Fortunately for Samuelson, his job as a columnist for the Washington Post doesn’t require him to know anything about income distribution among the elderly, even though according to his own claim, he has been writing about it for decades. Samuelson has another big push for means-testing of Social Security and Medicare, telling us how wealthy the elderly are.
Samuelson’s piece is full of comments that are either deliberately misleading or profoundly ignorant. For example, he tells readers:
“From 1959 to 2007, the proportion of the 65-plus population with incomes under the government’s poverty line ($12,968 for a couple in 2009) dropped from 35.2 percent to 9.7 percent, which was half the poverty rate for children under 18 (18 percent).”
It’s true that the elderly poverty rate has fallen from what had been very high levels to roughly the same rate as for the adult population as a whole. It’s not clear why Samuelson thinks it is appropriate to compare their poverty rate to that of children. Would he also compare the poverty rate for African Americans to the poverty rate for children to tell us that it’s not that bad?
Furthermore, there are serious questions about the methodology for calculating poverty among the elderly. The methodology designed by the National Academy of Sciences shows the poverty rate for the elderly is about 10 percent (@1.1 percentage point) higher than for the prime age adult population.
Samuelson also quotes a government report telling us that:
“Most older people are enjoying greater prosperity than any previous generation.”
This would actually be true of any age group, at least before the recession. Per capita income is growing at roughly a 2.0 percent annual rate. It has nearly doubled since 1980. Even with substantial upward redistribution, most people at most points in the income distribution have seen some gains over this period.
Most importantly, if Samuelson did know anything about income distribution among the elderly he would know that means-testing of Social Security and Medicare is not likely to save much money unless the intention is to take benefits away from middle-income people. The problem is that the portion of the benefits going to the wealthy (as opposed to the portion of income) is not very large.
Means-testing cannot be a cliff where everyone earning over some amount (e.g. $100k or $200k) gets zero. It has to involve a phase out. Unless these phase outs start at incomes around $40k (Samuelson’s definition of wealthy?) and are very steep, they will not save much more than they would cost to administer.
Fortunately for Samuelson, his job does not require him to know anything about income distribution among the elderly.
Fortunately for Samuelson, his job as a columnist for the Washington Post doesn’t require him to know anything about income distribution among the elderly, even though according to his own claim, he has been writing about it for decades. Samuelson has another big push for means-testing of Social Security and Medicare, telling us how wealthy the elderly are.
Samuelson’s piece is full of comments that are either deliberately misleading or profoundly ignorant. For example, he tells readers:
“From 1959 to 2007, the proportion of the 65-plus population with incomes under the government’s poverty line ($12,968 for a couple in 2009) dropped from 35.2 percent to 9.7 percent, which was half the poverty rate for children under 18 (18 percent).”
It’s true that the elderly poverty rate has fallen from what had been very high levels to roughly the same rate as for the adult population as a whole. It’s not clear why Samuelson thinks it is appropriate to compare their poverty rate to that of children. Would he also compare the poverty rate for African Americans to the poverty rate for children to tell us that it’s not that bad?
Furthermore, there are serious questions about the methodology for calculating poverty among the elderly. The methodology designed by the National Academy of Sciences shows the poverty rate for the elderly is about 10 percent (@1.1 percentage point) higher than for the prime age adult population.
Samuelson also quotes a government report telling us that:
“Most older people are enjoying greater prosperity than any previous generation.”
This would actually be true of any age group, at least before the recession. Per capita income is growing at roughly a 2.0 percent annual rate. It has nearly doubled since 1980. Even with substantial upward redistribution, most people at most points in the income distribution have seen some gains over this period.
Most importantly, if Samuelson did know anything about income distribution among the elderly he would know that means-testing of Social Security and Medicare is not likely to save much money unless the intention is to take benefits away from middle-income people. The problem is that the portion of the benefits going to the wealthy (as opposed to the portion of income) is not very large.
