If you want to read something chilling you might want to read David Einhorn’s presentation on why we shouldn’t worry about impoverishing our grandchildren, namely, because the policies we’ve been embarked on since the start of the Great Recession are likely to cause major problems much sooner than that:
Before this recession it appeared that absent action the government’s long-term commitments would hit a wall in a few decades. I believe the government’s response to the recession has created budgetary stress sufficient to bring about the crisis much sooner.
Good news for the grandchildren, I suppose.
His company has bought gold and gold stocks. That’s nearly the equivalent of crying “The sky is falling!”
Normally, the Medicare trustees report would have been due about two weeks ago. It’s been delayed, presumably so that it can incorporate the changes in the report necessitated by the ACA, healthcare reform. I’m guessing that it will predict Medicare insolvency within three years. No more than five.
But Social Security is fine. Medicare will be fixed. And debt doesn’t matter anymore. Don’t let a good crisis go to waste. Change you can believe in.
I was interested until he used, as a serious piece of evidence, the bogus Cato Institute study on public vs. private pay.
Then I read further to discover that he disputes the way CPI is calculated–which is interesting. But he offers no reason to support his preferred alternative.
For my own part, I track our household spending, and the only significant increases among our daily expenditures in the past three years have been in energy costs. Everything else has been pretty stable. Both milk and gas are cheaper than they were a year ago around these parts.
That’s the second time in a few days I’ve heard about this shadowstats place. It’s hard to fathom how anyone can take it seriously. I now make 1.77 times what I made in 2001. According to shadowstats I haven’t even kept up with “alternate inflation”. I sure feel like I can buy more now than I could in ’01.
Hmmmm, looking at the BEA data it seems that the CATO study does have a point in that government pay is rising faster than private pay. I’m just looking at the BEA data, care to elucidate on why the CATO position is bogus Alex?
If Einhorn want s to conjecture, we should remember to look at the alternative. Suppose we had done nothing when the market started to bomb. Suppose the bank runs had not been stopped. SUppose the big international banks were allowed to fail, etc. We would probably have been looking at depression levels of unemployment. Revenues would have been even worse, which is where most of the increase in debt has occurred. One could pretty easily see the alternative as worse.
Steve
Steve: When you are comparing – are you looking at comparable professions – does a federal government accountant do far better than a private sector one? Cato comparing the compensation of a predominantly white collar institution to the population at large for the shock value when it’s obviously not a fair comparison was the complaint I read.
@Steve Verdon,
What Sam said. The study does not control for education levels, or compare across professions, years of experience, etc. It’s apples to oranges.