A Stitch in Haste

Regardless of which Democrat is elected in November, one of the first policy showdowns in 2009 will likely be calls to eliminate the wage cap on Social Security taxes ("scrap the cap").

Obama has been making more noise on the subject than Clinton:

Obama believes that the first place to look for ways to strengthen Social Security is the payroll tax system. Currently, the Social Security payroll tax applies to only the first [$102,000] a worker makes. Obama supports increasing the maximum amount of earnings covered by Social Security[.]

Back-pedaling (back-pandering?), Obama revised his calls for scrap-the-cap to instead endorse the so-called "donut hole" plan (originally crafted, incidentally, by a Republican).

An opponent of Obama's call for higher payroll taxes explains:

Currently, all wages below about $100,000 are subject to a 12.4% Social Security payroll tax. But all wages above that amount are not subject to the tax. Mr. Obama wants to eliminate the cap, but, in a concession to taxpayers, exempt wages between $100,000 and $200,000.

There's just one problem with the notion that scrap-the-cap is "a little bit more" — it's a willful lie. Scrap-the-cap would be the largest tax hike in American history. The donut hole, meanwhile, would not only not be much better, but would also have no underlying logical basis other than to pander to the middle class (shouldn't a progressive liberal concerned about the working poor be advocating a hole (i.e., an exemption) for the first $100,000 in wages rather than the second?).

In any case:

The top marginal federal tax rates would effectively increase to 50.3% from 37.9%, equivalent to repealing the Bush income tax cuts almost three times over.

This, according to Obama, is no big deal:

"Once people are making over $200,000 to $250,000," Mr. Obama says, "they can afford to pay a little more in payroll tax."

Seizing an additional one-eighth of every dollar you earn is "a little more"? I guess that, when it comes to lying, "Yes we can."

A few more hasty stitches in review:

--The wage cap increases every year anyway. When's the last time you heard a liberal acknowledge that pesky fact?

--When people pay more in Social Security taxes, then earn more in benefits.* If the idea is to "ask"** those earning above the (ever-increasing) wage cap to pay more FICA tax, does that mean with or without the added benefits that currently accrue to those taxes? If the former, then the funding problem isn't helped that much — it simply becomes a "tax more, pay more" system that still faces long-term crisis. If the latter, then that's an even bigger "little more" — bigger than Obama, qua moral defective, is willing to declare openly — his speeches and website are silent on the matter.

--The original purpose of Social Security was to mandate modest but compulsory old-age insurance. Its original New Deal proponents were adamant that it be formulated in such a way that people would not consider it "the dole." FICA — deceptively labeled a "contribution" — was not designed to be "just another tax to raise." But once you've purchased that old-age insurance (i.e., by paying a lifetime of capped Social Security "contributions"), then what is the basis for the government compelling you to purchase even more (i.e., by removing the cap)? Of course, there is no basis. The only logic in scrap-the-cap/donut-hole is to abandon forevermore the notion of Social Security as "old-age insurance" and replace it with a brazen redistributionist welfare scheme. Again, think Obama will acknowledge that openly?

More thoughts from Cato@Liberty, Cato Daily Commentary.

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Unrelated, but from the same op-ed:

Many high-earning individuals evade the Medicare payroll tax by setting up "S Corporations," paying themselves in untaxed dividends rather than taxable wages. John Edwards avoided $590,000 in Medicare taxes this way in the 1990s.

I take it back: There are indeed "Two Americas" — the one consisting of disgraceful hypocrites like John Edwards, and the one with honest people.

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*But only at a redistributionist rate: A worker who pays twice as much FICA tax over her working career as her coworker earns far less than twice as much in benefits. This is why those who insist that the wage cap makes Social Security "regressive" are mistaken at best and liars at worst: the program as a whole is an extremely progressive income redistribution scheme.

**What an insolent lie that is — that people are "asked" to pay taxes. What happens when you say "No thanks..."?

The conundrum I (and Lewis Black) hinted at previously about the latest plan to pander to the middle class stimulate the economy via minuscule (i.e., purely symbolic) "tax rebates" is becoming surprisingly (and refreshingly) prominent:

As President Bush and Congressional Democrats begin negotiations on a package of measures to stimulate the economy, the big fight will be over whether to put extra money in the hands of tens of millions of low-income families who paid little or no income tax last year.

