Obama vs G20

[gunnut]

There has to be a limit on how much a person can get from government pension. We simply cannot sustain people getting 90% of their final year's pay as pension, for life, in addition to free health care for him/her and spouse, for life.

Assuming a public school teacher retires after 30 years at the average salary of $72k a year (in Orange County), at the age of 60, the pension will be 80% base pay plus whatever overtime there was in the final year. People "spike" their pension by doing massive overtime work in the year just before retirement, often pushing this number to 90% of final year's pay. That comes out to be $64.8k per year. And remember this is only the average salary. Many teachers with 30 years of service make way more than this. The average life expectancy is 78 years. If someone retires at 60, that means he would get 18 years of pension at $64.8k a year, plus gold health care package for the couple, for as long as they live.

This is insane!

[highsea]

IIRC, if we had some sort of VAT or sales tax, even at low rates we could lower the income tax dramatically.

Problem is, it could as easily be raised again.

Combine it with a balanced budget amendment and we'll talk.

honestly, SS is actually the by-far smaller part of the problem-- it's medicare/medicaid that's the monster. SS would most likely be OK if we were to just raise the retirement age and then age-index it every year. hey, another conservative point for me, eh.

That's true, SS is easier to fix.

For medicare, we would need some kind of health care reform legislation. ;)

yeah, i figured as much, that way anyone to the left of me can be defined as an outright socialist

Well, I use the rural america/alaska standard. Basically, anyone who lives in New York or DC and calls himself a centrist is a liberal. If you call yourself a conservative, you're still a liberal. If you call yourself a liberal, you're a commie. :))

In Alaska, I would be a centrist or maybe even be a shade left of center. But by your standards I am quite a ways to the right.

[gunnut]

For medicare, we would need some kind of health care reform legislation. ;)
Well, I use the rural america/alaska standard. Basically, anyone who lives in New York or DC and calls himself a centrist is a liberal. If you call yourself a conservative, you're still a liberal. If you call yourself a liberal, you're a commie. :))

In Alaska, I would be a centrist or maybe even be a shade left of center. But by your standards I am quite a ways to the right.

I've actually browsed some sites where people say Obama is center right....

Wow...I wonder what a "leftist" is to such a person?

[astralis]

gunnut,

Assuming a public school teacher retires after 30 years at the average salary of $72k a year (in Orange County), at the age of 60, the pension will be 80% base pay plus whatever overtime there was in the final year. People "spike" their pension by doing massive overtime work in the year just before retirement, often pushing this number to 90% of final year's pay. That comes out to be $64.8k per year. And remember this is only the average salary. Many teachers with 30 years of service make way more than this. The average life expectancy is 78 years. If someone retires at 60, that means he would get 18 years of pension at $64.8k a year, plus gold health care package for the couple, for as long as they live.

This is insane!

yeah, the problem is that states have a tendency to offer crap pay to beginning teachers, and hold out a great pension package upon retirement. thinking is that they can hold off the payment, maybe even skip it altogether if the teacher changes professions.

this needs to be reversed, probably by raising the original base pay and holding out pension packages depending on performance reviews. a great teacher is worth the pension package, a crap teacher punching the clock isn't. not perfect, but better than what we have currently.

[astralis]

gunnut,

I've actually browsed some sites where people say Obama is center right....

go on huffpo or tedrall.com, obama is considered at best a conservative dem, at worst a republican-in-democrat clothing. the funny thing is that they seem more pissed off about obama being this way compared to bill clinton, even though on my scale, obama is roughly three ticks to the left of bill. i guess they saw whatever they wished to see in obama, and with the way obama ran his campaign, that's no surprise.

my main beef with obama since the election is that obama takes the New Democrat/Third Way talk about rising beyond the left-right debate...but in actuality, what he usually does is square the difference and move it several ticks to the left. that's not centrism as an ideology.

[gunnut]

gunnut,

yeah, the problem is that states have a tendency to offer crap pay to beginning teachers, and hold out a great pension package upon retirement. thinking is that they can hold off the payment, maybe even skip it altogether if the teacher changes professions.

this needs to be reversed, probably by raising the original base pay and holding out pension packages depending on performance reviews. a great teacher is worth the pension package, a crap teacher punching the clock isn't. not perfect, but better than what we have currently.

