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19 July 2016
about 6:15 pm PST
It has taken me so long to get here because I wanted to read the chapter on Social Security again, to decide what were the most important things I wanted to blog about. It's hard to know whether to focus on political jargon, confusing statistics, or budget details that are really just one person's projection (usually to make the numbers larger and more threatening).
I should include a notification that this chapter is important to me because I recently became a recipient of early retirement funds. I only receive $381 a month because I spent a lot of time at home with my kids, trying other ways to make an income, working erratically at minimum wage jobs, and other factors. I don't know how Social Security is figured, but it is my ONLY cash income right now, along with less than the maximum amount of food stamps (SNAP) because I receive that income (only $126/month). Government living is not easy.
I guess the biggest missing number was some idea of what the GDP amount was. Many of the figures are compared to GDP levels by a percentage, but who knows what kind of amounts they are talking about, and what is included in the GDP. An example that is nearby, in my notes, is the projected growth of Social Security from 2015 to 2040, from 4.9% of GDP to 6.2% of GDP. What kind of money are we talking here? What will life be like in 2040?
And, my biggest gripe about projections, how do we really know what will happen in the future? It's like a business plan... it's all on paper, a best guess. Real life changes everything you plan on paper. Many people are homeless because their plans didn't work out. People buy things on credit based on what they make now, then something happens and they can't make the payment. Projections are assumptions, not reality. We also have to remember that writers, in creating an argument for their proposals, will manipulate facts and perspectives to only present what makes their view acceptable. This is why we have to spend so much time trying to find the real Truth.
I would guess that the main concern this report has with Social Security and its related programs, called "entitlement programs" for their purposes, would be the lack of control over them. Part of the chapter's details revealed to me that these programs are paid first, probably AFTER the interest on the debt, and leave little money right now for anything else that might fit into a legislators bartering toolbox. As expected, the military, national security, and defense budgets are mentioned as needing funds more than these "entitlement" programs. I am sure there are other undeclared programs in their minds to fund, but these security programs are the hot buttons for every election... for the Republicans, anyway.
As far as I can tell, these figures break down into several different conglomerations of "entitlement" programs based on Social Security Retirement Benefits, Disability Insurance, Medicare, Obamacare subsidy payments (which I think begin in earnest in 2017), and Medicaid. Different money amounts mentioned include different parts of those programs. It is not an easy maze to conquer.
A graph of the projected deficit growth from 2015 to 2024 shows a category called "all other federal budget deficits" over the Retirement program and the Disability program. Most of these years are when the Boomers enter the system, which is one of the arguments about how the program is set up. There isn't any way to know what the "other" program deficits are, and the Disability deficits seem to be constant. It was stated that the Retirement and Disability Funds are not yet "insolvent" but that there is no real cash in them, only government IOU's. The Boomers and the lack of real investment money in these Funds are part of the reason the deficits are happening. The bill is coming due now, and the current Congress doesn't want to pay it.
I was rather irritated at the argument on the same page as the graph about interest outlays and non-interest outlays as a focus for the spending cap proposal. It was suggesting a spending cap on the non-interest related parts of the budget, and specifically saying that no action on the debt interest would be possible. I suppose I am confused about this, but it seems to me that reducing the debt would be the best way to get rid of a LOT of our financial problems, especially the huge interest payments on it. I think there is a conflict of interest in this topic.
Government debt securities are seen as a very safe investment and prized for their repayment value. At least, they were until some governments started going bankrupt. If we didn't have our debt, we wouldn't have to pay that interest money to the debt holders. We could use it for other important programs, like the military, national security, and other defense programs. Right?
This report seems to say there is no opportunity to reduce our spending (increase our income) with the debt and any other interest-related budget item. I don't know what other interest and non-interest items are in the federal budget as no details on these items are really presented. The only focus is to create a spending cap to "encourage" entitlement reform.
For many years I have considered ways the American People could try to solve this debt problem outside of Congress. I think we could do it, but the bigger problem is that the government would just overspend again and create another debt crisis. The interest on the debt is so huge it would pay for many of the programs that make the budget a constant conflict, but those tax dollars are spent on interest payments to China and whoever else owns our debt.
I think it was when Obama sold the plans for the Hummer/Humvee to China that I decided ONLY Americans should own American debt. In the years that passed since then, crowd-funding has become big. I guess my idea was like a national crowd-funding effort to buy back the debt and hold it until the government was able to pay the debt back. Do you think it would work? I don't know. We need to think of something.