Nearly 40 percent of Americans owed no federal income tax last year, though even low-income workers paid taxes for Social Security and Medicare. While Mr. Bush has refused to disclose specifics of his $145 billion plan, administration officials and Republican lawmakers favor a proposal that would offer rebates of up to $800 for individuals and $1,600 for families — but only if they paid that much in taxes last year.
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"You have to be a taxpayer in order to get a tax rebate," said Representative Paul D. Ryan, Republican of Wisconsin[.]

Indeed. If the government remits money to people who pay taxes, that's a rebate. If the government remits money to people who don't pay taxes, that's welfare. Think any Democrat proposing the latter will have the intellectual honesty to admit as much?

Exhibit A:

On the presidential campaign trail, Senator Hillary Rodham Clinton of New York and John Edwards, a former senator from North Carolina, attacked the Republican approach for excluding people who need help the most.

Clinton and (especially) Edwards, who are moral defectives but not stupid, know full well that the federal income tax is obscenely progressive and that tax rebates cannot reach the working poor whom they pretend to champion. But did, or will, either acknowledge that what they are proposing is middle-class welfare? Of course not.

Exhibit B:

Senator Barack Obama of Illinois has already proposed a $90 billion program of rebates and supplemental Social Security payments that his aides said would reach 95 percent of workers.

Obama has been particularly insolent in not only vowing not to reform Social Security, but also in being the first and most vocal in calling for scrap-the-cap, which would remove any last pretense that Social Security is "old-age insurance" or "compulsory retirement saving" and is in fact merely another naked welfare scheme. (Recall also that it would be the largest tax increase in American history.) Remind me again how Obama is a libertarian?

Incidentally, does anyone really need reminding that January 2009 would be a tad bit late to implement any Democratic economic stimulus plan? Just saying.

To review: While no stimulus program is wise (or, for that matter, a legitimate function of government), and while increasing an already bloated government deficit is not exactly textbook Keynesianism, and while the only moral position would of course be permanently lowering spending and permanently lowering taxes, we are, in the reality-based community, confronted with three options:

1. The neither preposterous nor cruel premise that those who actually pay taxes should be the ones who actually get rebates.



2. Middle-class welfare during an election year.



3. Additional raiding of the (fraudulent) Social Security "trust fund."

I will not apologize for insisting that Option 1 is the least worst alternative.

Perhaps the New York Times editorial board has finally embraced fiscal responsibility?

Congress has passed and President Bush is sure to sign into law a bill that will spare some 23 million Americans from having to pay the alternative minimum tax next April.
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What they fail to say is that the bill doesn't include a way to make up for the lost revenue[.] To make up the shortfall, the government plans to borrow the money, which will have to be paid back later with interest, either by raising taxes or reducing government services.
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That's at best bait and switch, or at worst gross negligence.

That's also the Social Security "trust fund" — which the Times embraces and adores. Go figure.

The FICA taxes — one-eighth of most Americans' paychecks — that the federal government confiscates currently exceed current Social Security liabilities. The surplus is spent on other stuff: war, domestic spying, bridges to nowhere, etc. It is also used to lie to the American people about the size of the federal budget deficit (i.e., the reported deficit is the operating or "on-budget" deficit, reduced by the size of the Social Security surplus, which is "off-budget;" some people might call that "Enron accounting").

How deceitful — or stupid — does one have to be to call "war, domestic spying and bridges to nowhere" a "trust fund"? Yet that is exactly what the Social Security "trust fund" is — FICA taxes that have already been spent on other stuff.

The "Treasury bonds" (actually just a notebook in West Virginia) that comprise the Social Security "trust fund" are nothing more than an IOU from the government to itself. And just as IOU from yourself to yourself is not a "trust fund," so too is an IOU from the government to itself not a "trust fund."

Those ledger entries in that notebook in West Virginia are nothing more than a pledge by the federal government to fund future Social Security shortfalls — starting in less than a decade — with higher taxes or higher deficits in the future. Exactly the same fiscal shenanigans that, in the context of AMT reform, the Times blasts as "at best bait and switch, or at worst gross negligence." Yet it can't be negligence in one context and competence in another.

How, exactly, is it "at best bait and switch, or at worst gross negligence" for Congress to call spending money today and promising to pay for it tomorrow in the context of the AMT but not in the context of Social Security? How is less of a "bait and switch" to call it "tax relief" than to call it a "trust fund"?

This is not a difficult concept, except to the extent that politicians and their apologists try to make it difficult.