Means-testing cannot be a cliff where everyone earning over some amount (e.g. $100k or $200k) gets zero. It has to involve a phase out. Unless these phase outs start at incomes around $40k (Samuelson’s definition of wealthy?) and are very steep, they will not save much more than they would cost to administer.
Fortunately for Samuelson, his job does not require him to know anything about income distribution among the elderly.
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The NYT ran a column asking whether people who make more than $250,000 are really rich. It told readers that the richest 2 percent of the population face money problems also, suggesting that those near this cutoff for tax increases by President Obama might be unfairly victimized.
The poster child for this story is a person named Mason, who live in Manhattan with 2 young children and reportedly makes $262,000 a year. Since the 3 percentage point increase in the tax rate would only apply to income above $250,000, or $12,000 of his income, Mason would have to pay an additional $400 a year in taxes.
This comes to approximately 0.16 percent of Mason’s income. If he gets his entire income from working a 2000 hour year, then Mason will have to work about 3 more hours a year to cover this tax increase.
The NYT ran a column asking whether people who make more than $250,000 are really rich. It told readers that the richest 2 percent of the population face money problems also, suggesting that those near this cutoff for tax increases by President Obama might be unfairly victimized.
The poster child for this story is a person named Mason, who live in Manhattan with 2 young children and reportedly makes $262,000 a year. Since the 3 percentage point increase in the tax rate would only apply to income above $250,000, or $12,000 of his income, Mason would have to pay an additional $400 a year in taxes.
This comes to approximately 0.16 percent of Mason’s income. If he gets his entire income from working a 2000 hour year, then Mason will have to work about 3 more hours a year to cover this tax increase.
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In an interview in the NYT Larry Summers, who was Treasury Secretary under President Clinton and head of President Obama’s National Economic Council, was asked about his portrayal as a supporter of deregulation in Inside Job and Frontline. In his response he said:
“Did we 10 years ago foresee everything that happened with respect to derivatives? Absolutely not.”
Of course there were people who did foresee problems with a vast unregulated derivative market, most notably Brooksley Born. As head of the Commodity Futures Trading Commission in the Clinton administration she proposed tighter regulations for options, futures, credit default swaps and other derivative instruments. She was beat back in this effort by Alan Greenspan, Larry Summers, Robert Rubin, and other Clinton officials with close ties to Wall Street.
Some of us also saw the growth of the housing bubble and recognized the enormous risk that it posed to the economy. Mr. Summers was not among that group nor was anyone else among President Obama’s economy advisers.
In an interview in the NYT Larry Summers, who was Treasury Secretary under President Clinton and head of President Obama’s National Economic Council, was asked about his portrayal as a supporter of deregulation in Inside Job and Frontline. In his response he said:
“Did we 10 years ago foresee everything that happened with respect to derivatives? Absolutely not.”
Of course there were people who did foresee problems with a vast unregulated derivative market, most notably Brooksley Born. As head of the Commodity Futures Trading Commission in the Clinton administration she proposed tighter regulations for options, futures, credit default swaps and other derivative instruments. She was beat back in this effort by Alan Greenspan, Larry Summers, Robert Rubin, and other Clinton officials with close ties to Wall Street.
Some of us also saw the growth of the housing bubble and recognized the enormous risk that it posed to the economy. Mr. Summers was not among that group nor was anyone else among President Obama’s economy advisers.
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During the debate over the health care bill, tens of thousands of health care activists pushed for either a universal Medicare-type system or having the option of buying into a Medicare-type public plan included in the exchanges established in the plan that ultimately was passed into law. In spite of the work of these activists, which did lead the overwhelming majority of congressional Democrats to support a public option, no public option was included in the final bill.
Remarkably, it seems that the Washington Post (a.k.a. Fox on 15th Street) never heard about this debate. Its lead editorial told readers that:
“The current debate has an ideological incoherence on both sides. Republicans endorse a premium support model for Medicare even as they work to undo the new insurance exchanges in the health-care law. Democrats distrust premium support when it comes to Medicare but support the exchanges, with sliding scale subsidies that amount to premium support, in the health-care plan.”