The GDP came up again in the section on debt. I discovered there is a level of debt that is acceptable -- for nations, I think. The report stated that less than 60% of GDP is acceptable for a debt level, and 2% of GDP is acceptable for deficit levels. What happens when GDP changes because of conditions beyond its control? What seems acceptable one year may be a crisis the next. Living within our means is a better gauge. Creating income producing programs is a better use of our funds than subsidies for agriculture and housing. Revolving loan funds are better than loan guarantees. There are better choices, but something keeps our legislators from making them. What could that be???
I found it interesting that they want to make Social Security and its related programs into a "real insurance model." I thought it already was... a low-cost, shared, forced government insurance program. My view is they need to include all citizens, not just those receiving paychecks... to make it voluntary and devise a payment rate based on when it is collected on. One of the biggest problems with the system has been the family members that aren't included -- spouses, children, anyone who wants to have an account.
Creating a government version of Retirement insurance focused on low-income households would change the way we think of government programs, allow more people to pay in, and create both cash benefits and medical care in one program. If it is well defined, people can build up their accounts like a Health Savings Account, deciding how much they want as a final payment when they start to collect. It won't be modified by your later income, just a planned income amount paid by the future government at the start of each month. Medicaid and Medicare would become one part of that insurance plan, again focused on the poor, who are the only ones who really need government help anyway. Wealthy people can buy other forms of insurance in a free market, but every citizen would be eligible to purchase it as a back-up plan. The Obamacare focus on forced submission of every citizen is a faulty one. I hope they will create something more reasonable for poverty households when they repeal Obamacare.
I have also found it interesting that the government wants to raise the minimum age you can begin to collect on your Social Security benefits. It is going up to 67 by 2027 it says. With all the expected problems in the job markets because of technology taking over many of them, I think the recent "recession" is a clear indication that the age needs to be 50, not 65, 67, or 70. The benefit options can change by the age you choose to collect them, but the account holder is the one who needs to make the decision of when they need to start receiving their benefits... not the government. Every life is different, people need the flexibility to choose how to survive their situations.
In a crisis economy, business downsizes its labor expense, which often means that the older, more highly paid, employees are let go and replaced with younger, cheaper staff. In our near future, the jobs for older people may not be as plentiful or as well-paid as they are now. Technology is swiftly replacing real humans with robotics and other automated tasks. None of these pay taxes. Our current economy is still recovering... we are a global financial network now... there is no way to know what will happen in the future. The assumptions presented in this report are based on tax revenues that may not exist in ten years.
For me, these kinds of reports are like media presentations and the legislation Washington and other government agencies create. It is jargon that ordinary people cannot understand. Sometimes it is purposely so confusing so you will think it is good for everyone but it is really killing the common man it is suppose to help. Text, statistics, and graphs, look impressive, but when you have the time to really explore them, the story isn't right.
In the larger section about the Disability program, I had a hard time deciphering how the reforms would help people with disabilities survive their everyday existence. Legislators seem to make thousands of dollars a year in salaries and benefits and operating funds, but someone who has no other alternatives is seen as a burden on the government for needing a reasonable amount for shelter, food, and ordinary living expenses. The poor, including the disabled, are always attacked when a budget crisis occurs... they are the easiest targets and few know how difficult it can be to live on government "benefits."
In the sections about "flat rate" payments for disabled people, I found it questionable that future recipients would "eventually generate savings in excess of SSDI's shortfalls" and linking this flat rate to anti-poverty benefit amounts and the "poverty level." To me, that is government-speak for very low living amounts. I know what low government life can be like. Depending on where you live, it can be very, very bad.
This flat-rate payment was also linked to encouraging recipients to purchase supplemental disability insurance. This is a strange problem in our current government. We have mandated insurance now. Low-income recipients of government insurance (Medicaid) can't afford any other insurance. Their lives are mandated by the limits of the government's insurance policies. How is someone who is disabled and living on government assistance suppose to spend some of their few dollars on supplemental insurance?
The concept of linking the flat payment to the "poverty level" is also very questionable. As an applicant to many different government programs over my lifetime, poverty changes every year and with every program. Then there is the qualifying percentage of the poverty level that applies. This is a vague reference to something people know about, sounds good, and is very deceptive when applied.
It was also interesting how the savings that these proposals would create could be used by recipients to increase their own retirement savings plans and supplemental insurance. When I hear reports from various sources, most people in America are a paycheck away from ruin. This gap between those who have lots of money who create plans to make the poor into better citizens is really visible in moments like this. It is totally unrealistic.
When people are trying to survive, they spend everything, including their credit card balances if they have them, and borrowing from everyone they know when they don't have a credit card. That leads to its own problems. The government has done the same thing... it has "MAX'd" out its credit cards, and overspent it income. Now it is facing its own budget crisis and people who are dependent on its promises, like me, will suffer for what it has done.
