If there’s one thing Bernie Sanders knows, is that when the going gets tough, the tough – or in this case, the Bernie – simply doubles down on
the stupid, and goes even further into the Realm of the Unbelievably Economically Illiterate.
In his most recent iteration of this Bernie Behavior ™, he uncorked the idea of spending another $18 trillion on new, um, spending – in addition to the record spending, deficits, and debt we’ve already enjoyed under Barack “Deficit spending is unpatriotic unless I’m the one doing it” Obama. Because the last stimulus worked out so well. ($650 million for Digital-to-analog television converter box program?)
Bernie’s taxpayer-funded meme generator has this graphic all over the internet of late, and it would be hilarious in its unintended comedy if it weren’t also hideously obscene in what it means to promulgate, much less support, this level of lunacy:
But let’s take Bernie one disaster at a time. It’s the only way I can get through it.
1. Medicare for All – $15 trillion
First of all, covering everyone under Medicare means that what’s currently happening with Medicare – that the true costs of care are shifted onto commercial rate-payers – means that an entire system of payments that don’t cover hospital or provider costs results in hospitals and providers that will have to cut back on the care they can offer. In other words, by covering everyone with the same plan, you actually decrease access to care. You can’t ignore costs of providing care by only looking at what you’re willing to pay. Try that at an auto mechanic’s shop and see how that works out for you.
Note that this has been happening for years now under Medicare, and is also happening now, as predicted, with the other aspects of centralized health care, in that Obamacare co-ops are folding like the cheap financial tents they are. In what should come as a surprise to
Bernie, wishing things to be true does not make them so, so quadrupling down on Medicare is like stomping on the accelerator after you realize you’re headed for a cliff.
Oh, and where’s that $15 trillion going to come from?
2. Social Security – $1.2 trillion
Touted as a way to increase benefits and shore up its looming insolvency – a pairing of phrases that should give even a 6th-grader mathematical pause – Bernie figures why not throw a big money bomb at the problem and hope it goes away.
First, let’s do a little envelope math here: $1.2 trillion of $13.4 trillion in unfunded liabilities (as of 2014) is 9% of the total unfunded liability. That’s not even a dent in it. It’s not even a scratch.
Social Security ran a $71 billion deficit in 2013, closing out four years of consecutive cash-flow deficits as the program’s unfunded obligations continue to grow.According to the 2014 annual report from the programs’ trustees, the combined 75-year unfunded obligation of the Social Security and Disability Insurance Trust Funds (referred to collectively as the OASDI Trust Fund) is $13.4 trillion, a $1.1 trillion increase from last year’s unfunded obligation of $12.3 trillion.
So the spend won’t even touch the unfunded liability, only changing the benefits and raising the retirement age will do that. Which is not on Bernie’s table of offerings here to “fix” the problem.
Oh, and where’s that $1.2 trillion going to come from?
3. Rebuild roads, bridges, and airports: $1.0 trillion
Apparently the existing (near) $1 trillion “stimulus” wasn’t enough to rebuild our crumbling infrastructure, although, as reality kicked in on a massive spend of that scale, it turns out that the bulk of it went to nothing at all like rebuilding roads, bridges, and airports. It was sold as a means to reduce unemployment, with guarantees of a return to a “new normal” U3 rate of 5% back in 2009 – and with tales of horrific unemployment if we didn’t spend a trillion now, immediately.
Which, as it turns out, had little to no effect on unemployment, as the prime driver for the unemployment rate decrease was people leaving the workforce, a good percentage of which were doing so under extended unemployment benefits and lax disability requirements for SSDI, which made it much easier to do nothing and get paid for it. The stimulus has largely been classified as a bust, but Bernie wants more of the same.
Why? Why would he want to do something that has been shown to fail, again and again? That transferring wealth from one sector (the private) to the other (the public) does not necessarily result in a net positive? Considering that the federal government scrapes off its operating costs, and that the dollars become political playthings for politicians to use to enhance re-election results, why would an aging Socialist believe that the state knows better than the individual what to spend a dollar on?
