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First of all there is another chart slightly below that one which treats the budget as you suggest.

Secondly, there is a slight of hand being perpetrated that they are trying to emphasize. Things like Social Security and Medicare are not government programs. They are mandatory insurance programs that the government administers. They were added to the budget during the Viet Nam war so LBJ could disguise the true size of the military spending.

The government acts as a collection and dispersal agent for these funds. The funds are collected for a segregated purpose and spent for the same purpose when needed. Social security and medicare could be spun off into a government owned corporation like the post office and then it would be obvious that the money is not part of the "budget".

Your remarks just show how successful the policy of obscuring the true uses of federal funds has been.

And as the original posting shows distructive spending gets counted just the same as social programs in the "GDP".

Policies not Politics
---- Daily Landscape

by rdf (robert.feinman@gmail.com) on Mon Oct 31st, 2005 at 10:41:37 AM EST
[ Parent ]
You are aware, I'm certain, of the long-standing dispute about whether social security is a trust fund run by the government or an intergenerational wealth transfer program. The dispute has been going on since the 1930s...

But in any case there is hardly any difference between a mandatory insurance policy run by a government and a tax.

by asdf on Mon Oct 31st, 2005 at 12:36:02 PM EST
[ Parent ]
have long been used to finance general government spending; and since social security defecits, projected to start in 2018 or so, are by law required to be paid from general revenues, it seems that futher weakens the argument.
by wchurchill on Wed Nov 2nd, 2005 at 02:47:53 PM EST
[ Parent ]


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