Do we really have a revenue problem?

posted at 9:25 am on July 7, 2011 by Ed Morrissey

Over the last couple of days, we’ve had a good debate at Hot Air over the nature of our fiscal crisis between Jazz Shaw, and J. E. Dyer, and me.  At least we all recognize that we have a fiscal crisis; some members of Congress and “intellectual authorities” (with interesting if unreported conflicts of interest) still act as though nothing at all is wrong.  My friend Jazz wrote yesterday that we have a revenue problem as well as a spending problem in answer to my post rebutting David Brooks’ column, so let’s take a look at federal revenue to see whether Jazz’ contention holds up.

The Heritage Foundation provides this chart of federal revenue over the last 50 years in inflation-adjusted 2010 dollars, and the data is pretty clear that we have a recession problem, not a revenue problem:

Take a look at the trends here, again remembering that the data is all in 2010 dollars.  In fifty years, we have tripled overall federal revenue, and prior to the current recession/stagnation we had quadrupled it.  The current trough from the 2007 peak resulted from the fall in economic activity, not from tax cuts or any other intervention.  It’s similar to what happened in the prior trough, when the 2000-1 recession and the 9/11 attacks cut economic activity through 2003.

For that matter, look what happened to federal revenue after the much-maligned Bush tax cuts took full effect in 2003.  Economic activity expanded rapidly — and so did federal revenues.  In fact, the economy during that period boomed, and receipts from both personal and corporate taxes peaked as a result.  The Bush tax rates, as they are properly called today, did not create a revenue vacuum; they helped produce an expansion that enhanced rather than lost revenue.

Now, let’s put the data in this chart with one showing the rate of spending in inflation-adjusted 2010 dollars:

While revenues have tripled during this period, federal spending has more than quintupled.  The economic expansion of the 1990s (including the dot-com bubble) temporarily raised revenue above the spending trendline, but the slope on spending increased in the early 2000s, and practically launched spaceward in 2007 when Democrats took control of Congress.  Had spending increased at a rate of inflation from 2001 forward, we would probably not been in deficit at all.  Had it stayed at the rate of inflation from 2006 forward, we’d probably be looking at historically average deficits in terms of GDP.  But the chart shows very, very clearly that we have a recession problem combined with both a short- and long-term problem with expanding federal budgets — and the latter is the reason why we have a fiscal crisis, not some presumed revenue starvation.

It’s true that most of that spending problem comes from entitlements.  That’s why Republicans have focused their efforts on that sector of the federal budget, and not on hiking taxes.  The GOP wants to attack the recession problem by rolling back the regulatory adventurism of the Obama administration, especially in ObamaCare and at the EPA, in order to stimulate the economy and recover the revenue that we’re losing in the recession/stagflation period.  Raising taxes will have the opposite effect, and as we have seen any number of times, will not produce the revenues estimated by tax-hike advocates using static tax analysis.

Let’s confront the real problem in our fiscal crisis, and not make the recession crisis any worse than it already is.

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The founders are rolling over in their graves at how quickly we pissed away the country.

Lanceman on July 7, 2011 at 9:30 AM

La la la, I can’t hear you…we need revenue increases…period

-lsm

cmsinaz on July 7, 2011 at 9:30 AM

While revenues have tripled during this period, federal spending has more than quintupled.

Our founders are spinning in their graves.
We have discovered that we can vote ourselves benefits that other people pay for.

itsnotaboutme on July 7, 2011 at 9:32 AM

Lanceman on July 7, 2011 at 9:30 AM

Congrats, you beat me to it!

itsnotaboutme on July 7, 2011 at 9:33 AM

We’re doing it wrong.

Cindy Munford on July 7, 2011 at 9:38 AM

Well, we DO have a revenue problem insofar as the current administration is choking the life out of the economy and keeping taxable income on individuals and businesses down.

flipflop on July 7, 2011 at 9:38 AM

Spending problem. The government already confiscates too much money that could be at work in the economy.

hawksruleva on July 7, 2011 at 9:39 AM

I’d still like to see what the plot looks like if you move tax deduction and credits from a negative number on the revenue side to a positive number on the spending side.

