Free Markets, Free People

Daily Archives: April 19, 2011


Entitlements–the elephant in the room

As Republicans and Democrats jockey for political position in the upcoming budget fights, entitlements should loom large as programs that must be addressed and addressed quickly.

Instead, as we see so many times, the tendency to avoid the problem – to kick the can down the road- often becomes the chosen path.  Majority Leader Reid, for instance, has made it clear he doesn’t want to deal with Social Security at this time.

But, as we watch the deficit grow and debt pile up to unprecedented levels, most of us have come to realize there isn’t anymore road down which we can kick the can.  We’re at a dead end.  And the problem with entitlements still persists and has gotten worse.

Which brings me to the cite “elephant in the room” pertaining to entitlements.  Note the word – entitlement.  It connotes something which is owed without exception or change, something which is sacrosanct, something which can’t and shouldn’t be touched.

But Sal Bommarito at PolicyMic points out something which, despite all the rhetoric to the contrary, we should all realize:

Abrogation of existing entitlements is an arduous process as the roar of liberal lawmakers and civic leaders is much louder than the proponents of the fiscal conservatism side. Often, a sense of entitlement can overwhelm such debates. However, the most important thing to keep in mind is that an entitlement is only valid so long as it earns the approval of the people. Changing economic prospects could increase or decrease our nation’s propensity to be altruistic. In essence, entitlements are “people-given,” not “God-given”.

There is no “right” to “people-given” entitlements.  They are a privilege we choose to bestow when we can afford it.

Some will argue, rightly, that not all of the entitlements are bestowed.  That in fact, by legal mandate, we’re required to send Washington a portion of our income they demand for programs such as Social Security and Medicare.

But in reality, while that argument is valid, it isn’t valid for spending above and beyond what the programs take in.  The fact that government has badly mismanaged programs into which we’re legally obligated to pay doesn’t mean the programs should be left untouched.  Bommarito then addresses the elephant in the room, the argument those wanting entitlement reform to bring those programs to an affordable and sustainable level (or, elimination) should cite each and every time the subject is raised:

The legitimacy of the programs should not be based upon emotional responses to poverty — by Congress, society, and/or the media. If our government has the economic wherewithal, the effective transfer of money to those less fortunate should be law. However, the financial stability of our country is paramount even if this has become harder to achieve in recent years. And so, Congress and the president may have to rescind entitlements in response to bad times even if the beneficiaries will suffer greater hardships.

The absolute and primary priority for our national government should and must be the “financial stability of our country” – period.  That priority should never be held hostage to emotional appeals about the result of cutting or changing programs we obviously can’t afford.  We should never allow unsustainable spending on entitlements to threaten that top priority.

And of course the end state of 2 courses of action tell you why that priority should be paramount as Bommarito states.  Course A – do nothing.  We essentially bankrupt the nation with continued unsustainable spending and entitlements become null and void anyway.   Course B – we address the problem head on and do what is necessary to make entitlements viable and sustainable.   Some entitlements remain in force, even if at a lesser extent than before and we preserve the fiscal stability of the country.

President Obama, in his speech addressing the budget last week, essentially said we could have our cake and eat it too.  He declared that the other side’s claim that we couldn’t “afford” much of the welfare state was just pessimistic and wrong.  And of course, he then put forward a plan that would eventually raise taxes for everyone to pay for the profligacy of past (and present) government.

Bommarito has stated the primary reason entitlement reform must be a primary concern of the next budget cycle. Why not addressing those programs and doing what is necessary to reform them and make them sustainable or eliminate them is an abrogation of the primary priority for this government.  Entitlements are a “people-given” choice which should and must always be secondary to the overall financial stability of our country.

It is time we addressed this elephant in the room properly.

~McQ


Egypt woos US foes

Egypt continues to make more and more moves indicating that it desires to distance itself from the US and that more instability in the region will probably result from its diplomatic moves.

After decades of no relations with certain countries in the region, with the full approval of the US (and one would assume the lack of such relations would be in the best interest of the US and peace in the region), Egypt has now decided to change that course.  They tie to moves to regaining their regional prestige:

Iran and Egypt’s new government signaled Monday they were moving quickly to thaw decades of frosty relations, worrying the U.S., Israel and Saudi Arabia that the overtures could upset the Mideast’s fragile balance of power.

Iran said it appointed an ambassador to Egypt for the first time since the two sides froze diplomatic relations more than three decades ago, the website of the Iranian government’s official English-language channel, Press TV, reported late Monday.

Also Monday, officials at Egypt’s Ministry of Foreign Affairs confirmed that new foreign minister Nabil Elaraby is considering a visit to the Gaza Strip—an area controlled by Hamas, a militant Palestinian Islamist group backed by Tehran and until now shunned by Cairo.

It would be pretty hard not to see where this could lead. 

Additionally, Egypt is reaching out to Syria:

Egypt’s outreach has also extended to Syria, a close ally of Iran. In early March, Egypt’s new intelligence chief, Murad Muwafi, chose Syria for his first foreign trip.

The result of our “hey, Hosni, get out of town” policy?

Amr Moussa, the former Secretary General of the Arab league, owes his front-runner status in Egyptian presidential elections later this year to his forceful statements against Israel when he was Egypt’s foreign minister during the 1990s. Islamist groups in particular have been empowered by Egypt’s abrupt shift to democracy, and analysts expect that Egypt’s next government will have to answer to growing calls that it break with U.S. foreign-policy objectives.

Some Islamist political voices within Egypt have already begun their own sort of diplomacy. Magdi Hussein, the chairman of the Islamist Al Amal (Labor) Party, met with Iranian foreign minister Ali Akbar Salehi earlier this week in Tehran. Both sides encouraged a quickening of the diplomatic thaw between the two countries.

Egypt appears to be following a foreign relations pattern set by Turkey in the past decade—a strong American ally whose foreign policy has nevertheless decoupled from American interests. Regardless of its final position on Iran, the country is likely to be significantly less beholden to U.S. interests, American officials said, if only because Egypt was such a reliable ally under Mr. Mubarak.

"It’s hard to imagine a change that would improve on what we had" with the previous Egyptian regime, one U.S. official said.

If there’s a “Doomsday clock” for Middle East war, it is quickly moving toward 1 minute to midnight.

Meanwhile in Libya, the “days, not weeks” war enters its 2nd month with no resolution in sight.

~McQ