For those who want to have a substantive discussion on the federal budget and believe these cuts are justified, I have a few questions (putting aside questions of constitutionality for this thread):
1. There are claims that federal spending is out of control. How do you square that with the fact that spending as a percentage of GDP is only slightly elevated compared to the historical average going back to at least the 1970s, with the main deviation in the past few years coming from the after-effects of the pandemic? [1]
2. Federal spending largely falls into a few categories: taking care of the elderly (36%), defense and veterans (20%), taking care of the poor or disabled (22%), and interest on existing debt (13%). [2] This adds up to 91% of the budget. The US population is aging, which means that 36% slice is going to naturally grow. What do you think should be cut, and how?
3. The US pays far more for health care (28% of the budget if you include Medicare) and with worse outcomes on average. Why shouldn't the health insurance industry be the first item on the chopping block?
4. Corporate tax receipts have been steadily falling as a percentage of GDP. [3] Why shouldn't corporations (that benefit from a healthy and educated workforce, a safe and secure environment, a working transportation system, etc.) be paying their fair share to keep the national debt in check?
The proposed Senate budget includes $150 billion increase in the defense budget, which already was 50% of all discretionary spending (that means after SS and Medicare as that is covered by a separate tax).
This is much more than any DOGE savings, and shows that this isn't about reducing the federal budget, but about cutting services in order to fund two things: military, and corporate tax cuts (which largely benefit the rich).
With cuts to other parts of the federal budget, the defense share of the budget will be even larger than 50%.
I'd much rather my money being spent on education, foreign assistance, scientific research, etc., even if there is some inefficiencies and waste, than being spent on the military (which, by the way means that the big defense contractors in the US are _subsidized by tax payers_).
Right, but theres a difference between "economically inefficient because every dollar spent here translates to less than a dollar of direct returns" and "economically inefficient because every dollar spent on this requires spending five dollars more on administering it".
It's absolutely possible for a government to value investing in health care or education or foreign aid in a way that a corporation could never monetize, but still value doing it in a more effective way.
And don't worry, the House is ready to extend and expand tax cuts to more than extinguish any potential "savings" - to the tune of over $3 trillion in extra deficit spending. But don't worry, they've planned for that- just increase the debt limit by $4 trillion to cover the difference!
After all, now that the Democrats aren't in charge any longer, increasing the debt limit is no biggie - we'll just grow ourselves out of the hole! Once we enact those tax cuts, it'll be hard to justify even more debt spending on such silly things like "education" and "research". We've got to pay the interest on the money we borrowed to provide those tax cuts after all.
Wait, I thought the GOP was the party of fiscal conservatism and reducing the deficit? Shouldn't they be reducing the debt ceiling rather than raising it?
They’re the party of saying that, but then cutting taxes and launching insanely expensive very-optional wars paid for by credit card. This is just what they in-fact do when given a chance.
They claim to want to reduce the deficit, but are also committed to pretending that the best and least-painful ways to do that just don’t exist. So. Kinda hard to actually do it.
They only care about deficits when a democrat wants to pay for sick children’s medicine or something.
If you think that, then they've been successful at their usual smokescreen: blame Democrats for deficit spending, and then when the GOP is back in power, they do... more deficit spending. Sometimes even more deficit spending. Somehow a lot of people seem not to notice that.
They absolutely should be. The legislature is not representing the will of the voters and refusing to do what's right for society as a whole and pass term limits for themselves. It's not complicated. Those who vote yes are reasonable, ethical, moral people, and those who vote no leave behind a permanent legacy of boundless self-interest.
Public sector liabilities are private sector assets. GOP is the party of billionaires and billionaires want more money, so they demand lower taxes and greater deficits.
I'm not sure if this is true any more, or if it is it's nominally true. But Democrats certainly have a lot of wealth - Kamala Harris raised about $1.4bn to Trump's $700m in her campaign, and in record time.
DOGE isn't really cutting things to fund others. Many of their cuts are going to be net revenue negative. Many will cost taxpayers more of their money.
It's about gutting the civil service and staffing them with loyalists that will do what Trump or Musk want, despite what the law says. It's consolidation of power and corruption. Musk is also crippling many of the agencies that enforce regulations on his businesses.
The most obvious case is the CFPB, which returns roughly twice its cost to taxpayers. I would argue that's honestly very inefficient, I'd like to see the CFPB returning a multiple of its cost to taxpayers... but nonetheless it is obvious shutting it down will cost taxpayers more.
We only see what it's directly returning to customers, not the damage it prevents to happen in the first place by a) forcing companies to change their behaviour and b) possibly influencing legislation and policy making.
> I'd much rather my money being spent on education, foreign assistance, scientific research, etc., even if there is some inefficiencies and waste, than being spent on the military (which, by the way means that the big defense contractors in the US are _subsidized by tax payers_).
We all would, but given that Russia, Iran, China, and NK are aggressive states and all actively claim that the US is the enemy, and that the relative world order expired in 2022, we cannot have nice things. The peace dividend expired years ago
you could cut the US military budget substantially and it would still be the largest military power in the world and well able to defend itself
it might not longer be able to be the "undisputed global power" but, as someone who has lived abroad most of my life and seen American foreign policy from the other side, I don't know that's a bad thing
Although it is worth noting that the war spending the US does do also doesn't translate into being an undisputed global power. They burned a trillion or few in Afghanistan and I doubt that impressed anyone in particular. They didn't achieve anything. Challengers to the global hegemony multiplied in the aftermath.
If they hadn't wasted the resources they'd just be better off with no downsides.
They won’t have any choice soon enough - all that wishy washy they are not our enemy bullshit goes out the window with the first missile/shell/drone flying over.
I fail to see how the cuts as being implemented actually make US citizens safer from Russia, Iran, China, and NK. Can you elaborate on how they do that?
The only thing that we _need_ is ICBMs with nuclear warheads, which we already have plenty of. The rest of it is essentially optional. Even conceding the need for a large conventional military force (soldiers/tanks/boats/aircraft/drones/etc), the US military is way overfunded, and significant budget cuts would actually be on the table if DOGE were a sincere effort to reduce government spending.
Clearly false. Nukes are just not that useful in about anything except the end of the world. If you're fighting a Ukraine-style war, nukes are worthless.
Ukraine is only fighting an Ukraine-style war because it lacked nukes to begin with. Which, btw, they lack because we agreed to defend them from Russia if they agreed to not develop nukes.[1]
The list of wars that countries with nuclear weapons have lost against countries without nuclear weapons is pretty much all the wars those countries have list since 1945. It's a very long list.
Think about it. Would you be willing to end the world if your neighboring country just took one town? How about a city? A region? Countries need more than nukes to defend themselves because it's not credible or sensible to threaten to end the world over what could be just a border dispute.
On their own ground, deep in the heart of their most populated cities, using their own civilian aircraft, knowing they're unlikely to destroy their own cities and believing that your vision of God is on your side .. sure.
Nobody can use Nuclear bombs without serious repercussions.
Putin considered using new, smaller tactical nukes on Ukraine and that set off huge international opposition. The mere mention of nukes is extremely counter productive to whatever a state is trying to accomplish.
By some estimates Israel dropped 4 Hiroshimas worth of explosives on Gaza.
> Russia, Iran, China, and NK are aggressive states and all actively claim that the US is the enemy
Can you find a source where the Chinese government or even a Chinese official has stated the United States as an "enemy"? I've heard "economic competitor" or "strategic rival" before, but never "enemy".
On the contrary, I have heard many U.S. politicians (as well as social media commenters like yourself) claim that China is an enemy. However, I do think the official U.S. government view towards China is "strategic rival" as well.
American needs an enemy. Drugs, communism, terrorism, China. I guess without something to fear it would be hard to justify spending trillions on their military.
Generally I think most american military/state department people dont want China as an enemy but see a high chance of conflict if they invade Taiwan. Though under Trump I'm not sure we would defend Taiwan, we seem to be betraying Ukraine and other european allies
> I'd much rather my money being spent on education, foreign assistance, scientific research, etc., even if there is some inefficiencies and waste, than being spent on the military (which, by the way means that the big defense contractors in the US are _subsidized by tax payers_).
I would rather not spend taxpayers money on any of these and especially on military.
A bit off topic: end result and how to measure it is often the point against DOGE - that their “move fast and break things” approach would in fact break things, causing unexpected and excessive long term costs.
I get your point, they are still active and there will be more to evaluate.
> How do you square that with the fact that spending as a percentage of GDP is only slightly elevated compared to the historical average...?
Why should it scale linearly with GDP? I can see an argument that it should scale linearly with population (maybe), but if GDP per capita increases, you could also expect better tech/productivity to allow gov spending per capita to decrease.
> What do you think should be cut, and how?
Given the complexity in the details, I don't think a 'serious discussion' about this is even possible in this forum. But if the question is 'do you think an effort should be made to look for things to cut', I'd say 'yes, of course.'
> Why shouldn't the health insurance industry be the first item on the chopping block?
Absolutely, it should be looked at! I don't think it's a trivial problem to solve, but as RFK was confirmed as the secretary of HHS we should expect a lot of scrutiny on big pharma and insurers.
> Why shouldn't corporations .. be paying their fair share to keep the national debt in check?
By definition of 'fair', they should. But again, tax receipts falling as a % of GDP isn't evidence that they're not.
> But if the question is 'do you think an effort should be made to look for things to cut', I'd say 'yes, of course.'
This is such an unbelievably lazy response. Every single person in existence thinks there’s some amount of government waste that we wish were cut and either returned to the citizens or put to better use elsewhere.
The interesting and important question which GP poijted out—and which you completely dodged—is where and what should be cut. DOGE is looking at the set of government spending that accounts for less than 9% in aggregate of the entire federal budget. At best if they found that 10% of this money was abuse, it would account to less than 1% of the overall federal budget.
This isn’t about reducing government spending. If it was, they’d be going after larger targets. It’s about fulfilling their long-stated wet dream of finally drowning the government in a bathtub.
As I recall, the reasons are to: "form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity"
Whether all that was sincere or not is not the question: that was the promise I learned. 'Common defense' is well taken care of ... unlike 'general welfare' and/or liberty, particularly for 'our posterity'
It scales linearly because the same ratio of services to people continues. There aren’t suddenly less kids to educate, less elderly that need health care or less cases in federal court as the population grows.
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As someone that has been in healthcare for 12 years it’s broken because of the corporate structure and administrative state of companies. The payors and providers share the same incentive to raise rates because they each collect a percentage of premiums. This is a solved problem in every OCED country in the world except here. RFK isn’t going to fix this, he hasn’t even labeled the problem correctly. He has some ok ideas around nutrition but the rest of his ideas range from futile to dangerous.
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Corporate tax contributions aren’t at fair levels the national debt is increasing even while spending isn’t. They get access to markets created by society and government and yet as debts increase their ratio of tax payments is going down. The fair level would cover social service costs. I haven’t even gotten to the companies that receive subsidies or pay workers so little that they are in social support.
> It scales linearly because the same ratio of services to people continues
That would be scaling with population, not GDP.
> The payors and providers share the same incentive to raise rates because they each collect a percentage of premiums
This must be an oversimplification. Why would insurers ever reject a claim, or spend time negotiating lower rates, if they're only incentivized to see health costs increase?
A barber today is not much more productive than a barber in 1900, but a haircut today costs much more than a haircut in 1900, even adjusted for goods inflation. Why is today's haircut evidently more expensive?
The answer lies in the labour supply. If haircuts didn't cost more today than in 1900, would-be barbers would work in goods-producing sectors that have seen real productivity growth and consequently 'naturally' improved wages.
In some sectors, this has led to the replacement of labour with capital. Domestic help was once hired by the ordinary middle class, but now we have kitchen and household appliances instead. We see fewer expensive hand-crafts and more factory-produced goods. Even fast food joints try to replace human service with ordering kiosks.
This replacement is much more difficult in the government sector, where transfer payments tend to relate to income rather than absolute provision of hard goods and where health-care and education are two of the sectors most affected by the Baulmol effect.
Domestic help was once available because there was an extreme surplus of dirt poor people.
After the economic boom due to rising productivity, there weren't enough dirt poor people willing to work for peanuts, and today things like minimum wage and various benefits programs make it easier to not work for so little money a middle class family can easily afford it.
People would rather buy cheap factory goods than the more expensive hand made ones because they prefer to spend money on other things instead.
Google says the average barber haircut in 1900 for a man (women often did their hair at home) was 25 cents, which is just shy of $10 adjusted for inflation. Most places around me offer basic haircuts for $20.
In 1900, only the state of Minnesota had a requirement for barbers to be licensed (it was the first state to do so, in 1897). No beautician school requirement, no licensure payments, no state or federal income or sales taxes.
In short, it's surprising that the rise in cost of a haircut hasn't been higher.
I think there's something to Baulmol's theory, but there's a lot of hand waving that isn't really supported as well by the examples given here or elsewhere that I've seen. That, or the effect isn't all that it is claimed to be; it's almost tautological that as supply of workers for a low paying job dries up, the wages for the job have to go up to retain workers.
Yes you are right of course - my main point was about the cost of an MD visit. The reimbursement part was just to flex about how our health insurance is good :) (unrelated to the discussion)
No, because the level of services and cost to provide them scales also.
Inflation. What paying workers costs. What is considered an “acceptable” level of poverty vs abject poverty as we get richer. New, expensive medical procedures. And as the world gets richer, defense gets more expensive.
We can’t pay 1930 salaries to workers, field a 1930s army, nor would we consider it humane for our elderly to end up with an impoverished 1930s standard of living with 1930s medical care.
Inflation is misleading for these purposes, too, because it includes hedonic adjustments. So a new better procedure or bigger apartment costing 40 pc more might only be 10 pc higher from an inflation point of view, even though you can’t really buy the old one.
Re: insurers— it is an oversimplification. Suffice it to say they are at scale where they have market power and thus don’t price where p=mc, and the regulatory pressures and price opacity push them even further away from efficiency. They are not completely insulated from costs or market pressures, but it’s fairly close.
> GDP without qualification is 'real GDP', not 'nominal GDP' i.e it's already adjusted for inflation.
Nah.. I can't intuit what you are thinking or arguing. But I already addressed much more than you responded to. e.g.:
> > Inflation is misleading for these purposes, too, because it includes hedonic adjustments. So a new better procedure or bigger apartment costing 40 pc more might only be 10 pc higher from an inflation point of view, even though you can’t really buy the old one.
Claims approval has nothing to do with rate setting. Insurance companies can deny individual claims and still use the total payments in the aggregate to argue for premium increases with their regulators. Remember they are entitled to a statutory administrative costs fee. That’s how they really make money. 10% of a $2B is more than 10% of 1B so they want spending to go up.
That may actually be an improvement. One of my math teachers in high school hated the text books and gave us sets of problems from the 1950s. Instead of 20 easy problems, it was 3 much more difficult problems. The problem in our education system is the standards are in the toilet because they are afraid to fail people. This does not cost money to correct.
I do worry - in a sense. I have no doubt that a mugging gone wrong or a car crash because reasons could occur or is being considered actively.
Too often the enemies of the deep state wind up dead under suspicious circumstances. I see no reason why any of the new guard will be exempt from those methods.
I'd argue that we shouldn't expect government expenses to be effected that much by advances in productivity. Government services largely exist to handle situations that are inherently inefficient (disability, national defense, civil rights, education, elder care, etc.).
What's the argument that corporations should be laying a lower share of the GDP? Due to their greater proportionate wealth, corporations and the wealthy can better afford to pay. They also tend to disproportionately benefit from the government.
Service delivery can be improved by advances in productivity for both public and private sectors equally - The difference is that the private sector is constantly focusing on reducing costs of the most expensive business areas. For most businesses this is operations/service delivery, and reducing these costs allows the business to extract higher profit and gain the flexibility to compete on price. Employees who deliver cost out effectively are also rewarded. There is risk but also high reward.
Government organisations don't have the same profit incentive as they aren't in a competitive market, nor are there any personal incentives for executives to achieve these efficiencies. Government does eventually implement productivity improvement however it lags behind the private sector, with investment in productivity only occuring once risk has effectively been eliminated.
I've worked in both sectors, and people working in each sector are equally frustrated with inefficiency and seek to improve things. The problem with government isn't really the people nor the agency nor the sector, it's that the organisation and it's people only gain rewards by improving the status of the politician running the agency.
Nowadays saying that $X billion is being spent is more important than whether it successfully achieved the outcome. The effect of this is that one politician can announce $X billion to more efficiently achieve the same outcome as another politician announcing $2X billion at half the productivity and the second politician sounds like (or can easily be spun to sound like) they are achieving more/ care more than the first. The end result is massive expenditure on very little.
They absolutely benefit significantly more, from roads for shipping/traveling to educated workforce, to a more stable economy, more stable international trades, to a more stable electrical grid, plumbing, more stable buildings to house their business, and on and on etc… etc…
it’s absolutely wild to me how people fail to see how much more companies benefit from taxes.
The tax code can be looked at as written by the rich to pad their pockets. But it can also be looked at as the main lever by which the government manipulates us to get what it wants: affordable housing, high employment, cheap energy. There are a lot of real estate, business, and exploration / mining tax breaks presumably because the government wants to incentivize that activity.
The book “Tax Free Wealth” covers this and points out that the tax code looks pretty similar across all western countries when it comes to the way the activity the code is trying to stimulate.
I personally don’t like the tax code being used for such manipulations regardless of the motive behind it.
Most politicians are doing all sorts of real estate deals on the side. That’s why there are all kinds of tax breaks and incentives for real estate. It’s not to encourage such activity, but rather to directly benefit themselves and their associates.
I think we all agree that making the Gov more efficient is a good thing but this is about terrorizing federal employees for ideological reasons. There is no crisis to justify this. We do have a crisis in healthcare which is being ignored.
I am certainly not a supporter of this government, but I do find it unsettling to have massive amounts of ideologically fueled bureaucrats running the government. It goes both ways. The pendulum is now swinging in the other direction. I am losing hope that it will return to the middle one day.
Probably not fueled but in some agencies most staff is Democrats
> Democrats made up about half of the workforce during the 1997-2019 data period (compared with about 41% of the U.S. population). Meanwhile, registered Republicans dropped from 32% to 26% during the period, with an increase in Independents making up the difference. The most heavily Democratic departments are the EPA, Department of Education, and the State Department, where about 70% of employees are registered to the party, while the most conservative departments are Agriculture and Transportation.
GDP per se, maybe not, however we should still expect it to scale with the costs of services and goods that are correlated.
Ex: If the dollar price of rent doubles, then dollar expenditures to keep the elderly from dying in ditches will likewise double, even with no change in population.
GDP increases are generally measured in real (i.e. inflation adjusted) terms, so a doubling of rent costs don't imply a larger GDP. If we're talking nominal GDP, then I'd agree we should expect gov expense to increase as well.
Inflation refers to the money supply and is one number applied to everything in the economy. It does not account for things getting legitimately more expensive. Rent can go up faster than inflation, indeed we'd expect it to as presumably buildings are built or improved to higher standards and the surrounding neighborhoods have improvements which make the local real estate more valuable. Likewise for many other goods and services.
There's a lot of other data on the site the graph in 4 came from. I put together my own chart comparing corporate tax receipts to annual corporate profits, and it doesn't look any better. Looks worse, in fact. I have successfully convinced myself that corporations are not, in fact, paying their fair share.
To understand what's going on here, compare corporate income tax with VAT.
These are very similar taxes: A business takes its revenue and subtracts its expenses, the tax rate is applied to what's left. The distinction is that VAT is paid to the jurisdiction where the corporation's customers are, whereas corporate income tax is paid to the jurisdiction where the corporation files paperwork. It should be obvious what happens when you do the latter: International corporations start filing their paperwork in the countries with lower tax rates.
To fix this you need to tax corporations using a different kind of tax which is tied to some actual activity happening within the jurisdiction, which is what the US has been doing piecemeal rather than all at once, with corporate income tax playing a smaller role as time passes.
> To understand what's going on here, compare corporate income tax with VAT.
Under classical economics, there's also another effect at work. Corporate income taxes are capital taxes, whereas the VAT is a consumption tax.