Count to 10 on July 7, 2011 at 9:42 AM

Ed: My friend Jazz wrote yesterday

What Jazz wrote yesterday earned the coveted Madison Academic Decatholon Award.

Terp Mole on July 7, 2011 at 9:43 AM

But but but June job numbers show many more people have jobs so why not tax them? They are grateful that the one made the economy so robust. /lib

andy85719 on July 7, 2011 at 9:43 AM

I have a sinking feeling that the Republicans are going to agree on new taxes.It will be the end for them if they do.

sandee on July 7, 2011 at 9:45 AM

I’d still say we don’t have a revenue problem and that we have a spending problem.

We can’t possibly get to a point of revenue where we can pay for current spending and the future spending that entitlements ‘obligate’ us to.

No matter how you slice it we’re spending way too much money. Arguments can be made about what factors would positively or negatively effect tax revenue but the truth is that no matter what we do we will never be able to pay for our entitlement programs as currently constituted.

gwelf on July 7, 2011 at 9:46 AM

I have a revenue problem! The government keeps stealing all my revenue!

Vntnrse on July 7, 2011 at 9:46 AM

Looks like spending took off with Nancy Pelosi’s tenure as speaker,what a revelation!

tim c on July 7, 2011 at 9:48 AM

But but but June job numbers show many more people have jobs so why not tax them? They are grateful that the one made the economy so robust. /lib

andy85719 on July 7, 2011 at 9:43 AM

I saw the prediction that twice as many jobs were created than expected for June. How many is that? 157,000 jobs. If those numbers turn out to be true, we should celebrate why?

We need a lot more than that to get us out of this mess.

sandee on July 7, 2011 at 9:48 AM

The Federal Reserve enables deficit spending by printing money. The solution is to abolish the Fed.

If they can’t print it, they can’t spend it.

Emperor Norton on July 7, 2011 at 9:48 AM

Ed: The GOP wants to attack the recession problem by rolling back the regulatory adventurism

Better still, Congress should scrap the current tax system as quickly as possible and replace it with a flat tax that treats all taxpayers equally and minimizes the burden on productive behavior.

*Taxed Enough Already*

Terp Mole on July 7, 2011 at 9:49 AM

Cat fight between Ed and Jazz!

[My money's on Ed]

stvnscott on July 7, 2011 at 9:50 AM

We have a revenue problem only as far as we’ve lost $400 Billion in revenue due to the recession. But the real problem is that future projected debt is based on the assumption that revenue is historically low and will increase. However, the more likely senario is that revenue is about at its baseline and will only increase with the gradual economic expansion.

Looking at the revenue graph, you see two big bumps. The first was a bump from the tech bubble, and the second from the real estate bubble. Remove those bumps and the current revenue collection is on trend. Both bubbles came from excess leverage that is no longer available outside federal government borrowing. Politicians look at those bumps and see the revenue graph currecting upward, and so they make agreements to cut spending by, say, $2 Trillion over 10 years. But that $2 Trillion is not $200 Billion each year but is maybe $50 Billion the first year and $400 Billion at the decade’s end, hoping that revenue will pick up.

Economists suspect that we’re in a new normal. The economy doesn’t leap out of a hole but instead creeps up a ramp, dragged down through excessive debt and offshored production. The outyears of today’s budgets will bleed red without the rosey economic forecasts coming to fruition, which is why the bulk of savings are deferred to latter years. Therefore, those savings won’t occur at all, as spending will be increased and revenues will be lower than anticipated.

shuzilla on July 7, 2011 at 9:50 AM

The Federal Reserve enables deficit spending by printing money. The solution is to abolish the Fed.

If they can’t print it, they can’t spend it.

