Discussion of 2010 Fiscal Commission Proposal to Reduce Debt / Deficit

WASHINGTON — The United States must move to rein in its massive budget deficits or it faces the risk of a bond market crisis, former Federal Reserve Chairman Alan Greenspan said Sunday.

"We've got to resolve this issue before it gets forced upon us," Greenspan said of the ballooning U.S. debt levels.

He spoke as a panel, chaired by former White House chief of staff Erskine Bowles and former U.S. Senator Alan Simpson, is due to deliver a report on debt and deficits by Dec. 1.

A draft report made public last week offered a series of politically tough tax and spending choices that would seek to reduce the debt by $4 trillion by 2020.

The suggestions received a lukewarm reception from some politicians and outright condemnation by others, including House of Representatives Speaker Nancy Pelosi, who pronounced the ideas "simply unacceptable."

Greenspan, who spoke on NBC's "Meet the Press," said he believed "something equivalent" to what Bowles and Simpson recommended would eventually be approved by the U.S. Congress.

"The only question is, is it before or after a bond market crisis? Because there's no alternative," he said. More

I respectfully disagree with your conclusions. The proposal does indeed touch social programs just as it touches the military programs and every other agency of government to include VA and justice. If your looking at the same proposals as I - this proposal speaks to steps to overhauling the tax code, and getting a handle on debt. Although I agree with you 100% on a balanced budget, these proposals will go a long way to securing such a balanced budget.

Do you have specific sections that concern you?

WASHINGTON — President Barack Obama's deficit commission on Wednesday debated a dramatic plan to gradually turn Medicare from a system in which the government pays most beneficiaries' medical bills into a program in which seniors would purchase health insurance with government-issued vouchers.

Current Medicare beneficiaries wouldn't be affected, nor would future enrollees age 55 or over.

But, surely you would agree that there is room for spending cuts in some areas.

I thought the suggestions were fairly balanced in who would be affected. Do you have specific sections that concern you?

Deficit commission debates Medicare overhaul

Quote:

WASHINGTON — President Barack Obama's deficit commission on Wednesday debated a dramatic plan to gradually turn Medicare from a system in which the government pays most beneficiaries' medical bills into a program in which seniors would purchase health insurance with government-issued vouchers.

Current Medicare beneficiaries wouldn't be affected, nor would future enrollees age 55 or over.

I don't have too many issues with Paul Ryan's plan to overall Medicare

Paul Ryan’s Medicare Plan

David Brooks columns are often difficult to grasp hold of, but I want to flag this accurate-but-misleading account of how Paul Ryan’s “budget roadmap” achieves large reductions in entitlement spending: “On the welfare-state side, he’d sweep away most subsidies to the middle and upper classes, like the tax exemption on employee health plans. He’d essentially voucherize federal benefits, like health care and Social Security, and increase federal subsidies for people down the income scale.”

Since Social Security is just checks mailed out by the government I don’t even know what voucherizing it would mean. But it is true that he wants to replace Medicare, a program that pays for health care services, with vouchers that you use to buy private health insurance. But why would that save money? Is it because private insurance is more efficient than a government-run universal pool? No. It’s because while Medicare’s costs are projected to increase at the same rate as overall health care costs, Ryan’s vouchers are designed to increase in value at a much slower rate. So instead of paying for old people’s health care, which is expensive, Ryan proposed to just not pay for old people’s health care. Nobody can seriously deny that refusing to pay what health care costs saves a lot of money relative to paying what it actually does cost. But the savings here have nothing to do with vouchers or with sweeping away benefits to the middle and upper classes. You could accomplish the exact same thing by setting a cap on how much Medicare will pay for any one person’s health care. But conservatives would denounce that as “rationing” even though it’s identical in its impact on patients.

Either way, though, the issue is that as a country we can’t afford the quantity of health care services we’re projected to consumer in 30 or 40 years. Shifting the cost around doesn’t actually address that issue.