Under "spherical cow in a vacuum" economics, capital taxes wind up reducing wages in equilibrium. The idea here is that investors care about their after-tax return, and if corporate taxes (on profits) go up they'll simply forego less-profitable investments to keep the marginal return on capital at the right level. With less capital investment, workers are less productive, and under the same spherical-cow assumptions workers are paid in proportion to their marginal productivity.
Conversely, VAT is assessed on consumption but not investment because corporations receive a VAT rebate on their inputs. The same "taxes are a disincentive" effect orients the economy towards investment (on the margin) and away from consumption. Capital intensity, productivity, and wages increase in equilibrium.
Reality's messier, of course, and economic academia engages in lively debate about the real incidence of all of these taxes.
It doesn't have to. But GDP is a good proxy for the tax base. If the problem is deficits and spending isn't increasing linearly with GDP, that suggests the problem is with taxation. Not spending.
Another factor is cost of debt. In a decreasing interest rate environment it's possible to run with increasing deficits without any major issues, but once you bounce off zero, even if thos deficits are not currently a problem, projections show that they will be.
If you increased debt in the past, interest on the debt then becomes a recurring expense. You then have to reduce spending relative to taxes, not only to pay the interest, but to eventually pay down the principal if you ever want to stop paying the interest.
> several reports recently that the interest on our debt will exceed the defense budget within the next couple of years. Is that not accurate?
This happened, I believe, in FY 2024 [1][2].
We're currently running a 6.5% primary deficit/GDP [3]. With real GDP growing around 2.5% a year [4], that means we need to cut about 4% of GDP, or $1.2tn [5], to stabilise our debt/GDP ratio. That's two Medicaids [6]. (Which would probably trigger a recession.)
It already was in 2024 (if you exclude veteran related costs.) Some of the increase is due to the government debt being larger, and some from interest rates rising. (The average interest rate we pay on our debt has doubled in the past 4 years, from 1.59% in 2020 to 3.28% in 2024.)
For simplicity, imagine one program like food stamps. It costs X dollars per person on the program.
The cost of that program should scale with inflation and population. If taxes and government should scale with GDP, that implies either making more programs or expanding existing ones. As an example, you'd increase the amount of people eligible for food stamps as the population became wealthier.
I can understand that as an argument but implying that the government isn't growing because the relationship to GDP hasn't changed seems to prove the opposite to me.
The federal budget, if the size of government remained static, should be Inflation * Population increase, shouldn't it?
GDP is rising faster than inflation so the services that the government provides should take less, as a percentage, of the population's money.
The cost of the Supplemental Nutrition Assistance Program (SNAP) has been decreasing year over year when adjusted for inflation since 2021. It was also decreasing when adjusted for inflation from 2013 to 2019.
The logic for food stamps does not really apply to other programs though. The amount of calories people need is constant, so supplying a given population with enough food to survive should be easier as time goes on. However for most things, we're not aiming for a fixed outcome but one that scales with GDP. For example medicine - providing people with 1970s levels of care would certainly be cheaper adjusted for inflation than it was in the 1970s, but providing access to modern medicine in modern hospitals performed by current doctors is substantially more expensive, and providing 2050 medicine will be more expensive still.
>> How do you square that with the fact that spending as a percentage of GDP is only slightly elevated compared to the historical average...?
> Why should it scale linearly with GDP? I can see an argument that it should scale linearly with population (maybe), but if GDP per capita increases, you could also expect better tech/productivity to allow gov spending per capita to decrease.
Over time it _can't_ scale linearly with population, unless you decide to not adjust for inflation. It _could_ scale with population and inflation, assuming that you agree that you don't want more services from your government.
Don't forget, a percentage of that GDP increase is just inflation.
Most people, as they get richer, want to have services increase, as they can afford to pay more. For example, they go to nicer restaurants, nicer hotels, maybe they get a massage, where previously they would not have, etc.
This is largely also true of a population. We expect that our children will be better educated. We expect better roads/bridges/other infrastructure. Heck, we might even expect better public infrastructure such as trains, buses, etc.
Scaling with GDP, rather than population, implies that government spending is scaling with the country's ability to provide services commensurate with prosperity.
Who said the problem is solely deficits? I don't think spending should just "scale" with anything and there is empirical evidence that that is a horrible way to run an economy.
You are literally just suggesting we spend more no matter what. Obviously, there is a massive difference in types of spending right? And we have an incredible amount of bad spending. In fact, in places like public education and health, we continue to spend more to get worse outcomes.
You're making large, sweeping generalizations and most of the positions espoused are more political than scientific.
The entire premise is to cut wasteful, corrupt, and ineffective spending. I’m sure nobody will agree with every single line item cut, but generally throwing money away on ineffective and fraudulent spend isn’t contributing to wealth transfer. Putting “bad spending” in quotes like none of the spend being cut is actually bad is disingenuous. If you tax the wealthy and get $100, but 95 of them end up in landing in other wealthy people’s pockets along the way, the people who need it aren’t winning. if you can remove $90 of waste, give the people who need it $20 instead of $5 and spend $5 to grease the wheels, you’ve cut spending 3 fold while transferring more wealth.
Then why are we talking about personnel at all? That's like 3% of spending. The only way to achieve actual savings is to reduce program spending, which isn't even an executive power.
> Scaling with GDP, rather than population, implies that government spending is scaling with the country's ability to provide services commensurate with prosperity.
This is only true if the value of government services increases over time and not just their cost. If GDP doubles and the government then spends twice as many real dollars to provide the same level of services as before, all you've done is cut efficiency in half.
>Why should it scale linearly with GDP? I can see an argument that it should scale linearly with population (maybe)
That does seem more intuitive, but I think throwing GDP in the mix is intended to measure something different—kind of our theoretical ability to bear the cost.
>but if GDP per capita increases, you could also expect better tech/productivity to allow gov spending per capita to decrease.
To some degree, yes. But, this potential decrease is limited by the proportion of our spending represented by direct transfers, such as Medicaire and Social Security.
Medicare is very much not a direct transfer. It's highly dependent on the cost of providing healthcare, which, if reduced (e.g. through regulatory reform) would allow the same value in benefits to be provided at a lower cost.
Social security is a direct transfer, but it's also... not a very well-targeted program. The nominal purpose is to prevent indigent retirees from being on the street, but then it not only makes payments to the retired Bill Gates, those payments are larger than the payments people who had made less money will receive. A major efficiency improvement would cause everyone to receive the same payments. That would face obvious opposition from the affluent retirees who are currently receiving payments and spending them on luxury vacations etc., but it could certainly save a lot of money without at all compromising the goal of the program.
Medicaire is not fully a direct transfer, but not for the reason you mention.
But, on the substance, you're correct that it was a horrible example, because the outlay is influenced by a highly inefficient system. Feel free to ignore.
My larger point to OP was that, the higher the proportion of our spending that is represented in transfers, the less likely it is that the same general technology and productivity gains that lifted per capita GDP would likewise decrease government spending per OP's assertion.
But, I missed the mark a second time in my comment by failing to mention that very little of those private sector productivity gains would flow to any government spending by osmosis. Beyond true direct transfers, other services would require regulatory change (to your point) or a review of specific government processes.
So, in any case, there's little reason to believe that per capita GDP increases would cause a corresponding reduction in government spending. They're coupled very loosely, if they are at all.
Part of this is that specifically social security has become a monstrous program which is in need of significant reform but consistently fails to receive it because it's the third rail, and then because it has been allowed to become so large, it's crowding out the rest of the government.
There are a lot of other de facto transfer payments in the government, but those programs do have the potential for significant efficiency gains, because they're not just transfer payments. They're each making relatively small payments and then have associated eligibility and means-testing bureaucracies. They would also be better replaced with tax credits for the same people for exactly that reason, but in a comparison against the historical programs, the current programs should be benefiting from significantly improved administrative efficiency as a result of computers etc.
And the budget items that aren't direct transfers generally aren't individually large budget items (the military being an obvious outlier), but cumulatively they're still most of the budget.
Well, to be clear, I'm not claiming that there's no room for more government efficiency. My point here was just that these efficiencies don't happen automatically, simply because the private sector figured out how to increase productivity (i.e. a simplification of what increases in per-capita GDP presumably proxy).
Your point that the current programs should be (emphasis mine) benefiting from improved efficiency "as a result of computers, etc" suggests that we are in agreement that it's not automatic (since it's not happening). Likewise, we agree that direct transfers are the larger individual items.
But, that's not to say that I agree with you 100%. For instance, recent data suggests that only 0.5% of the money paid to Social Security recipients goes to administrative costs [0]. So, I don't want to overlook the programs that are administered efficiently. And, if by "monstrous" you mean we pay out a lot of money, then this is only a potential issue relative to what we take in. That is, the implication is always that cutting benefits is the answer.
So, the other third rail seems to be having the wealthy pay more by raising caps on FICA or otherwise. I mean, at what point do we consider that billionaires and centibillionares are increasingly common, and we're well on our way to minting a trillionaire? Yet, we're considering cuts to programs that contribute to mere subsistence for others? (I'll leave aside the irony that it's the would-be trillionaire who may well drive the cuts, because it's almost too rich).
>They would also be better replaced with tax credits
I'm not sure that adding to our already insanely complex tax code/bureaucracy gains us much, or that it would approximate needs as accurately as the current means testing approaches (even if it were more efficient).
> My point here was just that these efficiencies don't happen automatically, simply because the private sector figured out how to increase productivity (i.e. a simplification of what increases in per-capita GDP presumably proxy).
You can argue that the increase in government productivity wouldn't be exactly the same percentage change as the increase in private sector productivity, but it's highly implausible that it would be zero.
> that it's not automatic (since it's not happening)
That's not necessarily what's happening though. Some of the efficiency improvements have been realized by the government. But instead of taking the efficiency improvement as lower spending, other spending increased to consume the surplus.
> For instance, recent data suggests that only 0.5% of the money paid to Social Security recipients goes to administrative costs
That doesn't necessarily imply a high level of efficiency given the massive outlay though. "Oh, it's only 0.5%... of $1.5T." That's still billions of dollars in overhead. If you could cut the overhead in half you could save billions of dollars.
It's also not even accounting for all of it because a lot of the overhead from Social Security comes from the administration of the tax, which falls under the IRS. Which then uses the same trick where they hide a huge administrative budget by comparing it to the entirety of all income taxes paid by everybody to turn a large number into a small percentage. And then the separately budgeted federal law enforcement resources that go into investigating social security fraud etc.
It's easy to make something look more efficient by shifting its costs into someone else's budget.
> And, if by "monstrous" you mean we pay out a lot of money, then this is only a potential issue relative to what we take in.
Well no, any given program should have to stand on its own. Just because you could hypothetically collect more tax revenue doesn't mean you should raise taxes, nor does it mean that you should spend the money on program A instead of program B. For example, which is a better use of tax dollars, sending a social security check to millionaires, or increasing the child tax credit?
> So, the other third rail seems to be having the wealthy pay more by raising caps on FICA or otherwise.
The far better solution is to eliminate FICA whatsoever and put Social Security and Medicare into the general budget. Having a separate tax for them is an anachronism and it would eliminate the wailing about the "social security trust fund" which was never anything but Congress immediately spending the money when social security was collecting a surplus and funding the shortfall out of general revenues (or, let's face it, deficit spending) now that it isn't.
> I mean, at what point do we consider that billionaires and centibillionares are increasingly common, and we're well on our way to minting a trillionaire?
Why does anyone think this has much to do with taxes? Taxes in general are a percentage of profits. If someone's company becomes worth three trillion dollars and as a result they now have $800B, is the problem actually that the government took 30% of it instead of 38% or something like that? No, the problem is that the market is so consolidated there is a three trillion dollar corporation roaming around, which there still would be even if you changed who owns it unless you do something about that, which is a competition problem rather than a tax problem.
> Yet, we're considering cuts to programs that contribute to mere subsistence for others?
The point is that the program's budget is so expansive because it's cutting larger checks to affluent people who are not relying on it for subsistence.
> I'm not sure that adding to our already insanely complex tax code/bureaucracy gains us much, or that it would approximate needs as accurately as the current means testing approaches (even if it were more efficient).
You don't have to create a separate tax credit for each individual program. The programs all do the same general thing: Transfer payments to lower income people. Create a single refundable credit in the combined amount that everybody gets (and parents can claim on behalf of minor children) and it replaces all the different programs at once.
A lot of government service does not scale that way. When a veteran needs help getting groceries, or getting to the VA, or has to go into long-term care, for example, there isn't technology to scale up a human being helping them with the groceries, or the transportation, or the nursing.
The government mostly serves human beings and the options for scaling that problem domain (which aren't dehumanizing) are limited.
There kind of is though. There are now grocery delivery services that amortize the cost of the trip by delivering groceries to multiple people, and self-driving cars.
Moreover, a major role of the government is record keeping, which computers have made dramatically more efficient. Many of those roles have in fact been replaced in the government, with the savings being reallocated to new spending rather than returned to the public. And many of them haven't been but could be; take any instance of something that could reasonably be done via a government website only the website doesn't support it or is broken so instead the government is still paying a large staff to do it manually.
Self-driving cars aren't nearly ready to solve this problem.
Besides the fact that they don't work yet (source: I'm working on it ;), a self-driving car can't bring the food to the door because the veteran is in a wheelchair. It can't knock on the door, have short chat, ask about the wife (who is deceased five years), and when necessary... Call elder care services when the veteran says he just talked to her yesterday.
None of this is part of the formal job description; it's the stuff that keeps real human beings from "falling through the holes" of the social safety net.
There's a lot of the web of government support of people that doesn't scale because the human-to-human contact is part of the point.
> Besides the fact that they don't work yet (source: I'm working on it ;)
They don't work everywhere all the time. They clearly exist; they're out there on the roads.
> a self-driving car can't bring the food to the door because the veteran is in a wheelchair.
It could, however, deliver the veteran to their appointment, in the many cases where the path between their home and the VA is one of the ones a self-driving car can already navigate.
Grocery delivery, by contrast, could still be done by a person, but modern logistics technology allows that person to deliver groceries for multiple people with one trip to the store.
> It can't knock on the door, have short chat, ask about the wife (who is deceased five years), and when necessary... Call elder care services when the veteran says he just talked to her yesterday.
That is an entirely different service. To see why, consider the veteran who has that problem but has never needed (or anyway requested) to have groceries delivered.
> Absolutely, it should be looked at! I don't think it's a trivial problem to solve, but as RFK was confirmed as the secretary of HHS we should expect a lot of scrutiny on big pharma and insurers.
Eh, we're going to see a lot of scrutiny on proven vaccines and other proven medications that RFK harbors a lot of delusional beliefs about, because he's a conspiracy addled pudding-brained nutjob.
Number 3 can’t be overstated. Healthcare costs for the exact same care are 2x-3x what they are in Europe.
Global health insurance plans usually come in two flavors:
1. Global coverage
2. Global coverage excluding United States (for half the monthly premium of the first plan)
The United States in an extreme outlier in terms of cost. This is separate from rationing care. This is separate from even population health (ex. higher obesity rates)
20 years ago I read a story about an obstetrician in the USA.
His premiums at that time for professional negligence were $1m per year. He would have to keep paying those premiums for 18 years after his retirement.
Same for every obstetrician.
Professional fees then must be set to cover those insurance premiums.
Has that changed for the better in the USA? Seems very unlikely to be the same in Europe.
Obstetrics is obviously a illustrative case. How are the professional negligence premiums across the other specialties?
Why does the effect of the US legal system never seem to come up much in the “US healthcare is insanely expensive” discussion? Is the effect of it really not significant?
Australians are more litigious than Americans, with similar insurance costs for doctors, yet our healthcare costs are still half of the USA's.
So insurance costs may be a factor, but its doubtful that its a large factor in healthcare costs, they largest factor is by far the public vs private system.
I experienced US healthcare when I went to visit a doctor in the US for a simple (obvious) ear infection. I was charged $600 USD for a five minute consult because the doctor wanted to milk as much $$$ from me as he could, giving me lots of unrelated/pointless blood tests (which were pointless because I was flying out the next day and wouldn't get the results).
In Australia it would have been a $65 fee paid by the government, and $10 for the antibiotics, around 1/10th of the US costs.
The problem in the US is that doctors and hospitals are incentivised to give patients unnecessary tests and medication, because it inflates their bills, and they make more profit.
I've noticed the same thing happening in Australia with private vets & vet hospitals because they are less regulated. They try and talk you into a lot of unnecessary procedures, test, and drugs because they make more profit, and the industry is not where near as well regulated as healthcare.
At least with a vet you can usually shop around, when you are sick often you cannot.
> The problem in the US is that doctors and hospitals are incentivised to give patients unnecessary tests and medication, because it inflates their bills, and they make more profit.
You’re right about what happened, but not for the wholly right reasons. The hospital charged you so much because they have to also negotiate prices with insurance companies (health insurance companies are just for-profit government agencies, they don’t actually serve a market value today) and pay for those who are uninsured. There are for-profit healthcare systems of course, but that’s only part of the story.
If the cost of the doctor’s time and the medication was $100, they can now cover let’s say 3 uninsured people for $300 each then take the other $300 you paid and book that against someone going bankrupt or a difference in negotiated cost with the insurance agency.
In America we have privatized profit for the insurance companies and socialized loss. They deny a claim, book a profit, the person with the claim doesn’t get treatment, then can’t work, then needs care, and society pays for it.
Purely from a cost perspective we should just go to single payer, but we won’t do that because who is going to the the politician that causes 10s of thousands in job losses of highly paid white collar professionals?
I was effectively uninsured as a foreigner, and had to pay for it myself hoping that I'd be reimbursed by my company later.
I had a nasty ear-infection, could hardly walk, and was in no state to argue, but the nurse gave me dozens of what they said were completely "normal procedure" blood tests from their in-house lab, which the doctor would have profited from directly. I told them I was leaving the next day and wouldn't get any results if they took a day, but they ignored and persisted.
I looked at the bill later and they were for loads and loads of completely unrelated conditions, diabetes, HIV, etc... a useless waste.
It was price gouging from the doctor directly pure and simple, no insurance providers involved, but I'm sure that normally that also adds an extra layer of silly costs.
In Australia its carefully regulated what a doctor can charge, and its a different company that does any tests, or gives out medication, the doctor or company can't profit directly from sending patients off for more testing, or for prescribing medication.
The main issue is you went to a hospital for an ear infection. You are subsidizing someone who is destitute getting a bullet wound treated potentially. The solution is the urgent care clinic for these situations. You would have paid quite a lot less. My last urgent care visit cost me $50 and I walked out with a $10 prescription.
I would need to see a citation for this story. Medical malpractice/negligence premiums are very high - OBGYNs pay some of the highest rates. Just a few google searches shows that rates can exceed $200k (annually) in some locales in 2024.
So to claim in 2004 that there are doctors paying > $1m/year in malpractice insurance is at least an order of magnitude away from what casual googling discloses.
I agree that the whole system is fucked, but I would like to make sure we are working on a solid set of base facts.
I found this article [0] from the NYTimes in 2005 that highlighted a neurosurgeon who was paying >$200k/year in malpractice premiums around that time
I totally believe you could find examples of insurance products that have increased in price 4x over the last 20 years. I have a harder time believing that obstetricians were paying $1m/year in insurance premiums 20 years ago (the claim in the GP) when obstetricians make on average around $300k per year now. You'd have to believe they gross around $1.5m to net out a $300k salary, which seems unlikely.
> The United States in an extreme outlier in terms of cost. This is separate from rationing care. This is separate from even population health (ex. higher obesity rates)
Are you sure? People comparing US healthcare costs to European costs don't realize that these are two very different products. The US population is much more unhealthy, yet it has about the same life expectancy as an average European country. This would suggest that Americans actually have access to significantly more healthcare services than Europeans do.
I think a lot of people assume that some of this stuff is linear when it actually seems to be exponential (or super-exponential) in cost. The median American spends half of their lifetime medical bills in their last year of life. That's a lot of money for not a lot of time. Incidentally, American doctors also tend to spend a lot less in this period, indicating that they have a much more healthy relationship with at least one of health or death.
I haven't been particularly convinced, looking at the healthcare systems across the pond, that they are providing anywhere near the same level of service that you get from the ultra-expensive US healthcare system. They are somewhat more optimized for efficiency and the US healthcare system is much more optimized for outcomes - partly because Americans are so litigious and IMO partly because the patient is the customer. That doesn't lead to low costs.