Emperor Norton on July 7, 2011 at 9:48 AM

This

SouthernGent on July 7, 2011 at 9:51 AM

I have a sinking feeling that the Republicans are going to agree on new taxes.It will be the end for them if they do.

sandee on July 7, 2011 at 9:45 AM

There will be some sort of new tax revenue, most likely in the closing of “loopholes”. It’ll be annoying, but as long as the ratio of cuts to tax revenue is 5:1 or higher, I’d think that will be acceptable. Wouldn’t you trade $2 trillion in cuts for $200-$400 billion in new tax revenue (both over 10 years)?

If the way those increases came about was a drastic overhaul and simplification of the federal tax system, I’d be okay with paying a little more. It’s worth it to me to make tax collection far more streamlined and it would also have the wonderful effect of shrinking the IRS.

strictnein on July 7, 2011 at 9:55 AM

Emperor Norton on July 7, 2011 at 9:48 AM

As long as the Fed prints money to loan against assets and/or to buys asset outright, currency emmission is not a problem. It’s the overstating of the value of those assets, the illegality of the Fed’s purchasing of much of them, and the regulatory repeal of mark-to-market that makes the supply of money problematic.

Increasing the money supply produces inflation, which pushes up the value of the assets backing the currency.We’re all paying more for commodities so the banks can inflate their way to solvency. But printing first in anticipation of asset values catching up later is raw, unbacked printing akin to check kiteing on a grand scale.

shuzilla on July 7, 2011 at 9:57 AM

To be fair, there are two revenue problems:

1. There are a lot of people unemployed, due to government interference in the marketplace. I don’t see how additional goverment interference, or higher taxes on potential employers rectifies that.

2. There are a lot of self-employed people, who are closing up shop due to goverment interference in the marketplace. The only solution to that one is to replace the current government.

So, in no case is there a valid argument to be made that additional taxation or government will aid in fixing our budgetary problems. There is no level of taxation that will save the entitlement programs, whose unfunded liabilities now exceed 8 times our GDP. The only solution is to cut entitlements drastically, and the sooner, the better.

Vashta.Nerada on July 7, 2011 at 9:58 AM

I have a revenue problem! The government keeps stealing all my revenue!

Vntnrse on July 7, 2011 at 9:46 AM

Comment of the week

gwelf on July 7, 2011 at 9:59 AM

If the goal is growing revenue, tax increases usually just make the problem worse. Increasing taxes makes liberals feel better, but it doesn’t help. It likely just delays the only way out–a better business climate.

RBMN on July 7, 2011 at 10:00 AM

The Federal Reserve enables deficit spending by printing money. The solution is to abolish the Fed.
If they can’t print it, they can’t spend it.
Emperor Norton on July 7, 2011 at 9:48 AM

You don’t need to abolish the federal reserve, you just need to prohibit it from buying bonds.

Count to 10 on July 7, 2011 at 10:00 AM

He is the Pharoah…….Bernanke is Joseph….

…..and we already have the debt chains on (hint we’re the slaves).

PappyD61 on July 7, 2011 at 10:05 AM

Wouldn’t you trade $2 trillion in cuts for $200-$400 billion in new tax revenue (both over 10 years)?

strictnein on July 7, 2011 at 9:55 AM

No, because all that accomplishes is fooling people into thinking things are fixed when they’re not.

$2 Trillion in cuts plus $400 Billion in taxes is $2.4 Trillion. The projected increase in the national debt is well over $12 Trillion, probably closer to $15 Trillion. $2.4 Trillion in savings probably won’t cover the error in the projection. If they project $12 Trillion in new debt but we actually accumulate $15 Trillion, then a $2.4 Trillion savings only gets us down to $12.8 Trillion in additional debt, which is more than what we were trying to avoid accumulation in the first place.

shuzilla on July 7, 2011 at 10:06 AM

We’re all paying more for commodities so the banks can inflate their way to solvency.

Pretty much. Though you are missing that they are doing this because it is the only mechanism the banks have to pass the losses on to those of us that have bank accounts with them. If we could have just taken the losses of our failed investments in the banks, there would have been no “systematic crisis”.

Count to 10 on July 7, 2011 at 10:07 AM

Looks like spending took off with Nancy Pelosi’s tenure as speaker,what a revelation!

tim c on July 7, 2011 at 9:48 AM

Nice observation. Looks like it was starting to head downward right before the ‘rats took over.