If the Post had heard about the debate over a public option they would know that the vast majority of Democrats actually distrust a system of premium supports when it comes to the exchanges as well. This is why they pushed so hard for the public option. This public plan would both provide people with a way of escaping the private insurance system altogether and provide an effective competitor that could help to ensure that private plans did maintain acceptable standards.
During the debate over the health care bill, tens of thousands of health care activists pushed for either a universal Medicare-type system or having the option of buying into a Medicare-type public plan included in the exchanges established in the plan that ultimately was passed into law. In spite of the work of these activists, which did lead the overwhelming majority of congressional Democrats to support a public option, no public option was included in the final bill.
Remarkably, it seems that the Washington Post (a.k.a. Fox on 15th Street) never heard about this debate. Its lead editorial told readers that:
“The current debate has an ideological incoherence on both sides. Republicans endorse a premium support model for Medicare even as they work to undo the new insurance exchanges in the health-care law. Democrats distrust premium support when it comes to Medicare but support the exchanges, with sliding scale subsidies that amount to premium support, in the health-care plan.”
If the Post had heard about the debate over a public option they would know that the vast majority of Democrats actually distrust a system of premium supports when it comes to the exchanges as well. This is why they pushed so hard for the public option. This public plan would both provide people with a way of escaping the private insurance system altogether and provide an effective competitor that could help to ensure that private plans did maintain acceptable standards.
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Fool or liar? That is the only question that needs to be asked of anyone saying that they want to promote domestic oil production in order to bring down the price of gas.
The simple fact is that there is not enough oil in the United States to bring down the price of gas to any noticeable degree. This is not a debatable point, the United States has 22.3 billion barrels of proven reserves. The U.S. consumes around 20 million barrels a day. This means that we could supply the country for 3 three years with domestic production.
Of course, from the standpoint of domestic oil prices what matters is the U.S. contribution to world production. This is around 90 million barrels a day. In an incredibly optimistic scenario the U.S. could increase its domestic production by 2 million barrels a day, this would increase output by a bit more than 2 percent [thanks Rogermac]. The net effect might be a reduction in price @5-6 percent. Even this price decline would take around 8-10 years to realize.
There is not much basis to dispute these basic facts. Therefore when AP reported that Doc Hastings, the Chairman of the House Natural Resources Committee, said:
“The president is finally admitting what Republicans have known all along, that increasing the supply of American energy will help lower prices and create jobs.”
It should have pointed out to readers that increasing domestic supplies will not lead to noticeable effect on prices. Readers may not have the time to discover this fact for themselves.
Fool or liar? That is the only question that needs to be asked of anyone saying that they want to promote domestic oil production in order to bring down the price of gas.
The simple fact is that there is not enough oil in the United States to bring down the price of gas to any noticeable degree. This is not a debatable point, the United States has 22.3 billion barrels of proven reserves. The U.S. consumes around 20 million barrels a day. This means that we could supply the country for 3 three years with domestic production.
Of course, from the standpoint of domestic oil prices what matters is the U.S. contribution to world production. This is around 90 million barrels a day. In an incredibly optimistic scenario the U.S. could increase its domestic production by 2 million barrels a day, this would increase output by a bit more than 2 percent [thanks Rogermac]. The net effect might be a reduction in price @5-6 percent. Even this price decline would take around 8-10 years to realize.
There is not much basis to dispute these basic facts. Therefore when AP reported that Doc Hastings, the Chairman of the House Natural Resources Committee, said:
“The president is finally admitting what Republicans have known all along, that increasing the supply of American energy will help lower prices and create jobs.”
It should have pointed out to readers that increasing domestic supplies will not lead to noticeable effect on prices. Readers may not have the time to discover this fact for themselves.