If US healthcare is optimizing for outcomes, it’s doing a poor job and maybe we should optimize for something else. Our outcomes based on relative rating does not justify the additional cost.
What do you mean by that? The population of the US is incredibly unhealthy, but that has little to do with the healthcare system and a lot more to do with consumption habits.
The life expectancy of the USA is a few years lower than the average in Europe. And of course Europe is poorer on average, plus has a war ongoing. Adjusted for those, I imagine the gap is larger still
That's the point of looking at global healthcare plans, which are giving two prices for the same person depending on whether they will or won't be in the US.
And while they aren't giving the same service, there isn't much evidence the service is necessarily worse. More healthcare doesn't necessarily lead to better outcomes, it's not uncommon for more liberal treatment guidelines to only improve through statistical errors or to lead to compensatory idiopathic illness.
This is systematically incentivized in the US, where both the doctors (obviously) will be paid more for more/worse care, but also the insurers which have to follow the 80/20 or 85/15 rules and are therefore incentivized to increase costs to increase total profits, especially in places where they have little competition, or agreements with hospital systems to pay a similar amount to other insurers.
Additionally, the spurious nature of claims in the US system wastes massive amounts of resources where insurers (with their 15-20% of premiums) but also practitioners (sometimes even over 20%) spend their time just haggling over approvals instead of using a clear and deterministic system, which also causes knock-on consequences later.
I don't think your methodology of looking at global plans holds up, because on balance those are a self-selected crowd (a bias, likely toward healthier people) and if you note that the standard of care is different, the price is going to be different. These healthcare companies know what product they are selling well.
I think it's clear that there's significant waste in terms of advertising, haggling with each other, etc. that you don't get in a universal healthcare system. However, there is also waste in universal healthcare systems around the cost of the bureaucracy to manage the leviathan.
The way to attack the problem economically would have involved giving everyone in the USA an HSA that was funded to allow them to directly consume healthcare services with price exposure. It would naturally force competition on price.
The ACA that we got instead cemented the separation of people from the price of their service and costs have ballooned even more than that were previously.
The economic approach is the only real way to fix things long term.
Are you going to shop around different pathology labs when they snip a bit out of your colon during a colonoscopy where you are under general anesthesia? Are you going to be googling for reviews of different neurologists when you get taken to the emergency room with a bad concussion or a stroke?
I don't think so.
So how is your market-driven medical system going to work? This isn't like picking a restaurant.
I think you’d be surprised how little price competition there would be if everyone paid out of pocket. It won’t change insurance premiums; it won’t change the amount of investment (training and certification) needed to become a health care provider; it won’t change the price of advanced medical equipment; and it won’t change the price of patented drugs.
Before you conclude that the free market can solve everything, consider too that health care isn’t a typical service that follows ia supply/demand curve. The demand curve is practically vertical, especially when your life is on the line. You’re not going to shop around when your appendix is about to burst. Plus there are still high base costs, and scarcity (artificial or otherwise) of healthcare resources. And the monopolies granted to medical device and drug makers through the patent system keep prices high so the patentees can recoup their investments.
There is no easy way to solve this problem, despite breathless claims to the contrary that have been plaguing our airwaves since the 1980s.
Sure there is. It's called single payer.
There's no way to fix this with the current layers of middlemen milking profits from what should be a public utility.
I meant to say there’s no market-based solution to the problem.
That said, single payer has problems, too, which is why few countries use it in its purest form. Everyone gets a “floor” of coverage, which is a good thing, but people also hate waiting long periods for treatments and the inability to choose a specific care provider. Britons love NHS, but they hate it, too.
Why do Americans think competition on price is practical for health services? The most expensive services people receive tend to trauma care or for long term debilitating conditions. In both cases the ability to "shop around" is either literally impossible, or geographically limited (and the ability to travel is just another regressive tax).
I went into the hospital for shortness of breath but my main issue was fluid accumulation. I had 3 paracenthesis procedures and was hooked up to a drip of Lasic and a catheter bag for 20 days. I didn't even recognize that I was in the ICU until I got the bill.
They charged $194,000. Insurance claims they paid $193,781. Of that, it was $7300 a day for staying in the ICU. My ambulance ride was $2500 for an 11 minute trip where one guy listened to my lungs and took my blood pressure. I had a palliative care doctor who met with me for 1.5 hours during my entire stay. She charged me $1K per hour.
I know of at least one source arguing that in fact, population health (mainly obesity and gun violence) explain upwards of 70% of the difference in healthcare spending between the US and other developed nations.[1] To me, this seems like the most likely explanation because I believe we have pretty similar diagnostics and treatments to other developed countries, and I don't feel like a British doctor would give me any treatment that an American doctor wouldn't, and vice versa. As for the other 30%, I think it's probably due to inefficiencies in the insurance-based payment system and our patents lasting too long making drugs more expensive.
A doctor I know worked in the US and then returned to Canada. In his US clinic, each doctor had 2-3 employees devoted to billing (patient-paid and insurance). In his Canadian clinic, they had 1 employee doing the billing for 4 doctors.
Even the various single payer models in Europe and asia still have insurance companies.
The difference is that in these systems the government has some stake — whether it’s providing the public insurance fund, or owning the company itself — so that the government is financially incentivized to reduce costs.
In the US case everything is private so all parties are incentivized to increase costs as much as possible.
We really should to copy the Bismarck model. Public owned “public fund”, heavily regulated private insurance and care.
Competition among insurance companies in most other systems (like the Bismarckian system) is far more constrained and so consumes far less capital. A huuuuge portion of health insurance premiums just go toward spending on ads to pull members from other insurers and otherwise retain your own (especially while they are paying into the plan rather than pulling from the plan, at which point you’re happy to lose them).
1. Your $3.7 billion figure is about auto insurers
2. I misspoke and meant "marketing" broadly, not ads in particular. This all fits under administrative overhead which is one of the major sources of inefficiency between private health plans in the US compared to Medicare/Medicaid.
I believe there should be a government backed, credit union style, non profit operating in every industry as a baseline for companies to compete against.
I don’t think that would work. The big insurance companies would find a way to undermine that. But also, the government insurer would end up with the most expensive patients who can least afford premiums, and then the libertarian types will use that to show how the government isn’t as efficient as the private sector.
I have no idea what the actual solution should be, though.
I had almost identical cases of cellulitis, one in the US and one in the UK. In the UK, I opted for private hospitalization in one of the fancier hospitals in London. The care was noticeably superior in the UK hospital. The attending doctor was available for a case summary on a few minutes notice, the sterilization and cleaning of the room was vastly better and the nursing staff could recite my case notes and recent test results and vitals at any time. None of these applied for the US hospital.
The bill in the UK was about half what it was in the US and the walk-in price in the US if I hadn't had local insurance would have been nearly double the price I did pay.
The kicker was that the UK hospital was run by HCA, an American corporation.
> I believe we have pretty similar diagnostics and treatments to other developed countries
I don't know. I remember reading an MIT PhD thesis describing how Kaiser Permanente does autism diagnosis [0] – and comparing it to my personal experience of the same topic in Australia, it seemed significantly more rigorous – e.g. specialist centres that only do autism diagnosis, using the multidisciplinary team diagnosis model instead of the single clinician diagnosis model, use of research reliable examiners for ADOS (the training and validation process required to use ADOS in research settings is much more intensive than that required to use it clinically), etc. Now, the thesis does acknowledge that Kaiser is somewhat of an outlier in this regard compared to the US average (plus it is 10 years old so now so I don't know how things have evolved since), but I still get the impression that this highly rigorous approach to autism diagnosis is much more of a thing in the US than in Australia – and if that's true of autism, maybe it is true of other conditions as well.
[0] https://dspace.mit.edu/handle/1721.1/90070 – the first half of the thesis uses the pseudonym "Allied Health", but I know from other sources that "Allied"=Kaiser; the second half discusses Kaiser without any pseudonym
Kaiser is above average in the US, but in the major cities on the East coast you can actually find care that is much more sophisticated than you will get at Kaiser. If I were dying of a rare and aggressive form of cancer right now, I would rather be in Florida (Mayo), New York (Mount Sinai and Sloan Kettering), Boston (Dana-Farber), or DC (Johns Hopkins) than California. Kaiser's big advantage is the whole-life aspect of care, which is pretty appealing as a healthy person, but the medicine available in the US gets much more complicated.
If you live in an area served by Kaiser and don’t have a very specific health reason to choose a different provider, I highly recommend them. They might not be able to treat that rare and aggressive cancer as well as the Mayo Clinic, but because it’s whole-life care, you’re more likely to find the cancer early.
Edit: Question. Can Mayo expand to cover everyone in Florida? Or is their advantage in hiring the best of the best? What makes their model better than Kaiser?
I agree with you that the Kaiser model is very successful and has great outcomes at relatively lower cost. I was just pointing out that if you want to show off the complexity of US Healthcare, Kaiser isn't the best model.
> I know of at least one source arguing that in fact, population health (mainly obesity and gun violence) explain upwards of 70% of the difference in healthcare spending between the US and other developed nations
I have my doubts. Over the last 50 years the ratio of US per capita health care costs and European per capita health care costs (or per capita health care costs for most of the rest of first world countries) has stayed about the same.
In other words, health care costs have risen at about the same rate throughout the first world over the last 50 years. So if in 1970 the US was paying say 3x per capita what some other country paid the US would still now be paying about 3x what they are now paying. Both would be paying maybe 35x now than they were in 1970.
Over that same time both US and European obesity rates went up, but they went up way more in the US. If obesity was a major factor driving health care costs then I'd expect US health care costs to be rising significantly faster than European health care costs.
Experimental therapies do exist in public healthcare systems, the costs are generally borne by the universities with special financing for experimental treatments. Many universities in public systems are run directly by universities which simplifies the process.
I don't think a reasonable discussion is possible.
Congress is supposed to fund the government and say how money is spent.
The executive "cutting" things to "save money" is basically the executive assuming the power of the legislative branch.
That said, what we're witnessing doesn't actually seem to be about spending. It seems to be more about obtaining direct dominance over the whole branch so it can be run essentially free of any oversight or connection to legislation and law - IE to create a quasi-imperial executive branch narrowly focused on the priorities of it princely leaders. So most of the "firings" are basically to make a point, winnow things down to loyalists who will ignore the law, and keep the news so filled with surface reporting on each new small outrage that the big ones don't get noticed, not so save any money.
Anyone who truly believes that there's tons to cut and that government institutions need reform can't also think that getting rid of huge swaths of the institution without attempt to identify improvements, priorities, or waste, will actually create efficacy, unless their real goal is not reform and cutting waste, but rather to make the whole of the current form of government fail.
I've seen some wild social media posts that suggest that people have really absurd views on this, too - someone I went to high school with like 20 years ago is having some kind of issue with navigating the Social Security Administration for something via phone and he's cheering on what's going on like it will actually solve his issue.
I have the same concerns as you regarding the constitutionality of everything that's been going on. The thing is, the judicial branch interprets the constitution, and while the Supreme Court likes to maintain a pretense of cold impartiality, in practice they try not to run too far out of step with popular opinion.
Which is to say, the opinion of your old high school classmate matters, for better or for worse. And I'd like to believe that our conversations matter, in so far as we can talk civilly with each other, and perhaps, just perhaps, change each others' views over time. We need to reverse this trend of shouting at each other over the Internet and hating "the other side" that we've been on for the past 10, 20 years. Our democracy depends on it.
> 1. There are claims that federal spending is out of control. How do you square that with the fact that spending as a percentage of GDP is only slightly elevated compared to the historical average going back to at least the 1970s, with the main deviation in the past few years coming from the after-effects of the pandemic? [1]
Government expenditure as a proportion of GDP has been rising steadily for a century and is now approaching 40%. From IMF: https://www.imf.org/external/datamapper/exp@FPP/USA. The recent trend is shaky due to Covid, housing crash, maybe dot com crash, etc., but it looks like it's probably still trending upward.
I've actually heard claims of the opposite -- that government has been under persistent and increasing attack since the 70s (or alternatively, since Reagan). I just can't see how the numbers square with that.
> Government expenditure as a proportion of GDP has been rising steadily for a century and is now approaching 40%
No it hasn't. It rose until about 1980 (mostly until 1970), and it's been about the same for the past 45 years.
And yes, it rose 1925-1980 as we built the modern social services state. With social security, Medicaid, Medicare, and so forth. This was a worldwide phenomenon too, not just the US. People asked for more from their governments. This is a good thing.
It does not look like it's currently trending upward, from your own data.
> No it hasn't. It rose until about 1980 (mostly until 1970), and it's been about the same for the past 45 years.
Yes it has. In 1980 it was 34.25%, in 2022 it was 36.25%.
> And yes, it rose 1925-1980 as we built the modern social services state. With social security, Medicaid, Medicare, and so forth.
US government spending on healthcare is about as most other developed countries yet they are able to provide universal or similar healthcare access. Americans spend that amount again privately on healthcare, and the result is worse outcomes in many objective measures of public health. Just one example since healthcare is one of the biggest expenditures. This is not a good thing.
The idea that "some government good" = "more government better" or "less government worse" is just not a sound argument. At all.
> This was a worldwide phenomenon too, not just the US. People asked for more from their governments. This is a good thing.
Not many Americans I know of asked to pay universal healthcare tier costs without getting universal healthcare. Not many asked to pay for forever-wars and interventions and meddling all over the globe.
> It does not look like it's currently trending upward, from your own data.
It does to me. The linear trend plotted from 1980 to 2022 does have it increasing too.
2% in 45 years is a completely meaningless amount. You are technically and pedantically correct, but in the context of the actual conversation being had it is so little as to be irrelevant.
On the graph they shared earlier, 2020 is 44.82%, exactly on the 1960 - 1992 trendline. The 2022 and 2009 dropoffs coincide with major disruptions (don't know about the late-90s one), which almost seems to hint that's the value we should be looking at: +10.57% in 20 years.
2019 was 35.97, and 2022 was 36.26, but we shouldn't use those, we should use the 2020 number? Come on, the 2020 and 2021 numbers are not representative of the overall trend.
Honest question, do expect people to actually believe you're a serious person interested in rational debate with that kind of response?
What Trump / DOGE has proposed or claimed to have cut amounts to far less than $500 billion / year from the budget. Like 1/10th that amount. Yet people are seriously concerned about those cuts. Clearly it's not a reasonable amount, as you would understand if you had any idea of the context of this conversation.
What DOGE has claimed to have cut is a similarly meaningless amount (and likely significantly overinflated), and what's worse, the value we were getting from those expenditures likely greatly exceeds what we were paying for them.
$500bn/yr would be about 15% of the annual budget. That number doesn't even pass a basic sniff test.
2% of US GDP is 500 billion. I don't know what you're confused about. I'm taking numbers linked from the IMF so perhaps you know better? Also it's obviously not a 2% increase over 45 years, it's a nearly 6% increase, so not sure if numbers are your strong suit here. At least you did admit I was correct though, so I don't know what you're really continuing to try argue about. What I wrote originally stands.
Rising steadily is what you said. It's really not doing that.
It's funny that you latched onto the mention of the year 1980, because if you used 1982 (or 1983, 1984, 1985...) you'd see that it has gone down. The most recent measurement is lower than it was in the years around 1990, and the measurements before covid hit were also lower than those years.
And I just realized. If you actually want to go back 40 years from the most recent data point, the year to use is... 1982.
There’s no reason we have to be spending so much on healthcare. I’m convinced if Joe Lieberman didn’t block the public option in 2009, or if the Democrats had a spine and actually bypassed the filibuster to make sure the bill was as good as it could be, we’d have universal health care today. Instead, we decided to bail out insurance companies, to the benefit of nobody but insurance companies.
We still could have single payer, but that’s not going to happen with the current group in charge.
Right. Healthcare expenditure just looks incredibly wasteful. Even if it is (as its defenders would say) buying more for the money, it just seems to be costing way too much when you look at others. And it's not as though those other developed countries' healthcare systems are paragons of efficiency themselves.
That people are so flabbergasted and astounded that voters should be concerned by government spending and waste is actually the incredible thing to me.
> The US population is aging, which means that 36% slice is going to naturally grow. What do you think should be cut, and how?
Old people [1], veterans [2], high earners and homeowners [3] turn out to vote. The only demographic we can cut benefits to are the poor. That's what's happening. (Given partisan polarisation, my guess is Democrats will take an axe to veteran benefits next cycle.)
> Why shouldn't the health insurance industry be the first item on the chopping block?
Health insurance is orthogonal to federal spending. The correct question is why Medicare shouldn't be allowed to directly negotiate pricing with providers on more items.
> Why shouldn't corporations (that benefit from a healthy and educated workforce, a safe and secure environment, a working transportation system, etc.) be paying their fair share to keep the national debt in check?
The term "fair share" is always loaded in tax discussions. Be honest and say why shouldn't corporations pay more. The answer to that is it's an inefficient way of taxing the wealthy since absent a progressive corporate tax structure, which nobody seems to be proposing, you wind up taxing a lot of small and medium-sized businesses.
Better: add tax brackets at the $1mm, $10mm and $100mm thresholds.
> Health insurance is orthogonal to federal spending.
As an Australian looking at the USA - I'm not sure how you make that claim sincerely.
Perhaps you're constraining it specifically to 'insurance', rather than the only slightly broader question of private health coverage. It still feels like a tenuous claim, given parent's valid point about health costs at the federal level, and intimation around the poor comparison to almost all the other advanced nation states on the planet.
> Be honest and say why shouldn't corporations pay more. The answer to that is it's an inefficient way of taxing the wealthy ...
You seem to be conflating corporations with wealthy people.
Taxing corporations more has been shown - in your country, albeit some decades ago - to be both eminently achievable and effective.
Taxing corporations less has, in recent years, demonstrated clearly how poor a decision that is.
> Perhaps you're constraining it specifically to 'insurance', rather than the only slightly broader question of private health coverage
Correct. Our major uses of our $4.9tn of annual healthcare funds are 31% to hospital care, 20% to physician and clinical services and 9% to retail prescription drugs [1]. Lowering that number begins and ends with better price transparency from and efficiency in hospitals and physicians' practices.
Our sources of funds are private health insurance (30%), Medicare (21%), Medicaid (18%) and out-of-pocket (10%). Within the context of federal spending, Medicare and Medicaid are relevant, as well as the price and utilisation of the aforementioned uses.
> You seem to be conflating corporations with wealthy people
I'm specifically saying these are separate, and that taxing the latter would strike me as fairer than raising taxes on McDonalds franchisees.
> Our major uses of our $4.9tn of annual healthcare funds are 31% to hospital care, 20% to physician and clinical services and 9% to retail prescription drugs.
The adjacent 'National Health Expenditures by type of service and source of funds, CY 1960-2023' paints this picture more clearly, and identifies $1.5T of that $4.9T as going to 'private health insurance'.
It's odd that you overlooked that 30% figure in your summary of major uses (or 'wealthy corporate parasitic recipients', in this case).
I think it's this bit that everyone outside of the USA can't understand the high tolerance for.
> I'm specifically saying these are separate, and that taxing the latter would strike me as fairer than raising taxes on McDonalds franchisees.
Perhaps, but perhaps try both? Anyway, as I said, the USA used to have high corporate tax rates - up until Reagan, I believe - and almost every graph showing something awful happening in the USA at some point in the past 80 years has a suspiciously consistent inflection point of Reagan. [0]
I mention this only as it relates to any proposal to reinstate higher corporate taxes. I don't think anyone's suggesting chasing large numbers of (likely already acceptably taxed) $500k franchisees are the place to focus on. I don't understand why you would assume that's what I meant.
