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Prioritizing Entitlements

In a post about the costliness of climate change adaptation, Noah Millman reframes the fiscal debate:

The debate about whether we should be spending more and borrowing more, or whether we should be spending less and borrowing less, really is secondary. The real problem is that we are unable to debate what our spending priorities ought to be – which is to say, what spending is most important for the future of the country.

Even if climate change is poised to have catastrophic, Sandy-level consequences, I’m skeptical of government’s ability to do much about it short of spending a ton of money (with no reliable way to measure results). Not without making it a very high priority, so to speak. Perhaps above certain domestic programs people have come to expect and count on.

That said, discretionary domestic outlays have been stable or in decline for the last few years, excepting the 2009 stimulus.

What is growing is the cost of entitlement programs and interest on the national debt. Avik Roy writes about the collision of two of them down the road, now that Obamacare will inevitably be implemented:

The government expects that there will be approximately 62 million Americans on Medicare by 2020. The CBO assumes that 25 million Americans will enroll in the exchanges that year. But the CBO assumes minimal employer dumping, and no state-based arbitrage between Medicaid and the exchanges. If, say, 20 million workers are dumped into the exchanges, and 5 million Medicaid enrollees are transferred to them, exchanges could have 50 million enrollees in 2020.

If that were to happen, America would be faced with a titanic battle between two large, subsidized constituencies: those on the Obamacare exchanges, and those on Medicare. While elderly voters are famously active at the ballot box, it’s those on the exchanges who would have much more money at stake. After all, the average retiree is on Medicare for about 14 years; a low-income high-school graduate could stay on Obamacare for 47 years.

He goes on to point out the irony, should Obamacare win out, that it would represent voters validating a premium-support system over a defined-benefit one, the same thing the Obama campaign attacked the Ryan plan for doing.

Roy thinks Obamacare would prevail because there’s more money at stake. That’s true, but as he notes, young people tend not to vote, though there’s evidence that is changing. And Obamacare too, by virtue of its price controls, functions as a subsidy from the young, who are less costly and less financially secure, to the elderly who are relatively secure and cost more to take care of. Young people get a raw deal either way. It’s true that they’d get something out of Obamacare, unlike Medicare, the trust fund of which is projected to be insolvent by 2024. The scenario he sketches is a long way from a sober discussion about priorities, but rather the gravitational pull of two large self-interested constituencies.

about the author

Arthur Bloom is managing editor of The American Conservative. He was previously deputy editor of the Daily Caller and a columnist for the Catholic Herald. He holds masters degrees in urban planning and American studies from the University of Kansas. His work has appeared in The Washington Post, The Washington Times, The Spectator (UK), The Guardian, Quillette, The American Spectator, Modern Age, and Tiny Mix Tapes.

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