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The Washington Post had a piece reporting on the Senate Republicans’ positions on the debt ceiling. At one point the article tells readers:
“McConnell’s assistance is also critical to Senate Democrats. Unless they can win Republican votes, they would have to approve one of the largest debt-limit increases in U.S. history entirely on their own — an unappetizing prospect for up to a dozen potentially vulnerable incumbents who are up for reelection next year.”
Actually, almost all of the cuts that McConnell would insist upon as part of a deal to increase the debt ceiling are likely to pose far more political problems for Democrats up for re-election than voting for a higher debt ceiling. The vast majority of voters have no idea of what the debt ceiling is nor how large any particular increase is relative to anything in the world. This is largely due to the fact that the media almost never puts this issue into any context, for example pointing out that the main reason the debt has soared is due to the recession caused by the collapse of the housing bubble.
To most voters, a politician voting to raise the debt ceiling by any amount simply means that he/she voted to allow increased borrowing of “a really big number.” By contrast, a deal with Senator McConnell would mean cutting Medicare, Medicaid, unemployment insurance and/or other programs that enjoy the overwhelming support of the electorate. It is far from clear that Democratic politicians would do better in the next election if they take the Post’s advice and agree to these cuts in order to get Senator McConnell’s support on raising the debt ceiling.
The Washington Post had a piece reporting on the Senate Republicans’ positions on the debt ceiling. At one point the article tells readers:
“McConnell’s assistance is also critical to Senate Democrats. Unless they can win Republican votes, they would have to approve one of the largest debt-limit increases in U.S. history entirely on their own — an unappetizing prospect for up to a dozen potentially vulnerable incumbents who are up for reelection next year.”
Actually, almost all of the cuts that McConnell would insist upon as part of a deal to increase the debt ceiling are likely to pose far more political problems for Democrats up for re-election than voting for a higher debt ceiling. The vast majority of voters have no idea of what the debt ceiling is nor how large any particular increase is relative to anything in the world. This is largely due to the fact that the media almost never puts this issue into any context, for example pointing out that the main reason the debt has soared is due to the recession caused by the collapse of the housing bubble.
To most voters, a politician voting to raise the debt ceiling by any amount simply means that he/she voted to allow increased borrowing of “a really big number.” By contrast, a deal with Senator McConnell would mean cutting Medicare, Medicaid, unemployment insurance and/or other programs that enjoy the overwhelming support of the electorate. It is far from clear that Democratic politicians would do better in the next election if they take the Post’s advice and agree to these cuts in order to get Senator McConnell’s support on raising the debt ceiling.
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That what readers of today’s column, “Let’s Go Caps!,” are asking. The article begins by telling readers that he is excited over the possibility that there may be a deal to address the “nation’s ruinous debt problem.”
This raises the obvious question of how he determined that the debt problem is “ruinous.” Is it the 3.2 percent interest rate on government bonds? That is certainly a much lower interest rate than we have seen through most of post-World War II era.
Is it because of the $110 billion (0.7 percent of GDP) in interest that the government paid out last year, net of the money refunded by the Fed to the Treasury? This is a much lower share of GDP paid out in interest than the average for the post World War II era.
There is no obvious event in the world that could justify calling the debt problem ruinous. The country does face a risk of exploding private sector health care costs, which is projected to lead to large budget deficits in the long-term. However it would be peculiar to call this health care problem a debt problem and if we fixed the health care system the deficit would be a non-issue.
Since there is no evidence in the world that would justify calling the debt problem “ruinous,” we can assume that this is just the sort of belief that was passed on to Brooks by his parents, in the same way that religious beliefs can be passed on. People can hold these views in a way that is not susceptible to logic and evidence in the same way as other beliefs might be.
Of course, there is also the alternative that Brooks may just be excited about the possibility that there will be cuts to programs that the elderly depend upon, like Social Security, Medicare, and Medicaid. Readers will no doubt be debating this question for some time.
That what readers of today’s column, “Let’s Go Caps!,” are asking. The article begins by telling readers that he is excited over the possibility that there may be a deal to address the “nation’s ruinous debt problem.”
