Bernie Sanders's $18 trillion in proposed spending is more affordable than it sounds

[ksen]

http://www.vox.com/2015/9/15/9330931/bernie-sanders-spending-cost

I'll take it.

 

[Nice Squirrel]

It that all it costs? Surly the Wall Street Journal Wouldn't lie.

 

[Axulus]

What, no huge investment in green energy projects? No huge raises for public sector employees and teacher salaries? No new huge grant increases for research? No huge increase in NASA budget to go to Mars? Is this really all the spending increases he and his supporters want, or is this just the first course of a multi-course platter?

What about the fact that the labor force participation will continue to decline as time goes on as the population ages?

What about the fact that medical costs continue to outpace inflation? How "affordable" will it be in 15 years? 30 years?

More paid family and medical leave means less work gets done, shrinking the economy, which means tax revenue shrinks.

What happens when the next recession hits? How much borrowing can be sustained? 10% of GDP borrowing during the last recession will look like a drop in the bucket should another hard recession hit. The more you rely on tax revenue, the greater the percentage of GDP tax revenue will decline during recessions.

Isn't this the kind of casino mentality, where a low probability severe impact event can create a catastrophic situation, that the left criticizes the banks for? Doesn't this proposal make the government far more vulnerable to that kind of a situation?

Think about it: if the US were to have the same GDP per capita as France (which this proposal helps push us toward, as many of the policies are similar and responsible for France's 26% smaller GDP per capita), the US would NOT be able to afford this. If credit were to ever dry up for the United States, the global catastrophe that would result would make the great recession look like a trip to Disneyland in comparison.

 

[Jimmy Higgins]

What, no huge investment in green energy projects? No huge raises for public sector employees and teacher salaries? No new huge grant increases for research? No huge increase in NASA budget to go to Mars? Is this really all the spending increases he and his supporters want, or is this just the first course of a multi-course platter?

What about the fact that the labor force participation will continue to decline as time goes on as the population ages?

What about the fact that medical costs continue to outpace inflation? How "affordable" will it be in 15 years? 30 years?

What about mom and dad living at your place because there is a shortage on affordable Nursing Home beds?

More paid family and medical leave means less work gets done, shrinking the economy, which means tax revenue shrinks.

Oh gawd no! Can't have a higher standard of living! That'd cost rich people money! Also, how many people work at a company where family leave (not even certain if it needs to be paid) is required by law?

What happens when the next recession hits? How much borrowing can be sustained? 10% of GDP borrowing during the last recession will look like a drop in the bucket should another hard recession hit. The more you rely on tax revenue, the greater the percentage of GDP decline will occur during recessions.

Isn't this the kind of casino mentality, where a low probability severe impact event can create a catastrophic situation, that the left criticizes the banks for? Doesn't this proposal make the government far more vulnerable to that kind of a situation?

Think about it: if the US were to have the same GDP per capita as France (which this proposal helps push us toward, as many of the policies are similar and responsible for France's 26% smaller GDP per capita), the US would NOT be able to afford this. If credit were to ever dry up for the United States, the global catastrophe that would result would make the great recession look like a trip to Disneyland in comparison.

I'm presuming that this isn't proposed deficit spending, but would likely require higher taxes. The big part, $15 trillion over 10 years is Medicare which would be less a new tax and more our health care premiums going to a different location.

 

[ksen]

What, no huge investment in green energy projects? No huge raises for public sector employees and teacher salaries? No new huge grant increases for research? No huge increase in NASA budget to go to Mars? Is this really all the spending increases he and his supporters want, or is this just the first course of a multi-course platter?

:itisamystery:

What about the fact that the labor force participation will continue to decline as time goes on as the population ages?

What about it?

What about the fact that medical costs continue to outpace inflation? How "affordable" will it be in 15 years? 30 years?

You mean medical costs currently outpace inflation and have done so for decades.

Given that Medicare is much more cost efficient and every other UHC/Single-payer system is more cost efficient than our current system then I'd put money on it being much more affordable in 15 or 30 years than continuing on the path we're on now relying on private insurance markets.

More paid family and medical leave means less work gets done, shrinking the economy, which means tax revenue shrinks.

Conclusion assumed and not proven.

What happens when the next recession hits? How much borrowing can be sustained? 10% of GDP borrowing during the last recession will look like a drop in the bucket should another hard recession hit. The more you rely on tax revenue, the greater the percentage of GDP decline will occur during recessions.

That sounds scary!

Isn't this the kind of casino mentality, where a low probability severe impact event can create a catastrophic situation, that the left criticizes the banks for? Doesn't this proposal make the government far more vulnerable to that kind of a situation?

Um no, it's kind of a let's join the rest of the civilized world when it comes to health, education and other social policies.

 

[ksen]

The big part, $15 trillion over 10 years is Medicare which would be less a new tax and more our health care premiums going to a different location.

Yeah, about that $15 trillion in medicare spending.

