• Debt and taxes, past and present

    Simon Johnson gives a short course in today’s NYT Economix.

    Now we find ourselves again about to debate the fundamental Hamiltonian questions: At the federal level, who will pay how much, to whom and for what, exactly? […]

    But are we now willing to debate the real issues: taxes, health care costs and what kind of redistribution we think is fair and sustainable?

    Worth a full read. Won’t take but a few minutes.

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    • Simon Johnson wrote:

      It masks the deeper and important issues here, which are more about distribution, in particular how much relatively wealthy Americans are willing to transfer to relatively poor Americans.

      But it is important to keep in mind that most SS and Medicare money is spent on the rich and middle class. A sensible step would be to pay everyone the same amount of SS without regard to how much they contributed.

    • I forgot to write:

      The only problem with that is that middle class and rich older people are more likely to vote than anyone else and it is easy to convince oneself that I deserve it, after all I paid into the program.

      So it will not happen until a real crisis hits people in the pocketbook.