Lanceman on July 7, 2011 at 10:07 AM

Meet the Zero Deficit Line – note that the line really represents the amount of the government’s total tax collections. The federal government very definitely has a spending problem.

ironman on July 7, 2011 at 10:08 AM

O/T: speaking of Nancy Pee-Lousi, she must have had another facelift, cause she looks more surprised then usual!

Vntnrse on July 7, 2011 at 10:10 AM

And if the economy recovers before Nov 2012…..

…..Satan himself could win re-election in America.

That’s just the way it is.

PappyD61 on July 7, 2011 at 10:10 AM

Ed:

There is a part of the equation that you, Jazz Shaw, and J. E. Dyer have not really talked about, and that is interest rates.

Right now, U.S. interest rates are near historic lows. The U.S. government is able to borrow gigantic mountains of money for next to nothing. U.S. consumers are still able to get home loans, car loans and student loans at ridiculously low interest rates. When this low interest rate environment changes (and it will), it is going to absolutely devastate the U.S. economy. Without low interest rates, the U.S. financial system dies. When it comes to borrowing money, it is the rate of interest that causes the pain.

If you could borrow as much money as you wanted at a zero rate of interest for the rest of your life you would never, ever have a debt problem. But when there is a cost to borrowing money that changes things. The higher the rate of interest goes, the more painful debt becomes.

The only reason that U.S. government finances have not fallen apart completely already is because the federal government is still able to borrow/print huge amounts of money very cheaply. If interest rates on U.S. government debt even return just to average levels, it is going to be absolutely catastrophic.

So what happens if rates go above average?

The reality is that if there is a major crisis that causes interest rates on U.S. Treasuries to go well beyond normal levels it is going to cause a complete and total collapse.

In 2010, the U.S. government paid out just $413 billion in interest even though the national debt soared to 14 trillion dollars by the end of the year.

That means that the U.S. government paid somewhere in the neighborhood of 3 percent interest for the year.

Considering how rapidly the U.S. dollar has been declining and how much money printing the Federal Reserve has been doing, a rate of interest that low is absolutely ridiculous.

If you want to know when things are really going to start coming apart, just keep an eye on interest rates. When they really start spiking, you can start sounding the alarm.

Revenue increase or spending decrease, or both, the truth is that the state of the economy is going to continue to get worse. Our debt is growing every single day and our country is getting poorer every single day. When interest rates start surging it is going to start knocking over a lot of dominoes.

I hope you are getting prepared for when that happens.

PatriotRider on July 7, 2011 at 10:13 AM

Obama and his administration don’t have a revenue problem. This really isn’t that complicated, and by now any high school student could tell you that spending more than you have equals debt (that’s a public school education, too). The real issue is the President and that obviously cannot be fixed any time soon.

RDE2010 on July 7, 2011 at 10:19 AM

The real issue here is whether or not the general voting public is paying attention. If there is even the mildest economic uptick at a point in time close to the election, Obozo will STEAMROLL the Republican challenger. So although the longer term trends look very poor, I wonder how many people are paying attention.

KMC1 on July 7, 2011 at 10:21 AM

Ed this is sloppy and somewhat misleading.

1. You should be looking at tax receipts as a share of GDP. Of course when GDP falls, so do tax receipts. So maybe what you are saying are trends in revenue are really just trends in GDP. (Not saying that is the case, but you must consider it.)

2. Government spending as a share of GDP will fluctuate with the business cycle, and it is probably countercyclical. So maybe “spending is rising!” in fact means “we are in a recession.”

3. There is no counterfactual to justify the claim “the Bush tax cuts were revenue enhancing.” Most likely we would have had a boom absent the Bush tax cuts, and the relevant question is how did revenues compare to what we would have gotten in that scenario.

My intent is not to say that your conclusion is wrong, only to highlight how difficult it is to make economic claims rigorously (and this applies also to liberals, obviously).

ggoofer on July 7, 2011 at 10:22 AM

That ZDL is definitely work after my own heart. :)

Scott H on July 7, 2011 at 10:22 AM

Cat fight between Ed and Jazz!