Between 2011 and 2020, Amazon, Facebook, Alphabet (the owner of Google),
Netflix, Apple and Microsoft — known as the "Silicon Six" — paid roughly
$219 billion in income taxes, which amounts to just 3.6% of their $6
trillion-plus in total revenue. [1]
Democrats do a lot of things deeply wrong, but they seem to exhibit punitive behavior like this a lot less than their Republican counterparts. Republicans pay a lot of lip service to veterans but actual GOP legislation in favor of them is sparse at best
> they seem to exhibit punitive behavior like this a lot less than their Republican counterparts
It's not about being punitive. It's about finding resources to deliver goodies to your voters. Democrats have plenty of spending priorities. They're also, at least now, cognisant of the electoral impact of inflation. That means no more trillion-dollar deficit packages, but finding places to cut. Republicans have the poor. Democrats had deficits; if they can't figure out how to pass tax increses on the wealthy or corporations, that only leaves cuts, and the first place to start is where people who will never vote for you (and are already turning out to the opposition) live.
Hence next cycle. Nobody will say they’re punishing veterans. The pitch will be increasing efficiency at the VA and the reason to fund e.g. the energy transition or some other Democratic priority. Hell, the GOP might wind up going along with it to pay for their tax cuts and border priorities.
Why would they do it next cycle when they haven't done it in the past, especially when there's fair odds that the military will be more Democratic in the future?
R's are much more likely to cut veteran benefits/services and the VA. Some of that is happening now through DOGE, in fact. I don't see this as a likely path for the D's at all.
I think they have plenty of appetite to tax the wealthy and corpos... and we're possibly seeing the first stirrings of a new populist backlash to the billionaire bros. If D's can ride that wave back to power, they'll have a mandate to stick it to the uber rich.
B/c honestly, Musk, Theil, Adreessen, et al, through their recent actions, are making the argument that billionaires shouldn't exist much more effectively than Elizabeth Warren or Bernie Sanders ever could.
> Given partisan polarisation, my guess is Democrats will take an axe to veteran benefits next cycle
I highly doubt it. The Senate “Democrat” in charge of the VA is Bernie Sanders himself, and he’s been a stalwart supporter of improving veteran benefits his entire career. There’s also the whole “it would be political suicide” thing.
Partisan polarization is a good way to predict a lot of things, but if you lean into it too much you will in fact be wrong.
It was political suicide because the 18% of Americans who are veterans turn out to vote, are seen sympathetically by other voters [1] and were often swing voters.
The last part was critical: veterans are already turning out, so offending them was less about turning out votes for your opponent than losing your own votes. But if they aren't voting for you [2], you aren't losing anything by them. Meanwhile, the resources they're getting could help you gain votes (or turnouts) with others.
I feel like you might be contradicting yourself a bit there, though. If veterans mainly don't vote Democrat, then sure, pissing them off isn't a problem. But if veterans "are seen sympathetically by other voters", then you maybe won't want to piss off those other voters, unless we know that they also primarily vote Republican.
Or you could just not assume some random unsignaled shift in own goaling might not happen? What's your goal to argue this hypothetical with no evidence or reason so hard?
Googles net income in 2024 was 100 billion. How much did they pay in taxes? And why %wise my company pays more. This should be DOGEd on top of what is being doged now.
1. US GDP estimated GDP in 2024 is $29 trillion. According to your first source, U.S. Federal Spending was 23% of GDP. If that were reduced to the 2014-2019 average of 20%, that would trim $870 billion from federal spending. That seems like good progress toward avoiding a potential debt crisis.
2. Reduce defense overall and make the process of getting money to the needy more efficient.
3. No comment. Healthcare is mess.
4. Taxes on corporations, like tariffs, are just passed onto consumers. I'm in favor of tax reform, but thinking that taxing corporations is a way to stick it to rich people is shortsighted, IMO.
1. I actually mostly agree with you (and the other reply that said something along the same lines). IMO, the debt situation isn't great, and it's getting worse. Bringing down spending as a percentage of GDP doesn't necessarily require trimming the budget, though - it could also be done by keeping the budget flat and letting GDP growth catch up.
2. Personally, I'm not opposed to trimming defense spending. However, how do we square that with the current security environment (an increasingly antagonistic Russia, China, etc.) and the fact that defense spending is also essentially a domestic jobs program?
4. The share that corporations have been paying has been falling over time. I'm not saying we should stick it to rich people - but what about making corporate taxes more in line with what they've paid in the past, instead of having employees (those same consumers you're talking about) pick up the slack?
Don't worry about #2, Canada is taking care of this for you, to prevent fentanyl and illegals from pouring in over the top border (assume because of gravity...)
> Taxes on corporations, like tariffs, are just passed onto consumers.
Perhaps, but that's not really how it works. The market price doesn't care how much it costs to make a particular good, it's just the market price. If you raise prices in order to pass on new costs, fewer people will buy your stuff.
Put another way, if consumers would tolerate higher prices, corporations would already be charging those higher prices.
Are you sure about point four? Taxes on corporate profits might be indirectly passed on to consumers (e.g. corporations take advantage of the knowledge of the taxes to justify raising prices), but since goods and services are presumably already optimally priced, and taxes on profits aren't an increase to costs, they shouldn't be directly passed on.
It would be an extraordinary claim to say that corporations are not pricing as high as they can without decreasing profits. If you believe that there is some other mechanism by which taxes on corporate profits could increase prices, please explain it.
Thank you for actually providing a source. I haven't had time to read the whole thing yet, but their methodology seems reasonable, although it's not certain that corporations would behave the same in response to a federal tax. As is, that paper supports the assertion that some percentage of taxes is passed on to consumers, though not a total pass through, which is very different from a blanket "taxes get passed on to consumers".
"A one percentage point increase in a state-level corporate tax rate leads to an increase in affected retail prices of approximately 0.24 percent." is much less strong of an affect than, say, tariffs.
They also say "Pass-through is larger for products purchased by high-income households, higher priced goods, and in less competitive markets.", which makes it seem like corporate taxes might still be highly progressive even with pass-through.
Shareholders often take the biggest hit from corporate taxes. Consumers can to, but in most cases I think it's primarily the shareholders. But it will vary depending on the business and the market.
The more competitive the market, the less that companies are able to pass on income tax increases (as opposed to input tax increases - like tariffs). If companies are able to pass along income tax increases, it means that they have pricing power.
According to that, corporate taxes are passed through at a rate of .24. And the pass-thru decreases as there’s more competition and for cheaper goods. In other words it’s a fairly progressive tax. Tariffs are a 100% pass-thru by definition because they’re a sales tax. This hits lower income people the hardest (unless we only tariff luxury goods).
>Taxes on corporations, like tariffs, are just passed onto consumers
The manner by which tariffs and taxes effect the price consumers pay are not at all the same. Tariffs have a far more direct (and immediate) impact.
And, in the case of taxes, these are not "just passed onto consumers" in healthy markets with good competition. But, I agree that this does not describe our current market, which I'm all in favor of fixing.
As it is these oligopolies and monopolies are double dipping. They get us on price and selection to their own gain, then threaten to get us even more if we ask them to pay more taxes on those gains.
The social security administration estimates ~$60b a year in fraud on ~$400b budget! [1] [2]. People can have a rational discussion as to where and how fraud and abuse are rooted out, but I have trouble understanding how people don’t think it’s an issue?
The problem is that the real perpetrators of the fraud are just trying to redirect the blame to regular citizens. The biggest source of fraud is the insurance and hospital industry itself. See the example of Rick Scott: https://en.wikipedia.org/wiki/Rick_Scott, yes, that Rick Scott- current Senator from Florida.
> Scott was pressured to resign as chief executive of Columbia/HCA in 1997. During his tenure as chief executive, the company defrauded Medicare, Medicaid, and other federal programs. The U.S. Department of Justice won 14 felony convictions against the company, which was fined $1.7 billion in what was at the time the largest healthcare fraud settlement in U.S. history.
In short, yes there's fraud, yes it's a problem, and the biggest offenders are probably insurance companies. This shouldn't surprise anyone who has dealt with the US health insurance scam, er, I mean system.
P.S. To clarify for others who may not bother to click into the links, the parent post mentions the social security administration but the numbers and sources are specifically referring to Medicare, which is what I'm responding to.
Medicare would not include SSN payments, though? With a quick search showing Medicare will have a trillion dollar budget. Feels like you are picking incompatible numbers to exaggerate a point.
Fraud is also tough, as it is an optimization problem. You want the amount of fraud to be less than what it would cost to fight it more. Especially since a lot of mistakes are labeled as a type of fraud.
> The US population is aging, which means that 36% slice is going to naturally grow. What do you think should be cut, and how?
The callous, cynical and on-brand answer to that question is: "the number of elderly, in the cruellest possible fashion". You've got to balance the age pyramid somehow, right? And if that sounds obscene, you're not alone.
The depraved part is that from an inhuman, entirely utilitarian perspective there is a ruthless logic to it. For many Western societies it would be fiscally so much easier if you could just ... get rid of the over-aged population. Or at least the segment who don't have dynastic wealth to protect them from the ruin.
It seems to me the US now have a government who have no problem trying out their own variant of Logan's Run.
It’s also notable that those who used “death panels” as a scare tactic back when Obamacare was being created were perfectly fine with saying some old folks just have to be sacrificed during COVID and will be perfectly fine cutting Medicare and Medicaid if they can get away with it. And, of course, they are also ok with the private-run death panels most of us are subject to by our insurance refusing to cover necessary treatments.
> "4. Corporate tax receipts have been steadily falling as a percentage of GDP. [1]"
That needs some context. Here [2] is a graph of corporate profits after tax versus GDP. Corporate profits are, counter-intuitively, a far smaller percent of the total GDP, so it's rather logical that tax from said profits would be a smaller percent of GDP. This is one sample of why looking at things as a percent of GDP can be quite misleading.
From what I gather these people don't understand country scale spendings and debts. They think it's 1:1 the same thing as a family budget, that if we don't "pay the debt" some kind of magical entity will come and collect their cars an houses
GDP does not equate to government revenue. The expenditure to GDP is irrelevant. GDP also considers government spending and it’s easy to inflate the number when a good chunk of it is borrowed money [1].
I agree with (3) but don’t think (4) has substance. “Fair share” is subjective never used in good faith.
The opposition against spending in itself is a subset of a wider issue of spending well beyond our means - taking on ever mounting debt. This [1] is a graph of the US debt to GDP. That's a rather unpleasant graph. The countries with comparable debt:GDP ratios (2 worse, 2 better) are Bahrain, Maldives, Laos, and Cape Verde. [2] In fact we have the 7th worst debt:GDP ratio in the world.
So the obvious response here should be - who cares? Nothing apocalyptic's happened so far. True. And the reason for that is because the US has (and to a lesser degree) retains a unique superpower to export our inflation [3] to other countries. This was because of a perfect storm of a number of factors including:
- the USD being world reserve currency (the currency other countries kept under their bed in case of a rainy day, or if they wanted to buy oil...),
- the US being the largest consumer economy
- the USD being the standard in global trade
But these factors are all coming to an end, some slowly and some not so slowly. The petrodollar is basically dead, countries are gradually to detaching themselves from the dollar, an increasing chunk of the largest economies in the world are now no longer settling trades in the USD, and so on. The world becoming more multipolar, the introduction of alternative global currencies, and such will only accelerate this trend. This is also happening that the US economy is starting to slow down.
So basically this level of debt spending is simply unsustainable. If the spending is indeed necessary, then our economy will have found itself in a situation where it can't sustain itself, and there will end up being a 'correction' that'd be far more painful than some bluntly targeted cuts.
The core question is less about the cuts themselves and more about if we the people are getting what we're paying for.
1) It kinda doesn't matter if it was caused by the pandemic or not, what matters is it needs to be fixed. Cherry-picking "since the 1970s" keeps us in difficult times energy-wise which we've attempted to correct for with more spending. If you go further back, our current ratio is what it was during WWII. Do you currently see federal government production as similar to during WWII, or are we not getting value out of what we're spending?
2) Assuming we all agree with those percentages, there's still an obvious 9% to look into. At these levels, that's real money. Also, certain initiatives are way more destructive than the spending would suggest, e.g. just about everything found out about USAID impacts hearts and minds, which impacts further negatively productive efforts outside the federal government.
3) Of course healthcare is on the list. Single-payer systems have their problems, free market systems have their problems, our current hybrid gets the worst of both. So it needs to be addressed, but perhaps not "first" because the answer here is a total rework, whereas there's plenty of other savings available right now as low hanging fruit.
4) Corporations do not pay corporate tax, their customers and employees do. Why should we burden our productive populous with tax on their income, tax on their workplace before they even get paid, inflation due to government spending, etc? If the argument is that tariffs are passed on to the customer, then corporate tax is definitely passed on to the customer and the employee. Additionally, corporations are not currently benefiting from a healthy workforce (look around), or an educated workforce (steady decline since the DoE was established), or a safe environment (go to SF), or a working transportation system in many cases. Again, are we getting what we're paying for?
Thank you for responding. I'm glad we agreed in principle on #3. I'm afraid we'll have to disagree on the other points though:
1. The claim that spending / GDP is at WWII levels is simply wrong: please take a look at the link in my original comment.
2. 9% isn't nothing, agreed. It does, however, pay for: scientific and other research (mostly medical, then much smaller slice for general science, then a much much smaller slice for everything else); keeping national parks running smoothly; keeping planes in the air; shutting down financial scams; and other wonderful things like that. Like you said, it comes down to what we get for that spending. I think there's bound to be some waste here and there, but I rather like all these things our tax dollars are paying for. Oh, and funny you mention USAID - I rather like the idea of feeding starving children around the world too, with a triple whammy of moral impact, winning hearts and minds in other countries, and putting money into the pockets of US farmers. Would love to hear properly sourced arguments on why USAID is as terrible as you seem to think it is.
4. You forgot about the shareholders. Corporations mostly get taxed on profits, not revenues, so it's hard to see how consumers are part of the equation. (We're not talking about consumption taxes, which tend to be state level anyway.) And employees pay income tax - the only part that the corporation covers is the employer end of payroll taxes. Wikipedia has a nice breakdown and comparison: https://en.wikipedia.org/wiki/Payroll_tax
(Yay, thanks to whoever saved the parent post so my thumb exercise wasn't entirely wasted.)
> Corporations do not pay corporate tax, their customers and employees do. Why should we burden our productive populous with tax on their income, tax on their workplace before they even get paid, inflation due to government spending, etc?
I can answer this one: Corporations come with a veil, to shield risk takers from financial liability and ruin.
That’s normally good, as we want to encourage business.
But the corporate veil was never intended as free pass to break or subvert the law; nor to undermine national interests.
It’s both the corporate veil and the sheer size of some multi-state and
multinational companies: It takes considerable resources to police.
A single multinational has the resources to undermine any state, with lawyers to delay; and lobbyists to influence legislators against their constituents interests. This undermines government credibility and rule of law.
> Corporations do not pay corporate tax, their customers and employees do
Corporations pay tax on their profits not, revenue. Employees have already been paid and customers have already bought before these taxes are levied. (The first bit is of course more complicated; for example, salaries paid for R&D don't always count as a deductible business expense.)
The market price is the market price. If corporations could raise prices further (even without new taxes) without losing customers, they would. If corporations end up being taxed more, raising prices in order to "pass on" those taxes will just cause them to lose customers, and end up with lower revenue (and likely profit too), perhaps even more than if they just sucked it up, paid their taxes, and left prices alone.
> If the argument is that tariffs are passed on to the customer, then corporate tax is definitely passed on to the customer and the employee
No, because they're not the same thing. Taxes, as I said, are applied only to profits. Tariffs are essentially in increase in COGS. They more or less require corporations to increase prices, with the expectation that sales will decrease. (They can also choose not to raise prices, and live with lower profits, if they have the margin to do so.) And this is the actual point of tariffs: to get people to buy less of that particular good, and presumably buy more of a similar locally-produced good. (The problem, of course, is when the locally-produced good already has a higher price, so everyone either has to pay more, or do without.)
> tax on their workplace before they even get paid
After. Corporate taxes are paid on income, not revenue. Income is what's left after paying employees.
Corporations get more productive by having fewer employees or paying them less. That's not a bad thing, it's what's supposed to happen in a competitive market with technological progress. But it also means tax revenue will shrink unless taxes on workers increase. I don't see how that's better.
Customers and employees are not burdened by corporate taxes and this can be shown by a simple equivalence. Savings and profits are not passed onto customers OR employees, they're pocketed by wealthy investors and the c-suite.
Are you sure customers pay corporate taxes? Corporate taxes are on profits. I keep hearing corporate taxes are passed on, but I genuinely cannot figure out a mechanism for them to be directly passed on.
As discussed in the reports above, these budget cuts are not for the sake of saving money, but for redirecting said money towards "border defense" and other priorities of the new administration
A deeper issue is one I mentioned here on how contractors outnumber US government employees by more than 2-1, quoting experts in public administration:
"Washington Monthly "Fire the Contractors": paradoxically add government employees to reduce costs"
https://www.reddit.com/r/fednews/comments/1iq66qa/washington...
From the article: "Voters are right to want a less bloated and wasteful government. But Elon Musk’s plan will fail because the most inefficient parts lie outside it."
And also: "That’s because Trump and his DOGE sidekicks both misunderstand the nature of the problem and risk undermining the government services that their base depends on. The primary source of government waste and inefficiency isn’t what they say it is: a bloated civil service insufficiently “loyal” to the president. Rather, as writers for this magazine ... have tried to explain, the problem is the opposite. Federal agencies have too few civil servants with the right expertise to manage the contractors who increasingly deliver the federal government’s services. The key to reducing waste and increasing efficiency is for the government to hire more high-quality government employees and shrink the number of contractors. And there’s even a huge opportunity here of bringing in the technology and people skills to remake government so it’s ready for the challenges of the future."
Why are there so many contractors? As the article explains: "There are two reasons why the number of federal workers has flatlined over the past six decades. Republicans have been distinctly unsuccessful in cutting federal programs—and often have been complicit in increasing them—but they’ve found that attacking federal employees is a useful proxy battle in the war for controlling government. Democrats have been too afraid of being labeled as apologists of big government to fight back very hard. As a result, the two parties have reached a quiet understanding. Government can grow, as long as it doesn’t grow its workforce. ... After decades of the “no more bureaucrats” political feedback loop, private contractors working for the federal government now outnumber federal employees by a factor of more than two to one, as estimated by the New York University professor of public service Paul C. Light. That’s right: There are more than twice as many contractors working for the federal government as there are federal employees. The result has been an endless parade of stories about cost overruns and policy snafus, which get blamed on Washington—and on incompetent federal bureaucrats. ..."
The solution? "What we ultimately need is a massive increase in the number of civil servants in the federal government— upward of one million more by 2035, according to the eminent political scientist and scholar of government John DiIulio. ...""
An even deeper issue is the fact that Trump's and Musk's plan isn't to eliminate government waste, it's to privatize as much of government as possible in order to funnel money to their corporate cronies. And on top of that, eliminate much of the government's ability to make and enforce regulations, so those same corporate cronies can spend less on regulatory compliance.
Well just give it some time, the axe is coming for fed contractors IMO. It’s no secret they cost a lot and Elon hates consultants anyway. I’ve spent the past 5 years in my firm’s public sector practice but am transitioning out over the next 6 weeks. I’m heading to an entirely different practice and bringing the pick of the litter from some of my past projects with me. We’re being welcomed with open arms. I think the writing is on the wall that the fed consulting gravy train is coming to an end.
GDP includes government spending as well. Cut government spending and GDP goes down. Our ability to make debt payments is not very great when you look at it this way. GDP is not revenue. Revenue as a percentage of the debt is nearing all time lows.
> 1. There are claims that federal spending is out of control. How do you square that with the fact that spending as a percentage of GDP is only slightly elevated compared to the historical average going back to at least the 1970s, with the main deviation in the past few years coming from the after-effects of the pandemic? [1]
That might not be the best metric. Sure it's only "~13%" higher than the running average, but in that 55 year period only 4 years (2008, 2020,2021,2022) had a higher spending to GDP ratio than 2024. Also those years all had ZIRP
I think these are good reasons why our fiscal picture is not hopeless, but not good arguments agains improving our efficiency:
1. Thank you for linking that graph, it seems to show that our spending is 25% higher than it was in the 1970s as a % of GDP (23 vs 18). But our level of _debt_ is approx 375% higher (as a % of GDP) than it was in the 70s (120% now vs 32% then). That doesn't sound like we are sustaining it well, and tht interest is compounding as we borrow to pay it.
