In part 1 of this discourse, we indicated a few areas where the government could acquire additional funds that would help with the country’s expenses and also help lower the deficit. But funding alone won’t do the trick. As the Republican’s love to point out, adding funding will only encourage the Democrats to add spending when spending can and should really be cut to help reduce the deficit. Let’s look at areas where we can cut entitlements and other areas in order to support the tax increases and make the whole picture work.
Yes, there are certainly entitlement cuts that will have to be made, just not always in the ways that Republicans would like us to make them. The health care industry, which includes Medicare, Medicaid and the Affordable Care Act (Obamacare), are rife with duplication and waste. Healthcare is an issue that during the course of our lifetimes will involve every single human being in the nation. There is no more universal issue, and as such, it should only be dealt with, on a national level. The ACA was a beginning but in order to get established it had to ignore or concede many issues that must be resolved in order for it to function efficiently and affordably. What happens with ACA will be true for Medicare and Medicaid or vice versa.
The first thing we have to do to make our healthcare system more functional and more affordable is to get the insurance industry out of it. This complicated but necessary goal will entail somewhere between a 30% and 40% savings to the whole process. Where do I get that figure? It has already been established by the ACA that the insurance companies are limited to 20% profit and you can bet that every one of them is currently right at that line or above it. That 20% figure wouldn’t be in the law if the insurance companies hadn’t been making a hell of a lot more profit than 20%. Many insurance companies are currently, still far over that 20% and betting that the audit won’t show all their excess profits. Despite the ACA, the entire industry averages at least a 25% to 30% profit now. That means that it had been showing up to 40% profit before ACA. Eliminating the insurance companies and their profit from the equation will do a great deal to cutting the cost of healthcare. The government doesn’t have to show a profit and all the workers who worked for the insurance companies won’t lose their jobs, they will just move over to the federal healthcare operation that replaces the insurance companies. Sure it sounds like socialized medicine but so what? The form isn’t important. The result is and saving that much on the total bill will, in itself, make the process work.
But getting the insurance companies out of healthcare is only the beginning. We must get control over the legal shenanigans that add a huge amount to the costs of the medical care by passing Tort reform. This will remove a big number from the cost of medical delivery by helping to reduce the crippling cost of malpractice insurance. It will also help to reduce, substantially, the current practice of doctors covering their butts by ordering extensive and often unnecessary procedures just to avoid frivolous lawsuits. Of course, this must be done without removing patient protections. Part of the answer, undoubtedly lies in getting this process out of the courts and into the hands of arbitrators or some kind of professional panel.
Put the elimination of private insurance companies together with Tort reform and add the implementation of high tech record keeping, to help reduce mistakes and duplication and you have a real formula for cost reduction in national healthcare without having to reduce eligibility or eliminate people from the system. There would be no need to raise the minimum age for coverage and it would produce a system that would be on the road to realistically sustaining itself.
Needless to say, there are savings to be had from our healthcare model but for them to be available both the left and the right must put some of their sacred cows out to pasture and try to come to a reasonable solution, something they have not been able to achieve in a long, long time.
The next big savings area is the bloated defense budget. Everybody agrees that there are savings to be had there, but Congressmen Ryan’s latest budget actually gives the Pentagon about $300 billion more then they have asked for. Why? Maybe because a big bunch of Republican money-men make their living making guns. In any case there is a lot of money to be saved here. Of course doing so will entail finishing off the war in Afghanistan and ending some really bloated arms programs that are now over a dozen years old and still costing us money with almost no hope of them ever being functionally successful.
I am referring to programs like the X-35A, a plane that has been hyped to do wonderful things but has, after 12 years in development and cost overruns into the billions, not been unable to get safely off the ground. This is a loser that is now slated to cost $38 million per plane. No wonder defense is our biggest budget item.
Many have pointed out that we have troops stationed all over the world, mostly in nations that don’t need our troops but love the extra money they pump into the local economy. Last year we had 380,000 troops deployed on foreign soil. We had at least 1000 troops in 54 foreign nations, including 36,708 in Japan, 53,526 in Germany, (big war going on there) 10,817 in Italy, 9,317 in England and 1,017,418 in the contiguous United States. Last time I looked none of these places was being invaded. It must be pointed out, however, that in this time of high unemployment, those troops would only add to the unemployment rolls if we cut them loose and sent them home. It must also be pointed out that the best use of those troops would be to keep them in uniform and use them the way they were used in the Great Depression, to help build infrastructure. The Army Core of Engineers has been responsible for the building of much of this country’s roads, bridges and highways. The savings here are obvious. We keep our military employed but instead of having them stand around doing nothing we use them to replace our failing infrastructure thus saving billions in construction costs.
Another place where big cuts will work is the bloated Homeland Security Agency, which currently employs over 250,000 people. We’re all in favor of good security but our problem with our intelligence and security agencies has always been one of quality not quantity. Maybe we could get along with just a few less paper pushers at HS, like an eighth of a million instead of a quarter.
We should be able to take 30% out of the Pentagon budget without sacrificing either our war effort in Afghanistan, our national security at home or our heavy-duty arms development.
According to the federal budget, there are twenty-three agencies that share in our tax money and add to our deficit. Experience tells us that there must be a couple of hundred different sub agencies, which means that there is tremendous duplication of services. Most of this must be cut.
So, yes there are plenty of places to cut waste from the government without actually cutting essential services. By the way, all the people who are shouting about how much the government has grown in the last ten years should know that most of that growth has been the Homeland Security Agency which barely existed before 911 and now employs that quarter million people I spoke of, above.
The argument to the above is that we wouldn’t really be cutting entitlements we would just be improving and streamlining the programs and the government. And this is bad?
Look, the reason why we have entitlements is that we choose to live in a country that cares about its citizens. All means tested federal welfare in this country, excluding social security, Medicaid and Medicare which are not welfare programs, comes to about $150 billion per year. Our failed war on drugs comes to about $80 billion or a little over half of that. What do you think is more important, supporting citizens who have fallen on hard times or chasing a bunch of foreign drug dealers who we could put out of business tomorrow by simply legalizing and taxing the cargo they sell?
The bottom line is that we don’t have to cut entitlements, we certainly have to streamline and eliminate waste in them but there are plenty of places in our current spending that are so bloated or unnecessary that shaving them would easily replace the entire entitlement cuts that the Right demands.
No one likes welfare cheats but it takes tens of thousands of welfare cheats to account for the money that is not paid in taxes by the tax loopholes available to the likes of one General Electric. It takes a warehouse full of food stamps to equal the money lost to the economy by an outfit like Wal-Mart not paying its workers minimum wage. We could eliminate free loaders in emergency rooms across the country by including all our citizens in a comprehensive medical program like ACA was designed to be and we could pay a hell of a lot of qualified teachers by moving the money from tax breaks now enjoyed by the bloated oil and farming industries into education. All we need is a congress with enough balls to give the finger to the greedy corporations and to try to make America the country we all say it is.
It’s time we demanded that congress help the American people, the 99% that aren’t millionaires, to live out the American dream. And don’t kid yourself, the American dream has nothing to do with welfare cheats or people who want to live on the dole. Those are the failures of the American dream. The American dream is about working hard, being fairly rewarded for our work and being able to raise a family and live an appropriately comfortable lifestyle, much like our parents did after WWII. I don’t know why the far Right doesn’t understand this but it’s our job to show them how the interests of the 1% have nothing to do with their own interests and until we do that job we have little hope of achieving our much more modest goals.