[My money's on Ed]

stvnscott on July 7, 2011 at 9:50 AM

Old age and treachery beat youth and skill every time. Ed should goad Jazz into a hair-pulling cat fight.

SKYFOX on July 7, 2011 at 10:23 AM

PatriotRider on July 7, 2011 at 10:13 AM

Yep, coming at us like a freight train. Very dangerous times lie ahead thanks to a bunch of lawyer elitist self proclaimed “smartest people in the room” corrupt selfish wipes. I sure hope Americans learn this lesson once and for all ages; never trust lawyers to accomplish anything that is of value to others.

Keemo on July 7, 2011 at 10:23 AM

***

I hope you are getting prepared for when that happens.

PatriotRider on July 7, 2011 at 10:13 AM

Thanks for the reminder…and for ruining my day.

In the end, the country’s inability to turn things around right now seems to me the result of having a president and a Senate controlled by a belief that their job is to mete out “fairness” rather than simply establishing and maintaining a level playing field for those who choose to participate in a stable society while helping to provide a safety net for those who truly are not able, physically or mentally, to care for themselves. For those able-bodied people who are unwilling to participate, they should be left to the concentric circles of private charity–immediate family, extended family, friends, religious communities (congregations, parishes, synagogues, and the like), and local community organizations. Such relief should be temporary and should require them to look the donor in the eye when accepting assistance, rather than receiving the government check in perpetuity.

BuckeyeSam on July 7, 2011 at 10:29 AM

“Let’s confront the real problem in our fiscal crisis, and not make the recession crisis any worse than it already is.”

Too late!!!

gitarfan on July 7, 2011 at 10:30 AM

…never trust lawyers to accomplish anything that is of value to others.

Keemo on July 7, 2011 at 10:23 AM

Lawyers have their place in American society, but they should never be allowed anywhere near the political system except as proofreaders and fact-checkers.

SKYFOX on July 7, 2011 at 10:32 AM

We have a federal government spending problem. The trouble is, Kudlow says, the spending never goes down. He offers a chart to demonstrate his point.
http://www.nationalreview.com/kudlows-money-politics/271258/why-budgetary-game-big-taxpayer-scam

onlineanalyst on July 7, 2011 at 10:32 AM

n the end, the country’s inability to turn things around right now seems to me the result of having a president and a Senate controlled by a belief that their job is to mete out “fairness” rather than simply establishing and maintaining a level playing field for those who choose to participate in a stable society while helping to provide a safety net for those who truly are not able, physically or mentally, to care for themselves. For those able-bodied people who are unwilling to participate, they should be left to the concentric circles of private charity–immediate family, extended family, friends, religious communities (congregations, parishes, synagogues, and the like), and local community organizations. Such relief should be temporary and should require them to look the donor in the eye when accepting assistance, rather than receiving the government check in perpetuity.

BuckeyeSam on July 7, 2011 at 10:29 AM

+1

gwelf on July 7, 2011 at 10:35 AM

It seems pretty clear from the chart- if the government is bringing in revenue akin to what it had in the early 2000s then their spending should be at the same level.

The problem is that too many in Washington are so addicted to spending that even the coming economic apocalypse in America (and it’s coming unless something drastic is done) hasn’t done anything to make them realise the folly of their position. If they can’t roll back spending levels by less than a decade then what chance does America have of actually tackling the looming crisis unfunded liabilities and soaring debt?

One point I think should be made clear in the debt ceiling debate- Obama wants a $2 trillion increase to see the country through to the 2012 elections. In other words, come 2012 whoever is President is going to be faced with another debt ceiling crisis- anyone want care to believe that if it’s Obama he’s not going to call for yet another multi-trillion dollar increase then too?

Watching America now is like being in the audience of a disaster film- we know the iceberg is up ahead and the ship is speeding towards it and certain doom but no matter how hard we shout it seems that no one in the film (i.e. political leaders in Washington) can hear what’s being said.

