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Post Partisan
Posted at 03:40 PM ET, 11/12/2012

PostScript: Robert Samuelson and the welfare state

It’s most fashionable to be freaking out about the fiscal cliff right now, but Robert J. Samuelson reminds us today in his column that Congressional intransigence and public denial are bringing us an entirely new (80 years in the making) doomsday in the form of the unsustainable welfare state. In a shocking twist, the government has plans to spend money without actually having obtained the money first, and not all the recipients actually need it. Bad.

Samuelson’s answer is that we have to target the benefits much better to the people who really need the help. We need to stop giving benefits — even ones they are currently entitled to — to people who don’t really need it. Seems simple enough! But it’s not, as we find in the comments.

hipshot thinks the government should stop paying for medical care and retirement for people who can fund themselves:

It seems the wise thing to do is means test Social Security and Medicare. Sell it on the notion that there is a better chance the money will be there later if you run into trouble with your own assets. If not, then what are the viable options? My wife and I have paid about 400K into the system. We are for means testing and I expect we would get hit. Conservative here.

jiji1 says not enough people are willing to give up payouts from funds they paid into:

What I would like for people to understand is that social security pays the current beneficiary much, much more than they ever paid into the system. But yet many retirees will say that it is ‘their money.’

Rusty3 nicely interjects to prove Jiji’s thesis:

Give me every cent I have invested in Social Security, say 3% interest, and I’ll send it to Vanguard and invest with them. Otherwise, leave Social Security alone.

nick212 says as precarious as Social Security’s funding is, it’s a lot more secure than most people’s personal retirement accounts:

Actually, social security has become the defacto savings account for most people - for their retirement. If there were no social security we would already be a third world country - because most people are terrible investors.

vinyl1 says that entitlements don’t need to be cut, if we’d be willing to pay for what we want:

It is perfectly possible to have this level of welfare state or whatever you want to call it, and some countries do. What has to happen is that nearly everyone, not just the rich, pay 40-60% of their income in taxes. This level of taxation is typical of the Scandinavian countries, France, and the Netherlands. Their systems do not rely on high taxes on the rich, but hit everyone, because that’s what it takes to raise sufficient funds.

longjohns also sees the current levels as sustainable — because the middle class is stagnating, growing entitlements compensate:

There is a welfare state and a good thing too. As wealth gets concentrated at the top, this is the only thing that’s guaranteeing an improvement in quality of life over the past 30 years.

Developing World also sees the welfare state as a feature, not a bug:

First, as a percentage of GDP, US over social spending is 25th out of 35 industrial countries. Plus, keep in mind there are some relatively less well off countries in the OECD, i.e., Mexico, Turkey, Estonia, etc. And the US number is overstated given our inefficient health care delivery system.
Second, with regard to public old age spending, the US is 21 out of 35 OECD industrial countries.
Thus, when we compare ourselves to the rest of the world we do not have a bloated welfare state; in fact, quite the contrary.

Luckily we’re all scheduled to be freaking out about the fiscal cliff for the next few weeks, or things could get very uncomfortable.

By Rachel Manteuffel  |  03:40 PM ET, 11/12/2012

 
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