LESSONS LEARNED #58: “Presidents with aggressive domestic agendas tend to have inept and naïve foreign policy.” -Old Pithy

Posted by PITHOCRATES - March 24th, 2011

Social Security:  A Fiscal Disaster just Waiting to Happen

FDR’s New Deal programs were an abject failure.  Nothing he tried ended the Great Depression.  Proof positive that Keynesian Economics doesn’t work.  But this Britain infatuated the world.  Many still cling to the teachings of Keynes.  Because he empowered Big Government.  And people in government love that.  But government is pretty inefficient.  And not very good at doing things.  Take Social Security, for example. 

It started as a payroll tax of 1%.  They argued it was a paltry price to pay to help the disabled and retired.  Of course, the actuaries never saw birth control and abortion coming.  So as the population aged, the birthrate declined.  With the boomers starting to retire, the great pyramid inverted.  More people are collecting than paying in.  Today the tax rate is 6.2%.  That’s 6.2 times the FDR rate.  Which is an increase of 520%.  The federal government has increased the rate 20 times to save the program from bankruptcy.  And, guess what?  It’s STILL going bankrupt.  It’s one fifth of the federal budget.  And it keeps getting bigger.  And it’s such a political third-rail that no one will touch it.  Taxpayers will have to pay so much in taxes that they will have to live a very austere life to pay for people they don’t even know who are collecting far more than they ever paid in.  Because, according to the actuaries, people were just living too long.  That’s another thing they never saw coming. 

In 1937, the average lifespan was 60 years.  The retirement age was 65.  So, in other words, the average social security beneficiary would be dead for approximately 5 years before they were eligible to collect Social Security.  Now that’s how you keep a program solvent.  Make sure that most of the people paying into it die before they have a chance to receive benefits.  Today the average lifespan is about 78 years.  The retirement age is 67.  So the average retiree will collect benefits for approximately 11 years BEFORE he or she dies.  The actuaries NEVER envisioned this.  Damn the American health care system and their miracle drugs.  We’ve never lived longer.  Or burdened the government more.

FDR was a domestic policy disaster.  He ruined this country.  Any objective analyst would agree.  But we still love him for getting us through the dark years of World War II.  Of course, much of the world doesn’t for his gift of the Cold War to these oppressed people.

FDR loved Joe Stalin, Joe Stalin walked all over FDR

In the 1930s, there was some serious government tinkering going on with economies.  FDR in the USA.  Hitler in Germany.  Mussolini in Italy.  And Joseph Stalin in the Soviet Union.  FDR was on the same page, especially with Mussolini and his beloved Joseph Stalin.  He loved these guys.  Until they went rogue.  FDR had no problem hating Germany.  He was never a fan of the country.  But when Germany and the Soviet Union entered into a nonaggression pact to divide and conquer Poland, thus launching World War II, it broke his heart.  He and all his New Dealers were devastated.  Uncle Joe was the model they wanted to copy.  They loved this man.  And what he was doing in the Soviet Union.  Acting bold without a pesky Congress hindering him.  They loved him so much that they didn’t try all that hard to hunt down the Soviet spies within the FDR administration.  And there were plenty of them to hunt down.

But then God answered FDR’s prayers.  Hitler launched Operation Barbarossa, a massive invasion of the Soviet Union.  This part of the war became hell on earth.  The Eastern Front.  There cruelty knew no bounds.  Scorched earth policies.  And genocide.  Hitler’s SS did most of these acts of barbarism.  And the dreaded Einsatzgruppen took systematic murder to new heights.  The Eastern Front saw the worst cruelty of man.  But there was a bright spot.  For FDR.  He could welcome Uncle Joe back into the fold.  And did. 

Roosevelt was a master diplomat.  He could charm the pants off of anyone.  He had a gift.  And it filled him with great pomposity and reckless arrogance.  People warned him about Stalin.  And Soviet Communism.  But FDR poo pooed them.  He said he could talk to Uncle Joe.  Reason with him.  Give a lot and ask for nothing.  And he did.  FDR thought Stalin would then ask for nothing more and work with him in establishing world peace.  Just like a typical progressive/liberal.  And how did that work out?  Not only did the Red Army NOT pull out of occupied countries, they tried to occupy more.  Soviet Communism took Eastern Europe, tried to take Turkey and Greece and pushed into Iran.  We pushed some of these pushes back.  But the Cold War was on.  FDR had given so much that the Soviets had control over huge populations, condemning them to the misery of life behind the Iron Curtain.  And suffer they would for 44 long years.