This raises the obvious question of how he determined that the debt problem is “ruinous.” Is it the 3.2 percent interest rate on government bonds? That is certainly a much lower interest rate than we have seen through most of post-World War II era.
Is it because of the $110 billion (0.7 percent of GDP) in interest that the government paid out last year, net of the money refunded by the Fed to the Treasury? This is a much lower share of GDP paid out in interest than the average for the post World War II era.
There is no obvious event in the world that could justify calling the debt problem ruinous. The country does face a risk of exploding private sector health care costs, which is projected to lead to large budget deficits in the long-term. However it would be peculiar to call this health care problem a debt problem and if we fixed the health care system the deficit would be a non-issue.
Since there is no evidence in the world that would justify calling the debt problem “ruinous,” we can assume that this is just the sort of belief that was passed on to Brooks by his parents, in the same way that religious beliefs can be passed on. People can hold these views in a way that is not susceptible to logic and evidence in the same way as other beliefs might be.
Of course, there is also the alternative that Brooks may just be excited about the possibility that there will be cuts to programs that the elderly depend upon, like Social Security, Medicare, and Medicaid. Readers will no doubt be debating this question for some time.
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Actually the Washington Post never mentioned patent monopolies in an article reporting that Google is likely to pay a $500 million fine for running ads from illegal pharmacies. The main reason that there is a market for illegal pharmacies is that government granted patent monopolies allow drug companies to charge prices that are several thousand percent above their free market price.
This fact should have been mentioned. This would be like reporting on illegal efforts to circumvent tariff barriers without effort referring to the tariffs. In the absence of patent monopolies, these rogue pharmacies and the resulting enforcement issues would not exist.
Actually the Washington Post never mentioned patent monopolies in an article reporting that Google is likely to pay a $500 million fine for running ads from illegal pharmacies. The main reason that there is a market for illegal pharmacies is that government granted patent monopolies allow drug companies to charge prices that are several thousand percent above their free market price.
This fact should have been mentioned. This would be like reporting on illegal efforts to circumvent tariff barriers without effort referring to the tariffs. In the absence of patent monopolies, these rogue pharmacies and the resulting enforcement issues would not exist.
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It does according to Marketplace Radio. It told listeners this morning that Medicare beneficiaries were getting a good deal because Medicare benefits cost almost three times as much as beneficiaries paid into the program in taxes. The main reason for this gap is the United States pays more than twice as much per person for its health care as the average for people in other wealthy countries. It has no obvious benefit from this added spending in the form of improved outcomes.
The main reason for the extra costs in the United States is higher payments to drug companies, doctors, medical supply companies and other health care companies. It is peculiar to claim that beneficiaries are getting a good deal because the government overpays health care providers.
It does according to Marketplace Radio. It told listeners this morning that Medicare beneficiaries were getting a good deal because Medicare benefits cost almost three times as much as beneficiaries paid into the program in taxes. The main reason for this gap is the United States pays more than twice as much per person for its health care as the average for people in other wealthy countries. It has no obvious benefit from this added spending in the form of improved outcomes.
The main reason for the extra costs in the United States is higher payments to drug companies, doctors, medical supply companies and other health care companies. It is peculiar to claim that beneficiaries are getting a good deal because the government overpays health care providers.
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Just kidding. Buried in their business digest section we learn:
“Other reports showed that the number of workers filing claims for unemployment insurance dropped less than forecast last week and that wholesale prices climbed more than projected in April.
Applications for jobless benefits decreased 44,000 in the week ended May 7, to 434,000, Labor Department figures showed.”
I couldn’t find even this much in the NYT. (Here’s the bad news story.)
Just kidding. Buried in their business digest section we learn:
“Other reports showed that the number of workers filing claims for unemployment insurance dropped less than forecast last week and that wholesale prices climbed more than projected in April.
Applications for jobless benefits decreased 44,000 in the week ended May 7, to 434,000, Labor Department figures showed.”
I couldn’t find even this much in the NYT. (Here’s the bad news story.)
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