From the article linked in the OP:

But right now private health insurance plans are projected to spend $14 trillion over the next 10 years, and people are forecast to incur $4 trillion in out-of-pocket expenses.

$15 trillion over 10 years is actually about $3 trillion less than is currently projected to be spent privately over the next 10 years on healthcare.

 

[Shadowy Man]

More paid family and medical leave means less work gets done, shrinking the economy, which means tax revenue shrinks.

Conclusion assumed and not proven.

In fact, one might argue that paid family leave may result in more women staying in the work force, growing the economy.

 

[Tom Sawyer]

Conclusion assumed and not proven.

In fact, one might argue that paid family leave may result in more women staying in the work force, growing the economy.

And there's a word for those people.

Communists.

 

[Nice Squirrel]

No huge raises for public sector employees and teacher salaries? No new huge grant increases for research?

That'd be great but since the Federal Government doesn't pay teachers (and most public sector employees), I'm not sure this is on his radar.

 

[Sajara]

Also, how many people work at a company where family leave (not even certain if it needs to be paid) is required by law?

I believe the law requires any company with 50 or more employees...at least in my state.

 

[Axulus]

No huge raises for public sector employees and teacher salaries? No new huge grant increases for research?

That'd be great but since the Federal Government doesn't pay teachers (and most public sector employees), I'm not sure this is on his radar.

The dept of education has a $77 billion budget. That money primarily gets distributed to various school districts, who can use it for teacher salaries. I would not be surprised if Bernie wants to double the dept. of education budget.

 

[Axulus]

What about it?

Tax base shrinks.

You mean medical costs currently outpace inflation and have done so for decades.

Except now all of that cost will need to be taxed, on a smaller workforce (due to more retirees), who work less with paid family and medical leave.

Given that Medicare is much more cost efficient and every other UHC/Single-payer system is more cost efficient than our current system then I'd put money on it being much more affordable in 15 or 30 years than continuing on the path we're on now relying on private insurance markets.

Private insurance markets, the way it currently operates, is not the only choice. See Switzerland or Singapore for some UHC options that I would support.

Conclusion assumed and not proven.

If people take more time off, you really think we'll get the same level of production?

That sounds scary!

To assume that all of this is affordable in 30 years without showing the math from expected cost inflation, smaller workforce, etc. is what is really scary.

Um no, it's kind of a let's join the rest of the civilized world when it comes to health, education and other social policies.

How long can this graph and this graph keep going up? If you can't demonstrate the situation will be sustainable in 30 years and not have an unacceptably high risk of a global financial catastrophe should credit markets lose confidence in the fiscal situation of developed countries debt, then your proposal is a non-starter. How high of a risk of global financial catastrophe orders of magnitude more severe than the great recession and the EU sovereign debt crisis are you willing to tolerate? 1%? 5%? How much does the risk increase with these proposals?

 

[bilby]

...

If people take more time off, you really think we'll get the same level of production?

...

I do.

Most people are not productive 100% of the time that they are at work. Many people have a job to do that is paid either by the hour, or for a set amount of time per week, where the volume of work that must be done is finite and set not by the employee, or the employer, but by the customer.

If I take a Monday off, then the total work I am expected to complete by Friday doesn't change; and I have to work more, and goof off less from Tuesday to Friday to achieve my targets. Many people spend far more time at work than is strictly necessary based on the work to be done - because they are rewarded for taking a long time to do it. Directly rewarded, in the case of hourly waged employees; and indirectly in the case of salarymen who need to be seen to be working late, if they want to get promotions and bonuses.

It's a stupid system; but it's what we have got.

Certainly it is far from clear that having fewer days off makes a workforce more productive overall.

 

[Axulus]

...

If people take more time off, you really think we'll get the same level of production?

...

I do.

Most people are not productive 100% of the time that they are at work. Many people have a job to do that is paid either by the hour, or for a set amount of time per week, where the volume of work that must be done is finite and set not by the employee, or the employer, but by the customer.

If I take a Monday off, then the total work I am expected to complete by Friday doesn't change; and I have to work more, and goof off less from Tuesday to Friday to achieve my targets. Many people spend far more time at work than is strictly necessary based on the work to be done - because they are rewarded for taking a long time to do it. Directly rewarded, in the case of hourly waged employees; and indirectly in the case of salarymen who need to be seen to be working late, if they want to get promotions and bonuses.

It's a stupid system; but it's what we have got.

Certainly it is far from clear that having fewer days off makes a workforce more productive overall.

Then why does France, with its generous vacation benefits, family leave, and medical leave, have 22% less GDP per capita compared to the US?

I am NOT saying that more work and less time off is necessarily better. What I am saying is that the tax revenue shrinks when you have less GDP, which means the maximum level of goodies the government can buy would also necessarily go down, and any level of spending requires more burdensome taxation to fund.