Class warrior John Edwards this past Sunday:

Mr. Edwards said that a big-stick-carrying approach was the only way to effect change. Corporate resistance, he said, had ... resulted in a kind-to-the-rich tax policy[.]"

Reality:


(Click to enlarge.)
The only epilogue required is to note, yet again, that these figures are only for income taxes. Where the working poor are indeed oppressed is of course not federal income taxes but Social Security taxes, which seize one-eighth of working-class Americans' paychecks to fund a high-risk, low-return intergenerational transfer scheme that is in severe fiscal distress. Anyone who claims to champion the working poor should make meaningful Social Security reform his highest fiscal priority.

John Edwards?

He does not believe we need to reduce benefits, change the retirement age or increase the burden on average workers.

In other words, he's blind.

But not deaf:

Edwards will fight to keep the promise of social security by ending the Social Security tax exemption for workers making more than $200,000 a year.

To Edwards, the answer to everything, absolutely everything, is class warfare. Everything.

When did "The American Dream" start to mean "having someone else pay for everything"? When did "progressive social policy" start to mean "an unlimited and unapologetic willingness to spend other people's money"? When did "the new social compact" (Edwards' term) start to mean "the new socialism"?

More thoughts from Brink Lindsey.

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Actually, I have another post script: When Edwards rails against "big, multinational corporations" (as he did this past Sunday) he is of course damning the owners of those corporations — the shareholders. Who exactly does he think those shareholders are?

As a general rule, the stock of "evil" or "tax-privileged" blue-chip American mega-companies such as Exxon ("Big Oil"), Merck ("Big Pharma") and Cigna ("Big Insurance") is owned largely, often overwhelmingly, by the middle class — either directly (including via mutual funds and similar investment vehicles) or indirectly (via pension funds, including — gasp! — government employee pension funds). Not to mention all the (vicariously evil) universities, hospitals, scholarship funds and other non-profit institutions that rely on endowment income — do such institutional endowments tend to serve the poor, the rich or the middle class? (Recent example here.) So whom, consequently, does Edwards serve by declaring such corporations, and the income they generate, "the enemy"?

It's a pity that socialist megalomaniacs like Edwards have so corrupted the word "populist" that it is now essentially a synonym for "ignorant."

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For those confused by the title, see here.

A question I posed to Robert Reich ("the nation's 22nd Secretary of Labor and a professor at the University of California at Berkeley") in response to his question: "Why is HRC stooping So Low?"

"That [Social Security] cap is now close to $98,000 (it's indexed), and the result is highly regressive."

Surely you know that Social Security as a program (and it is a program, not just a tax), is not regressive but in fact highly progressive.

A taxpayer who pays twice as much tax over her working career than another taxpayer receives far less than twice as much in benefits. That is unarguably the progressive redistribution of income.

And that's before the federal income taxation of Social Security benefits, which is itself radically progressive. So in fact Social Security is "double-progressive" (or "progressive-squared").

So I ask you -- why are you misrepresenting the issue?

We'll see whether I receive an answer.

Paul Krugman lying yet again about Social Security:

But a determined defense by progressives in the media, on the blogs, and in Congress beat back one spurious argument after another, while the American people made it clear that they really want a program that guarantees a basic retirement income that doesn't depend on the Dow. And Social Security survived.

First of all, there is nothing more "spurious" than the fictitious and fraudulent Social Security "trust fund," which is nothing more than a solemn promise by the federal government — to raise taxes in the future, explode the deficit, or both.

Also spurious is the lie that any plan of voluntary* partial privatization would have to be invested in that most evil of contrivances, the stock market. One would think that such a supposedly brilliant economist as Paul Krugman might have heard of a money market fund — which would still outperform the returns Social Security offers its typical participant, and with zero risk to principal.

(*Sidebar: Isn't it interesting how the word "voluntary" is always conveniently omitted from every apologia for the status quo?)

But my main point is this: If it is indeed true that "the American people made it clear that they really want a program that guarantees a basic retirement income that doesn't depend on the Dow," then why not do exactly that? Why not abolish Social Security outright and simply replace it with a flat, egalitarian, public pension entitlement for all retirees equally — a program that guarantees a basic retirement income, paid not from a dedicated payroll tax but from general revenues?