Often I hear reports on TV about the state of our economy and they include credit card spending as if it is a worthy part of life, directly responsible for the improving economy. Credit card spending can also be survival spending. It doesn't seem like a good measuring tool to me.
Showing posts with label Heritage Foundation report. Show all posts
Showing posts with label Heritage Foundation report. Show all posts
Tuesday, July 19, 2016
Monday, July 18, 2016
Solutions 2016 :: Housing
This is where I have decided to add all my comments about Solutions 2016, Heritage Foundation's report on issues for this election. This blog post is for the chapter on Housing, pages 49-51.
I am not a government expert, so my comments are from my point of view and based on my limited experience with life and the government. I read as much as I can, but I don't read a lot of the details of all the bills going through our governmental process, including the Dodd-Frank and some of the other government agencies referred to in this chapter.
I hear the names Fannie Mae, Freddie Mac, and FHA (Federal Housing Authority) in the news, but they are just another government reference, like the IRS and Homeland Security and the EPA (Environmental Protection Agency). There is so much government that doesn't seem to directly affect my day-to-day life, I can't keep up with it all. I suppose I run on the same foundation as all these government offices, "crisis mode." When I need to know about it, I will search it out.
This is how so many of our laws, rules, regulations, and restrictions get passed... everyone in the country is trying to survive and doesn't have time to check it all out every single day. We are left to suffer the consequences.
Groups have formed, like the Heritage Foundation, to try to deal with this time commitment, and they are mostly funded by the wealthy because their profits are tied to these decisions. They are also trying to survive. This isn't just a Republican process, the Democrats have their own groups, so do other large interests. If I had money, I would be doing the same thing. I think you would, too.
I just want to make sure you know that my opinions are about the issues I see, and this may be a Heritage Foundation document, but it could be any other political publication -- even your daily news, in print or on the TV. Bias is part of the information process. We have to try to sift through all this data as best we can... and make our decisions as best we can with that information.
recent
In this chapter of Solutions 2016, there are many references to subsidy applications and government guarantees that bind the tax structure. We have committed our tax income, or maybe I should say it has been OVER committed, and now Washington is struggling to deal with the consequences of their actions in the past.
I have some of my own opinions about the housing "bubble" we continue to struggle through, but this report says it was caused by government policies that the public sector would not have been involved in. That may be true, but it was the banks that sold the mortgages. (I have said elsewhere that I believe someone got the bright idea to sell mortgages like they have sold student loans, but it didn't work the way they thought it would.) It was the banks that needed to be bailed out... the BIG banks. A lot of small banks were left to die.
I had to wonder in those days why the banks didn't just work with the homeowners... flex with the crisis... give them more time at the same interest level, or make it better. Banks had a choice, in my view, to help their homeowners survive their financial struggles so the banks would not have to suffer theirs. People who had been successfully making their payments suddenly were hit by outrageous interest on their home loans... it didn't have to end in foreclosure, but it did. Someone profited by this whole crisis... which speaks more to our moral issues than our financial difficulties.
It may have been impossible for the banks to flex with the situation because of regulations about lending, I don't know. This is one of the things in my "have no idea" files. I did think that the selling of these loans made the real people in those homes into just a line on a computer printout. It is easier to force legal rights on people you don't know personally, people who are just a piece of paper. If they change anything, I think they should change the ability of any financial institution to pass on their loan agreements to anyone. The ones who make the loans would need to service the loans they make, building their relationship and history with them, and being able to flex when necessary. I think that would create better decisions and less failure and loss for everyone.
Another issue I see in the conservative viewpoint is with government regulation of business activities, which they seem to think is "intrusion." If we were all moral individuals and ran our activities in a moral fashion, there wouldn't be a need for laws governing them. Too much regulation is a hindrance to accomplishing business goals, which includes jobs and profits. Sometimes these efforts to make the world a better place have a different motivation... to get rid of the competition, to make it easier for them, to control their part of the universe... etc... you get the idea. In my small efforts to start a business on my own, from a poverty background, I have found the expenses to be very difficult.
When I was living in Hollywood in the early 1980's, some of the people who lived in the neighborhood tried to support themselves by making and selling food to their neighbors. I imagine that is how they survived in their home countries, and I doubt the health department existed there. It was wonderful. I thought it was like the early cart vendors on the corners of busy locations. They were doing their best to provide for their families in their circumstances. Not bad people out to poison anyone, just starting from nothing and trying to build a new life. We have become too regulated when every action to improve one's life is tied to some form of tax income so the government can have a piece of it.