2. The underlying assumption that makes this argument compelling is that every dollar being spent on these noble categories is being done efficiently. What if fixing healthcare costs cut them in half for the same effect? What if there is fraud to cut in the programs for the elderly? We should tighten these and prepare to pay more as we age.
3. Strongly agree and hope to see some action. It seems that fixing the incentives and inefficiencies of the healthcare system is the core mission of RFK Jr., despite all the vaccine FUD.
4. Strongly agree. I wonder if a VAT would be effective for this.
We all know what efficient healthcare systems should look like, there are a dozen countries with lower overall healthcare spend per capita than US with better outcomes. What specific skillset of RFK do you find as compelling evidence they they will be extract higher efficiency similar to these other nations?
I'm not sure I meant to take a mantle as RFK's personal champion, but my _hope_ comes from hearing his points on prevention and improving the quality of the food supply. The incentives of both the healthcare and food industries in the US seem to be misaligned with a healthy population, much moreso in the US than in other countries in the West.
> 4. Corporate tax receipts have been steadily falling as a percentage of GDP. [3] Why shouldn't corporations (that benefit from a healthy and educated workforce, a safe and secure environment, a working transportation system, etc.) be paying their fair share to keep the national debt in check?
1. Aren't shareholders already taxed? Maybe revise how they are directly taxed instead of indirectly taxing them again which they can compensate for (see point 2).
2. Aren't corporate taxes simply passed on as costs to customers and employees as lower pay and benefits? Maybe that's the opposite of what should happen, see point 1.
One loop hole that I think is more important to close is taking loans against volatile assets. This lets the very wealthy live lavish lifestyles without apparent income on any balance sheet, and so no tax owed. ProPublica documented this a few years ago IIRC.
Non war times pre 1913, federal spending was such a low percent of gdp as to barely be noticeable, generally far below 5%. The 15%+ I pay now is painful, 2% would barely be noticed. Especially in the context I have to pay (state) taxes on all the new federally required stuff like air bags and emissions controls.
So federal spending has been "out of control" for over 100 years in your view?
I guess I don't really think we can have fundamentally similar views on what it means to be "in control" of something, because I don't think something can be "out of control" for 100 years.
But, if you want to go back to pre-1913 levels of federal spending, you must mean to significantly cut or eliminate all federal entitlements?
If that is your view, do you think you're representative of others that would argue that federal spending is "out of control"? Do you think it would be fair of me to assume that most people who think federal spending is "out of control" also want to significantly cut or eliminate social security/medicare/medicaid? Or do you think your views are an outlier among those that think federal spending is "out of control"?
People who think spending had been out of control for 50 years, your original question, generally are against the 30s era expansion of federal government which is the genesis of the modern federal spending expansion.
To be fair, though, my original question was in response to someone saying that "many people who would say spending is out of control now, would say it was out of control in the 1970s".
I guess I'd love to get some kind of intuitive sense for what fraction of people who think spending is out of control _today_, would think it was out of control in the 1970s, and what fraction would think it was out of control in the 1930s.
Honestly, my naive my assumption is the number of people who would think spending has been out of control since the 1930s, and want to totally eliminate things like social security and medicare completely is small enough to be politically ignored. I could be wrong about that, though (I get the feeling that _most_ of the political actors who are aiming for this goal have decided to lie about their intentions, because it's such a politically toxic position to take today; but that makes it hard for me to get a sense of how many of those actors there are).
But, then I'd assume that the number that have thought it "out of control" since the 1970s would be a higher fraction (I would've guessed maybe...30% or 40% of the people who think it's out of control today). I would've assumed that a decent chunk of people thinking spending is out of control today, would've at least looked back favorably on the Clinton era deficit elimination and mild surpluses.
Anyway, I guess my point is, I have no idea how many people would hold to each of these positions, but I'm quite curious about each since it seems like my naive assumptions don't really line up well with how you think the distribution would be. And since you hold those beliefs, I think you probably have a better intuition about those belief distributions.
Sure, and to return to that the first thing we would need to do is shut down Medicare and Social Security and also sell off most US military equipment for scrap.
Corporate income tax is a bad idea. It should be cut to zero.
If you run a corporation, and a larger tax bill comes, you will keep your own salary (hence, wealth) and either pass the tax onto your employees or cut employee benefits/jobs to afford the tax.
With corporate tax in effect what you are doing is handing the responsibility of allocating obligations to the owners/controllers of the corporation. They will definitely choose to pay the tax in a regressive manner.
Instead what must be done is a progressive income tax, enforced evenly, even for owners of corporations. Unsurprisingly, what we are seeing today is an immense tax cut for high earners.
That's not how taxes work, though. By the time a corporation pays taxes, employees have already been paid, and that's a business expense that hasn't been taxed.
Ironically, if you reduce employee salaries or benefits, then you will have lower expenses, and thus a larger amount of profits you have to pay taxes on (regardless of the tax rate).
I do agree that corporate tax should be progressive, though, just like personal income taxes are. Corporate taxes used to be progressive, but Trump and the GOP changed that in 2017.
Corporate income tax exists because S-corps have legally distinct income. If you set that rate to 0, there would be nothing stopping everyone from forming an S corp, transacting solely via that S corp, and evading massive amounts of tax.
These questions are about common sense, but the election of Trump has proven once again (if it needed proof) that politics don't have anything to do with common sense.
Politics is about sticking it to the other side, even if it means hurting oneself in the process.
I'm not sure anymore the famous Churchill quote about democracy[0] is true. Elections inevitably produce populism, and populism often lead to catastrophe. But we haven't tried "all the other" forms of government, and some could be tried again. Sortition being a prime candidate:
As a fan of democracy, I always like to point out when people complain about the results of the democratic process in the US, that the US has many well understood flaws in its democracy that could be fixed to the benefit of all by increasing the level democracy.
Some examples are:
* Voting systems that don't encourage polarization
* Mandatory voting
* Anti-gerryamndering
But there's lots, from small scale to large, within and outside of political parties and politics generally.
It's a bit "no true democracy" but generally giving people a say seems to work really well, even in the face of people trying to sub wet it.
1. I do not really care about any historical precedent, they take 40% of my money and there is clearly a ton of waste, if not grift.
2. All of those things can be done more efficiently. Drug prices, crappy mega defense contractors, welfare work traps, etc.
3. People eat themselves to death. RFK is going after this problem.
4. I'm in favor of simplifying the tax code and charging a flat tax to corporations, ending tax havens. We should end the tyranny of the shareholder and start rebuilding the American worker.
> I do not really care about any historical precedent, they take 40% of my money and there is clearly a ton of waste, if not grift.
Er what? The top marginal tax bracket is only 37%, and no one will pay that percentage on all their income. Perhaps you misunderstand how marginal tax rates/brackets work?
I was very tax-inefficent a few years ago, and my effective tax rate was still under 25%. Usually it's under 20%, even though my income does sometimes put me in into the tax brackets that are in the 30s.
If you're paying 40% of your income in taxes, you're either a) doing something exceptionally wrong, or b) one of a very small, sub-1% group of people who need to do super tax-inefficient things on a regular basis for some reason.
> All of those things can be done more efficiently. Drug prices, crappy mega defense contractors, welfare work traps, etc.
How? That's the meat of the question and problem here. It's easy to say "government is inefficient". It's a lot harder to identify what those inefficiencies actually are, and come up with a plan to reduce or eliminate them. Simply saying that certain things in government are inefficient is not useful.
I think this is hard to discuss because if you disagree with the premise that the cuts are targeting “fraud waste and abuse” then you’re already talking past the other side. In order to have a productive discussion you need to defend the specific spend being cut, not argue about the ideal spend pie chart.
Trump’s administration believes they are cutting legitimately outrageous spending across every piece of the pie. We can ra ra all day about how an effective and ethical government shall include some layer of social welfare, but cutting out pieces of the pie is not specifically what DOGE is doing or was tasked to do.
So we should spend on elderly: why must it be 36%? What makes up the 36% and is it legitimate? Are there portions of that percentage deployed in a way that does not serve taxpayers’ interests? Is the workforce tasked to manage the “give money to the elderly” program performing to expectations? Are there redundancies? Why are any of those type of questions bad to ask especially when you’re asking them unilaterally (across all gov’t programs)?
If the government offered a public option for medicare at rates that were sustainable for the government, but significantly below market prices for health insurance companies, that could be a real danger to health insurance companies.
The following categories of people have much or all of their healthcare expenses covered by the government:
1) Military (and their families)
2) Retired military.
3) Government workers (all levels of government—not all paid out of the federal budget, but paid by public dollars nonetheless; this includes teachers. To be clear, these folks all pay quite a bit themselves, too, but their insurance is covered by the taxpayers. This isn’t a complaint, just an observation)
4) Many of the very poor (Medicaid, CHIPS)
5) The old (Medicare)
6) The disabled (Also Medicare)
7) Elected officials.
Probably a few more groups I’m forgetting about.
This ends up being a large proportion of all people in the US.
On top of this, the government funds things like healthcare research.
End result, our government spends as much per capita as some OECD states do to provide universal healthcare… but we spend that much and don’t cover everyone.
Part of the reason the math works the way it does is that the government covers a lot of the costs for some of the most-expensive groups of people (old, disabled, veterans with extra wear n tear if not outright injuries).
> How do you square that with the fact that spending as a percentage of GDP is only slightly elevated compared to the historical average going back to at least the 1970s, with the main deviation in the past few years coming from the after-effects of the pandemic?
To begin with, that is a chart of federal spending as a percent of GDP. Since 1960, real GDP per capita has increased by 360%, so if real government spending per capita would have only increased by 360%, federal spending as a percent of GDP would have been flat. Instead it increased by 35%, which is to say by 486% in real dollars per capita.
> Federal spending largely falls into a few categories: taking care of the elderly (36%), defense and veterans (20%), taking care of the poor or disabled (22%), and interest on existing debt (13%). [2] This adds up to 91% of the budget. The US population is aging, which means that 36% slice is going to naturally grow. What do you think should be cut, and how?
The premise of "government efficiency" is to improve efficiency. That doesn't inherently mean discontinuing programs as much as investigating them to see how they're wasting money.
For example, a large chunk of that money is Medicare and Medicaid, and we would like people to continue to have healthcare, but maybe we would like to not pay so much for it. Medicare is paying significantly more to provide healthcare to the elderly in the US than the healthcare systems in most other countries. What's going on there? Are certificate of need laws or other rules inhibiting competition between healthcare providers? Are regulations imposing onerous compliance costs on providers? Lower the cost of healthcare and you can lower the Medicare budget without reducing benefits.
Likewise, there are a lot of assistance programs for the poor. A convoluted, overlapping bureaucratic mess of them that burden the recipients with paperwork and create perverse incentives as a result of stacked benefit phase out rates. The purpose of the whole lot of them is simply to make transfer payments to lower income people, so the entire bureaucracy could be deleted and the programs replaced with a refundable tax credit in the same total amount to the same set of people.
> The US pays far more for health care (28% of the budget if you include Medicare) and with worse outcomes on average. Why shouldn't the health insurance industry be the first item on the chopping block?
The insurance companies aren't where most of the money is going, it's the healthcare providers. Which in turn is down to the healthcare regulations that inhibit competition between them or require them to spend an undue amount of money on administrative and compliance costs -- a government efficiency problem.
> Corporate tax receipts have been steadily falling as a percentage of GDP. [3] Why shouldn't corporations (that benefit from a healthy and educated workforce, a safe and secure environment, a working transportation system, etc.) be paying their fair share to keep the national debt in check?
Corporations pay a variety of taxes, one of which is corporate income tax. Corporate income tax is essentially a tax on profits, but that leads to a problem. Where is the "profit" from an international supply chain? There is no principled way to pin it down because it's just the number at the bottom of a spreadsheet where all of the inputs are in different countries. But if you let the corporation decide, or leave enough play in the system that they can squish it around, international corporations will arrange to have their profits in jurisdictions with lower tax rates, and furthermore cause corporate income tax to act as a penalty on purely domestic corporations, which then promotes market consolidation because international supply chains gain a major tax advantage.
But to do otherwise you have to pin the profits down to something which is happening in a particular place. If that's workers, it's equivalent to payroll tax. If it's real estate, property tax. If it's customers, sales tax or VAT. If it's shareholders, the income tax on dividends and capital gains. So of all the taxes you can collect from a corporation, corporate income tax is one of the least sensible because the megacorps you most want to pay are the ones most able to avoid it, and giving them another advantage over smaller domestic companies is nothing we need, whereas those other taxes they can't avoid while still doing business in your jurisdiction.
Thanks for the response. I think we agree on a fair amount - in particular, I absolutely think Medicare and Medicaid can and should be made more efficient. I'm doubtful, however, that an administration that tries to antagonize its civil servants at every turn and an organization like DOGE is going to do the kinds of things you're suggesting. At the end of the day, I don't efficiency is really even the goal for them.
Regarding insurance companies, I was writing a bit hastily - my train of thought is that providers are able to charge obscene amounts largely because insurance companies pass on these costs to consumers, who have little choice (and only see the result as steadily rising premiums). Meanwhile, these government programs end up paying the same kind of increasing costs to health care providers.
On your first point, I think sibling comment threads already have some good discussion about why it may make sense for spending to keep pace with GDP.
Y'all, original poster here - please don't downvote or flag kill responses to this that are good-faith attempts to discuss the issue, even if the response seems misinformed to you. I don't think anyone will change their minds when that happens.
I'm a bit torn on this request of yours: I don't think people should be penalized for good-faith responses that contain wrong information (so, no flagging), but unless we're all going to spend the time to reply to and refute the wrong information, we should be downvoting those so the stuff with correct information has a better chance of floating to the top.
HN mods (or perhaps pg) have said in the past that "I disagree" is a perfectly reasonable use of the downvote button.
Thanks for making a sensible comment. I’m very concerned about the fate of America right now, and particularly the sudden hard-right swing of the tech community. It’s comforting to see a factual post on HN and see many others responding reasonably.
In many ways I love the US and its citizens, highly diverse and fascinating folks that you are, but recent events have been crushing that view. Us Europeans have always felt our differences but also an acknowledgement that we are essentially “on the same side”. DOGE’s apparent violation of the constitution has eroded that bond, as America turns away from democracy.
I understand the anger that fuels Trump voters, but it is a misdirected anger and I hope that America can recover its path and also reform itself to address the genuine concerns of trump supporters.
1. The higher the debt-to-GDP ratio, the less likely it becomes that the country will pay back its debt and the higher its risk of default. The most recent number for the US is 123%. $28.83 trillion GDP vs $35.46 trillion debt.
2. They are "overlapping" categories. The money you give to the elderly is then spent by them in healthcare. So the true expenditures in healthcare are higher when you take this into consideration.
3. The pharmaceutical industry and insurance companies share a lot in common with organized crime. It is here where most of the money is leaked.
4. Because there is tax avoidance and tax evasion. Tax evasion is illegal, tax avoidance is not. If there's a way to achieve tax avoidance, someone will find it and use that approach.
> 4. Corporate tax receipts have been steadily falling as a percentage of GDP. [3] Why shouldn't corporations (that benefit from a healthy and educated workforce, a safe and secure environment, a working transportation system, etc.) be paying their fair share to keep the national debt in check?
I'd be incredibly careful assuming that lower tax receipt from corporate income is due to lower tax rates.
Why? Because lots of things impact corporate tax receipts beyond tax rate.
If you look at the graph since 1980, you can clearly see a correlation with economic downturns. In fact, they tend to lead downturns which makes sense as corporations see a drop in profits as the economy slows and heads into recession.
Corporate tax receipts would also drop as corporate investment increases. When Amazon spent billions on expanding their business, profits dropped and so did tax receipts.
I think you're only half right. Yes, the nominal rate is far from the only thing that determines corporate income tax receipts. But in practice, what you see is that the effective tax rate has been steadily dropping. That is, corporations are more and more profitable, and contributing a smaller and smaller fraction of those profits: https://en.wikipedia.org/wiki/Corporate_tax_in_the_United_St...
You'd need a in depth analysis to really see the impact.
Companies always do something with their profit after tax. Most commonly it's paid out as a dividend (which would be taxed) or used in a stock buy-back (increasing share price and eventually taxes as capital gains).
The Constitution doesn't protect the many bureaucratic organizations that have sprung up since it's inception. I could be wrong, but I don't think there's any amendments that protect the agencies either. For example, the CIA has been controversial. There's nothing protecting it in the founding documents.
1. The GDP is largely raised due to costs of services, tech innovation, & inflation. Note that the measurement of inflation has been revised several times over the past few decades. Why would we not expect the government to become more efficient due to tech innovation? Should they not get better & more cost efficient with the services they provide? Why is the expectation that the public budget must always grow to match GDP growth?
2. I don't think your numbers are correct. There's also bad accounting & no public source (possibly nobody) knows the true budget. For example, the Dept of Defense hasn't passed an audit. $11 Trillion went missing around the time of 9-11. There's also black budget projects that are top secret. Those projects are substantial & don't factor into the numbers. There's also rampant corruption with contracts. An example is the "Homeless Industrial Complex"...though that may be more of a select state + city government issue. Nonetheless, contracts are heavily padded for incumbent contractors in general across all sectors of the Federal Government.
3. IMO, the black budget projects along with the Dept of Defense should be the first to be audited & cut. The Health Care segments a close 2nd. USAID is a good cut, as it's been a vector for color revolutions & regime change. Looking forward to the IRS going away as well. Since it's founding justification was to support the war effort...And we have had never-ending wars (technically conflicts) since. And the Federal Government simply doesn't provide value to justify it's expenses.
4. I believe the argument is to attract companies. But I otherwise agree with you.
I'm skeptical over the changes that are occurring, but the size & scope of the Federal Government is clearly unsustainable & counter-productive to private commerce...particularly with small businesses. Considering how regulatory agencies are often revolving doors with industry incumbents with the incentive to stifle competition & promote incumbent interests.
> The Constitution doesn't protect the many bureaucratic organizations that have sprung up since it's inception. I could be wrong, but I don't think there's any amendments that protect the agencies either. For example, the CIA has been controversial. There's nothing protecting it in the founding documents.
Not sure what you mean by "protecting". Of course none of those agencies are mentioned in the constitution, but that doesn't matter. They were all created by bills passed by the legislature and signed into law by the president at one point or another. Their existence has been upheld by the judiciary on more than one occasion. The executive branch doesn't have the authority to disband something that Congress has created by law.
If you don't like that those agencies exist, you are free to lobby your congresspeople to write and sponsor bills to disband them.
Knocking out USAID, Health Care programs, or the IRS by executive order isn’t how our system works. The Constitution places agency creation and dissolution squarely in Congress’s hands under Article I, not the President’s. Even under a strong unitary executive theory, the President can’t just repeal statutes establishing these agencies; that power belongs to the legislature [1]. Congress also controls the purse (Appropriations Clause), so the White House can’t simply “defund” an agency on its own [2]. Furthermore, the Administrative Procedure Act demands reasoned legal processes; you can’t arbitrarily shut an agency that Congress told you to run [3]. If the President could unilaterally dissolve such agencies, he’d effectively be acting as a dictator, collapsing the separation of powers Madison emphasized in Federalist No. 47 [4].
the comparison with GDP is useless. If the federal budget is putting the country in massive debt, that's the only thing you should care about. Debt will kill your country sooner or later.
Seems like all the savings we need could be gained by a 50% (or more) cut to "defense" spending.
Doesn't that align with US conservative principles? Instead of trying to be the world police (in actuality suppress our "enemies'" access to dwindling oil and minerals) we could focus our efforts domestically?
I'm all for it: more education, healthcare, arts, housing, green economomy, less BS libertarianism (loot the treasury and "break out the bootstraps, you poors")
This is an incredibly disingenuous reply. The people that want these cuts genuinely believe taxes are too damn high. There is no reason I should be paying 60% of every dollar I get to the government (after sales and income taxes in California.)
I was curious so tried running my own numbers. TL;DR I find it’s about 34.5%-43.5% for a single person earning $100k-$300k in SF. So taxes would have to rise half again to hit that 60% claim.
According to https://smartasset.com/taxes/income-taxes#QL3tlUFIae, it’s an effective tax rate of 28.3% for federal/state/local income tax for someone making $100k in SF. For $300k, effective tax rate is 38.13%.