 

[Jimmy Higgins]

Also, how many people work at a company where family leave (not even certain if it needs to be paid) is required by law?

I believe the law requires any company with 50 or more employees...at least in my state.

50 or more employees or 50 or more employees working at the same location?

 

[bilby]

I do.

Most people are not productive 100% of the time that they are at work. Many people have a job to do that is paid either by the hour, or for a set amount of time per week, where the volume of work that must be done is finite and set not by the employee, or the employer, but by the customer.

If I take a Monday off, then the total work I am expected to complete by Friday doesn't change; and I have to work more, and goof off less from Tuesday to Friday to achieve my targets. Many people spend far more time at work than is strictly necessary based on the work to be done - because they are rewarded for taking a long time to do it. Directly rewarded, in the case of hourly waged employees; and indirectly in the case of salarymen who need to be seen to be working late, if they want to get promotions and bonuses.

It's a stupid system; but it's what we have got.

Certainly it is far from clear that having fewer days off makes a workforce more productive overall.

Then why does France, with its generous vacation benefits, family leave, and medical leave, have 22% less GDP per capita compared to the US?

That's because they generate almost all of their electricity from nuclear power, consume frog's legs and snails, wear berets, and speak a latinate language.

Seriously; This is a perfect example of the falsity of the phrase "There are no stupid questions"; IF France was exactly like the US in every way APART from generous vacation benefits, family leave, and medical leave, then your question might make sense.

But it isn't, so it doesn't.

The answer is "For lots of reasons" - but then, you probably already know that.

I am NOT saying that more work and less time off is necessarily better.

No, but you are implying that less work and more time off is necessarily worse

What I am saying is that the tax revenue shrinks when you have less GDP, which means the maximum level of goodies the government can buy would also necessarily go down, and any level of spending requires more burdensome taxation to fund.

Indeed; And what you are NOT saying is that less work and more time off leads to less GDP - presumably because you can't actually support that claim - but in the absence of your saying this, saying that the tax revenue shrinks when you have less GDP becomes a non-sequitur.

 

[maxparrish]

Yeah, about that $15 trillion in medicare spending.

From the article linked in the OP:

But right now private health insurance plans are projected to spend $14 trillion over the next 10 years, and people are forecast to incur $4 trillion in out-of-pocket expenses.

$15 trillion over 10 years is actually about $3 trillion less than is currently projected to be spent privately over the next 10 years on healthcare.

I see you are quoting "objective" VOX, and relying on their enthusiasm for impulsively dashing off uncited claims. Notice that the projected Medicare spending of Bernie's proposal is based on a 2013 analysis for a particular House bill, using Gerald Friedman's work.

But the 2015 estimates for future Medicare spending are based on unknown methods, which may or may not use the same criteria and methodology of Friedman.

Shopping for two different numbers is not difficult, especially when the criteria examined, the methods, and the time period covered are different.

PS - Also note that Friedman's "analysis" was rather superficial, nearly a back of the envelope calculation to justify single payer.

 

[Frikki]

More paid family and medical leave means less work gets done, shrinking the economy, which means tax revenue shrinks.

This is not necessarily true. Paid family leave is less disruptive for a persons carrier so I would guess that paid family leave evens out the loss of work through a workers life. Then of course letting parents spend time with their children is a societal good. Tax money is not just for killing brown people.

 

[Bomb#20]

What I am saying is that the tax revenue shrinks when you have less GDP, which means the maximum level of goodies the government can buy would also necessarily go down...

No it wouldn't. You just make up the shortfall by borrowing from foreign lenders, and then you pay them back by just borrowing more from foreign lenders, and then when the foreigners start to get antsy about lending you more and more you just threaten not to pay them back, and then the German government just makes its taxpayers guarantee your loans.

 

[Frikki]

I do.

Most people are not productive 100% of the time that they are at work. Many people have a job to do that is paid either by the hour, or for a set amount of time per week, where the volume of work that must be done is finite and set not by the employee, or the employer, but by the customer.

If I take a Monday off, then the total work I am expected to complete by Friday doesn't change; and I have to work more, and goof off less from Tuesday to Friday to achieve my targets. Many people spend far more time at work than is strictly necessary based on the work to be done - because they are rewarded for taking a long time to do it. Directly rewarded, in the case of hourly waged employees; and indirectly in the case of salarymen who need to be seen to be working late, if they want to get promotions and bonuses.

It's a stupid system; but it's what we have got.

Certainly it is far from clear that having fewer days off makes a workforce more productive overall.

Then why does France, with its generous vacation benefits, family leave, and medical leave, have 22% less GDP per capita compared to the US?

I am NOT saying that more work and less time off is necessarily better. What I am saying is that the tax revenue shrinks when you have less GDP, which means the maximum level of goodies the government can buy would also necessarily go down, and any level of spending requires more burdensome taxation to fund.

What natural resources does France have? Is it a major oil producer like the US? Mining? Natural Gas? That might explain the 22%.