Jay Mac on July 7, 2011 at 10:41 AM

BTW, every Republican who goes on TV to be interviewed about the GOP’s position on the debt ceiling needs to have that chart of revenue versus spending up on the wall behind them. All they have to do is point at it and say that without the disastrous spending policies of Democrats we wouldn’t be having the debt ceiling debate right now. When a family loses a breadwinner they don’t continue to spend at previous levels with a reduced income- let alone increase the amount they spend, which is what Democrats have been doing.

I wish to goodness that whenever Obama trots out that “living within our means” line a single reporter would challenge him on it. Just once.

Jay Mac on July 7, 2011 at 10:46 AM

One of the highest government priorities should be to require the CBO to use dynamic analysis rather than static analysis. I see two problems with doing this. The first is political: static analysis suits those who control the administration and the senate. Hopefully this will corrected in the future. The other problem is that dynamic analysis will be much less than perfect because there are unknowns required. These unknowns could be estimated from historical data and could be refined as experience with dynamic analysis is exercised. Even initial use of dynamic analysis would be much better than what we use now.

burt on July 7, 2011 at 10:56 AM

$800 billion for TARP
$887 billion for “stimulus”
$90 billion for extended unemployment benefits

That’s real money, and none of it was necessary and it probably made the recession worse and longer than it would have been if Congress had simply let the banks fail and cut taxes.

rockmom on July 7, 2011 at 10:59 AM

Watching America now is like being in the audience of a disaster film- we know the iceberg is up ahead and the ship is speeding towards it and certain doom but no matter how hard we shout it seems that no one in the film (i.e. political leaders in Washington) can hear what’s being said.

Jay Mac on July 7, 2011 at 10:41 AM

What we need is for Obama and Reid to sit down with a good credit counselor! They are acting just like the dumbass who runs up 5 credit cards and then thinks all he needs to do is get them all to increase his credit limit so he can buy more stuff he doesn’t really need. Credit counselors see people like this every day, and they give them a cold dose of reality that they must STOP SPENDING FIRST, cut up the credit cards, take another job, sell stuff, and pay down those credit cards!

rockmom on July 7, 2011 at 11:04 AM

Tax revenues historically have always been about 18% of GPP regardless of the tax rates [low or high] and spending about 20% of GDP. Spending has risen to about 27% of GDP so it doesn`t take a rocket scientist to see the problem

HAGGS99 on July 7, 2011 at 11:29 AM

How about this compromise: In addition to all of the spending cuts already discussed by the GOP, if Obama agrees to repeal Obamacare, I’d support a 1% increase in the top rate.

besser tot als rot on July 7, 2011 at 11:36 AM

It would also be nice to re-establish the rule of law and contract in bankruptcy proceedings.

besser tot als rot on July 7, 2011 at 11:40 AM

We will reach an agreement and The One will have saved us again. Wait for the headlines and the history.

IlikedAUH2O on July 7, 2011 at 11:48 AM

What we need is for Obama and Reid to sit down with a good credit counselor! They are acting just like the dumbass who runs up 5 credit cards and then thinks all he needs to do is get them all to increase his credit limit so he can buy more stuff he doesn’t really need.

Obama’s economy destroying policies are a Cloward-Piven styled feature…not a bug. Destroy the system and remake it into what you want. (In Obama’s case a socialist third world type system…And if he really gets his Christmas wish from Santa Mao, Presidente for life!)

Battlecruiser-operational on July 7, 2011 at 12:09 PM

So our super smart Ivy League economists are confused by “gross revenue” and “net revenue”… excellent.

Odie1941 on July 7, 2011 at 12:23 PM

If we accept little Bammie’s idiotic principle that ‘spending’ also represents that which we choose not to tax, how do we redraw the blue spending line? Wouldn’t it have to be the total nation’s GDP?

