IF YOU’RE PAYING, I’LL HAVE TOP SIRLOIN

[M]

An amazing eye opening dissertation by Russ Roberts on Government Taxing/Spending and who benefits, and especially who pays the bill. I find that I have nothing substantial to add to his essay, so here is the link; http://russroberts.info/article/if-youre-paying-ill-have-top-sirloin/ 

Here is the article;

From the Wall Street Journal, 5-18-95
Reprinted in The Libertarian Reader, David Boaz, editor, Free Press, 1997

---

As Congress prepares to try to cut spending, I am reminded of an evening last fall at the St. Louis Repertory Theater, our local company. Before the curtain rose, the company’s director appeared and encouraged us to vote against a ballot proposition to limit state taxes. He feared it would lead to reduced funding for the company.

I turned to the woman sitting next to me and asked her if she felt guilty knowing that her ticket was subsidized by some farmer in the “boot-heel” of Missouri. No, she answered, he’s probably getting something, too. She seemed to be implying that somehow, it all evened out.

I left her alone, but I wanted to say, no it doesn’t even out. If it “evened out” for everybody, then government spending would really be depressing: all that money shuffled around, all those people working at the IRS, all those marginal tax rates discouraging work effort just to get everybody to get the same deal.

Here in St. Louis we recently completed Metrolink, a light rail system. It cost $380 million to build. We locals contributed zero out of pocket. It was paid for by the rest of the country. Shouldn’t we feel guilty making people in Kentucky, Mississippi and Maine pay for our trips to the hockey arena downtown? No, say the beneficiaries. After all, we paid for BART in San Francisco and MARTA in Atlanta and all the other extraordinarily expensive, underutilized public transportation systems whose benefits fall far short of their costs. It’s only fair we get our turn at the trough.

This destructive justification reminds me of a very strange restaurant.

When you eat there, you usually spend about $6—you have a sandwich, some fries and a drink. Of course you’d also enjoy dessert and a second drink, but that costs an additional $4. The extra food isn’t worth $4 to you, so you stick with the $6 meal.

Sometimes, you go to the same restaurant with three friends. The four of you are in the habit of splitting the check evenly. You realize after a while that the $4 drink and dessert will end up costing you only $1, because the total tab is split four ways. Should you order the drink and dessert? If you’re a nice person, you might want to spare your friends from having to subsidize your extravagance. Then it dawns on you that they may be ordering extras financed out of your pocket. But they’re your friends. They wouldn’t do that to you and you wouldn’t do that to them. And if anyone tries it among the group, social pressure will keep things under control.

But now suppose the tab is split not at each table but across the 100 diners that evening across all the tables. Now adding the $4 drink and dessert costs only 4¢. Splurging is easy to justify now. In fact you won’t just add a drink and dessert; you’ll upgrade to the steak and add a bottle of wine. Suppose you and everyone else each orders $40 worth of food. The tab for the entire restaurant will be $4000. Divided by the 100 diners, your bill comes to $40. Here is the irony. Like my neighbor at the theater, you’ll get your “fair share.” The stranger at the restaurant a few tables over pays for your meal, but you also help subsidize his. It all “evens out.”

But this outcome is a disaster. When you dine alone, you spend $6. The extra $34 of steak and other treats are not worth it. But in competition with the others, you’ve chosen a meal far out of your price range whose enjoyment falls far short of its cost.

Self-restraint goes unrewarded. If you go back to ordering your $6 meal in hopes of saving money, your tab will be close to $40 anyway unless the other 99 diners cut back also. The good citizen feels like a chump.

And so we read of the freshman Congressman who comes to Congress eager to cut pork out of the budget but in trouble back home because local projects will also come under the knife. Instead of being proud to lead the way, he is forced to fight for those projects to make sure his district gets its “fair share.”

Matters get much worse when there are gluttons and drunkards at the restaurant mixing with dieters and teetotalers. The average tab might be $40, but some are eating $80 worth of food while others are stuck with a salad and an iced tea.

Those with modest appetites would like to flee the smorgasbord, but suppose it’s the only restaurant in town and you are forced to eat there every night. Resentment and anger come naturally. And being the only restaurant in town, you can imagine the quality of the service.