Plus, the teachers get something called "tenure" which should be junked altogether. Under that system, any lay off is "last in, first out." The system will always retain the most expensive worker, not the most productive or the best.

[crooks]

The European approach is governed by reality - we simply don't have the money, full stop, to go for full-on stimulus packages (neither do you, but you can print money;)), the books have to be balanced for future recovery, credit will be expensive and hence the economy weak (less capital for expansion in small/medium enterprise sector) as long as banks believe Ireland could crash Greek-style.

I'd argue a strong stimulus is needed to stem the private sector declines and keep the gears spinning, but with debt of some European countries tipping or over 100% there's much less flexibility in delivering a large scale stimulus. Right now best thing we can do is close loopholes, raise taxes, and cut spending.

There is no magic bullet, it's painful, but the only way to bring back strong growth is to regain our competitive edge - for us here in Ireland that means easing the job for exporters, for Spain it means building a more educated and tech-heavy workforce, and for the likes of France, Italy and Belgium it means lowering the huge debt levels.

For both saving the euro and saving a sustainable future for our children, the politicians of today should just man up and do what has to be done - Europeans will vote for prosperity, even if it means short-term pain.

Were I American I would fully support Obama's stimulus, it's working and it makes perfect sense for an economy like the US, but as an Irishman and European that option's not open to us, and frugality is the order of the day, for a lot of days to come.

[astralis]

crooks,

but as an Irishman and European that option's not open to us, and frugality is the order of the day, for a lot of days to come.

depends on the country-- maybe not for smaller ones like Ireland and Greece, but -not- for countries like the UK, France, or Germany.

ie if they really wanted to, they could make that trade-off between a larger stimulus and sharply reduced welfare spending. they're big enough and have the economy and people willing to loan them the money to do that type of immediate deficit spending. not only that, because of the respective size of their economies, it would have a reinforcing effect on the world economy.

however, they can't, because the political cost of actually dismantling and re-creating a new welfare state for the long-term would be too high. as it is, it's left up to the US and China to do the big spending to drag the world economy out of the doldrums. it's really a form of free-riding by the europeans.

[crooks]

crooks,

ie if they really wanted to, they could make that trade-off between a larger stimulus and sharply reduced welfare spending. they're big enough and have the economy and people willing to loan them the money to do that type of immediate deficit spending. not only that, because of the respective size of their economies, it would have a reinforcing effect on the world economy.

however, they can't, because the political cost of actually dismantling and re-creating a new welfare state for the long-term would be too high. as it is, it's left up to the US and China to do the big spending to drag the world economy out of the doldrums. it's really a form of free-riding by the europeans.

It's possible, but it wouldn't make all that much difference to the economies of said countries when compared to it's costs, which is an equally relevant disincentive - stimulus doesn't tend to have a huge effect in places like Germany because even in good times consumer spending is weakish. Germany is corporatist in structure, it makes more sense to ease the burdens of German corporations than give tax rebates to general citizens, who may not spend or invest it.

France in a more direct sense is over-reliant on public spending as it stands, a strong recovery would be built more readily on encouraging and creating new investment, especially outside of Paris and the Alpine Basin, though the scope for cash for clunkers schemes and such would be better in France than Germany.

As for welfare reform, I think you'd be hard pushed to find anyone from far-left to far-right opposed to the principle, and in my view European economies do need to look at planning for the future - I don't accept off the bat that the total sum of welfare spending needs to be cut, but pensions could be pushed back, and welfare could be geared more towards retraining and reskilling workers than just direct aid.

The Danes 'Flexicurity' model appeals to me greatly, and perhaps the biggest failure in politics is that radical reform is considered politically unviable, though that may change from the bottom up once people see the pressures the current system unreformed will cause in the future.

In terms of free-riding, It's a bit unfair to say that, especially considering German credit (a side effect of Germany's fiscal discipline) was happily invested just about everywhere during the boom, bringing plenty of benefits to the rest of the world.

The way I see it, Lagarde, Schauble et al are trying to do the best they can with one hand tied behind their backs.