Obama’s Fuzzy Math

The president-elect announced yesterday that he will tackle entitlement reform — specifically addressing Social Security and Medicare. This will be part of a “fiscally responsible summit” President Obama will convene next month prior to his first budget submission to Congress.

Where to start? President Obama might be best to review the $1 trillion “stimulus” bill that is being rushed through the Congress, filled with a Democratic wish list of pork that would make a pig blush at the unseemliness of it all. I never understand why politicians never learn from history, but the simple fact of the matter is that the Depression suffered during the 1930s in America was extended due to dual increases in taxes and spending. The incoming administration seeks to increase taxes on “the wealthy” while increasing spending by $1 trillion to stimulate the economy. I wonder what impact this will have on the recession …

Next, Obama’s pledge to reform entitlement spending. I seem to recall the Democrats accusing President Bush of trying to destroy Social Security when he proposed a voluntary retirement account where participants could contribute up to 2 percent of their payroll tax to a private account. I seem to recall that this voluntary system was Bush’s attempt to privatize Social Security and break the pledge made to seniors. Apart from the lie that Social Security was never intended to be a full retirement benefit, now the system is going broke (Medicare even faster) and President Obama will now make reform a top priority.

In order to reform Social Security and Medicare, there are three options: (1) cut benefits, (2) raise taxes or (3) raise the eligibility age to reduce the demand on the system. I’m curious which option the president-elect will take.

Change we can believe in is about to arrive — I suspect the president and his team will find that it is much harder to govern than it is to campaign. I further suspect they will discover that, no matter how much they claim they will change in Washington, so much will remain the same in the next administration.