So, for each gross dollar, you have 71.7¢ net after income tax, which gets taxed 8.63% on purchases, about another 6.19¢, bringing that original dollar’s purchasing power down to about 65.5¢ for a $100k/yr earner. At $300k, this goes to 61.87¢-5.34¢=56.53¢.
Edit: I don’t think I’m calculating the sales tax burden correctly, but don’t see my error yet. Would I just subtract the 8.63¢/$? That’d make the combined tax rate 36.3%-46.76%.
Next year, the highest federal tax rate will be around 40%. The highest state income tax is 13%. I guess if you factor in sales tax, and various soft taxes, you could get pretty close, but yeah. Seems exaggerated.
Oh boy. Tax brackets are incremental. Most people in the 40% bracket will not pay anywhere near 40%. There is a theoretical possibility that someone, who's income exceeds the highest bracket MANY times will have an effective tax rate approaching 40%. But in reality people with that kind of income derive their earnings from sources that are taxed in a very different way such as long-term gains.
This is an incredibly disingenuous to my post. The people MAKING these cuts have stated what I posted. My posting their own statements can not be considered disingenuous, only informative as it shows their goals and motivations. While my post might be inconvenient to those trying to relabel their goals/motivations, posting 'inconvenient' statements they have made as to their goal is not disingenuous.
Disingenuous would be more something like me posting Umberto Eco's item three on his list of the 14 Common Feature of Fascism:
3. The cult of action for action’s sake. “Action being beautiful in itself, it must be taken before, or without, any previous reflection. Thinking is a form of emasculation.”
2/3. If the US pays more for health care and gets worse results why should we give them more money?
I don't think health insurance companies should be abolished by royal decree. I think the government should offer an alternative and when that alternative is 4x as dollar efficient the health insurance companies will die a natural death.
4. Your chart shows corporate tax rates have been flat for 50 years. Seems fine?
As an aside, I dislike the overemphasis on Federal spending and Federal income tax. The real question is federal+state+local spending and revenue.
I wish as a society we could work backwards. What services do we want to provide? How much will that cost? How do we pay for it? We've turned into a culture where some people thinking spending is good solely for the sake of spending. When politicians trumpet how much money they're going to spend rather than the benefits they're going to be provide I get very sad!
2/3. Then perhaps the US should elect representatives who will expand Medicare to more people. (Or go back in time and get the public option added back to Obamacare.) Unfortunately, instead we have an increasing number of people using Medicare Advantage, essentially a private wrapper around a public insurance plan, which costs taxpayers 22% more per participant.
4. Are we looking at the same graph? The ratio is almost half of what it was in the '70s. The economy has grown substantially; corporate tax contributions, not so much.
I agree with your sentiment that we should talk about what spending achieves and not just the dollar amounts. Hopefully, now that a lot of things are being cut, more people will appreciate what the government has been quietly providing for us all this time. I just hope that the rebuilding won't be as slow and painful as I fear it will be.
> The economy has grown substantially; corporate tax contributions, not so much.
Hey wait a second. Why should the PERCENT of corporate tax contributions increase as the economy grows? That doesn't make any sense. Corporate tax percent has been basically flat for 40 years.
Personally I find the whole "tax the rich / tax the corpos" philosophy to be misguided. That's not how countries like Sweden and France pay for robust social services! They do so with extremely regressive taxes (20% or 25% VAT) and very high tax rates (40%+) at relatively low income rates (50k to 80k depending on country).
If we want to decrease inequality and increase social services then the average blue collar worker is going to have to pay for it. Taxing the rich is populism that cares more about being punitive than useful. But I digress.
2. The corporate tax rate was cut by the last Trump administration in 2017, which also removed tax brackets and made the rate uniform. So even the nominal rate hasn't been flat.
But at the end of the day, I actually agree with you. There are other ways to raise revenue, and the US needs to decide if it wants to pay to support its old people, its poor people, and its military. Right now, it seems like the answer is trending towards "no".
It's also the case that even if you wanted to make the remaining few percent more efficient via spending cuts, randomly grepping through database entries and claiming success without any real understanding of what you're cutting is complete bullshit.
This blathering about the federal budget has been going on for 50 years.
What I think if if you want a real discussion then you need to talk about the real federal budget separately from the retirement, income security, health benefits for and paid by the peons.
So take away social security, unemployment, welfare, Medicare, VA and federal retirement benefits. And lets talk about what left. And pikachu there ain't any fat and little meat.
The whole debate from where I sit is based on innumeracy and wishful thinking.
I'm not a "MAGA" guy at all. (Except my last name LOL)
But I do think the government should constantly be using tech and putting systems in place to accomplish three things:
1. Become more efficient
(use AI to solve Bloom's two sigma problem)
2. Become more transparent
(data.gov, blockchain)
3. Become more useful and friendly
(online, not on-line at the DMV)
Of course, I later learned that I was way too optimistic. They never even read these applications. They are just more of the same... a blunt government hammer that isn't actually solving much, just doing surgery.
I hate that they are removing data.gov datasets and other scientific and health data. That's less transparency. It smells of sharpiegate all over again.
I like that they are exposing a lot of waste and corruption. I really like that they will be going after the GOP's sacred cow: the Department of Defense budget, which is the LARGEST discretionary budget, where we can get the most bang for the buck. The Pentagon can't account for $35 TRILLION in spending, that's insane.
But there is a lot more transparency that needs to be done, than simply budgets. I am somewhat hopeful that Tulsi Gabbard will clean up the "deep state" in terms of transparency, as CIA fomenting avoidable wars affects many people's lives around the world: https://community.qbix.com/t/transparency-in-government/234
Now, to answer your questions:
1. We've seen this before. The Grace Commission in the 80s concluded:
"With two thirds of everyone's personal income taxes wasted or not collected, 100 percent of what is collected is absorbed solely by interest on the federal debt and by federal government contributions to transfer payments. In other words, all individual income tax revenues are gone before one nickel is spent on the services that taxpayers expect from their government."https://en.wikipedia.org/wiki/Grace_Commission
Subsequently, Clinton got a surplus, Gore campaigned on putting Social Security into a "lockbox", and Obama reduced deficits by 2/3 from $1.5 Trillion (after two wars, etc.) It's the Democratic presidents who actually get things done. Bush and Trump just did massive tax cuts which balooned the deficits to trillions, and the current idea is to cut a check to Americans, a la 2021. I thought the goal was to reduce deficits? In that case elect Democrat presidents (not Biden or Kamala, though, LOL) with a Republican congress.
2. Go for the discretionary budgets, working your way from the largest items on down. But Trump has done the opposite back in 2017 and 2019, giving them even more than they asked for, even though they failed audits for decades: https://foreignpolicy.com/2019/03/10/pentagon-eyes-windfall-...
If MAGA makes Republicans step aside and cut wasteful spending of the DoD, that would be very impressive indeed. Kind of like Bernie's movement would have done with Democrats.
I agree that USAID and CIA causes a lot of damage and costs (not just in money, but human lives) around the world with their regime-change operations, so I would like to see that brought to light and limited.
3. The health insurance agency is actually the only part of the health system whose incentives are aligned with people being healthier. Think about it... if people are healthier, they pay out less. Everyone else in the industry on the "supply side" makes more if people are sicker and aren't cured. If you really want to know how bad it is, read this: https://magarshak.com/blog/?p=362
Besides, their profits are only like $18B I think. Not much savings there.
If you want us to pay less, phase out the Patent System, where we go after the rest of the world for daring to share our R&D costs. We pay the most for drugs, and
Also if you want us to pay less, then stop letting lobbyists write laws such as Medicare Part D, forbidding Medicare to negotiate drug prices as a single payer health system. That's insane. Let me quote wikipedia:
Former Congressman Billy Tauzin, R–La., who steered the bill through the House, retired soon after and took a $2 million a year job as president of Pharmaceutical Research and Manufacturers of America (PhRMA), the main industry lobbying group. Medicare boss Thomas Scully, who threatened to fire Medicare Chief Actuary Richard Foster if he reported how much the bill would actually cost, was negotiating for a new job as a pharmaceutical lobbyist as the bill was working through Congress.[58][59] 14 congressional aides quit their jobs to work for related lobbies immediately after the bill's passage
And the revolving door with regulatory capture is a systemic problem in general:
This is not rocket science, people. If government should do anything, it should be taxes, followed by single payer or UBI. That's it. The Patent system being enforced internationally only makes drugs more expensive, not less.
4. In my opinion, Corporations and LLCs etc. should be the only ones paying tax, and also required in order to be employing people. The personal income tax is stupid! And I say this not just as a libertarian, but because Milton Friedman already made these corporations withhold our taxes. They know exactly how much we make, since they pay us. Why should every employee be forced to pay an accountant in order to report the same info? Rich people can pay accountants to save money, perhaps, but that leads to just more loopholes and corruption, typically the rich people can afford to pay more tax, they'll just drop down one tax bracket.
On the other hand, corporations have well-defined budgets, and they need accounting. You could cut the number of accountants -- and staff at the IRS -- in half by phasing out the individual income tax, and instead requiring this tax of the corporations which pay them, in various forms. In fact, you should tax automation and robots, as corporations increasingly fire their staff and cut their salaries. But I doubt that will happen anytime soon.
I'll throw in a critique of our monetary system. Our money is issued by banks on the basis of guessing whether a business or a consumer will be solvent in X years. Instead, a UBI would be issued on the basis of what people actually need, now. People ask "how can we afford it" because they don't understand that the role of taxes in a modern monetary system is to remove money from the economy. As long as people fear taxes and money printing, they entirely miss the point. Giving every American a UBI (monetary policy) coupled with massively increasing Pigovian Taxes (fiscal policy) would give government much better levers to do things like curbing pollution, congestion, fossil fuels etc. Much better than the Green New Deal!
Show me where MAGA praises Clinton, Obama and other Dem presidents for balancing the budget, massively reducing the deficit and getting a surplus.
Show me where MAGA blames Trump for increasing the military budget beyond what even they asked for, in 2017 and 2019. Or the Bush + Trump tax cuts being a huge factor in our debt.
Show me where MAGA endorses Modern Monetary Theory and argues that we should massively increase pigovian taxes to help curb greenhouse gas emissions, phase in a UBI, and increase the power of single payer systems like Medicare to reduce costs (this was what was asked)
Show me where they argue about phasing out the Patent system, or anything else
Let's start there. As a libertarian, I guess 50% of what I say may sound like one side, and 50% like the other, but people tend to only pay attention to the stuff they don't like.
I agree. I actually typed up a whole response to that post (which I vehemently disagreed with, but appreciated nonetheless) but by the time I hit submit it was already dead. Vouching wasn't enough to bring it back. I understand the temperature is running hot, but I hope that at least on HN we can strive to have civil discussions about these issues. I say this even though I am personally quite distraught about the current state of affairs.
The reason these questions are not front and center is that the people with money don’t want to talk about them. And, the ensure we are kept busy with cheap gadgets, entertaining tv and movies and enough controversies that don’t matter to last a lifetime.
Alsr, the population is less educated and able to actually think critically about these issues than they used to be.
That’s not the argument either. Read GP’s comment attentively, they’re making a general commentary on how the people with money manipulate the conversation by distracting everyone else. If you’ve ever read Neil Postman’s “Amusing Ourselves to Death”, you’ll recognise the thought.
Being pedantic about which particular conversation is or isn’t happening where and by how many people is counter-productive and only serves to exhaust everyone and exacerbate the issue.
> Being pedantic about which particular conversation is or isn’t happening where and by how many people is counter-productive and only serves to exhaust everyone and exacerbate the issue
I'm arguing there is no conspiracy. It would be lovely if rich people (namely, anyone) were coherently running the government. But the reason we're seeing chaos is because there are fundamental interests attached to each of those major spending lines that have wide voter support (and antagonism).
I’m pretty sure the US government has a rich dude in the presidency, a rich dude pulling the strings via doge, and all the members of the presidents official inner circle are rich people.
In congress, it’s very much a rich persons club.
Maybe this is how it’s always been, but it feels even more obvious and extreme today.
> I’m pretty sure the US government has a rich dude in the presidency, a rich dude pulling the strings via doge, and all the members of the presidents official inner circle are rich people
That doesn't mean they're coordinated. Particularly not on matters of deficit reduction, let alone controlling the national conversation around it. Saying the conversation around the deficit is being suppressed is more a statement of ignorance than anything happening in reality.
The ability to distract people is orthogonal to the ability to functionally operate a government. I mean, that’s Donald Trump’s (and his protégés like MTG’s and J.D. Vance’s) entire schtick.
> leftist talking point are systematically downranked on X
This is about as relevant as when Twitter was a cesspool of far-left nonsense. Twitter and X aren't the real world. They influence it. But what people are talking about there has about as much correlation with policy and politics as what your neighbourhood housecats might be yapping about.
Citation on that last point? The amount of people I know who were the first in their family to attend college, and sometimes even graduate high school, makes me question that people are measurably less educated.
Education + thinking critically and having educational credentials are not the same thing. At least, there needs to be some justification that they are related.
> (Education + thinking critically and having educational credentials are not the same thing. At least, there needs to be some justification that they are related
It's ironic how often people criticise the lack of critical thinking in higher education while simultaneously not bothering to examine the hypothesis.
Cognitive development is associated with critical thinking [1], and the "number of years of formal education completed by individuals is positively correlated with their cognitive function throughout adulthood and predicts lower risk of dementia late in life" [2].
So yes, voters with educational credentials are more likely to be better critical thinkers as well, as a bonus, not suffering dementia in their later-voting years. (Whether this is a selection effect or product of education is unclear. And it doesn't suggest everyone in academia is an excellent critical thinker.)
> having two separate studies for A-B and B-C does not prove there's any A-C relationship
You're making a claim about the world. The evidence points in the opposite direction. If you have a problem with cognitive function relating to critical thinking, put forward some evidence about it. Because the link between those seems much more intuitive than your unsubstantiated hypothesis.
The quality of high school educations have fallen, which is the most important to develop critical thinking. This is measurable when the education level of U.S. high school students is compared in global rankings.
On top of that social media has put people in echo chambers and force fed them outrage content. People who are outraged and surrounded by peers who are also outraged are less likely to think critically.
I personally think that the replacement of newspapers that invite critical thinking by yellow journalism and social media has had a more significant effect on critical thinking than the drop in education quality.
I believe it's more the critical thinking piece that's the problem. And, perhaps there has not been a decline there, but we're just witnessing an unprecedented cultural and technology-fueled abuse of an existing lack of reasoning ability (expansive reach, bot farms, algorithms, conspiracy theories, etc).
I mean, any actor—including state adversaries—can essentially run military-grade psyops on our population. In a "stable" environment, an inability to think critically is somewhat buffered and fallout is limited. But, in a hostile information space—intent on manipulating subjects for the destruction of their society—it's catastrophic.
1. The federal government has been bloated for a long time, as you mention. Getting back closer to 10% of GDP is a better target.
2. As we've seen with DOGE, there's clearly a lot of waste and inefficiencies. So first cutting out all of that, plus the grift, etc. would go a looong way, as we're seeing with DOGE currently. Also obviously the healthcare system has a lot of grift and inefficinecies on a massive scale that can drastically reduce the spent on healthcare, but this applies to so many systems that government is involved in, again DOGE is clearly proving this to be the case.
3. Yes definitely healthcare needs DOGE
4. Corporations should and do, but corporations are also made of people who also already pay their fair share of keeping national debt in check
> 3. The US pays far more for health care (28% of the budget if you include Medicare) and with worse outcomes on average. Why shouldn't the health insurance industry be the first item on the chopping block?
This framing is a bit far from the actual motivating issue underlying the federal "budget" itself. I think a better question is whether having a federal workforce of 4 million people managed by an unaccountable bureaucracy is in the best interests of any country. If you frame it as simply whether to spend money on this or that or if you're getting comparable value to other countries, then it is inevitable for the sides to talk past one another.
I think it is more productive to understand the "federal budget is out of control" argument in its spirit and motivational effectiveness. The simple fact is that many people are unhappy about HOW the money is spent and would rather reserve the choices on how to spend that money to the households.
To respond to your specific callouts, the growth of federal programs in the post WWII era is a fundamental point of contention. Averages going back to the 1970s (pegged to GDP of all things) are somewhat beside the political point. The federal bureaucracy is enormous. The ancillary industries that service the federal budget is prone to grift, graft, and corruption. Anyone who has worked in or near Washington DC knows this.
I believe you are talking about Social Security, which is a bit different from "taking care of the elderly." It is more like a public pension. Historically, no country in the world would have spent 36% of its budget "taking care of the elderly" because families, churches, and charities served that function, when necessary. Your framing is already misleading but let's go on.
Combining "defense and veterans" is also misleading. I believe somewhere south of 5% goes to Veterans Affairs (if that much). If you think the US government should spend 15% of its budget on its war machine and the inevitable foreign wars that feed the military industrial complex, we can have that discussion. I don't think 15% of budget is an absurd amount to maintain a global empire, but I assure you it won't be cut all that much.
"Taking care of the poor and disabled" is also a misleading number. Much of that is towards the "welfare state" which is a very gameable and corrupt program. Even if you remove all the outright fraud, reasonable people wonder why a healthy, wealthy country should incentive people not to seek work or to have families out of wedlock and become perpetual wards of the state, as the programs (as currently constituted) promote. And if you think the corruption only helps the poor, you are ignoring the many services that benefit from a large pool of welfare recipients.
Health care costs in the US are too high, but there are many perverse incentives at work leading to those costs that would be tedious to go into here. You cannot begin to fix them without removing the main sources of cost. One is that the population is unhealthy, but also over-medicalized. If Medicare can't negotiate costs by law (remember that battle?) the it is hard to bring down prices. If you want to have a good morbid laugh, take a look at the pricing sheet from a hospital one day. You don't charge that kind of money unless you have someone by the short and curlies.
Corporations are the employers of the workforce. Many are also owned by you and me as common stockholders in our 401k and other savings. You say they are declining as a percentage, but that says nothing about what the optimal percentage is. Too high and you will choke off dynamism and job creation, and drive industry overseas. Who does that benefit?
But all this penny-counting is a distraction. The political motivation for shrinking the federal government is as American as apple pie. As the recent political realignment suggests, most people don't want to be governed by this a federal bureaucracy (or civl service, if you prefer) that has its own political interests at odds with the rest of the population. Centralized power is very susceptible to grift and corruption. It's useful to point out "waste" in terms of inefficiency, but more revealing to point out spending at odds with the values of the majority of the population. People may not want their tax dollars spent on projects they find diametrically opposed to what they value. They don't want to be "pay pigs" for a vast patronage network that extends well beyond any benefits that come back to them. It is at those moments that people start to think that the government isn't working for them. Is that so hard to understand?
I'm not sure what's unaccountable about a bunch of people who report to political appointees who have been confirmed by the Senate (a body elected by the people), who then report to the president and vice president (also elected by the people).
> I think a better question is whether having a federal workforce of 4 million people managed by an unaccountable bureaucracy is in the best interests of any country
Is having a federal workforce that's managed by an unelected, and unaccountable, oligarch more in line with the best interests of any country?
> Centralized power is very susceptible to grift and corruption.
Isn't putting oligarchs with significant conflicts of interests in charge of the federal bureaucracy also susceptible to graft and corruption? Isn't halting enforcement of the law banning Americans from bribing foreign government officials also susceptible to graft and corruption? Doesn't pardoning a former governor convicted of literally selling a Senate seat make us more susceptible to graft and corruption? Doesn't the Supreme Court continually narrowing the conditions for bribery, making all but impossible to ever charge someone for accepting a bribe make us more susceptible to graft and corruption?
Honestly, it seems strange to me to say that the current administration is reducing graft and corruption, when the policies of this administration and the current conservative Court all seem to be *pro* graft and corruption.
It depends how you word it. 'Would you rather put your money in stock indexes or pay out N shares of 1/N of your contribution to old people then hope and pray the same is done for you' ( which is more or less the realistic question for the middle class ) and I bet they'd say shitcan it.
The question isn't so much whether social spending is a personal investment but rather whether trigger pullers with badges and automatic weapons enforce it or the laborer personally invests as he sees fit in ways that enable social charity and retirement without the threat of imprisonment.