Conservatives hate government housing programs because the people who live in them are just a line on a computer printout. They have no meaning to them, so they are seen as blights on the taxes they want for their own purposes. I don't like to live in subsidized housing either... but it is all I have access to at my income level.
I have personally experienced years of housing struggles, with evictions and homelessness, in projects and in programs... they all have their problems and those who benefit by the government's funding to create them. I call them "planned poverty" because you have to be poor when you sign up, you have to stay poor to qualify when (years later) you finally get contacted, and you have to stay poor (or commit fraud) to keep living in them to remain in the same neighborhood, schools, jobs, and more. I don't consider subsidized housing to be a good choice for spending tax dollars to "eradicate poverty."
With the tiny home movement, I have been advocating for home ownership for low-income families, homeless individuals and families, and disabled persons. I have share several of my concepts in other blog posts and at Facebook. Ownership will bring stability to anyone... and poverty households, especially those with single parents, young children, and those who seem to slip through the cracks of our country's vision for changing the world of poverty, need stability most of all. It allows them to stay in one place, to have security, to build a life that won't be lost with the next financial crisis. Tiny homes can be had for a very small investment, and the payments can be made affordable to those who need them. Using the same 30% of income that subsidies require turns this housing outreach into a profitable investment.
So many options are available, but the government doesn't see them. All their plans are based on the past models. I think loans are an election pay-back vehicle, so there may be motives behind these choices. I really don't know. Maybe it is too hard to change the way the government works. I know I had years of failed efforts in trying to do it.
The amounts listed in this chapter are enormous. One of the ending facts stated that about 5 million people receive housing assistance at an average benefit of $8000 each. The details are missing so it is hard to judge what the money was spent on.
In my proposed tiny home biblical loan with a limit of $50,000 over 15 years, the payments would be less than $300 a month... which is affordable for many low-income households, but if there is a financial crisis, the government can flex with it.
That $8000 expense per person mentioned in the Heritage report would equal over 2 years of homeownership payments, and would be income rather than an expense to the government. I am guessing that $8000 barely makes one year of subsidized rent payments for the smallest (and usually worst living conditions) apartment in any urban setting.
In an ownership program, the monthly payments by low-income households would be income for the government. At the end of the repayment period there would be a small profit for the effort to change a family's life dramatically. Multiply that small profit by the 5 million participants that go with the $8000 estimate and you have more money to invest in poverty housing.
This seems like a better idea than budget battles every year to increase tax allocations for poverty housing efforts, with nothing to show for the investment at the end of the year or when a problem rises up to send a family back into the homeless cycle again and again and again....
Subsidies or income, recycled poverty or stability, which do you think are better ideas?
I am not a government expert, so my comments are from my point of view and based on my limited experience with life and the government. I read as much as I can, but I don't read a lot of the details of all the bills going through our governmental process, including the Dodd-Frank and some of the other government agencies referred to in this chapter.
I hear the names Fannie Mae, Freddie Mac, and FHA (Federal Housing Authority) in the news, but they are just another government reference, like the IRS and Homeland Security and the EPA (Environmental Protection Agency). There is so much government that doesn't seem to directly affect my day-to-day life, I can't keep up with it all. I suppose I run on the same foundation as all these government offices, "crisis mode." When I need to know about it, I will search it out.
This is how so many of our laws, rules, regulations, and restrictions get passed... everyone in the country is trying to survive and doesn't have time to check it all out every single day. We are left to suffer the consequences.
Groups have formed, like the Heritage Foundation, to try to deal with this time commitment, and they are mostly funded by the wealthy because their profits are tied to these decisions. They are also trying to survive. This isn't just a Republican process, the Democrats have their own groups, so do other large interests. If I had money, I would be doing the same thing. I think you would, too.
I just want to make sure you know that my opinions are about the issues I see, and this may be a Heritage Foundation document, but it could be any other political publication -- even your daily news, in print or on the TV. Bias is part of the information process. We have to try to sift through all this data as best we can... and make our decisions as best we can with that information.
recent
In this chapter of Solutions 2016, there are many references to subsidy applications and government guarantees that bind the tax structure. We have committed our tax income, or maybe I should say it has been OVER committed, and now Washington is struggling to deal with the consequences of their actions in the past.
I have some of my own opinions about the housing "bubble" we continue to struggle through, but this report says it was caused by government policies that the public sector would not have been involved in. That may be true, but it was the banks that sold the mortgages. (I have said elsewhere that I believe someone got the bright idea to sell mortgages like they have sold student loans, but it didn't work the way they thought it would.) It was the banks that needed to be bailed out... the BIG banks. A lot of small banks were left to die.