Because Socialism. That’s why.
Oh, and where’s that $1.0 trillion going to come from?
4. College affordability: $750 billion
One of the reasons college tuition goes up 2x-3x the rate of inflation is because tuition is subsidized by our loving godparents, the federal government, under the guaranteed student loan program. So now, spending what’s close to the 2009 “stimulus” total on colleges is going to do what, exactly? Make colleges reduce their tuition rates? Make students smarter? Reduce loan debt by shifting the cost of what would have been the loan onto taxpayers, which, in effect, raises taxes on people most likely to be paying off their own student loans to pay for the schooling of current undergrads?
Even I can’t distill this lunacy into its purest form. It’s like trying to gaze into a singularity. I might glimpse it, once, but then I’d go insane.
As others have noted, repeatedly, if you make money available to pay for something, the price of it will go up to match the availability:
Federal student aid, whether in the form of grants or loans, is the main factor behind the runaway cost of higher education. As Cato Institute economist Neal McCluskey explained in an April 2012 article for U.S. World & News Report:
“The basic problem is simple: Give everyone $100 to pay for higher education and colleges will raise their prices by $100, negating the value of the aid. And inflation-adjusted aid–most of it federal–has certainly gone up, ballooning from $4,602 per undergraduate in 1990-91 to $12,455 in 2010-11.”
Bernie wants to increase this lunacy, which will only a) drive up the tuition prices, b) incentivize an even larger student loan debt, and c) make the problem he purports to solve worse by enabling the educational industry to happily raise its own spending on the backs of students, all under the guise of making education more “affordable” for all.
Oh, and where’s that $750 billion going to come from?
5. Paid family and medical leave: $319 billion
This is simply another labor cost in the form of regulatory requirements that, despite what it sounds like, in terms of a cute-and-fuzzy-who-could-argue-against-this statement, is just another cost of labor, like the Medicare deduction. This is yet another way to fund a federal program that will net payments to those who choose to have a family (in part). Which is essentially asking people who do not have children to help subsidize the costs of those who do, which is another form of federal re-distribution and policy-making hiding behind the fig leaf of health care.
In thinking about this purely in terms of benefits, the cost of this paycheck deduction would come directly out of gross pay for the individual, and/or the costs to the employer – but essentially those costs will be borne by the consumer that buys the product or service the company provides, resulting in less demand for that product or service as costs go up.
Which might mean some people get fired for having increased benefits. Funny how wishing for something nice in one hand might leave you with something else less nice in the other hand.
So where, exactly, is that $319 billion going to come from?
6. Bolster private pension funds: $29 billion
Here’s a place to start: Where’s the $29 billion going to come from? Taxpayers? And to what end? The federal government is going to essentially give a grant to private pension funds to cover potential losses? What could possibly go wrong here?
7. (Yuuuuge) Youth Jobs Initiative: $5.5 billion
1 million jobs for disadvantaged youth. This price tag results in a $5,500 per person subsidy.
Sanders’s bill, which he introduced in a D.C. neighborhood with relatively high unemployment and crime rates, would send $5.5 billion to local and state governments to fund job-training programs. Much of the money would go to helping unemployed African Americans. Sanders suggested the investment could pay for itself if it keeps more young black men out of jail.
Sanders seems to be living in a dream world where a jobs program would magically return its investment if it kept more young black men out of jail. It’s being done right now, in terms of spending, and that hasn’t seem to have done a thing in terms of minority unemployment rates, incarceration rates, or the future prospects of the disadvantaged. In fact, $18 trillion has been spent on Great Society programs since the 1960’s, and how’s that working out? In short:
The best thing we can say for the Great Society economic programs as a whole is that they amounted to a gigantic waste of the taxpayers’ money. Many, however, were worse than wastes; they actually caused harm.
Bernie’s fix for this problem? Spend more.
And yes, I have to ask, once again: Where is that $5.5 billion going to come from?
All that said, I can tell you where the money for Bernie’s spending won’t be coming from: Bernie’s pockets. He’ll just be making even more money if enough people vote for him for President.