Sure but the question is about the law that the trigger pullers enforce. If the laborer can invest his retirement rather than having it taken, redistribute, then told if there is no Trump v2 maybe there will be something for him -- maybe he decides the rule of law is to put the power of social spending on the individual rather than a corrupt government who's treasury system is controlled by unelected billionaires.
> I think a better question is whether having a federal workforce of 4 million people managed by an unaccountable bureaucracy is in the best interests of any country.
The word "unaccountable" gets thrown around a lot in these discussions. The leaders of these bureaucracies are ultimately appointed by and accountable to the President, who is in turn elected by and accountable to the public. In what sense are they unaccountable?
> Historically, no country in the world would have spent 36% of its budget "taking care of the elderly" because families, churches, and charities served that function, when necessary.
I'm talking about both Social Security (21%) and Medicare (15%). Historically, families were much bigger; you'd have many children who could all pitch in to help take care of their parents. Historically, people also didn't get treated for cancer, heart disease, etc.
Families, churches, and charities still exist, and still can help in this capacity. As a person with gradually aging parents, I fully intend to help my parents however possible, but I'm also glad that society (well, for them, Canadian society) sees fit to provide them some support too. And as a Christian, I'm both happy when I see churches serving the poor and elderly, and happy when I see society agreeing with these Christian values and also collectively striving to serve the poor and elderly.
> Even if you remove all the outright fraud, reasonable people wonder why a healthy, wealthy country should incentive people not to seek work or to have families out of wedlock and become perpetual wards of the state, as the programs (as currently constituted) promote.
If you're talking about welfare traps where government benefits disappear when your income increases over a (fairly low) threshold, disincentivizing extra work or raises, I fully agree that there are changes to be made.
On the other hand, if you think people don't work because they think they can live off government handouts, I'm curious if you've ever tried that, or put yourself in the shoes of someone who has.
> If Medicare can't negotiate costs by law (remember that battle?) the it is hard to bring down prices. If you want to have a good morbid laugh, take a look at the pricing sheet from a hospital one day.
Fully agree on Medicare negotiation. I've seen my fair share of hospital bills, and believe me, I wasn't laughing...
> The political motivation for shrinking the federal government is as American as apple pie.
Only if you pretend that FDR, LBJ, etc. are not "American" (or perhaps, as American as apple pie - but maybe pumpkin?). Yes, there's always been a strain of rugged individualism in American political thought. We'll see where it leads, I guess.
> They don't want to be "pay pigs" for a vast patronage network... Is that so hard to understand?
What's hard to understand is how this (IMO) distorted view of the government has taken hold. The government may be slow at times, may be wasteful at times, but, til now, it's worked. Old people get health care. Social Security checks get cashed. National parks stay open. Science gets funded. Planes stay in the air. The US university system is the envy of the world. And so on.
What hasn't worked is that people's lives haven't really improved that much. Jobs have gotten worse - more part time, more "gig economy". Housing prices have shot up. Health care costs are out of control. Etc. But please, help me draw the line between excess government spending and all of these problems, because I can't seem to see the connection.
People voted for change, and now they're going to get it I guess. Let's see if it's the kind of change they wanted.
It only will make sense when you reintroduce the idea of "the political" into your framework. Without that, a government is simply a territorial administrative apparatus or provincial satrapy. If your parents are Canadian, perhaps you are as well (or at least very familiar with Canada), and can relate to a government seeing its population as simply interchangeable units of administrative responsibility managed by a hedonic rationalism. I think Canada is a great example of what US voters in the last election don't want to be. It's kind of a nice, albeit cold, place but very authoritarian and prone to treating its identity as something of little value and an embarrassment, except contra the big bad United States next door. Canadians look at our health care system and school shootings and suppose their system is obviously better, but Canada comes across as very naive and ungrateful for the benefits it receives as our northern neighbor. I suspect there are many Canadians who also don't like their government's policies but are at a loss on how to effect change because their government is less susceptible to populist political waves than the US.
The government works in some areas and not in others. Our once envied university system has become a human gristmill cartel, indenturing a generation of our youth under debts they will never dig out of because of perverse incentives engineered via vast federal spending programs. Foreign students may still come for the prestige but many diplomas are effectively worthless and many schools properly should be mothballed. In any case, measuring a government's worth by how many people receive benefits is a pretty pathetic standard. It's beneath human dignity to have such meager aspirations for a country.
Unaccountable civil services aren't hard to understand in history. Like a military that is ostensibly under the control of the king or president but not really, so have civil services sometimes constituted as separate government that can just ignore the commands of elected representatives of a people. Laws can and are passed to entrench the civil service even deeper, making it hard to fire any but the top-level appointees. These can try to get the institution to do something differently but if the institution is unresponsive they can rant and rave all day, the careerists can just wait them out. It's not hard to understand if you study incentives. They are deeply misaligned and it is only because the administration learned some of these lessons the first time around that they came in with a much more effective game plan this time. You can see how dramatic actions are required to overcome the institutional resistance. I'm sorry that good people have/will lose jobs, but government should not be a tenured jobs program. The taxpayer doesn't have that luxury, why should this subgroup? Why should we all engage in a fantasy that federal employees aren't people who, sometimes despite the best of intentions, are going to pursue their group interests even at the expense of other groups? Huge pots of money are going to attract huge pressures from outsiders trying to access funding. Many of the high profile grants to ridiculous projects are not surprising when you see these institutions as participants in political patronage networks. There has to be some way to officially distribute the money. Have them dig and fill holes or put on puppet theater for the blind. It doesn't really matter.
Keep in mind there is no ultimate fix for this. All institutions decay and need to be replaced from time to time. Getting upset about this particular patronage network being disrupted is the wrong worry unless you were a particular recipient of its largesse. If not, then you might come out better off at the end of the day.
It sounds like you have a fair bit of pride in the US, and a fair number of grievances as well. Goodness knows there's plenty of grievances to go around, and I can hardly fault you for having pride in your country and desiring to see better days for it.
So, I suppose I'll just hope (against hope) that you're right in your optimism about these changes.
I'm a Canadian expat who's lived in the US for many years, partly for work and partly because of the relationships built up over these years. I can only laugh a little and shake my head at your notion that Canada is authoritarian. I suppose it all depends on how you define freedom, and whose freedom ultimately matters.
> Centralized power is very susceptible to grift and corruption
Does it look like we're going to less of that though?
Also, just looking at the numbers, I wonder if a few percent savings in the federal budget could possibly translate to positive changes for the working class. Maybe part of the population will be happy to know they don't fund hypothetical gender studies anymore, but let's hope the cuts don't affect them negatively.
Inevitably, there will be eggs broken to make omelettes. I will consider the realignment successful if there is a reset in the current grift industrial complex and some interregnum until new patronage networks are established and corrupted that will, in their turn, be destroyed to make room for the next generation. If you think the issue is the amount of money spent on "gender studies" you really don't understand the far greater value of what the education of our children should consist in and who gets to decide what that education will be. Those are battles worth fighting over. Penny pinching is missing the point.
> If you think the issue is the amount of money spent on "gender studies" you really don't understand the far greater value of what the education of our children should consist in and who gets to decide what that education will be.
I can't parse this sentence at all. Are you maybe able to better articulate your point?
Many people got a chance, during the pandemic, to see that contemporary K-16 education consists of a lot of political ideology (aka indoctrination). Many thought their kids were learning useful skills and were shocked, shocked, to find that they were being groomed to reject the worldview and values of their parents. They didn't like it no matter what it cost. It became a hot-button issue and an own-goal by the cultural gatekeepers, who consistently present themselves as our betters. Framing this as a cost issue is missing this critical fact. A majority doesn't care what it costs. They don't want it even if it's free.
1. The simplest answer is that federal spending has always been out of control.
2. This assumes a 100% effective government. If it's only 70% effective, you can cut spending by 30% without affecting the noble goals you list.
3. This is the Luigi argument. Get rid of health insurance and we'll all be happy! What exactly to replace it with is TBD.
4. The main argument against high corporate taxes is that it leads to companies moving to countries with lower taxes. The US still has higher such taxes than most and suffers from that, but the optics of lowering further are too bad, so we live with it.
In #2, doing the DOGE way you cut by 30% but the efficiency is now lower than 70%. Government is now less effective, costs less, wastes more. Cuts in education, research and consumer protection will cost a lot long term.
For #3 there is like dozens of models from different countries around the world. The U.S. could start by looking into those.
You really think that reducing IRS funding will reduce audits on the bottom 80%, and not the top 20%? If you're going to go around telling people they've been gaslit (using a straw man, I might add), you might want to check your own biases first.
Yes! The IRS budget has nearly doubled in the last decade, primarily to increase their workforce and use manpower to focus on shotgunning low-yield audits.
High-income audits are difficult to conduct. To increase receipts, it is far easier to just conduct more easy, low-yield audits. This is the optimization they are making, and in service of their mission (maximizing revenue) it is technically correct.
Instead of picking your favorite logical fallacy to throw at me, you can go look this stuff up yourself to confirm.
Please stop repeating misinformation. For your own sake, and for the sake of those around you, please also consider where you're getting information from.
Here's my attempt at contributing something meaningful to this discussion, since I'm tired of seeing the same kinds of responses to these threads over and over again. Feel free to disagree, the idea is to try to move the conversation past knee-jerk reactions.
This is an FAQ of sorts.
Q1: What's wrong with making the government more efficient? My tax dollars are being wasted by Agency X, spending billions of dollars a year on who knows what.
A1: There's nothing wrong with making the government more efficient, but (1) there are good and bad ways of cutting spending (and DOGE, IMO, is really bad), (2) the federal budget is massive [1], 1B or even 10B USD is practically peanuts, so a real cost-benefit analysis is critical while knee-jerk "that's too much money" reactions are usually short-sighted, and (3) the Trump administration is planning to spend FAR MORE on massive tax cuts - a government that's serious about reducing the deficit would not spend 5-10 trillion USD on tax cuts.
Q2: What's wrong with how DOGE is trying to cut spending? Government is filled with red tape, and they're taking a hacker approach to circumvent the things that prevented past governments from fixing things.
A2: Any time a large group of people need to agree on something, it takes time. Small-d democratic governance doesn't prioritize getting things done quickly in normal times, it prioritizes reaching consensus and respecting individual liberties. Occasionally war-time governments will temporarily suspend normal procedures (and rights), but there's good reason why things (mostly) go back to normal after the war ends. And whatever you may be seeing in your news feeds, America is NOT AT WAR.
A2 (pt. 2): The HN community usually (and rightly, IMO) gets very upset and concerned when companies or the government infringe on our privacy. The situation this article brings to light seems analogous to a big tech company bringing in consultants who are later found to have cybercriminal connections, without any safeguards or auditing around access of employee or user data. If that happened, there would be a huge uproar.
A2 (pt. 3): Except, it's worse, because the government is not the same as any old company. The US government was designed with checks and balances precisely to avoid concentrating too much power in the hands of any individual, including the president. Remember, America was establishing a democracy in a time when most countries were monarchies - a monarchical president was something the framers desperately wanted to avoid. There's too much to get into here, but this ongoing story is not just about privacy/security, but also about breaking legal and constitutional safeguards.
Q3: You admit that the federal budget is massive, so it's obvious that it's spending too much money. Sometimes it's hard to fix an old system with lots of parts - we need a ground-up rewrite! Cut first, then add spending back later - what's wrong with that?
A3: What's wrong with that is that people will get hurt. Ordinary people (no, not "woke leftists" - they're real people) will lose their jobs. People who were getting HIV treatment will stop getting treatment. Poor children will lose school lunches. And on it goes. To play along with the analogy, even if you think the only option is a ground-up rewrite, you don't run around the data center unplugging machines that you don't like. But that's also buying into a false premise. The federal budget as a percentage of GDP really hasn't grown all that much [2], and a huge part of that spending is on things that are really hard to cut (because most people don't want to cut it): social security, Medicare, defense.
Q4: Well, tax cuts aren't spending, it's just giving money back to the people! It's too bad you want the US government to spend so much, but that's my tax dollars you're talking about.
A4: Well, unfortunately, we live in a society, one that has historically agreed through democratic processes to care for its elderly, (sometimes) its sick or disabled, and (occasionally) its poor, because our ancestors wisely realized that those are elements of a stable societ where its people can flourish. Feel free to disagree.
Q5: Why report on the identities of these young people? And what's wrong with being young - many startup founders are college dropouts, right?
A5: Founding a startup isn't the same as running a mature company, and even running a mature company isn't necessarily the best preparation for civil service IMO. Youth has its advantages - fearlessness, energy - but wisdom comes with age. On the other hand, youth are impressionable, and can be easily led (or rather, misled) into doing illegal and/or immoral things. That's a pattern we've seen throughout history, and I see no reason to believe that the folks at DOGE are any different. As for making their names and identities public, they were the ones who made the decision to participate in actions that affect millions of people. Anonymity is for Internet commentators, not for supposed public servants cutting off funding to aid workers or scientists (you know, the actual public servants).
Q6: Why is this on Hacker News?
A6: See A2, pt. 2. There's no surprise that a news about hackers in on Hacker News. Also, should Elon Musk only be on Hacker News when it's about Tesla or SpaceX, and not when he's off trying to shut off funding to half the government? If you agree with him, fine - let's have a discussion. Don't flag kill everything that's reporting on what might be one of the most consequential events of this century. (Thanks for giving this a chance, dang.)
This should be the top comment, thank you. I think the key message is that running a government is very different from working in tech or running a startup, and that’s because a government has to (at least try to) act democratically whereas a company does not.
I guess as hackers we instinctively distrust authority, so it is difficult for us to defer to experts in the government and accept that they might know a lot that we don’t.
I don’t understand why the article is flagged as per Dang’s posts. Is it because a lot of HN folks think DOGE is good? I’ve seen some supporting tweets from senior YC people. Or is it just because people are worried posts like this will cause flame wars and be unproductive?
Aside: Some of the DOGE supporting posts from YC have made me sad. Would appreciate it if anyone can provide a perspective that reconciles those posts with a positive view of YC.
I enjoyed reading that. i don't have anything to add, but i wanted to ensure you at least got a thank you for putting in the time to write all that in the way you did.
You've basically put together an FAQ that summarizes the talking points from one party. I'm sure it's quite helpful if people are looking to understand the views of that party, but I'd hardly call it an authoritative FAQ on the issue at hand.
> A1: There's nothing wrong with making the government more efficient, but (1) there are good and bad ways of cutting spending (and DOGE, IMO, is really bad), (2) the federal budget is massive [1], 1B or even 10B USD is practically peanuts, so a real cost-benefit analysis is critical while knee-jerk "that's too much money" reactions are usually short-sighted, and (3) the Trump administration is planning to spend FAR MORE on massive tax cuts - a government that's serious about reducing the deficit would not spend 5-10 trillion USD on tax cuts.
You don't actually provide much rationale or provide a broad perspective on the issues at hand.
"DOGE is bad" because we should have a small d "democracy" approach. This completely ignores the Constitution and division of powers with the President in control of the Executive and all the agencies that report to it. Yes, Congress controls spending, and the Supreme Court will likely need to rule on exactly where the line divides between Executive/Legislative powers, but it's not accurate to say that spending cuts should be a small d democracy exercise.
Then you mention how 1B or 10B is practically peanuts (this is a talking point directly from one of the political parties) which isn't a great argument at all because DOGE isn't cutting 1B or 10B and stopping, the intent is to cut hundreds examples of 1B or 10B in spending, which is certainly not peanuts.
Then you mention how "tax cuts are bad and you wouldn't do that if you were serious about the deficit", but that's not true at all. Removing wasteful spending is 100% a goal in and of itself. We have no idea how much wasteful spending will be cut, and if we reduce it by $2T, and Trump decides to cut taxes by $1T, we're still reducing the deficit. That is also a "policy choice", not some universal rule that you can never cut taxes and be financially responsible.
As I said in the beginning, "feel free to disagree", so thanks for taking me up on that. As for coming across as one-sided, I didn't feel the need to represent both sides - I don't think I can fairly represent your point of view, and that's the value in having a discussion after all. However, I disagree with your implication that my viewpoint is partisan. Truth is neither Democratic nor Republican. If the facts line up on one side, then perhaps one side is right on a particular issue (while they could still be wrong on another issue). Again, feel free to disagree about what the facts are, but let's not make this about partisanship.
As to your response, I'll try to describe your points and then reply. Let me know if I mischaracterized anything you said.
1. Spending cuts shouldn't necessarily be a small-d democratic exercise.
Yes, they should. I am well aware that the President is the chief of the executive branch and its agencies. On the other hand, these agencies are also established by laws passed by Congress (e.g., the Department of Education was established by a 1979 law [1]). Sure, judges can rule on the division of powers; judges can also issue injunctions to halt what the administration is trying to do, until it has had time to consider its rulings. In the meantime, DOGE is still in government servers, and it's not even clear to me if DOGE will always follow court orders.
And for the purposes of discussion, instead of solely appealing to the future authority of the courts, we can also reason about what happens if all of this is deemed constitutional. If Congress can establish agencies, through laws signed by the Nth president, but the N+1-th president can simply ignore Congress and tell the agency to cease and desist... what exactly is the role of Congress?
And pray tell, why can't spending cuts be a democratic exercise? Trump is a democratically elected president with a House and Senate controlled by his own party. He can absolutely pass spending cuts that are agreed to by Congress, especially given that no congress member in the Republican party seems to have any backbone to stand up against President Trump. Here's my answer: it will be long, drawn out, and politically damaging, because too many people will have a chance to realize what these spending cuts are really taking away. Trump, Musk, and the crew are trying to pull a fast one on the American people, and this kind of anti-democratic maneuver is exactly what the framers were worried about when they wrote the Constitution in the first place.
2. DOGE wants to cut 1B or 10B times 100.
Umm, okay, good luck. Here's a breakdown of YTD US federal spending according to treasury.gov [2]:
- Social security (21%)
- National defense (15%)
- Health (14%)
- Net interest (13%)
- Medicare (13%)
- Income security, i.e., various financial assistance programs for the poor (9%)
- Veteran benefits and services (6%)
- Everything else (9%)
Cut "everything else", and that's ~600B off the budget. Great. See A1 in my original post: that's not going to pay for the tax cut Trump wants. And what do you give up? All science funding? All "education, training, employment, and social services"? (All while AI might start to displace more and more jobs?)
Or should we cut one of the other items? Sure, let's hear some proposals. My original point was, there's a cost-benefit analysis to be made, and DOGE is circumventing that cost-benefit discussion completely undemocratically. Spending 10B or even 100B isn't "too much" or "too little" unless we know what we're buying.
3. You can cut taxes and still trim the deficit.
Sure, please do the math and show me how this is going to happen. Where are $2T in spending cuts going to come from? I can reduce power usage in a datacenter by 50% by randomly unplugging half the machines, but I'm pretty sure that will get me fired. Show me what you think should be cut, and we can have a discussion. And again, why can't this go through a Republican- (and in reality, Trump-) controlled Congress?
> I disagree with your implication that my viewpoint is partisan. Truth is neither Democratic nor Republican. If the facts line up on one side, then perhaps one side is right on a particular issue (while they could still be wrong on another issue). Again, feel free to disagree about what the facts are, but let's not make this about partisanship.
"Facts line up on one side"? I didn't see much facts, I just saw what one party is repeating again and again when interviewed. Saying cutting small amounts is nothing while factual, is an attempt at arguing any small cuts are worthless, which isn't true. Saying money is "spent" on tax cuts is not factual it's an opinion, since you're presupposing taking less money from someone is "spending" on them when it's their money in the first place.
But I agree, let's not make this about partisanship.
> And for the purposes of discussion, instead of solely appealing to the future authority of the courts, we can also reason about what happens if all of this is deemed constitutional.
I find it funny to say "appeal to the authority of courts", when in fact the court are the authority. If they decide the President has the powers to impound wasteful spending, then that's what the Constitution says. That's how things are done until the Constitution is changed (or the court rule differently).
> Here's my answer: it will be long, drawn out, and politically damaging, because too many people will have a chance to realize what these spending cuts are really taking away. Trump, Musk, and the crew are trying to pull a fast one on the American people, and this kind of anti-democratic maneuver is exactly what the framers were worried about when they wrote the Constitution in the first place.
