Mar 1, 2011


A CEO, a teabagger, and a union member are sitting at a table with 10 cookies. The CEO grabs 9 of the cookies. She turns to the teabagger and says, "That union member wants part of your cookie."

I don't know if it is an inherent problem with humans that they can't stay focused or that they can't process information to come to rational conclusions, but either way the current financial woes are being addressed in the media and by politicians in a way that doesn't have any bearing on facts. Or maybe it's just because the media and politicians are more beholden to corporate interests.

Here is the 2011 estimate for government expenditures.

You can see the breakdown here.

The biggest pieces in the pie are Health Care, Pensions (social security) and Defense.  The media seems to focus on unionized government employees as the source of easy cost cutting.  And I'm sure there is a lot of waste there.  But the reality is the main source of budgetary woes is in Health Care.  Even Social Security which is maybe a second area of concern is not terribly underfunded if you look at the data and is also easily solved with a minor increase in the retirement age.  The problem is Health Care.

The proof of that is here:

What justification is there for US to be spending so much on Medicare?  And yet we never talk about Medicare? I'm sure most people don't even know what Medicare really is? It's medical care for people over 65. And compared to social security it is hideously underfunded.  The costs of the system per user are about 3 times as much as they put in.  Completely unsustainable. And part of the problem is that chart above. And it also suggests that if it is right-sized that 16% of the budget would decrease to somewhere in the area of 8%. A massive savings of about $400B a year. In fact I would suggest that Health Care is the ONLY financial problem the US has right now.

But you'd never know it.

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