If Krugman so correctly reads the American psyche, then he ought to advocate, indeed demand, the compete abolition of all FICA taxes. The federal government could replace those foregone FICA taxes by adjusting federal income tax rates and brackets, such that total federal receipts were not affected. It would be that much easier for employers (and the self-employed) to run their payrolls. Social Security's huge computation bureaucracy that must calculate credits earned, wage replacement formulas, etc., could be abolished and replaced with simple "Office of Retiree Check Printing."

And one more "benefit," at least to the Krugman types: Swapping FICA taxes for federal income taxes would be the single biggest "soak the rich" policy since the August Decrees. Far more redistributionist, incidentally, than that other radical liberal canard du jour, scrap-the-cap.

Remember: the working poor pay no federal income tax, but they do pay one-eighth of their income to Social Security (and Medicare). Surely the distribution of tax burdens would, if anything, become even more progressive if we swapped FICA for FIT, and surely any self-professed champion of the working poor would cheer such a proposal.

And yet they don't. Why?

Simple: Because, contra Krugman, the last thing in the world that apologists of Social Security want is "a program that guarantees a basic retirement income" (i.e., independent of any taxes paid to accrue such income).

There's another term for "a program that guarantees a basic income" — welfare. Americans love getting checks from the government, to be sure — but not when it's a welfare check. That's not a pension; it's a stigma.

The New Deal socialists who first devised Social Security recognized from the outset that the program must, at all costs, not be interpretable as "the dole." Yet the working poor would have seen a simple old-age pension entitlement as exactly that: They spend an entire career not paying any income tax, then suddenly they start getting checks from the government? That would be welfare, and that would be a dealbreaker. Thus was the FICA tax born.

What Americans really want is not a check from the government, but a check from the government that they can rationalize, that they need not feel embarrassed by. Which, one would think, would not be the prime criterion of "enlightened" central planner wannabes like Krugman.

One would think.

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UPDATE: Krugman has gone from blogpost to full-blown column. More thoughts from Greg Mankiw.

Pot.Kettle.Black.

In another jab at his chief rival, Democratic presidential candidate Barack Obama says in an ad released Sunday that the country needs an honest dialogue about Social Security in order to fix the system.
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He accused Clinton, the Democratic front-runner, of dodging tough questions about whether the government should tax workers' earnings above the present cap of $97,500 to help pay for Social Security benefits.

Obama should read the newspapers every so often. Perhaps once a year?

Some other changes that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $102,000 from $97,500. Of the estimated 164 million workers who will pay Social Security taxes in 2008, nearly 12 million will pay higher taxes as a result of the increase in the taxable maximum.

But of course higher taxes, each and every year, for 12 million Americans is nowhere near enough for class warriors. Neither of any concern to them is the pesky fact that higher Social Security taxes on the rich today simply means higher Social Security benefits for the rich down the road; it does extremely little to alleviate the system's long-term nonviability.

That doesn't matter to Obama. This does:

The ad shows Obama speaking to a group of older people who quietly nod as he tells them that, with 78 million baby boomers projected to retire, Social Security will pay more money in benefits than it receives to fund the system.

A disengenuous moral defective, pandering to a gaggle of greedy ignoramuses, attacks his rivals for not pandering to them enough?

"The American Century" is unarguably over.

First it was newborns whom Hillary Clinton invited to suck at the government teat via her infinitely asinine "Baby Bond" proposal. Now it's entire families:

Families could get 401(k) retirement accounts and up to $1,000 in annual matching funds from the government under a plan offered Tuesday by Democratic presidential candidate Hillary Rodham Clinton.

At a cost of $20 billion - $25 billion a year, the plan is Clinton's largest domestic proposal other than her plan for universal health insurance. The New York senator said it would be paid for by taxing estates worth more than $7 million per couple and would help narrow the gap between the rich and those who don't have enough savings for retirement.
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Clinton said she wants to create "American Retirement Accounts" in which each family could put up to $5,000 annually in a 401(k) plan. The federal government would provide a tax cut to match the first $1,000 for any household that brings in less than $60,000 a year and 50 percent of the first $1,000 for those that make $60,000-$100,000.

A few hasty stitches:

--What basis does any Clinton supporter have for pretending that she is in any way a "moderate"? Her answer to every domestic issue, real or imagined, is to throw taxpayer money at it. This is not the behavior of a "moderate." Positioning oneself barely a millimeter to the right of John "Two Americas" Edwards and his brazen calls for class warfare does not make one a "moderate."

