small slice of the population can have wildly so, so much. Mitt has many multi-room mansions, and only pays 13 percent, making 20-30 million a year, and he doesn't even get why we're upset. We pay more than that just on SS insurance.
Democrats aren't much better, but moving left is our only chance to salvage this mess that evil old, addled b*stard Reagan started. We've been "rushing to the bottom," for 35 years now, and at this point we're bouncing like a rock on the pond. The question is, are we going to sink, or bounce back up on the shore.
People had better, once again, pay attention to which party butters their bread, vote in the primaries and choose those who actually help YOU on economic issues, not some jerk who is campaigning on social issues, many that have nothing to do with you, or your lives at all. Mostly they are about you voting for trying to control the lives of others, and in the process losing money economically.Posted 12-22-2012 at 02:28 AM by mike27
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By the way, people act like redistribution is a bad thing. When wealth in particular (Waltons, same wealth as bottom 42% of Americans), and income are so maldistributed, then not only is redistribution not a bad thing. It's the ONLY thing to do. Best we do it creating jobs, making sure we all have access to health care, and that our grandparents are taken care of, at least minimally. Call me a Socialist. I'll thank you. Some people foolishly believe it's a bad thing, because instead of thinking about how it affects you, they've heard someone else tell them it's bad, and they've repeated it.Posted 12-22-2012 at 02:31 AM by mike27
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Posted 12-22-2012 at 02:49 AM by mike27
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Your idea of a successful economic system is to have mass mediocrity. That's what socialism is. I believe if you want more money, go earn it. I've never been above the poverty line, yet I don't ask the government to steal from the rich as if they've done something immoral by earning their wealth. Raising taxes on the wealthy just ensures that more workers will be laid off to compensate. The rich already pay about 70 percent of the taxes. What more do you want?
At some point the wealthy will inevitably fall back into the middle class, and that's where people lose jobs. If the wealthy are paying 70 percent, then what does that tell you? It means a lot of people have no jobs. Even if the rich paid the same total amount of tax dollars as they do now, their percentage of total taxes paid wouldn't be nearly so high if there were more tax payers.
I don't have a problem with financial aid, in and of itself. I have needed it myself, but what I have received is only to help cover my family's basic needs when money is tight. However, when I, or any of us are working we may still need foodstamps if we're not making enough, but at least we're doing our part to pump whatever money we can afford back into the economy. In other words, we don't need MORE stuff being given to us, we need jobs, we need opportunity for advancement so that we don't have to rely on the government. It's simple. If people are not MAKING money then they are not able to pay taxes and give back.
But instead, you have big brother promising to "take care" of the poor, not by creating jobs, but by giving them more and more money to do nothing. It has created an attitude of entitlement and too many people are just sitting back, taking advantage.
This creates two major problems: The demands continue to rise on the wealthy to subsidize the irresponsible, and secondly, those of us who are below the poverty line but want to work, or maybe get a raise, have a hard time getting either of the two because employers who would otherwise help us are cutting back instead.
And before you say that these businesses can afford these taxes, but they just don't want to fork over the money, you might want to read this. Caldeira: How Do You Hurt Franchises? Raise Tax Rates : Roll Call Opinion
Many of those who are referred to as "rich" are in fact not even close to being rich. Franchise businesses may have a big name, but each branch of them is run by small business owners. A fact that is pointed out in the article, is that the top 2-3 percent include 941,000 small businesses. This effects all of us. As I've stated, I'm not rich, and I know from experience that sometimes financial aid is needed. But I don't want to rely on it, and I don't want anyone else thinking they are owed it. If we have more job opportunities and more people motivated to work we will have a much more efficient economy.
Simply raising taxes on the top 2 or 3 percent, and giving handouts is not stimulating anything, nor is it motivating those who are taking advantage of the system to at least try to work. As for Social Security, that is not a handout. It is a reward. If you don't earn enough credits over the span of your working years, you don't get anything. So nothing is being wasted there. If money is taken out of social security to pay for Obamacare, then it won't matter what age you are, or how much you worked. Your reward will be nothing, because SC will be bankrupt.
Xan believes we should simply do a better job of saving toward our retirement. But there's one problem with that. Those who need SC aren't making enough money to afford saving much of it. Seniors deserve to be taken care of when they've paid their dues but can no longer work. Xan's plan is to just say to hell with the seniors because they are sucking money out of our pockets. First off, that is essentially euthanasia. But they are not sucking money from anyone. They have earned those credits.Posted 12-22-2012 at 04:51 AM by burningmetal
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Ah... sarcasm is the one tool that never blunts.
I am so pleased to find so many reasonable and socially conscious people. I was starting to dispair that people would agree with this rediculous proposition, like people did with the NRA statement. I am not so secretly hoping theirs was a huge punk, too.Posted 12-22-2012 at 06:34 AM by xan
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hehPosted 12-23-2012 at 08:05 PM by Nemesis
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