I had to wonder in those days why the banks didn't just work with the homeowners... flex with the crisis... give them more time at the same interest level, or make it better. Banks had a choice, in my view, to help their homeowners survive their financial struggles so the banks would not have to suffer theirs. People who had been successfully making their payments suddenly were hit by outrageous interest on their home loans... it didn't have to end in foreclosure, but it did. Someone profited by this whole crisis... which speaks more to our moral issues than our financial difficulties.
It may have been impossible for the banks to flex with the situation because of regulations about lending, I don't know. This is one of the things in my "have no idea" files. I did think that the selling of these loans made the real people in those homes into just a line on a computer printout. It is easier to force legal rights on people you don't know personally, people who are just a piece of paper. If they change anything, I think they should change the ability of any financial institution to pass on their loan agreements to anyone. The ones who make the loans would need to service the loans they make, building their relationship and history with them, and being able to flex when necessary. I think that would create better decisions and less failure and loss for everyone.
Another issue I see in the conservative viewpoint is with government regulation of business activities, which they seem to think is "intrusion." If we were all moral individuals and ran our activities in a moral fashion, there wouldn't be a need for laws governing them. Too much regulation is a hindrance to accomplishing business goals, which includes jobs and profits. Sometimes these efforts to make the world a better place have a different motivation... to get rid of the competition, to make it easier for them, to control their part of the universe... etc... you get the idea. In my small efforts to start a business on my own, from a poverty background, I have found the expenses to be very difficult.
When I was living in Hollywood in the early 1980's, some of the people who lived in the neighborhood tried to support themselves by making and selling food to their neighbors. I imagine that is how they survived in their home countries, and I doubt the health department existed there. It was wonderful. I thought it was like the early cart vendors on the corners of busy locations. They were doing their best to provide for their families in their circumstances. Not bad people out to poison anyone, just starting from nothing and trying to build a new life. We have become too regulated when every action to improve one's life is tied to some form of tax income so the government can have a piece of it.
Conservatives hate government housing programs because the people who live in them are just a line on a computer printout. They have no meaning to them, so they are seen as blights on the taxes they want for their own purposes. I don't like to live in subsidized housing either... but it is all I have access to at my income level.
I have personally experienced years of housing struggles, with evictions and homelessness, in projects and in programs... they all have their problems and those who benefit by the government's funding to create them. I call them "planned poverty" because you have to be poor when you sign up, you have to stay poor to qualify when (years later) you finally get contacted, and you have to stay poor (or commit fraud) to keep living in them to remain in the same neighborhood, schools, jobs, and more. I don't consider subsidized housing to be a good choice for spending tax dollars to "eradicate poverty."
With the tiny home movement, I have been advocating for home ownership for low-income families, homeless individuals and families, and disabled persons. I have share several of my concepts in other blog posts and at Facebook. Ownership will bring stability to anyone... and poverty households, especially those with single parents, young children, and those who seem to slip through the cracks of our country's vision for changing the world of poverty, need stability most of all. It allows them to stay in one place, to have security, to build a life that won't be lost with the next financial crisis. Tiny homes can be had for a very small investment, and the payments can be made affordable to those who need them. Using the same 30% of income that subsidies require turns this housing outreach into a profitable investment.
So many options are available, but the government doesn't see them. All their plans are based on the past models. I think loans are an election pay-back vehicle, so there may be motives behind these choices. I really don't know. Maybe it is too hard to change the way the government works. I know I had years of failed efforts in trying to do it.
The amounts listed in this chapter are enormous. One of the ending facts stated that about 5 million people receive housing assistance at an average benefit of $8000 each. The details are missing so it is hard to judge what the money was spent on.
In my proposed tiny home biblical loan with a limit of $50,000 over 15 years, the payments would be less than $300 a month... which is affordable for many low-income households, but if there is a financial crisis, the government can flex with it.
That $8000 expense per person mentioned in the Heritage report would equal over 2 years of homeownership payments, and would be income rather than an expense to the government. I am guessing that $8000 barely makes one year of subsidized rent payments for the smallest (and usually worst living conditions) apartment in any urban setting.
In an ownership program, the monthly payments by low-income households would be income for the government. At the end of the repayment period there would be a small profit for the effort to change a family's life dramatically. Multiply that small profit by the 5 million participants that go with the $8000 estimate and you have more money to invest in poverty housing.
This seems like a better idea than budget battles every year to increase tax allocations for poverty housing efforts, with nothing to show for the investment at the end of the year or when a problem rises up to send a family back into the homeless cycle again and again and again....
Subsidies or income, recycled poverty or stability, which do you think are better ideas?
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