--On the other hand, Clinton is distinguishable from Edwards in one respect. While Edwards seeks to soak the rich, Clinton seems intent on soaking the working poor -- who, you may recall, don't save much. (Neither of course do the non-working poor. Or retirees. Or...) These "American Retirement Accounts" are -- like her "Baby Bond" nonsense -- a middle-class entitlement pure and simple.

--Is Clinton unaware that there are already a wide variety of tax-advantaged retirement vehicles? (Recall that the "match" only comes via a tax cut, not via a bona fide contribution into the account. Which of course means that it isn't really a "match" at all.) With very few exceptions, any non-wealthy individual with earned income can open an IRA or similar tax-advantaged investment vehicle any time they like. How is this new entitlement anything other than a solution in search of problem?

--Meanwhile, the real problem -- the reason the working poor don't save -- is mostly because they can't afford to. It's hard to save when one-eighth of your paycheck is confiscated by the federal government before it even reaches your pay stub. It remains unrefuted because it cannot be refuted: Anyone who claims to champion the working poor must, by definition, champion Social Security reform. What does Hillary Clinton champion?

Clinton said the accounts should not be used to replace any part of Social Security and that she is committed to addressing the long-term challenges of that program. "We have to fight and finally bury the idea of privatizing Social Security," she said.

That is a fight I have no doubt she, or whichever Democrat ends up as our next president, will win handily.

--Apparently these accounts would somehow be, not for individuals, but for "families." However (thanks to her pervert husband), there are -- as a matter of federal law -- no such things as "gay families." Thrown under the bus by a Clinton yet again. Go figure.

My main thesis is of course not only unchanged but also reinforced by this hopeless nonsense: The cure for Republican fiscal recklessness from 2001 through 2006 will not be Democratic fiscal recklessness from 2009 through 2012. The cure ought to be libertarian principles of governance. In the alternative, gridlock would have been nice. Neither will be forthcoming any time soon.

I always try to pass along these data whenever I see them updated:

The top-earning 25 percent of taxpayers (AGI over $62,068) earned 67.5 percent of the nation's income, but they paid more than four out of every five dollars collected by the federal income tax (86 percent). The top 1 percent of taxpayers (AGI over $364,657) earned approximately 21.2 percent of the nation's income (as defined by AGI), yet paid 39.4 percent of all federal income taxes. That means the top 1 percent of tax returns paid about the same amount of federal individual income taxes as the bottom 95 percent of tax returns.

Also:

From other IRS data, we can see that 90.6 million of the tax returns came from people who paid taxes into the Treasury. That leaves 42 million tax returns filed by people with positive AGI who used exemptions, deductions and tax credits to completely wipe out their federal income tax liability.

When you add in those so poor that they need not even file a tax return, and then adjust the returns for family size (the poor tend to have more children), it turns out, as I have noted ad nauseum, that roughly the poorer half of all Americans simply pay no income tax.

Two hasty stitches:

--Remind me again how "the rich don't pay their fair share"? (Or, stated differently, has John Edwards no shame whatsoever?)

--These data are for the federal income tax. The working poor of course do pay taxes: FICA taxes — Social Security and Medicare. So I repeat: Anyone who claims to care about the working poor must, by simple logic applied to irrefutable data, advocate Social Security reform ("soak the rich" is not "reform").


(Click to enlarge.)

Specifically, the Democrats of 1935:

"But I don't understand why somebody who makes $50 million a year pays Social Security tax on the first $97,000 and somebody -- and not on the rest..."

Edwards is of course referring to the (ever-increasing) Social Security wage cap.

The resolution of the wage cap non-paradox is of course self-apparent to anyone who, unlike Edwards, is not an advocate of class warfare. When Social Security was crafted as a cornerstone of New Deal socialism, its creators -- its liberal Democratic creators -- were adamant that the program be structured, at least nominally, as a compulsory retirement saving plan and not "just another entitlement."

The scheme had and has many more bells and whistles than that, to be sure. But the all-important prime directive behind Social Security's founding was that it would not be presented as "a welfare program." To this day, reminding people of Social Security's progressive-redistributionist (i.e., welfare) structure will bring the scheme's apologists chasing after you like screeching Ringwraiths.

This explains, for example, the (preposterous) description of payroll taxes as "contributions," the naming of the program as "insurance" (as in "Old Age Survivor and Disability Insurance") -- and the wage cap.