Every change the government tries to do is a long, drawn out and politically damaging (look at ACA!). I think the American people have looked at Congress and the President "try" for decades and decades to rein in government spending and any approach the relies on Congress agreeing to substantial cuts has resulted in trimming around the edges and usually more spending added at the same time.
It's one of the reasons why Trump was elected. He's willing to try something different. I see lots of people on HN recoil at the stories of the DOD failing audit after audit. You're not going to fix an almost 1T budget that can't pass audit with a few nips and tucks here and there, it's going to require radical action to fix.
And I don't agree that DOGE is undemocratic (the courts will make the decision in the end) and I would argue the framers would spin in their graves if they saw what the government had become and abdication of powers by the various branches.
> Umm, okay, good luck. Here's a breakdown of YTD US federal spending according to treasury.gov [2]: - Social security (21%) - National defense (15%) - Health (14%) - Net interest (13%) - Medicare (13%) - Income security, i.e., various financial assistance programs for the poor (9%) - Veteran benefits and services (6%) - Everything else (9%)
Cut "everything else", and that's ~600B off the budget. Great. See A1 in my original post: that's not going to pay for the tax cut Trump wants. And what do you give up? All science funding? All "education, training, employment, and social services"? (All while AI might start to displace more and more jobs?)
DOGE has already said it's going to take DOD and CMS (healthcare), so that's another 29% that can be cut. And presumably once we move to budget surpluses, that 13% were't spending on interest won't be quite so large any more. Suddenly we are talking real change to government spending.
> Sure, please do the math and show me how this is going to happen. Where are $2T in spending cuts going to come from?
Where does the $2T come from? I'm reading $3T over 10 years, or $300B per year, or a 6% reduction in federal revenues in 2024.
Thanks for the discussion, and for agreeing to not let partisanship get in the way. This will be my last reply in this thread, but I'll still check back and read your reply if you'd like to get in the last word.
> I find it funny to say "appeal to the authority of courts", when in fact the court are the authority.
You're taking my words out of context and omitting a critical "future". My point is threefold:
(1) Courts are already issuing injunctions (e.g., [1]) and in at least one case having to double down because the administration is failing to comply with an earlier injunction [2], which indicates which way they are leaning.
(2) Because the courts haven't made any sort of final ruling yet, there's no way to appeal to their present authority (apart from 1), and trying to appeal to their future authority is rather silly.
(3) The courts are indeed the authority, but relying on being able to say "the courts said so" is still a fallacious appeal to authority [3]. We should respect the courts and what judges have to say, but we can also analyze their thought processes critically. We also know that even the Supreme Court has been egregiously wrong in the past (e.g., [4]), never mind lower courts. (Yes, I know this applies to my first point, which is why there are the second and third points. :))
All this to say, you're dodging my question of how DOGE defunding these agencies could possibly be constitutional.
> Every change the government tries to do is a long, drawn out and politically damaging...
I'm not sure what point you were trying to make here. So let me tell you where I think we agree. I agree that Congress has been shamefully dysfunctional for the past, oh, 15 years. I agree there's waste in the government - certainly in the DoD. I agree Trump was elected because the people wants something different. And I agree, the framers would be horrified at the current state of Congress.
Where we disagree is that I see the current administration making the worst assault on the American democratic system since perhaps 1861, with DOGE being the tip of the spear. I too want a more effective, less wasteful, less deadlocked government. But not an autocratic one. The great danger is that autocracy is appealing precisely because it can appear at first to be more efficient, more decisive, cutting through all that democratic nonsense. Never ends well, though.
Sure, we can hope the courts settle these debates. Curious, though, why Vice President Vance and Elon Musk feel the need to already start laying the groundwork for ignoring court orders. [5][6]
> And presumably once we move to budget surpluses...
Thanks for giving me a laugh (not really, I'm still feeling quite grim). Last year's deficit was $1.8T. Tack on some tax cuts and we're looking at $2T or more this year before spending cuts.
> Where does the $2T come from?
That's what Musk was promising, wasn't it? It's also the size of the current deficit. Apologies if I was being confusing there - I was referring to the promised spending cuts, not the size of the anticipated tax cut. I hope you'll agree that if Trump cuts taxes by $300B and cuts spending by, say, $500B, that's not a meaningful dent in the deficit.
Anyway, time for closing arguments - I'd like to think these as fact-based arguments, but you'll probably accuse me of only offering opinions regardless. :)
- Shutting off funding to agencies established by Congress, where the money has already been appropriated by Congress, is unlawful. There have been multiple injunctions against Trump and DOGE, and they are already floating the idea of defying court orders. It remains to be seen how judges rule in the end, but the law and the constitution are there for all to read; I've made my arguments, but I've yet to hear yours (besides "I don't agree").
- US federal spending has hovered around 20% of GDP since ~1975 (see my original post). Running a persistent and growing deficit is not great (just my opinion - some economists think it's fine) but it's not a five-alarm fire that justifies unconstitutional actions.
- Letting unvetted members of Musk's circle get access to sensitive code and data carries a lot of risks that are neither justified by their goals (see previous point) nor by their current results.
- Based on the top-level breakdown of the federal budget, it's hard to see how this administration can turn a budget surplus without raising taxes, never mind if they go through with cutting taxes. Defense, health, and "everything else" as I mentioned adds up to 38%, or about $2.6T. If you think we can dial defense spending down to $0...
At the end of the day, honestly, I hope I'm wrong, and history proves you right. But I'm not going to hold my breath.
This ongoing story is in a sense about hackers gaining access to an ancient mainframe that controls trillions of dollars of payments a year, and using that to wield political power. A rather "Hacker News" story if you ask me, even if it comes across as an "are we the baddies" moment.
As per recent reports, the status quo included kickbacks to politicians and their spouses through lucrative board positions on state sponsored NGOs, millions of dollars for subscriptions to partisan aligned news publication and other incidents which can easily be characterized as corruption, fraud or outright waste.
There's a meta argument to be had on whether reducing the size and scope of state power is political. It is political in that it is politically contentious, however reducing the scope of things which come under the purview of politics is as close as anything can come to anti-political in our current environment of hyper-politicalization.
I would appreciate sources for the first point, to know what precisely you're referring to. In any case, the idea that there is waste and fraud in the government is, I would think, common knowledge. Fighting this is a necessary, admirable, but never-ending battle. Greed has been with us forever. For the better part of the last 160 years, however, America has done this in generally peaceful and democratic ways, with elected leaders passing laws through Congress and delegating power to civil servants. I'm curious if anyone can think of an example where such a small group of unelected, unappointed individuals had such sweeping powers. It seems like technology has had a role in enabling this concentration of power, even as it's been an equalizer in other ways.
As to your second point, I think you're using a rather odd definition of what is political. Anything that requires agreement or compromise between a group of individuals involves politics, whether the context is your work, your neighborhood, or your government. In that sense, "reducing state power" is absolutely political. It took political agreement for the government to do new things, and it should take political agreement for the government to stop doing those things.
There's nothing inherently bad about politics, if we define it this way. I would also disagree that the current environment is hyper-political. We're free to do plenty of things without needing political agreement.
On the other hand, I would agree that the current environment is hyper-partisan. I think we do often judge one another these days based on political (really, party) affiliation, and let everything be tainted by those tribal instincts. I find that unfortunate, but partisanship has little to do with the size of government. Whether one wants change or the status quo, every option should involve politics. The only way out is to live in an autocracy, and history has shown that even then, you're not really free of politics for very long.
Another one is Politico, which has been receiving an alleged aggregate of 8M in funds for "institutional subscriptions" at 37K each. Aligned media groups are out in force to argue these figures by misleading turns of phrase. Typically they will cite, "we only took [smaller amount] from [specific agency]", rather than discussing the aggregate amounts. Searching for what should be easily accessible public data has been hampered as a result.
You'll find that many of the NGOs which funded Vox were in turn funded by USAID. As for the board memberships, you can also pursue those sources yourself. There's a self-perpetuation element to this graft, when aligned partisan media groups are funded with state funds.
"Jill Biden named board chair of aid group Save the Children"
"Save the Children is pleased to announce that we are a core partner on MOMENTUM 2A, a recently awarded 5-year, $100 million program funded by the US Agency for International Development (USAID) that will advance the survival and the health of women, mothers, newborns, and children worldwide."
>...every option should involve politics. The only way out is to live in an autocracy..
This keeps coming up here on HN. I feel that many posters fundamentally misunderstand the foundational values of western liberalism that gave rise to The United States. If not for these values, we probably would not be celebrating "Democracy" as the highest good, which is in itself a misunderstanding of individualist liberalism.
Yes, greed is innate to the human condition. Lord Acton has a famous quote that applies here. By recognizing the fallible nature of man, we then seek to limit the scope of possible corruption by limiting the scope of the state. It isn't authoritarian or autocratic to ask that those who wish to support Vox, do so voluntarily with their own funds.
The entire premise of a limited republican government is based upon limiting the coercion of the state. It starts from the first principles of Natural Rights. Many will dispute the validity of this approach, but to characterize it as autocratic is to misunderstand history and the basics of philosophy.
What a individual does with his own private property in absence of coercive taxes is not a political matter. Little "D" democracy has a role to play in the specific implementation of our limited republic, but it is not the highest good. We should not be voting away property for special causes or partisan journalists. This is not because we regard all special causes as being unworthy of support, but because we oppose authoritarianism. We oppose the of the tyranny of the majority. We recognize the dangerous feedback effects of politicians voting themselves and their constituents public funds.
There's nothing autocratic in this. The effort to spin it as such preys upon the illiteracy of the reader. If anything, it is slight restoration of the original values of These United States. If we recall history, the issues around 1776 were in response to an unaccountable parliament taxing colonists without adequate representation.
Posters go off the rails when they invoke Fascism in regards to these cuts. Mussolini famously said, "Everything in the State, nothing outside the State, nothing against the State."
> Save the Children ... will advance the survival and the health of women, mothers, newborns, and children worldwide.
> The entire premise of a limited republican government is based upon limiting the coercion of the state.
> We should not be voting away property for special causes or partisan journalists.
> If we recall history, the issues around 1776 were in response to an unaccountable parliament taxing colonists without adequate representation.
You're equating taxation with coercion, to justify unelected, unappointed individuals forcibly changing how taxes are spent. Then somehow trying to make a connection to taxation without representation. When, in reality, the spending was made through representation, and this reversal of spending is being made without it. Look, just because you happen to agree with the autocrats doesn't make them any less autocratic.
I believe we can and we should "vote away property for special interests" like providing basic care for mothers and babies who might otherwise die, and therefore have no chance to experience either life or liberty. You're free to disagree on the "should", and we can have civil debate on that resolved through democratic means. But if you disagree on the "can", I'm afraid that's just authoritarianism cloaked in the guise of libertarianism.
Keep in mind that total US foreign aid has been less than 1.5% of the total federal budget going at least as far back as the year 2000. [1]
Since you bring up western liberalism and accuse me of illiteracy, I'll wrap up by quoting none other than J.S. Mill himself:
"Governments and nations have made mistakes in other things, which are not denied to be fit subjects for the exercise of authority: they have laid on bad taxes, made unjust wars. Ought we therefore to lay on no taxes, and, under whatever provocation, make no wars? Men, and governments, must act to the best of their ability. There is no such thing as absolute certainty, but there is assurance sufficient for the purposes of human life." [2]
I do agree with your broader point though that it's worth asking if society is getting more illiberal and intolerant of opposing views. It's not just a "young people these days" kind of thing.
Came here to post the exact same comment. It's a fun read, especially since I remember enjoying the occasional bag of smashmallows years ago, but the Theranos comparison is ridiculous. By their definition, any failed startup is no different from Theranos. (If there's any need for clarification: one is a risky endeavor where the parties are properly informed of the risks, the other is fraud.) But yeah, it's BI, so why bother complaining...
There's an increase in incidents because ATCs are overworked and understaffed. The knee-jerk reaction is to try to automate the work away. A few problems with that kind of thinking:
- Automation already exists - e.g., the collision detection warning mentioned in the article. I don't know much about air traffic control but I imagine there's some element of defense in depth. ATCs dozing off or running on fumes won't cause collisions right away (these incidents are mostly close calls) but it sounds like it's only a matter of time before all the other defenses fail and a major accident happens.
- There's always going to be work that's hard to automate. Plenty of software teams have on-call rotations to cover production services. You'd think that if any field would have their operations be fully automated, it's software, but nope. We need to stop thinking that the physical world is easier to deal with - it's often much harder.
- Automation costs money to develop and deploy. Apparently one of the early outcomes of union action back in the 70s was faster automation rollout. [1] For an executive, why spend money on automation if you could just squeeze more out of your workers and compromise on safety instead?
The lack of automation is causing ATC work to be stressful. People orchestrating complex procedures over a shared vhf radio channel is inherently hard and error prone. Which is why it involves people endlessly confirming and double checking known bits of information.
Automation could simplify that a lot and remove a lot of the uncertainty. Making communications easier might save some lives. A lot of accidents are caused by human pilots and typically that involves them making mistakes in stressful situations. Dealing with ATC is very stressful for pilots. Task saturation is something they all fight throughout their career. IFR pilots have to train and fly a lot to stay current; the ability to keep up with the radio communication and fly procedures safely is quickly lost when they don't. That's how hard it is. A pilot that is not current is not a safe pilot. That's why the rules are so strict for this.
If you look at this space from a distance, it's kind of obvious that more automation is going to be inevitable. Airspaces are busy now and they are going to get a lot more busy in the next decades. At least part of the traffic is going to be autonomous. Those planes will likely be communicating with ATC via networked protocols that have yet to be proposed and standardized. There is no reason why those protocols could not work with other planes. And it would free up ATC staff and pilots to do more urgent things. The way ATC is currently done is not scalable or future proof.
> The lack of automation is causing ATC work to be stressful.
…
> And it would free up ATC staff and pilots to do more urgent things.
There’s a problem that can happen with this, though, wherein the “easy” routine work is automated out and the number of humans involved is scaled down, but the work those people do then winds up being 100% the urgent/stressful stuff.
I’ve heard that ER doctors have been experiencing this in recent years–not quite with automation so much as just offloading, as less serious cases are picked up by nurse practitioners/urgent care centers, staffing has been adjusted and the actual physicians wind up with a steady stream of stressful high-acuity cases back to back to back.
> I’ve heard that ER doctors have been experiencing this in recent years–not quite with automation so much as just offloading, as less serious cases are picked up by nurse practitioners/urgent care centers, staffing has been adjusted and the actual physicians wind up with a steady stream of stressful high-acuity cases back to back to back.
Yet at the same time, ERs (near me at least) are still inundated with so many patients that average wait times are 4-5hrs.
Maybe you are in an oasis of reason where this doesn't happen. But most ERs I have heard of that are overcrowded is because people go to the emergency room when there is no actual emergency.
I’m sure there’s a number of reasons for this - after about 5 PM, your options are typically the ER or an urgent care. UC’s usually require payment up front, and for people who either don’t have insurance or who have high deductibles, the cost of care at a hospital (which is way more but can be put off) vs the up front cost of urgent care probably pushes people towards ERs.
There’s likely other factors - lack of medical education/first aid, consulting Dr Google and then having anxiety that maybe that slight pain is something horrible, etc.
A public health system could alleviate this stress, if done well. Clinics that are open later than “business hours”, readily accessible telehealth providers, and better public health education could all come about from a public system. Privatized, all of these can only exist with a profit motive, and the insurance and health system are costly.
I agree we might need a minimum staff level of, say, 1 air traffic controller per airport, but unless I've been grievously misinformed about the safety of flying, urgent/stressful emergencies should be very rare.
I suspect the main thing limiting ATC automation is the fact ATC is all done by voice using incredibly shitty radios, and equipment upgrades take like 50 years to roll out.
Software doesn’t quite have the same fungibility to allow for this, but imagine your job was only being responsible for urgent, high severity tickets throughout your company.
There was no time to mull over a problem, pair code with a peer or junior, or talk to a product owner because everything was urgent and on fire.
They have been working on automated ATC for a lot longer than 20 years. I worked at Eurocontrol 1991-1996 where they had been developing a system called ARC2000 since well before I arrived. As the name suggests it was intended to take over ATC in Europe by the year 2000. I worked on a less ambitious system that helped visualise conflicts for manual resolution but that was not a big priority so I eventually left.
My internship in the mid-1990s was with a professor studying VR systems for ATC for low-visibility operation. At the speed this field changes (or doesn't), I doubt I'll see it in my lifetime.
I'm sure it would be done better if implemented over audio, but the image of a frustrated pilot yelling "REPRESENTATIVE! REPRESENTATIVE!!!" just came to mind.
This is not my experience at all, and I suspect is also not at all for air carrier pilots who deal with ATC on every flight.
Sure, the guy in the 170 or J3 who mostly flies off his farm might be stressed by flying into the big city airport, but the vast majority of pilots who interact with ATC regularly don't find it particularly stressful.
In fact, given a choice (and as a VFR pilot I have the choice), 99 times out of 100, I will voluntarily call up and receive flight following from ATC. There's pretty much no down side.
> Those planes will likely be communicating with ATC via networked protocols that have yet to be proposed and standardized.
The protocols are not the issue, it’s the high-bandwidth, low-latency wireless network that’s missing. LEO satcom may be an option in the future, but it isn’t yet for flight and safety critical real time applications.
I just finished building a pilot information system for an airline that uses ACARS to communicate. It’s a backup system for a backup system that supports a redundant electronic flight bag tablet.
Automation in ATC exists a little yes, as you said for collision detection, ground proximity warning and runway infringement. That's mostly it.
We have some cool toys to make life easier like CPDLC to communicate via data-link instead of voice, multi layer radar screens with tons of functions, ATIS generation etc but those are not automation, just QOL improvement and if anything goes wrong we go back to old school ATC by voice and maths.
There is a lot of automation in the data part of ATC, so flight plans processing, radar correlation, meteo data etc etc. But this is just normal IT stuff in 2023.
Some cool project are getting there, like virtual towers with augmented reality by using cameras instead of looking out a window.
My company did recruit an expert in big data and ML to develop new tools and automate stuff, but always data related, nothing to do with controlling and aircraft on a radar screen.
Instead of more automation, perhaps it would be good to occasionally introduce phantom traffic which is designed to require intervention on their part (e.g. fabricate two flights and put them on a collision path).
The air traffic controllers would be expected to flag them, or intervene, or do whatever they would realistically do in that scenario.
From that, you can determine who's asleep at the wheel so to speak, and send them home. If necessary, planes may need to be grounded until properly alert staff can be available
RAAS (Runway Awareness and Advisory System), the equivalent system installed on aircraft, also needs to become standard equipment. It is for some airlines, but it is by no means mandatory.
> Plenty of software teams have on-call rotations to cover production services.
There are plenty of valid criticisms of the cloud but this is what you are really paying for. The value proposition of the cloud is infrastructure-oncall-as-a-service.
A wrinkle to your wrinkle: a cursory glance at this source [1] suggests that the rise of adolescent suicide in the 1970s and 1980s was greater among young men, which is the opposite of what we're seeing today.
1. There are claims that federal spending is out of control. How do you square that with the fact that spending as a percentage of GDP is only slightly elevated compared to the historical average going back to at least the 1970s, with the main deviation in the past few years coming from the after-effects of the pandemic? [1]
2. Federal spending largely falls into a few categories: taking care of the elderly (36%), defense and veterans (20%), taking care of the poor or disabled (22%), and interest on existing debt (13%). [2] This adds up to 91% of the budget. The US population is aging, which means that 36% slice is going to naturally grow. What do you think should be cut, and how?
3. The US pays far more for health care (28% of the budget if you include Medicare) and with worse outcomes on average. Why shouldn't the health insurance industry be the first item on the chopping block?
4. Corporate tax receipts have been steadily falling as a percentage of GDP. [3] Why shouldn't corporations (that benefit from a healthy and educated workforce, a safe and secure environment, a working transportation system, etc.) be paying their fair share to keep the national debt in check?
[1] https://fred.stlouisfed.org/series/FYONGDA188S
[2] https://fiscaldata.treasury.gov/americas-finance-guide/feder...
[3] https://fred.stlouisfed.org/graph/?g=1DUdb
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