Entitlement Reform

Now that’s something we’ve been hearing for years…we have to fix entitlements to get control of the budget. Government revenues can’t keep up with growing demands.

Revenue…if I hear another politician use the term revenue I’m going to go nuts. Tell me, what good or service does the government produce that generates revenue? Absolutely nothing!

Government obtains funding through taxation – which means they are funded by the people. Why don’t they call it what it really is, an allowance. And much like the weekly allowance provided to a child, once it’s gone you have to wait until it’s replenished!

The problem with our government is they don’t wait, or better stated, can’t wait. They require instant gratification, which brings me to the subject of entitlement reform.

The problem with entitlements IS THE GOVERNMENT, Democrats and Republicans alike! Had the funds collected been utilized as they were intended, there would be no need for entitlement reform. Let’s take Social Security as an example:

The current Social Security tax rate is roughly 10% (employer and employee combined). Note: this rate is lower than in previous years, but for this example it makes no difference.

Now let’s create a fictional employee who earns $20,000 annually for forty years beginning at age 21 – no raises, cost of living increases, or bonuses – simply $20,000 annually for 40 years. At the end of 40 years, a total of $80,000 would have been paid into social security, assuming the above 10% rate.

Invested properly, that $80,000 would have grown in excess of $300,000 by the time our fictional employee was eligible for benefits. Where did the money go?

The government spent it, of course. They spent it on programs and/or projects the funds were never intended for. And, now they have the audacity to tell us there’s not enough money to fund the promise made to the people over all these years.

A similar example could be made for Medicare and Medicaid. Notwithstanding excessive fraud and government waste, our entitlement programs are in trouble now because our government spent the money when it shouldn’t have.

The only way to achieve entitlement reform is through government reform. Our government must stop spending what it doesn’t have. Of course, coming from a Tea Party supporter, this must be a racist statement!

The thing that really gets me is it really is this easy!