In the compulsory saving (or old-age insurance) model of Social Security, wage earners are required to "purchase" (i.e., fund via their payroll taxes) a future minimal annuity stream for their post retirement years. But it only takes so much money to fund such an annuity, just as it only takes so much money to buy a basic, minimal meal. Once a taxpayer has "paid up" for his future Social Security annuity (by hitting the wage cap), then why require her to buy even more annuity?

Remember: Paying more FICA tax means receiving a greater Social Security benefit after retirement. Scrap-the-cap is not "free money" for the government; it is offset by higher benefit obligations for the rich down the road.

So if the purpose of Social Security is not to soak the rich, but to ensure that no elderly be impoverished, then why require the rich to pay into the system beyond the "not impoverished" level? Why force them to buy very high benefits via very payroll taxes if the goal is merely to insure against elderly poverty? (Stated differently: Why force the rich to over-participate in Social Security to the point where they are more than simply "not-impoverished" but actually "very not-impoverished"?)

Meanwhile, scrap-the-cap would delay the Social Security crisis by a few years at best. It "solves" nothing. This demonstrates even more starkly why Edwards (and Obama and almost certainly Clinton) are flat-out lying when they advocate scrap-the-cap as a "solution" to the Social Security crisis rather than a naked class warfare appeal to radical liberal malcontents.

Bottom line: If you believe in Social Security as a "post-retirement safety net," then the cap is perfectly reasonable. It is fact absolutely necessary if the program is to be logically consistent. But if you believe in Social Security as backdoor income redistribution, as a wink-wink, nudge-nudge way to soak the rich (who, recall, also pay almost all the federal income tax), and as an insolent impediment to your dreams of class warfare, then the wage cap is indeed an illogical abomination.

No wonder John Edwards is confused.

(Via Tax Policy Blog.)

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Did I mention that scrap-the-cap would be the largest tax increase in American history?

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Meanwhile: Poor little rich boy. Or poor boy. Or something.

To review: There are only three "dials to fiddle with" in addressing the Social Security crisis:

1. cut / curtail benefits


2. raise the retirement age


3. raise taxes

There are no other approaches, no other options. This is more than basic economics — it's basic metaphysics.

Armed with that:

Hillary Rodham Clinton promised retirees that if elected president she will not cut Social Security benefits, raise the retirement age or privatize the taxpayer-funded system.

Okay, no benefit cuts and no increase in the retirement age. So she's promising to raise your taxes — because she cares about you.

Just one problem: she doesn't mention taxes either:

Clinton said instead she will protect the program through fiscal responsibility and criticized President Bush's leadership on the issue.

"Fiscal responsibility"? What kind of spineless blather is that?

no benefit cuts + no raised retirement age = tax increases
This is the moral defective who dares to claim that she represents "strong leadership"? But she's too much the coward to actually say what she means. To her the word "tax" is the political mouse that sends her shrieking atop the kitchen table like a caricature 1950s housewife?

At least the first President Bush, when he lied about "no new taxes," actually used the word "taxes" as part of the lie. He gave us "Read my lips..." — Clinton gives us "Read between the lines..."

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There is of course another possibility: Clinton simply thinks her supporters are all morons. Hey — she's the one implying it. So scowl at her, not me. On the other hand, I reiterate my befuddlement toward those who somehow conclude that "Bush-Clinton-Bush-Clinton" is the solution rather than the problem.

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Another hasty stitch:

"This is the most successful domestic program in the history of the United States," Clinton said to applause from seniors gathered in Washington to push their policy agenda.

Liar.

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One more, via the New York Times' blog, The Caucus:

"We need to get back to the fiscal responsibility of the 1990's when we weren't raiding the social security trust fund"

Given that Congress will certainly stay under Democratic control after the election, anyone who yearns for "the fiscal responsibility of the 1990's" must, by definition, vote Republican in 2008, since it was gridlock, not the supposed budgetary genius of Bill Clinton, that kept government spending in check from 1995-2000.

This is pretty much all you need to know:

A typical couple retiring in 2020, for instance, will have paid about $100,000 in lifetime Medicare taxes (much less if we don't credit them with interest on their past contributions). For that price, this couple is scheduled to receive about $500,000 in lifetime Medicare benefits over and above the premiums it additionally pays in retirement.

That, and one more sentence of my own:

Politicians are doing absolutely nothing about it.

Most politicians, that is. Some, such as John Edwards, do indeed have proposals, which can generally be summed up thusly: Let's do the same for everyone!

"Sicko" indeed.