Such a restaurant can be a happy place if the light eaters enjoy watching the gluttony of those who eat and drink with gusto. Many government programs generate a comparable wide range of support. But many do not. How many Americans other than farmers benefit from the farm subsidy programs? How many Americans other than train riders derive benefit from the Amtrak subsidy?

People who are overeating at the expense of others should be ashamed. That shame will return when others are forced to cut back too. This requires deep cuts and an end to the government smorgasbord where the few benefit at the expense of the many.

♦♦♦

 

[M]

Compare the Fictional Restaurant to the Social Security System vs the Welfare Systems. Congress complains there is never enough money to keep Social Security afloat even though it is collecting money every week from the current working people who outnumber the Baby Boomers by a 5-1 margin. On the other hand Congress never complains about there being a lack of funds to give outright to Illegals and Welfare recipients. WHY IS THAT? 

 

Many politicians and people complain about Social Security costing so much but forget that the public had no choice in paying into it. Neither do they seem to remember it was expected to remain solvent even considering the Baby Boom Generation. They complain that the 'Baby Boomer Generation' will cause it to collapse. They forget just who is the entity that ruined it to begin with. Back during the Eisenhower Administration, the Democrat controlled Congress went back on the deal they solemnly gave to the public over Social Security about NEVER Commingling Social Security Funds with the general fund and NEVER using Social Security funds for anything but paying out to Social Security Recipients. If you don't believe that read the original Social Security Law @ https://www.ssa.gov/history/35actinx.html. See; TITLE VIII- TAXES WITH RESPECT TO EMPLOYMENT and especially the section; UNEMPLOYMENT TRUST FUND SEC. 904.

 

The FIRST STEAL from Social Security came when some group of Democrats slavering to get their hands on ever more money to Bribe Help poor people decided to take ALL of the incoming funds and replace them with Federal Government IOU's from the General Fund, but leave the amassed money ( remember here it's the peoples money and not taxes per se) held in 'TRUST' for the people. That went along fine until LBJ had an epiphany about creating "The Great Society' welfare scam that would hold the poor in  extreme Penury where they and their children would not be able to get out of the Federal Governments grasp, and the only way to survive would be to keep voting for their "Government benefactors". This is where the Democrats stripped out ALL the Peoples  sequestered  money and replaced it with worthless Govt. IOU's and returned to using the incoming money to pay the recipients with. Seems Barney Madoff went to jail for using such a Ponzi Scheme. I wonder where the Governments getting the money for the Welfare they give to the Illegals and welfare people now?

 

The common response from the Democrat Politicians is saying, the 'Baby Boomers' are so many they are overwhelming the system. Of course it is when the Democrats have corrupted the system so thoroughly. They seem to forget the generations that came after the 'Baby Boomers' actually have 4 times the people the government is grifting er taxing money from to support the Social Security system, with the lions share going to Government "Help Programs" for Illegals and Welfare people to keep the Democrats in power.

 

To adequately correct the problem two things needs to be done;

 

For Social Security; There has to be a cut off point where the Government stops taking peoples money for Social Security with the express purpose of shutting it down after the last person to pay into it has received the Social Security they have been promised and has died. This frees up money back to the people earning it and would give a boost to the economy with the extra buying power it would give them. Extra tax breaks could be given to the people who set up their own private retirement accounts, not to be confused with employers retirement programs which the employers would get the tax breaks thus ending the Government subsidy of Social Security without cheating anyone who had been forced by law to pay into it.

 

For Welfare and other Government assistance programs;

First look at all the recipients to determine who is able and capable of working based on a set of public standards, and who is incapable of working because of age or physical or mental handicaps. Ignore the protests from the Politically Correct BSers and do it for the common good of ALL Americans.

 

Set a time limit to benefits and combine that limit with a mandatory education program, based on training people for real world jobs (Not Government Make Work or Government service Jobs.) 

 

Resurrect Civil Service, and Outlaw Government Employee Unions, setting up an impartial ombudsman service with the serving members picked randomly from tax paying citizens, and changed every year or two, whos main duty is to arbitrate disputes between govt.workers and govt. management.