Little Bammie is spending the entire GDP! It’s the end of the world as we know it!

slickwillie2001 on July 7, 2011 at 12:36 PM

Whatever defines the fiscal crisis with the U.S. government is clearly a result of poor governing and legislation over the last 60 years or so. Hard-working, patriotic American citizens are led to believe that they are at fault when that is not the case. Costly, foreign conflicts are not decided upon by everday citizens. Our government officials, past and present, are solely to blame for the economic mess and it’s always the everyday citizen that foots the bill, during and after.

This latest nonsense coming out of D.C. about cutting Social Security benefits is hogwash and dangerous talk. As a retiree, I had no choice during my 45-year working life other than to pay into a system that guaranteed I would get my money back. Not everyone is privy to a sustainable private investment plan and I simply planned my retirement based on a small pension plan and my SS benefit check. Any cuts on my SS benefit check may eventually put me out on the street.

Is Social Security an entitlement program similar to welfare? Not hardly. Yes, I am entitled to every last penny I paid to SS over the last 45 years, but that doesn’t define SS as an entitlement program such as welfare.

I am distressed over the mere fact that SS cuts are even on the table. I don’t live in luxury…not even close. But if I and other seniors have to eventually borrow money from relatives to stay warm in the winter and cool in the summer, to have food on the table and roofs over our heads because politicians want to confiscate even more of our money, there will be a non-stop revolt of gray citizens that will vote out every stinkin’ politician in D.C.

metroryder on July 7, 2011 at 1:23 PM

The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money.”

Alexis De Tocqueville 1835

E9RET on July 7, 2011 at 1:44 PM

I would like to see these yearly revenue numbers as a ratio of the number of citizens who worked in each of those years. Just as you normalized for inflation, I’d like the numbers normalized by number of tax payers.

Zaz on July 7, 2011 at 2:03 PM

Is Social Security an entitlement program similar to welfare? Not hardly. Yes, I am entitled to every last penny I paid to SS over the last 45 years, but that doesn’t define SS as an entitlement program such as welfare.

metroryder on July 7, 2011 at 1:23 PM

Yes, SS is an entitlement program like welfare. You didn’t put your SS money into a savings account, you paid a tax, and actuarially, will get your entire contribution back in the first few years of benefits – and the remainder of your retirement years will be gravy, paid for by younger workers. Social security and medicare are what is driving us under, and they must be cut dramtatically, and quickly.

Vashta.Nerada on July 7, 2011 at 2:04 PM

Thinking of this more, I’d like to see the plot of the number of tax payers in each year to see how the tax burdenis shared among the tzxed

Zaz on July 7, 2011 at 2:22 PM

Is Social Security an entitlement program similar to welfare? Not hardly. Yes, I am entitled to every last penny I paid to SS over the last 45 years, but that doesn’t define SS as an entitlement program such as welfare.

metroryder on July 7, 2011 at 1:23 PM
Yes, SS is an entitlement program like welfare. You didn’t put your SS money into a savings account, you paid a tax, and actuarially, will get your entire contribution back in the first few years of benefits – and the remainder of your retirement years will be gravy, paid for by younger workers. Social security and medicare are what is driving us under, and they must be cut dramtatically, and quickly.

Vashta.Nerada on July 7, 2011 at 2:04 PM

Which is why I believe the necessary amount of minimum quarters to qualify should be 70-80, not the current 40.

The drag on payments come from the low age disability claims who barely worked and paid into a system – not the guy who worked 40 years, paid his SS taxes and dares to live another 20…

I qualified at the age of 29 – because I worked my tail off and got a college education in between. I will work and pay for another 30, God willing.

So how exactly am I a welfare recipient and/or what should I get for that 20 year stretch.

Again – raise the minimum pay in quarters to almost double – and I guarantee 50% of those “disabled” aren’t; while making SS solvement again.

And getting a better than a 1% mandatory interest rate would help greatly too…

Odie1941 on July 7, 2011 at 7:00 PM

Odie1941 on July 7, 2011 at 7:00 PM

SS Disability is being scammed by thousands. We need a reporting program modeled after IRS reporting where you can report someone for fraud and get paid rewards.

Ditto food stamps.

slickwillie2001 on July 7, 2011 at 9:35 PM