Despite the fiscal carnage and world misery FDR left in his wake, he is still loved and adored by those on the Left.  People as pompous, arrogant and naïve as he.  Who still want to do things the Roosevelt way.  Despite the unmitigated disaster the FDR way turned out to be. 

Mismanaging Medicare/Medicaid and the Vietnam War

We can best describe LBJ‘s Great Society as doubling down on FDR’s New Deal.  And it was as big a disaster as the New Deal was.  LBJ was going to end poverty and racial injustice.  And pour federal money into education to make it better.  He failed.  Based on the Left’s attacks on the Right, we’re still beset by poverty and racial injustice.  (Even though we elected a black president.  Go figure.)  And that the teacher unions are constantly going on strike to get more money.  For the kids, of course.  And if we still have these problems it can only mean one thing.  The Great Society failed.

Included in the Great Society were Medicare and Medicaid.  Health insurance for the elderly and the poor, respectfully.  Currently, this is another 1/5 of the total federal budget.  And it has the same problems as Social Security has.  A declining birthrate and a growing elderly population that is living longer.  The actuaries crunched their numbers before the explosion of birth control and abortion.  So their projections are just as bad as FDR’s were.  The tax rate went from 0.35% to 1.45%, and increase of 314%.  Unlike Social Security, the death rate never ran in the black for Medicare/Medicaid.  From the get-go people were living 3 years beyond the average retirement age, consuming health care benefits.  Now the average American is living 11 years into retirement.  And a lot of them aren’t doing that by a healthy diet and exercise.  They’re doing it by consuming vast amounts of health care benefits.   LBJ took the problems of the New Deal and multiplied them by ten.  The cumulative effect of these two programs crashed the economy into stagflation and misery in the 1970s.  And if that wasn’t bad enough, he pushed the nation close to civil war by his mismanagement of the Vietnam War.

JFK got us into Vietnam.  But Johnson expanded our involvement.  And tried to manage it from Washington.  With the Whiz Kids left over from JFK.  A bunch of poindexters who tried to run a war by looking at numbers in columns.  Body counts.  And restrictions on the rules of engagement.  It was a horrible way to run a war.  It just prolonged it.  Created more American casualties.  And empowered our enemy.  Can’t bomb the North.  Can’t bomb their supply routes (i.e., the Ho Chi Minh Trail).  We did everything we could to help the enemy by giving them safe sanctuaries up the ying-yang.  And when we had a chance to deliver a knockout punch after the failed Tet Offensive, we did NOTHING.  Partly because Walter Cronkite said the war was lost.  Partly because of the hippies protesting on our college campuses.  And, of course, the race riots.  LBJ couldn’t understand it.  He had given so much with his Great Society and yet people didn’t love him.  All because of that damn war in Vietnam.  JFK’s war.  How he wished they never went there.  It was a distraction to his beloved Great Society.  And it was a bitch to pay for. 

Bad Domestic Agendas, Bad Foreign Policy

Unlike FDR, LBJ could not win his war.  Of course, FDR didn’t have hippies who hated their country protesting against him.  Just a bunch of communists in his administration who were simpatico with his Big Government view.  Because of Vietnam, though, the Left would never have the same fond feelings for LBJ as they do for FDR. 

Their foreign policy has made the world a less safe place.  FDR gave us 44 years of Cold War.  And LBJ weakened the United States by his failure in Vietnam.  Made us a paper tiger.  Made our enemies not fear us anymore.  They started taking chances.   Doubting our will to respond to their aggression.  Or, if we did, they figured we would just cut and run after a few casualties.  And that has been their strategy since.  Not to win.  But to make us quit.  By making us bleed.

Following World War II we had great prosperity.  Peace.  And happiness.  The 1950s.  Following Vietnam, we had stagflation and misery.  High crime rates.  Drug infestation and abject poverty in our big cities.  Abortion and birth control.  The 1970s.  All this despite the programs of LBJ’s Great Society that were to end all those woes.  And with the declining birthrate, the fiscal problems would only get worse.

Their domestic programs are pushing the nation ever closer to bankruptcy.  There appears to be no solution to the damage they’ve done.  Or will do.  Social Security and Medicare/Medicaid will either bankrupt the country.  Or ignite civil unrest as benefits are slashed.  Neither will be good for the country.  But this is what we get from presidents with aggressive domestic agendas.  Fiscal crises.  Domestic unrest.  And an unsafe world.

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