Monday, July 28, 2014

Why Isn't There A Committee Reporting That Our "Corporate Welfare Trust Fund" Is Insolvent?

   (Commentary posted by Roger Erickson - in memory of the writings of Robert Eisner.)

[Committee for Frozen Fiat] REPORT:
According to these geniuses, the Trustees show that The Social Security Disability Insurance (DI) trust fund is (as they already pre-decided):
* on the brink of insolvency (it wouldn't have mattered WHAT the report said)  
* projected to be exhausted in 2033 (assuming borrowing of more fiat - don't ask how, or why, that occurs either). 
* "Imbalanced" over 75 years -  to the tune of 2.88 percent of taxable payroll, or 1.02 percent of GDP.  (Heck - it's probably out of balance with Ayn Rand and the cosmic background radiation too, and a great many other anomalies, but who's counting?)
* facing a gap between Social Security spending and revenues that will grow from 1.3 percent of payroll (0.45 percent of GDP) this year to 3.9 percent of payroll (1.4 percent of GDP) by 2035 and 4.9 percent of payroll (1.7 percent of GDP) by the end of the 75-year window.
Oh ... my ... gosh! Liars & Innocent Frauds and Perma-DTs, Oh My! Can you visualize these dweebs trying to generate some fiat, and then imagine the semantic difficulties they're saddling future generations with?

They just drone on & on, with endless, invented data irrelevant to context.

How can fiat be exhausted? Don't ask. They have no answer, so they conveniently avoid asking themselves to face reality. They're lost in a crusade to balance what must evolve.

What does an "imbalance" in the fiat mean? Maybe only yodeling political Yoda's can sense that particular disturbance, since a politician's strength flows from the Farce? Curiously, there is no mention of what % of GDP goes to Corporate Welfare, aka "Policy."

Riddle me this Blather Man: why is Social Security the ONLY component of fiat that is [supposedly] funded by a tax on fiat?

So why AREN'T there formal Committees:
a) reporting that Our Corporate Welfare Trust Fund is insolvent?

b) reporting something equally implausible - that our nation's trusty Public Initiative Fund is insolvent?

c) reporting on the mythical gap between fiat "revenue" and fiat itself? [If you have to ask where fiat comes from ... you can't afford it? :( ]
d) explaining how, exactly, a nation generates the fiat revenue that fuels fiat? [Public Initiative?]
You'll never hear the Committee for Frozen Fiat (CFF) commenting on any of those basic sanity checks. Actual thinking does not seem to be in their repertoire, so it's no surprise that they display no sign of Logic-101 either. They have one campaign, and a one-track mind.

At this point any reasonable human should be wondering: "Why don't we just send clowns to Congress, and to staff all federal agencies too?" [Don't answer that unless you're ready to face the answer - it may not reflect well on the voters.]

Meanwhile, this CFF choir seems to have unstoppable momentum - irregardless of reality, or desired outcomes.

An old saying holds that "People will do anything in their power to avoid thinking."

Apparently, shameless politicians will do even more than that, and invoke negative-thinking or straw-concepts, not just lack of thinking. Worse, our foolish electorate will let them! The outcome? If we don't do anything about the real FUDeral Deficit, we might scare ourselves to death with complete nonsense.


circuit said...

Roger, you've made my day! Eisner was one of the best. He tackled all the nonsense: Ricardian equivalence, NAIRU, monetarism, you name it...

And thank goodness for CSPAN's archives. There's lots of classic Eisner appearances there.

Roger Erickson said...

Yes, Circuit,
the CSPAN Eisner tapes offer a wealth of fundamental preparatory training

Sort of like Dick & Jane books for 1st grade politicians & staffers.

Any suggestions for how to get politicians and agency staffers to LOOK at easily available reference material like Eisner's?

Listening to our politicians and agency & ThinkTank staffers discuss fiscal policy is like watching college professors trying to hide the fact that they never learned to read or write.

The policy emperors have no clothing ... nor any substance at all.

circuit said...

"Any suggestions for how to get politicians and agency staffers to LOOK at easily available reference material like Eisner's?"

The first step would be to convert these videos and post them on Youtube and create links via MNE and other blogs.

On a final note, it's important to note that Eisner had the most influence in the later years, around the time he presided the American Economics Association. In those days, guys like Bill Vickrey, Lawrence Klein, and James Tobin were all very active and personally involved in the debates against balanced budgets and the Fed's high interest rate policy.

There's still some good economists today who are active in DC (like James Galbraith and Dean Baker), and it's important that they be seen and heard as much as possible. I think what Stephanie Kelton and Marshall Auerback are doing is very useful.

TV is the best. When I worked as a staffer in Canada, CSPAN and all-day news channels were always playing in the background of politicians' offices. In my experience, politicians and their staffers looking to ground their positions on policy are very much influenced by what is being discussed on these channels. So it's important to continue to focus on getting some air time!

Roger Erickson said...

"People will do anything in their power to avoid thinking."

Really, that follows from standard thermodynamics & systems theory.

Autocatalytic aggregates - neurons or humans - only mobilize to respond to incident data once experience absolutely proves that a given data pattern can't be safely ignored.

(Don't fix it 'til it breaks something?)

Then it's a race to see who HAD prepared to adapt soonest & best - i.e., recognized a developing pattern. The details soon matter - in quasi hindsight.

Until then, everyone professes to not care.