Sunday Morning Talk Show Thread 9 August 2020

Various driveby media television networks ^ | 9 August 2020 | Various Self-Serving Politicians and Big Media Screaming Faces

[Reily]

Thanks !

[DanZ]

Respectfully Dan, you have predicted a down market for the last 5000 pts.

No offense taken. In my case I am still down about 2% from last December. I am just now recovering from the Feb./March 2020 drop.

You or your financial advisers may be better than mine.

[DoodleDawg]

Repeal of payroll taxes is another way of signaling reform.

Shouldn't reform take place before you eliminate the funding?

Trump wants a holiday on all payroll taxes. It is a very clever way to get the public on his side for entitlement reform in his next term.

No, Trump wants to eliminate all payroll taxes in his next term. He said so Saturday night. That's a way for the Democrats to hammer him with the claim he's out to eliminate Social Security. Not a smart way to win an election.

Congress will be forced to work together once this becomes a crisis—and it will.

It's questionable whether they will absent any clear plan from the Administration as a starting point, and Trump has none. And even if they do, history has shown when Congress works together to respond to a crisis it results in lousy legislation. Witness their response to the last two fiscal crisis.

Reagan and Tip O’Neill had to work together to save SS.

Reagan and O'Neill were willing to work together. Trump is no more interested in working with the Democrats as the Democrats are interested in working with Trump.

[kabar]

The current Trust Funds total almost $3 trillion, more than enough to cover the shortfalls while negotiators work out an alternative to the payroll tax.

Trump has stated repeatedly that he wants to protect SS and Medicare. Payroll taxes are just one way to fund these programs. There are other, better ways to do it. SS was developed in the 1930s and Medicare in the 1960s. It is time to restructure the funding mechanisms, which are on automatic pilot. 40% of all Medicare expenditures come from the General Fund, by law. The premiums we pay for Medicare Part B cover only 25% of the costs, by law. The rest comes from the GF. Medicare will consume most of the federal budget if not reformed. In 10 years the number of people over 65 will double. One-third of our population will be over 65 by 2030.

It is not a matter of whether the Reps and Dems WANT to work together. They MUST work together to avoid a crisis where SS and Medicare recipients will have their benefits cut by 20%, by law. Doubt the politicians will buck the firestorm of protest that will remove them from office. The pressure will be enormous. It will overwhelm any who stand in the way.

[DoodleDawg]

The current Trust Funds total almost $3 trillion, more than enough to cover the shortfalls while negotiators work out an alternative to the payroll tax.

What would that alternative be?

Trump has stated repeatedly that he wants to protect SS and Medicare.

He has said that, yes.

Payroll taxes are just one way to fund these programs. There are other, better ways to do it.

For example?

It is not a matter of whether the Reps and Dems WANT to work together. They MUST work together to avoid a crisis where SS and Medicare recipients will have their benefits cut by 20%, by law.

So eliminating Social Security and Medicare funding is a ploy to get the Republicans and Democrats to work together? You really think that Washington is capable of doing that? With the "leadership" we have? Really?

[kabar]

The alternative will be worked out thru a process similar to zero based budgeting. Everything is on the table. Benefits reviewed, revenue requirements determined, and how best to raise the money.

As I indicated, 70% of wage earners pay more in payroll taxes than income taxes. And 50% pay no income taxes. Eliminating the payroll tax could be replaced using a variety of sources. For example, you could have a small, minimum income tax for that 50% and combine it with various surcharges on other financial/sales transactions. Obamacare was partially funded using a surcharge on the sale of residences.

Neither you or I can come up with the best way to raise the needed revenue. But it can be worked out. We are a wealthy country.

The status quo is not an option. Historically, Washington needs a crisis to act. Look at how quickly the first multi-trillion pandemic package was put together. I could cite many such instances. Both parties will be forced to act. They have no choice. Simple as that. I would prefer a well-thought out solution crafted without an imminent crisis. That may be a bridge too far.