 

Then require assistance only be given to American Citizens or Aliens legally in this Country.

 

End the Anchor Baby bull crap by Congress overturning the SCOTUS decision that legislated it from the bench by mis-using the intent of the 14th Amendment. 

 

Illegal aliens are ALL to be deported, but will be required by law to work on public projects, at minimum wage, to gain money to pay for their temporary food & lodging and to purchase their ticket home to their Country of origin with no actual money going to their hands, just an account to keep track of the funds they earn with a ZERO balance when they buy their ticket home.

 

If the majority of the good and decent American Citizens could agree on that, we could turn the Country around and correct most of the poverty and promote true equality in America

 

[jack ludwig]

M welfare and the social security system are two different programs. Your idea of how to end SS is a good idea but not likely to ever get approved by the majority of people. SS is a scam. It was a scam form the first day it was ever created. Using the money for other purposes has nothing to do with making the system work. It cannot work, it will never work as long as we continue to improve on the life of society. The problem is we have advanced our medical capabilities to quickly, most of us live much too long. I was born before the baby boom generation and I have recieved more benefits from SS then I have ever paid into the fund and I payed the maximum for nearly my entire working career. There are millions and millions of people just like me and the  pool of recipients gets bigger every year. The time that it will take to wean off everyone from SS is much too long and the government cannot sustain making these payments for that period of time. More drastic action is required. Automatic cuts in SS for everyone and the cuts get bigger for those with means and those that are younger Example, one who is 70 years of age gets a larger cut then one who is 80 years of age. No one can collect SS until they are 70 years old and it should increase to 75 years of age before you can collect. Only the disable can get SS earlier. Disable means your mind does not function and your entire body does not function. Some one who is in a wheel chair is not disable, or someone who is missing an arm is not disable. Disable means you are confined to a bed and need help with all life sustaining activities..

We cannot deport illegal aliens. The cost and time to accomplish such a task would be unsustainable. Secondly it would cause such hatred among citizens the entire county would be in chaos.

Believe it or not we need workers. Small businesses can"t find employees, corporations can't find employees, our medical and scientific industries can't find qualified people. Our unemployed and underemployed numbers continues to grow. Why, because they are not suited for most jobs they are willing to work at.

We have a monumental job ahead of us to get America back on track. Worrying about the national debt and many social issues will not get us there the fastest way. Finding ways to improve our education system and getting every child into that improved education system is the only solution to begin the journey back. Technology advancements will be our best defense against any advocacy and attracting the brightest students around the world to our colleges and universities should be our goal along with increasing the standards to get into college to rid at least 40% of the dead weight that is already there to make room for the brighter students.

The middle class will have to begin to accept a lower standard of living for the nest 3 or 4 generations to give time to build a society that can work again. That sacrifice will help rebuild character again with the millions of citizens who have taken for granted the greatness this country has given us.

[M]

Jack,

Answer Three questions;

1. What was the population when you started paying SS and what was the cutoff point when you were paid up?

2. How much has the population of the work force expanded since you started paying into SS?

3. Did you miss my blurb about Madoff and the SS ponzi scheme?

Going forward from there;

Then you say that small business can't find employees, what small businesses. Our tech and medical businesses can't find qualified workers. Why have the progressives degraded education so much that no one seems to be qualified anymore? I strongly disagree with you about increasing the age to collect SS, I firmly believe it should be phased out completely using the method I suggested, and I suggested that way so no one coming into the workforce after a specific date would be required to pat SS tax and those who had paid in would be able to get the benefits until they died. How could anyone complain about that? No pay, No Play. The alternate of setting up an IRA through diversified investments that could not be touched until retirement would also play in Peoria as long as the Government could not touch the money people had saved for any reason. i.e. The money put in would have already been taxed so only the interest accumulated could be taxed on a yearly basis but only at say 3% to 5%, and that would be the tax break I was talking about. Same going for Employer pensions since it is earned money, with the tax break on invested money going to the employer and pensions being the employer putting aside a small amount into individual interest bearing accounts for the employees covered. Maybe some sort of insured annuity where the pay outs provide for the monthly retirement income and the main bulk of the money reverting to the individual companies on the death of the worker or other family members as provided for in the employment contract.